the “lottery winner” in your case assembles a block with transactions from the transaction pool (ie you don’t just make shit up. you are taking useful transaction that people are making them and capturing them into the chain)
So the winner does not decide much, except maybe what transactions to select (spoiler alert: the transactions with the highest fees are normally selected).
The consensus is in the sense that: you wanted to create a transaction and that transaction is captured and everyone in the network sees and agrees that the transact happened. The miner cannot alter your transaction. Other nodes in the network cannot arbitrarily reject it. You cannot simply claim you didn’t do it after the fact.
everyone == bitcoin nodes that each keep a copy of blockchain locally.
once a block is mined it is propagated through the network and it’s verified by all the nodes that see it. In effect, when you get the block and you append it to your local blockchain after verification you agree that the transaction that happened in that block happened.
They're welcome to disagree. I can write a node that creates a chain with blocks that only contain some transactions of my choice and then broadcasts it.
For nodes that only have access to my chain, they will also go with my chain. This is why being connected to multiple nodes is important.
For nodes that have access to both my chain and the rest of the world's chain, they will go with the chain that has the most work put into it, because that is the one that is clearly supported by the majority computation power. It's irrational to go with the chain that has less power, because the entities that created the chain with more power can easily overwrite the chain with less power by virtue of having more power.
Unless I happen to have more computation power than the rest of the world, the chain with more work put into it isn't going to be mine, which is why it's important that global computation power isn't consolidated into a single miner.
> It's irrational to go with the chain that has less power, because the entities that created the chain with more power can easily overwrite the chain with less power by virtue of having more power.
This basically means the entire bitcoin network depends on the entities that have the most computer power behaving correctly, am I wrong?
Suppose the majority decides that they won't halve coinbase (the mining reward) after every 210,000 blocks anymore (thus removing the 21m cap). Maybe that's irrational, maybe that's rational. Who is to say?
Right. Though the problem is not so much behaving irrationally as dishonestly. At any rate it's hard to argue that the bitcoin network is more "trustless" than a bank, since we have coercive mechanisms to ensure that a bank will behave honestly, while we don't have the same mechanisms to ensure bitcoin miners will do the same. Bitcoin users have to trust that they will be honest.
No, you still don't understand. It's not dishonesty, it's irrationality.
First you assume that the majority computation power is already colluding. This is not the case.
Let's assume it's the case. As soon as they stop adding all transactions to a block that they would've been expected to, the entire world will notice. In response, the currency will become valueless. That is, it's a public act to abuse your position as a majority power, and the very act of your abuse destroys the thing that you're trying to abuse to your profit.
No, it's you who don't understand. There are many ways someone can profit from bitcoin losing all its value. And there many motivations other than financial profit. Therefore it's more accurate to speak of dishonesty rather that irrationality.
This is key. Profits from Bitcoin or from Bitcoin's losses are not restricted to the Bitcoin ecosystem. In other words, the Bitcoin ecosystem is not closed. For example, Ethereum or Algorand or Avalanche may benefit if bitcoin loses its value, even if those communities may not participate in Bitcoin.
hmm. it’s not necessary more power. Sometimes it’s luck if you are talking about chains that are the same except the tip where they differ by 1-2 blocks.
the “lottery winner” in your case assembles a block with transactions from the transaction pool (ie you don’t just make shit up. you are taking useful transaction that people are making them and capturing them into the chain) So the winner does not decide much, except maybe what transactions to select (spoiler alert: the transactions with the highest fees are normally selected).
The consensus is in the sense that: you wanted to create a transaction and that transaction is captured and everyone in the network sees and agrees that the transact happened. The miner cannot alter your transaction. Other nodes in the network cannot arbitrarily reject it. You cannot simply claim you didn’t do it after the fact.