So as you can see I was pretty accurate on my price prediction. The price is being held at a level to keep the increase in mining power at around 5%. We just have a few hours left in the current 2016 Block session.
It looks like the initial drop to 6666.66 USD was not quite low enough. They did drop it down into 6500s and 6400. But they were very close on their initial price.
It's interesting to me that the traders have just now picked up on this. I think it upset a few of them. None of them referred to my article although they did directly address it with some serious FUD. So much so some even put out videos on this topic. The number three YouTube video under bitcoin yesterday was about this very subject. Oh and the FUD that was spread woo.
I don't know where they get their information on how the BTC blockchain works but obviously they are either ignorant or they are intentionally misleading.
They claim that the blockchain cannot come to an abrupt halt but they're wrong.
Let us step through this and see how a drop in mining power really affects bitcoin.
The difficulty setting is pretty simple every 2016 blocks the difficulty factor either increases or decreases to keep the blocks being found on average 6 per hour.
Now the FUD number of two weeks being spread around is really inaccurate when mining is decreasing instead of increasing.
If you take the 2016 and you divide it by six and you get the number of hours it takes for the blockchain to increase the difficulty if mining were steady, about 336 hours or 14 days. Because mining power is almost always increasing it rarely takes more than two weeks to mine the 2016 block session.
However If mining were to decrease by just 10% the time it would take to mine the 2016 blocks would increase by 1.4 days. Where this becomes a big deal is transaction times. Right now under the current difficulty and mining power we occasionally see some long blocks 1 to 2 hours long. This is because the blocks are supposed to be random. So some blocks mine in minutes other blocks are mined in hours but the average is six blocks per hour during the 2016 block session. I don’t know why but when mining decreases there seems to be more long block and more short blocks A variation of 10% can probably be more than 20% increase in long blocks time. As the number of miners drop off long block times increase dramatically and cause transaction to be held up because conformations take longer as they stack up you may not get in the next block.
Lucky you if you're trying to perform a transaction during one of these unlucky blocks.
If another 10% of minors drop off then this increase in time yet another 10% longer. Long blocks can take a few hours to mine. Keep in mind this also increases the time the chain will stay in the 2016 block session where the difficulty factor is 20% to high. This can force miners to switch coins taking away even more miners.
At around the 20 to 25% mark transaction fees may begin to rise and begin to discourage the holders of bitcoin.
This can create panic which in turn may drop the price even lower. Once you get around 6500 mark you're on the edge for a lot of miners. It won’t have to go much lower for many miners to begin shutting down or switching coins.
You can see how daintily they played around with the drop below 6666.66 drop. This is because they know this is true. If another dramatic price drop were to occur the chain would start to suffer greatly. The longer it holds the worse it will get.
As there is no way change the difficulty without either a hard fork, which would have to change the rules for mining or by mining out the full 2016 blocks. So you could lose another 25% of minors before the 2016 blocks plays out this would hurt Bitcoin tremendously if not put a fork in it.
Now the miners would never do this intentionally as they have the most to lose. Their goal is to get rid of as many miners as they can without this happening.
The problem is there are many out there including large holders of BCH that would love to see this happen. When the miners create a war climate it is the best time for one of bitcoins foes to attack.
The data bears this out. When the market is week the miners go to war with each other, If you don’t believe what I'm saying simply look at the network data and compare price drop with a decrease in hash power.
You will see the hash power decreases with the price. The greatest attack ever launched on bit coin was by BCH when it tried to coerce the miners into mining BCH instead of Bitcoin.
The second little secrete attack was when Bitmain quit taking Bitcoin and would only take BCH. This caused miners to desperately mine BCH a few days before the next release of S9’s. or take a big loss converting BTC to BCH. BCH prices always went up by 10% or more just before the release of the next batch of miners. The BCH price would immediately drop right after they quit taking orders and if you didn’t get your order in you lost both ways. Or you got stuck with BCH for a month or more. It was such a game.
For Sure this is a Game as all markets are the big stake holders Rule. I hope they let up on this. We are Just hours away from finding out which way they are going to go.
Update note I had 2500 block but its 2016 I adj. my calculations sorry.
Thanks #spiralmaster for pointing that out.