On Sun, Jul 12, 2015 at 7:37 PM, Jorge Timón <jtimon@jtimon.cc> wrote:

As long as miners switch back to the new longest chain after they
validate the block, mining on top of the
non-most-work-but-surely-valid may be less risky than mining on top of
a most-work-but-potentially-invalid block.

It depends on how long they are waiting. If they receive a header, it is very likely to be part of a valid block.

The more time that passes, the more likely that the header's block was invalid after all.

This tradeoff is what the timeout takes into account. For a short period of time after the header is received, it is probably valid but eventually, as time passes without it being fully validated, it is more likely to be false after all.

If they successfully SPV mine, they risk having mined on top of an
invalid block, which not only means lost coins for them but high risk
for regular SPV users.

With a 1 minute timeout, there is only a 10% chance they will find another block.

It is important that when a header is marked as "probably invalid" that all the header's children are also updated too. The whole chain times out.

It is important to note that while SPV mining requires you to produce
empty blocks, mining on the previous on top of the previous block
allows you to include transactions and earn fees.
In a future where block rewards aren't so overwhelmingly dominated by
subsidies, the numbers will run against SPV mining.

Agreed. Transaction only fees changes the whole incentive structure.

A fee pool has been suggested to keep things as they are now. All fees (mint & tx fees) are paid into a fee pool. 1% of the total pool fund is paid to the coinbase.

This keeps the total payout per block reasonably stable. On the other hand, it removes the incentive to actually include transactions at all.