According to the BCH code setting, when the block height reaches 630,000, the block reward will be adjusted from the current 12.5 BCH / block to 6.25 BCH / block, and the annual inflation rate of BCH will also be adjusted from the current 3.97% to 1.80%. Mining pool expects to reduce BCH production on April 8th, which has been less than a month. The halving is here. What will happen?
Changes in price computing power
Since 2020, BCH has led the rise. The price of BCH rose from a low of around $ 190 in early January 2020 to $ 490 in mid-February 2020. It has grown by 150% in less than a month, which has also pushed up the prices of mainstream currencies such as BTC, LTC and ETH. BCH is considered to be the first digital currency to “sound the horn of reduced production”.
Real-time data from Bitinfocharts shows that with the BCH price rising by 150%, the network computing power has also increased by 114%. With the slight increase in the overall computing power of the SHA256 network, the price of BCH has increased significantly. It can be said that some miners have been saved, and some backward mining machines that are close to shutdown can also mine profitably.
But unfortunately, since March, the entire digital currency market has begun to decline, mainly due to international economic problems and the plunge in oil futures prices. The market panic has caused prices to plummet. BCH has now basically returned to the price of early January. If the price remains unchanged after one month, and the sudden increase in BCH trading volume in the short term seems difficult, then it can be expected that when the halving comes, about half of the computing power will be unprofitable. Withdraw from the network.
Will there be a 51% attack after halving?
Halving will not have a great impact on the security of the BCH network, and any speech that halves leading to a 51% attack is maliciously vilifying. As long as the computing power reaches a certain scale, POW's currency is relatively safe. BCH has added restructuring protection (10 block confirmation), which is more capable and secure against 51% attacks. The most important thing is that BCH is the only one among all digital currencies that has experienced a hash war. Past experience has made BCH more successful and confident when facing the threat of hash power. What really affects the market is the halving of BTC, which may lead to short-term mining difficulties.
Whether the machine gun pool threatens network stability
For currencies with insufficient computing power, the machine gun pool has always been a threat to stable production. At the end of last year, a large amount of unknown computing power appeared on the BCH network, almost over 51%. It turns out that a large part of these unknown computing power does come from the machine gun pool, and they frequently switch computing power between BTC and BCH. The main reason for the existence of machine gun pools is that the adjustment difficulty of BTC and BCH cannot keep up with changes in relative prices, so switching mining will have a certain profit margin.
In order to solve the problem of the machine gun pool, BCH modified the difficulty algorithm as early as November 2017, changing the difficulty adjustment cycle to 10 minutes (that is, block-by-block adjustment, DAA) (BCH used EDA for a few months before this), In order to adjust the difficulty, you can keep up with the fluctuation of computing power faster and ensure its normal and stable block production.
BSV also copied the DAA mechanism from BCH in the early days of its birth. BSV can also halve the security through DAA, although the BSV controller has actually been constantly denying DAA. However, BTC still maintains the difficulty of adjusting 2016 blocks (14 days). If BTC is reduced by half, the computing power will drop sharply, and the difficulty is not reduced in the short term, which may make BTC difficult to produce blocks for a while.
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