In a previous post, we discussed bitcoin miners’ incentives to undertake a 51 percent attack given the current condition of the bitcoin market. We also speculated that high profits and free entry would cause more miners to enter the market, driving marginal mining profits to zero in the long run. Since then, the price of a bitcoin has declined over 40 percent and both the hash rate and the difficulty level of the bitcoin mining problem, which adjusts automatically to changes in the hash rate, appear to have leveled off. Our most recent calculations suggest the long run may have arrived.
Project Jasper: A Canadian Experiment with Distributed Ledger Technology for Domestic Interbank Payments Settlement (I am one of many that contributed to this detailed white paper that elaborates on the BoC FSR article.)
Bank for International Settlements Quarterly Review article with Morten Bech: Central bank cryptocurrencies.
Bank of England working paper with Evangelos Benos and Pedro Gurrola-Perez: The economics of distributed ledger technologies for securities settlement.
Bank of Canada Financial System Review article with James Chapman, Scott Hendry, Andrew McCormack and Wade McMahon: Project Jasper: Are Distributed Wholesale Payment Systems Feasible Yet?
R3 Public Report: CAD-coin versus Fedcoin
Working Paper with Neil Wallace: Bitcoin 1, Bitcoin 2, … : An Experiment in Privately Issued Outside Monies