Is it possible to build a bitcoin miner that mines 1 Terra ...
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CoinTerra Ships First Terahash Mining Rig
Bitcoin Mining: Lohnt sich das Mining von Bitcoin noch ...
Bitmain Unveils 2 Bitcoin Miners With Max Speeds Up to 110TH/s Per Unit. The Antminer S19 Pro model with 110TH/s and 29 joules per terahash (J/TH) is 24 trillion hashes per second faster than Microbt’s latest Whatsminer M30S model (86TH/s).
On October 6, the hash rate of the Ethereum network reached an all-time high of more than 250 terahashes per second, which is 80% higher than the levels in January. Glassnode noted that this was facilitated by a surge in hype around DeFi projects, which caused an increase in gas prices. Last time such a high hash rate was in the summer of 2018, then ETH was also trading slightly above the $400 mark. In addition, mining ethereum is now three times more profitable than bitcoin. According to the F2Pool mining pool, owners of Antminer S19 Pro devices can earn $4.33 per day, while ETH miners using NVIDIA GTX Titan V cards can expect to earn $15.56.
Bitcoin Hashrate Has Hit a New Record-High Again, Here's Why It's Optimistic
The total hash rate of the Bitcoin blockchain network has hit an all-time high, demonstrating an optimistic after the halving. Bitcoin’s third block reward halving in history occurred on May 11, 2020. Immediately after, its hash rate dropped from 121 million terahash per second (TH/s) to 90 million TH/S. The rapid recovery of Bitcoin’s hash rate shows that the mining sector is healthy, which could lead to market stability. A positive catalyst for Bitcoin in the medium-term Following a block reward halving, the hash rate of the Bitcoin network tends to drop substantially. The halving drops the amount of BTC miners can produce by half, causing their revenues to decline. When miners struggle with recurring expenses as a result of lower BTC production, they typically sell their BTC reserves. In the short-term, until a major difficulty adjustment occurs, the risk of miner capitulation or massive selling pressure is low. Alejandro De La Torre, the vice president of Poolin, explained that older machines have become profitable as well. That means even individual miners could be profitable and are likely less compelled to sell BTC. Torre explained: “Yesterday's two-week difficulty re-adjustment saw a decrease of - 2.87% & an average hash rate of 120.57 EH/s. What's interesting here is that the hashrate continues to increase, definitely related to the current #bitcoin price - older machines are profitable again.” Consequently, Torre said the hash rate of the Bitcoin network would likely continue to increase. The difficulty to mine BTC is lower than in previous weeks, and the price of BTC is above $11,000. He noted: “Difficulty is now lower than the last two weeks from 17.35T to 16.85T and the price is much higher so expect strong hashing for the next two weeks, all dependent of the price at the end of the day.” A record-high hash rate merely three months after the halving can be considered an optimistic trend. It shows that due to varying factors, which includes cheaper electricity in Sichuan, China, the mining industry is stable. Many large mining centers are based in Sichuan. Due to the rainy season and the presence of hydropower plants, lower-cost electricity is available for miners. Optimistic market cycle According to data from ByteTree, the net inventory of miners over the past five weeks is hovering at 30 BTC. The data shows that miners have not sold more than they mine, which leads to less selling pressure on BTC. Relatively low selling pressure from miners is a positive factor that could allow BTC to sustain its strong momentum. It also indicates that Bitcoin is on track to recover from the halving before the fourth quarter of this year, demonstrating the resilience of the sector. About the author Joseph Young Joseph Young is an analyst based in South Korea that has been covering finance, fintech, and cryptocurrency since 2013. He has worked with various recognized publications in both the finance and cryptocurrency industries.
[Researh] In 2017 bitcoin network consumed 5 TWh of energy, in 2018 – 29 TWh, in 2019 – 43 TWh. Banking industry consumes 74 TWh per year.
Electricity consumed by bitcoin network has been constantly and noticeably increasing. During the past years the consumption reached such big a scale, that it can be compared to electricity consumption of some countries, according to BlockchainAnalytics.pro research. The world’s first cryptocurrency is steadily becoming more popular and expensive every year. This motivates more individuals and companies to enter the mining business to earn a bitcoin share.
More miners, more efficient equipment
To validate a block of transactions and receive a reward, miners compete with each other by solving a deliberately complicated mathematical task, or puzzle. Those miners who own more computing power (hashrate) have more chances to win the competition. This incentivizes miners to buy more powerful equipment that consumes more electricity. At the same time, mining equipment efficiency is constantly improving, and with time less electricity is required to produce the same hashrate. This factor allows to slow down the increasing demand for electricity. For example, in 2016 Bitmain, world’s largest manufacturer of mining equipment, launched the legendary Antminer S9, which consumed 100 watts to produce one terahash per second, or 100 W/TH/s. The best modification of Antminer S15, released in 2018, consumed 57 W/TH/s. Currently, the most efficient Antminer S17 consumes only 40 W/TH/s. https://preview.redd.it/gh343l3p09j41.png?width=930&format=png&auto=webp&s=e350c1e7832e37c1e3c3aeac974428cca7f0f874 It is assumed that the market competition compels manufacturers to keep up with each other in developing more efficient hardware. If some manufacturer brings next-generation chips to market, other manufacturers start to produce chips with the same characteristics at about the same time. On the other hand, new miners are joining the network, thus increasing the hashrate. So the demand for electricity continues to grow. Also, it can be noticed later that the electricity consumption chart is similar to that of hashrate chart. https://preview.redd.it/3k32ci6q09j41.png?width=930&format=png&auto=webp&s=e70f600419bcbc9e7e82506b5f12bf4da6f00584
The incremental volume of electricity consumption is calculated by multiplying newly added hashrate by the best mining efficiency available at that moment. The sum of incremental volumes represents cumulative amount of electricity consumed by bitcoin network. The metric is expressed in terawatt-hours (TWh). To get annualized volume in terawatt-hours we multiply the consumption by 24 hours and 365 days. A 100-day moving average was applied to hashrate to make the final result less dependent on the short-term hashrate fluctuations. Assumptions, used in this study, are very conservative. It means that the results are in the lower limit of the range of possible volumes, and the actual electricity consumption can be higher. A detailed explanation and interactive charts are provided here: https://www.blockchainanalytics.pro/btc/electricity-consumption/ https://preview.redd.it/jol3703r09j41.png?width=929&format=png&auto=webp&s=252d4d67ff6882bb32ad63238537a41305719f05
Currently, annualized electricity consumption in bitcoin network is 57 TWh. To help readers get an idea of how much electricity the bitcoin network consumes, a comparison with some countries is provided alongside. Portugal consumes 49 TWh per year, Romania – 50 TWh, Czech Republic – 59 TWh. Some more numbers for comparison:
Antminer T19 May Not Affect Bitcoin Hash Rate but Keeps Bitmain Ahead
The Antminer T19 by Bitmain may not have a big impact on the Bitcoin network, and it comes out amid the firm’s internal and post-halving uncertainty. Earlier this week, Chinese mining-hardware juggernaut Bitmain unveiled its new product, an application-specific integrated circuit called Antminer T19. The Bitcoin (BTC) mining unit is the latest to join the new generation of ASICs — state-of-the-art devices designed to mitigate increased mining difficulty by maximizing the terahashes-per-second output. The Antminer T19 announcement comes amid the post-halving uncertainty and follows the company’s recent problems with its S17 units. So, can this new machine help Bitmain to reinforce its somewhat hobbled position in the mining sector? T19: The cheaper S19 According to the official announcement, the Antminer T19 features a mining speed of 84 TH/s and a power efficiency of 37.5 joules per TH. The chips used in the new device are the same as those equipped in the Antminer S19 and S19 Pro, though it uses the new APW12 version of the power supply system that allows the device to start up faster. Bitmain usually markets its Antminer T devices as the most cost-effective ones, while the S-series models are presented as the top of the line in terms of productivity for their respective generation, Johnson Xu — the head of research and analytics at Tokensight — explained to Cointelegraph. According to data from F2Pool, one of the largest Bitcoin mining pools, Antminer T19s can generate $3.97 of profit each day, while Antminer S19s and Antminer S19 Pros can earn $4.86 and $6.24, respectively, based on an average electricity cost of $0.05 per kilowatt-hour. Antminer T19s, which consume 3,150 watts, are being sold for $1,749 per unit. Antminer S19 machines, on the other hand, cost $1,785 and consume 3,250 watts. Antminer S19 Pro devices, the most efficient of three, are considerably more expensive and go for $2,407. The reason Bitmain is producing another model for the 19 series is due to what is known as "binning" chips, Marc Fresa — the founder of mining firmware company Asic.to — explained to Cointelegraph: “When chips are designed they are meant to achieve specific performance levels. Chips that fail to hit their target numbers, such as not achieving the power standards or their thermal output, are often ‘Binned.’ Instead of throwing these chips in the garbage bin, these chips are resold into another unit with a lower performance level. In the case of Bitmain S19 chips that don’t make the cutoff are then sold in the T19 for cheaper since they do not perform as well as the counterpart.” The rollout of a new model “has nothing to do with the fact that machines are not selling well,” Fresa went on to argue, citing the post-halving uncertainty: “The biggest reason machines probably are not selling as well as manufacturers would like is because we are on a bit of a tipping point; The halving just happened, the price can go anyway and the difficulty is continuing to drop.” Product diversification is a common strategy for mining hardware producers, given that customers tend to aim for different specifications, Kristy-Leigh Minehan, a consultant and the former chief technology officer of Genesis Mining, told Cointelegraph: “ASICs don’t really allow for one model as consumers expect a certain performance level from a machine, and unfortunately silicon is not a perfect process — many times you’ll get a batch that performs better or worse than projected due to the nature of the materials. Thus, you end up with 5–10 different model numbers.” It is not yet clear how efficient the 19-series devices are because they have not shipped at scale, as Leo Zhang, the founder of Anicca Research, summed up in a conversation with Cointelegraph. The first batch of S19 units reportedly shipped out around May 12, while the T19 shipments will start between June 21 and June 30. It is also worth noting that, at this time, Bitmain only sells up to two T19 miners per user “to prevent hoarding.” Hardware problems and competitors The latest generation of Bitmain ASICs follows the release of the S17 units, which have received mostly mixed-to-negative reviews in the community. In early May, Arseniy Grusha, the co-founder of crypto consulting and mining firm Wattum, created a Telegram group for consumers unsatisfied with the S17 units they purchased from Bitmain. As Grusha explained to Cointelegraph at the time, out of the 420 Antminer S17+ devices his company bought, roughly 30%, or around 130 machines, turned out to be bad units. Similarly, Samson Mow, the chief strategy officer of blockchain infrastructure firm Blockstream, tweeted earlier in April that Bitmain customers have a 20%–30% failure rate with Antminer S17 and T17 units. “The Antminer 17 series is generally considered not great,” added Zhang. He additionally noted that Chinese hardware company and competitor Micro BT has been stepping on Bitmain’s toes lately with the release of its highly productive M30 series, which prompted Bitmain to step up its efforts: “Whatsminer gained significant market share in the past two years. According to their COO, in 2019 MicroBT sold ~35% of the network hashrate. Needless to say Bitmain is under a lot of pressure both from competitors and internal politics. They have been working on the 19 series for a while. The specs and price look very attractive.” Minehan confirmed that MicroBT has been gaining traction on the market, but refrained from saying that Bitmain is losing market share as a result: “I think MicroBT is offering option and bringing in new participants, and giving farms a choice. Most farms will have both Bitmain and MicroBT side by side, rather than exclusively host one manufacturer.” “I would say that MicroBT has taken up the existing market share that Canaan has left,” she added, referring to another China-based mining player that recently reported a net loss of $5.6 million in the first quarter of 2020 and cut the price of its mining hardware by up to 50%. Indeed, some large-scale operations seem to be diversifying their equipment with MicroBT units. Earlier this week, United States mining firm Marathon Patent Group announced that it had installed 700 Whatsminer M30S+ ASICs produced by MicroBT. However, it is also reportedly waiting for a delivery of 1,160 Antminer S19 Pro units produced by Bitmain, meaning that it also remains loyal to the current market leader. Will the hash rate be affected? Bitcoin’s hash rate plummeted 30% soon after the halving occurred as much of the older generation equipment became unprofitable due to the increased mining difficulty. That spurred miners to reshuffle, upgrading their current rigs and selling older machines to places where electricity is cheaper — meaning that some of them had to temporarily unplug. The situation has stabilized since, with the hash rate fluctuating around 100 TH/s for the past few days. Some experts attribute that to the start of the wet season in Sichuan, a southwest Chinese province where miners take advantage of low hydroelectricity prices between May and October. The arrival of the new generation of ASICs is expected to drive the hash rate even higher, at least once upgraded units become widely available. So, will the newly revealed T19 model make any impact on the state of the network? Experts agree that it won’t affect the hash rate to a major degree, as it’s a lower output model compared with the S19 series and MicroBT’s M30 series. Minehan said she doesn’t expect the T19 model “to have a huge impact that’s an immediate cause of concern,” as “most likely this is a run of <3500 units of a particular bin quality.” Similarly, Mark D’Aria, the CEO of crypto consulting firm Bitpro, told Cointelegraph: “There isn’t a strong reason to expect the new model to significantly affect the hashrate. It might be a slightly more compelling option to a miner with extraordinarily inexpensive electricity, but otherwise they likely would have just purchased an S19 instead.” Bitmain continues to hold leadership despite internal struggle At the end of the day, manufacturers are always in an arms race, and mining machines are simply commodity products, Zhang argued in a conversation with Cointelegraph: “Besides price, performance, and failure rate, there are not many factors that can help a manufacturer differentiate from the others. The relentless competition led to where we are today.” According to Zhang, as the iteration rate naturally slows down in the future, there will be more facilities using “creative thermal design such as immersion cooling,” hoping to maximize the mining efficiency beyond just using most powerful machines. As for now, Bitmain remains the leader of the mining race, despite having to deal with the largely defunct 17 series and an intensifying power struggle between its two co-founders, Jihan Wu and Micree Zhan, which recently resulted in reports of a street brawl. “Due to its recent internal issues, Bitmain is facing challenges to keep its strong position in the future thus they started to look at other things to expand its industry influences,” Xu told Cointelegraph. He added that Bitmain “will still dominate the industry position in the near future due to its network effect,” although its current problems might allow competitors such as MicroBT to catch up. Earlier this week, the power struggle inside Bitmain intensified even further as Micree Zhan, an ousted executive of the mining titan, reportedly led a group of private guards to overtake the company’s office in Beijing. Meanwhile, Bitmain continues to expand its operations. Last week, the mining company revealed it was extending its “Ant Training Academy” certification program to North America, with the first courses set to launch in the fall. As such, Bitmain seems to be doubling down on the U.S.-based mining sector, which has been growing recently. The Beijing-based company already operates what it classifies as “the world’s largest” mining facility in Rockdale, Texas, which has a planned capacity of 50 megawatts that can later be expanded to 300 megawatts.
Bitcoin Mining Unit Manufacturer MicroBT Nibbles at Bitmain’s Market Share
Bitcoin miner maker MicroBT has rapidly expanded market share by selling over half a million units in 2019, chipping away at rival Bitmain's dominance. MicroBT sold about 600,000 units of its flagship WhatsMiner M20 series last year, Vincent Zhang, sales head of the Shenzhen-based company, said in an online panel hosted by Chinese mining pool Poolin on Thursday in a WeChat group. These products generate a computing power of about 60 terahashes per second (TH/s) on average, he said. That means the newly delivered 600,000 units may have contributed over 30 exahashes (EH/s) of hashing power to the bitcoin network in 2019. (1 EH = 1 million TH). Amid bitcoin's price jump throughout 2019, the network's two-week average computing power more than doubled from just 40 EH/s around the end of 2018 to nearly 100 EH/s in December. That'd mean close to half of bitcoin's computing power growth in 2019 may have come from equipment delivered by MicroBT. Zhang didn't specify the precise average unit price of these batches, as they could fluctuate depending on bitcoin's price over the year. But the firm's various models in its M20 product line are generally priced between $24 to $30 per terahash, meaning the firm has brought home a high nine-figure revenue in U.S. dollars for 2019. Bitcoin's current computing power stands at 110 EH/s. That also means MicroBT may account for around 30 percent of bitcoin mining power sold right now, making it one of the largest and fastest-growing miner makers in the world.
Selling 4 Bitmain S9 SHA256 Miners with power supplies. Chicago, IL. $150 each
I posted this on craigslist but am posting here for more visibility. Happy to answer questions. https://chicago.craigslist.org/nwc/ele/d/barrington-bitmain-s9-bitcoin-mine7052248048.html Bitmain Antminer S9 Miner System to mine Bitcoin or Bitcoin Cash Antminer S9 Unit 13.5 Terahash/second hashing speed SHA-256 encryption APW3++ 220V Power supply Cooler enclosure for sound and thermal control Insulated venting system Miners have been in service for a total of 361 days, in the process of moving so need to sell. These high performance miners fans can be noisy, so the cooler enclosure solves that challenge. Enclosure: 24" long x 16" wide x 14" high Miner: 14" long x 5" wide x 7" high Have a total of 4 systems available, buy one or will do a deal for all 4. Equivalent new miner currently selling for $415. Get local and save shipping, tax and import duty. Connect to your favorite mining pool and earn some bitcoin at the current low price.
MINING A CRYPTO CURRENCY
The mining activity consist in calling a mathematical procedure we can’t predict the result before we run it. But we intend to obtain a very specific result, which usually consist in a certain number of 0 as the first chars before any random answer. If we found the nonce (a random object) combined with the transaction data and the coin algorithm that produce such result, we’ll have solve a transaction block and we’ll get a reward for that. Thanks to this work, the transaction listed in the block will be added to the blockchain and anyone will be able to check our work. That’s the concept of ‘proof of work’ allowing anyone to replay the mathematical procedure with the nonce discovered by the node that solved the block and to confirm block inclusion into the blockchain.
POLITICAL AND ETHICAL CONSIDERATIONS
The Tera project is young. It will have to face the same problems is facing today the Bitcoin platform :
a large amount of accounts used to get money back from credulous people (e-intrusion, mail threats, etc.)
a large amount of accounts used for illegal commercial activities (drugs, weapons, etc.)
attacks to make the blockchain platform down or to corrupt the blockchain datas
too many financial speculation that result in a coin value that has no sense.
Any Crypto Currency Project with the goal its money and contracts to be used as any other historical money or service contract has to consider its political and ethical usage. Processes have to be imagined, designed and implemented in order to be able to fight against extortion, corruption and illegal activities threating crypto-currency development.
Tera is entirely written in Java) over the NodeJS library as functional layer in order to take advantages of a robust and high level library designed to allow large and effective network node management. The miner part is imported from an external repository and is written in C in order to get the best performances for this module. Tera is actually officially supported on Linux and Windows. If you start mining Tera thanks to this article, you can add my account 188131 as advisor to yours. On simple demand I’ll refund you half of the extra coins generated for advisors when you’ll solve blocks (@freddy#8516 on discord).
Mining Tera has one major design constraint : you need one public IP per Tera node or miner. Yet, you can easily mine it on a computer desktop at home. The mining algorithm has been designed in order to be GPU resistant. In order to mine Tera coin you’ll need a multi-core processor (2 minimum) and some RAM, between 1 and 4GB per process that will mine. The mining reward level depends of the « power » used to solve a block (Top Tera Miners).
COST AND USAGE CONSIDERATIONS
There is two main cost centers in order to mine a crypto currency :
the cost of the hardware and the energy required to make a huge amount of mathematical operations connected to the blockchain network through the Internet,
the human cost in order to deploy, maintain and keep running miners and blockchain nodes.
To acquire more than 50 percent of the Bitcoin network, an attacker would need at minimum the same number of ASICs that are already in circulation. Network hash rate / terahashes per ASIC = number of ASICs necessary to acquire 50 percent * 41,483,931 network terahashes / 14 terahashes = 2,963,138 S9is * 41,483,931 network terahashes / 23 terahashes = 1,803,649 T15s Calculations for total current ASIC usage: 2,963,138 * 1.75 (crude estimate accounting for older models) = 5,185,492
2,963,138 S9is * $307 per S9i = $909,683,366
1,803,649 T15s * $913 per T15 = $1,646,731,537
Including bulk discount of 10 percent for the size of the purchase and economies of scale.
Total for S9is after discount = $818,715,029
Total for T15s after discount = $1,482,058,383
Infrastructure costs such as housing are a multiple of hardware costs from anywhere between an additional 22 percent to 40 percent, according to the CEO of a large-scale mining operation based in Canada. We will use the low figure to again account for economies of scale.
Variable Costs: Costs of daily electricity consumption for S9i: * 2,963,138 ASICs * 1320W = 3,911,342,160 Watts * 3,911,342,160 Watts / 1000 = 3,911,342 kWh * 3,911,342 kWh * 24 hours = 93,872,212 kWh per day * 93,872,212 * $0.03 per kWh = $2,816,166 per day in electricity Electricity costs based the low-end of the electricity rates in Washington State, the state with the average lowest electricity costs in the United States: https://www.electricitylocal.com/states/washington/ Costs of daily electricity consumption for T15: * 1,803,649 T15s * 1541 Watts = 2,779,423,109 Watts * 2,779,423,109 Watts / 1000 = 2,779,423 kW * 2,779,424 kW * 24 hours = 66,706,155 kWh * 66,706,155 kWh * $0.03 per kWh = $2,001,185 per day in electricity Cost of labor and maintenance above electric costs: 10%. This is an estimate based on an interview with two different large-scale miners in Canada and Georgia who chose to remain anonymous. Average kWh: ((((3,911,342,160 Watts + 2,779,423,109 Watts) / 2) * 24 hours) * 365 days) / 1E12 watt hrs per terawatt hrs = 29.3 TWh This estimate is short of Denmark’s oft-cited annual energy consumption of 32 TWh, closer to Morocco's consumption of 29 TWh.
Check out my new Crypto mining and solution business. For checking it out I'll be giving back a little bit.
Someone is happy. Miner life. Old McDonald had a farm. Money machines. Out of my way plebs. 5 Bitcoin Antminer giveaway. Wolfe Crypto Assets https://www.facebook.com/WolfCryptoIdea/ We will be giving away 2 Bitcoin Antminers at the end of June. 2 different people will win 1 each. 1 entry for a like of our Facebook page. 1 like per share of our Facebook page. 1 entry for any service used. 1 entry per Twitter retweet. 1 entry for Instagram like. On reddit give Wolfe Crypto Assets a shout out and screen shot it. PM me the info and I'll enter you in. All comments here will get you entered in. All inquiries will get you entered. ;) (10 Terahash T9)
SQUIRE ENTERS INTO NON-BINDING LETTER OF INTENT AND EXCLUSIVE NEGOTIATIONS REGARDING ACQUISITION OF COINGEEK.COM AND 1.0 MILLION TH/S OF MINING ASSETS, FORMING THE LARGEST PUBLIC CRYPTO MINING COMPANY, AND NAME CHANGE TO “COINGEEK TECHNOLOGIES LTD.”
VANCOUVER, British Columbia, Nov. 30, 2018 (GLOBE NEWSWIRE) — Squire Mining Ltd. (CSE:SQR | FWB:9SQ | OTCQB:SQRMF) (“Squire”) is pleased to announce today it has entered into a non-binding letter of intent (the “Agreement”) and exclusivity with Bigfoot Holdings Group Ltd. (c.o.b. as CoinGeek Mining & Hardware) (together with its affiliates, “CoinGeek”) to purchase crypto mining assets owned by CoinGeek and certain of its affiliates representing approximately 1 million terahash/s of computing power (or approximately 960 petahash/s) and other blockchain related assets (the “Assets”), for total consideration of approximately CAD$60.3 million consisting of (i) 114,793,565 common shares of Squire, having a value of CAD$34.4 million based on the closing price of Squire’s common shares on the Canadian Stock Exchange (“CSE”) on November 29, 2018 of CAD$0.30 per share, and (ii) a vendor-take-back note in the amount of CAD$25.8 million, subject to adjustment at closing (the “Transaction”). The Assets The Assets consist of 62,440 ASIC mining rigs, representing approximately 960,000 terahash/s, or approximately 90.0 MW of power consumption, which, upon closing, would make Squire the largest publicly traded crypto mining company globally, as measured by terahash/s. The Assets are all operated by leading hosting providers and are allocated across the United States (35,940 rigs), Canada (6,000 rigs) and Kazakhstan (20,500 rigs). The all-in weighted average operational cost across the Assets being acquired in the Transaction is US$0.073 per kWh. As part of the Transaction, Squire would also be taking on employees and consultants of CoinGeek involved with the management and operation of the assets and acquiring the marketing and advertising assets related to the CoinGeek name including the “CoinGeek.com” website and domain, existing prepayments made to and deposits with the respective hosting partners, as well as CoinGeek’s outstanding global distribution agreement for Squire’s ASIC chips and rigs. Furthermore, as part of the Transaction, Squire would have a twelve-month right of first refusal to acquire CoinGeek’s remaining crypto mining assets. “This Transaction would provide Squire with a leading, recognized brand via the acquisition of the CoinGeek.com and CoinGeek name, but it would also make us the largest, publicly traded Bitcoin miner globally. It is expected to deliver significant shareholder value by enabling Squire to become vertically integrated with our growing chip design and manufacturing business, which we would seek to have commercial within 2019,” said Taras Kulyk, Chief Executive Officer of Squire. “I believe the next phase of growth for this industry is upon us and that means massive scaling of the Bitcoin blockchain to accommodate the throughput needed for enterprises to make use of this technology. By vending my mining and CoinGeek branded assets into Squire, I would be doubling-down on my commitment to Bitcoin’s success. These assets would enable Squire Mining Ltd to compete at a global level to pave a path for enterprise usage of blockchain technology to flourish,” said, Calvin Ayre, owner of the CoinGeek brand. The Consideration As noted above, CoinGeek would receive approximately 114.8 million common shares of Squire as partial consideration for the Assets. CoinGeek has agreed to enter into a voluntary one-year lock up on the common shares received. In addition, CoinGeek will receive an unsecured vendor-take-back (“VTB”) with a face value of CAD$25.8 million, a one-year term and a coupon of 15.0%. The principal amount of the VTB will be adjusted at closing of the Transaction (the “Closing”) to reflect any prepayments or prepaid deposits made in respect of the Assets between the signing of the Agreement and the Closing and by the amount (multiplied by CAD$0.45 per common share) by which the common shares to be issued would have exceeded the common share issued pursuant to the Transaction. In connection with a change of control, CoinGeek would be able to convert the VTB into common shares of Squire, with the number of common shares being equal to the principal amount and any accrued interest payments of the VTB divided by the then market price of the Squire common shares (based on a 30 day volume-weighted average), subject to a discount equal to the lesser of (i) 25%, and (ii) the maximum discount permitted under the policies of the CSE (or such other exchange as the Squire common shares may then be listed). With the launch of Bitcoin SV (BSV), the Squire team is confident that this Transaction would be just the beginning as the company scales to match the anticipated enterprise-level and large volume usage of BSV’s cryptocurrency and blockchain. The BSV roadmap aims to enable massive on-chain scaling, and outlines for the crypto mining sector why that is important for the entire interrelated Bitcoin ecosystem. Much bigger blocks are needed to support higher commercial transaction volume, allowing miners to earn more transaction fees, which is critical for miners to stay profitable as Bitcoin’s block reward halves in 2020 and every several years after that. This is why BSV’s plan will in-turn drive growth in the mining hardware sector, reinforcing the Squire team’s optimism on future growth prospects. Transaction In addition to the negotiation and execution of definitive agreements between Squire and CoinGeek, the Transaction would be subject to a number of conditions, including, among others, (i) Squire being satisfied, in its sole and absolute discretion, with the results of its due diligence review in respect of the Assets, (ii) receipt of the conditional approval of the CSE, (iii) the Transaction not being subject to shareholder approval , (iv) receipt of required consents; and (v) execution of third party software licensing agreements in respect of the Assets. The letter of intent is non-binding and there is no assurance that the Transaction contemplated by it will be completed as proposed or at all. The parties will seek close the Transaction on or about January 31, 2019. In conjunction with the Transaction, Squire intends to change its name to CoinGeek Technologies Ltd. and its fiscal year end from October 31 to December 31. The parties have agreed to an exclusivity period in the letter of intent ending on December 31, 2018, or such other date as the parties may mutually agree. Canaccord Genuity Corp. is acting as exclusive financial advisor to Squire in respect of the Transaction. Upon closing of the Transaction, Calvin Ayre, through the Antiguan Corporation Bigfoot Holdings Group Ltd. (“BHG”), would beneficially own or control 126,418,565 common shares of Squire representing approximately 53.3% of the issued and outstanding Squire common shares. The Squire common shares would be acquired by BHG for investment purposes only. Depending on market and other conditions, or as future circumstances may dictate, BHG may, from time to time, and subject to any contractual lock-up agreements (including the lock-up to be entered into in connection with the Transaction), increase or decrease its holdings of Squire common shares or other securities of Squire in accordance with applicable securities laws. About Squire Mining Ltd. Squire is a Canadian based company engaged, through its subsidiaries, in the business of developing data mining infrastructure and system technology to support global blockchain applications in the mining space including application specific integrated circuit (ASIC) chips and next generation mining rigs to mine Bitcoin SV, Bitcoin Core and other associated cryptocurrencies. About CoinGeek Mining & Hardware CoinGeek Mining & Hardware operates a global fleet of ASIC miners that provide the majority of the hash power to secure and scale the Bitcoin SV enterprise-grade blockchain. CoinGeek’s professional team has developed industry leading practices to ensure its mining fleet operates at maximum performance whilst optimizing its cost profile to maximize profitability. For further information contact: Taras Kulyk, JD, MBA Chief Executive Officer, Director Telephone: +1 (604) 260-6142 The Canadian Securities Exchange accepts no responsibility for the adequacy or accuracy of this release. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes “forward-looking information” as defined under applicable Canadian securities legislation. Forward-looking information and statements include, but are not limited to, disclosure regarding possible events, the proposed completion of the Transaction including the acquisition of the CoinGeek Assets, together with CoinGeek’s marketing and advertising assets and exclusive distribution agreement, and the consideration and timing thereof, conditions or financial performance that are based on assumptions about future economic conditions and courses of action, the future hash rate, energy consumption performance and all-in weighted average operational cost of the ASIC mining rigs included in the Assets and the Company’s ability to successfully integrate the Assets into its current ASIC chip and mining rig development business. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties, uncertain and volatile equity and capital markets, lack of available capital, future demand for Bitcoin SV, Bitcoin Core and other cryptocurrencies and risks related to the mining thereof, integration issues, personnel and staffing requirements and technological change and obsolescence. See also the Company’s Form 2A Listing Statement dated July 31, 2018 (the “Listing Statement”) filed with the CSE and SEDAR for a discussion of risk factors facing the Company and its development and manufacture of ASIC chips and mining rigs. There are no assurances that the Company will successfully negotiate, enter into and complete a definitive purchase agreement for the Assets on the terms presently contemplated or at all. Actual results and future events could differ materially from those anticipated in such forward looking information. Accordingly, readers should not place undue reliance on forward-looking information. All forward looking information in this news release is made as of the date hereof and qualified by these cautionary statements and those in our continuous disclosure filings available on SEDAR at www.sedar.com. The Company disclaims any intention or obligation to update or revise such forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
Litecoin Association Press Release on Litecoin Halving
The Litecoin halving is imminent and is predicted to occur on Tuesday, August 25th. Approaching so quickly, the Litecoin Association would like to reflect on the tremendous accomplishments and milestones achieved by its community during these last four years. On October 7, 2011, Litecoin was created and its genesis block was processed. Six days later on October 13th, Litecoin was released to the world -- to mine on and utilize -- via BitcoinTalk.org (small note, only 3 blocks were mined by Charlie Lee to test the network, the gap between the genesis block and release date was to ensure more people were aware of Litecoin at launch to ensure a fair launch and distribution). While Litecoin was not the first alt coin, it has been the most successful. Its adoption and acceptance within crypto communities, outside businesses and industries, and now regional, state, and national governments speaks volumes about its potential and is, frankly, incredible. Everyday, we are seeing increased activity with Litecoin. From miners to traders, to developers, merchants, exchanges, and general public, Litecoin is becoming synonymous with the word cryptographic-currency. It is listed on nearly all crypto-currency exchanges, and businesses are starting to accept and hold Litecoin as a form payment. Examples include REMAX London, Cheapair.com, BTC Trip, and eGifter. Beyond community involvement, Litecoin has one of the strongest and most secure networks on Earth. In October 2014, Litecoin surpassed the 1 terahash milestone. First achieved by Bitcoin and only achieved by cryptocurrencies having specialized mining equipment known as application-specific integrated circuits (ASICs), the terahash milestone ensures the strength and security of the network so that it may be utilized confidently as a payment method. Recently, there have been rumblings about the price of Litecoin due to its halving. Between the technophiles, traders, hobbyists, and others, we feel it is critical to mention that the price of Litecoin (while exciting) is not paramount to the goal of what we are trying to achieve as a cryptocurrency. The industry as a whole, not just Litecoin, have come a long way. And we feel it is critical to remind everyone that what we are doing is civilization defining. To be able to send remittances within minutes, to store legal information digitally without fear that the documents would be shredded, to be your own bank, and more, all in a decentralized manner, is revolutionary. To be able to accomplish these tasks are so momentous that it has attracted the attention of governments and trillion dollar industries! This is why we do what we do as an industry. For those who wish to understand a bit more about the halving, the Litecoin Association has produced an educational video on it found here https://www.youtube.com/watch?v=BPxq8CgMooI which describes in basic terms what the halving means and its significance to Litecoin. This is one in a series of growing videos that we have produced in order to explain crypto currencies to those both inside and outside of the crypto communities. Those interested can see the other videos at our YouTube channel here https://www.youtube.com/useLitecoinAssociation We at the Litecoin Association are both proud and humbled that we can play our small part in the crypto currency ecosystem and industry. The halving is a significant milestone for litecoin, and with the support of the multiple communities, one step closer to defining the future for the world. And remember, you can't spell aLTCoin without LTC. Thank you The Litecoin Association Andrew Vegetabile Jason King Eric Mihalik Ryszard Mielcarek Phillip Auman For more information about Litecoin merchants, exchanges, wallets, and more, please visit www.Litecoin.com
Cryptocurrencies Poised to Finish the Day Positive, Bernstein Report Suggests Bitmain Market Position Deteriorating
Bitmain, the world’s large Bitcoin mining manufacturer, is introducing a new 18 terahash water-cooled mining device. The new rig, called the Antminer S9 Hydro, will have a hashrate of 18TH/s and will consumer ~1,728W.
A research report from Sanford Bernstein suggest that Bitmain’s monopolistic position in the bitcoin mining manufacturing industry is deteriorating. According to the analysis, competitors such as Canann and Ebang International are catching up to Bitmain and cause pricing pressure on Bitmain’s products. The decline in cryptocurrency market valuations have further put downward pressure on Bitmain profitability and returns on capital.
US cryptocurrency exchange Bittrex is partnering with Rialto Trading, a regulated alternative trading system, to launch blockchain-based securities. If the regulators approve of the idea, the Bittrrex-Rialto partnership is looking to launch products like issuance advisory service, placement, trading and custody.
According to Chinese news sources, the Chinese government has blocked domestic traders from accessing 120 overseas cryptocurrency exchanges.
After being hacked this past June, South Korean cryptocurrency exchange Bithumb recorded net profit of USD$35mm for C1H2018. Total revenues were USD$270mm while operating profit was USD$194 in spite of a significant drop in trading volume following the USD$31mm breach in June 2018.
The German Government call for an independent payment system that is free of the United States is being viewed as a net positive for Bitcoin.
LG, the South Korean electronics conglomerate, is strategic focus that emphasizes blockchain. The blockchain platform will emphasize a new decentralized identification protocol which will help LG transition to a completely digital ecosystem that manages customer businesses.
Stockholm IT Ventures AB, a Swedish Block startup, has signed an agreement with Valens Bank to use the BTT Crypto Trading Toolbox for Crypto Fund trading. The agreement will allow professional traders to actively manage digital assets for customers using AI trading tools.
The UK Ministry of Justice is exploring blockchain as a tool to secure digital forms of evidence according to CoinDesk. The idea, as explained by Deputy Director Balaji Anbil is that blockchain technology can be used to assist in handling digital evidence.
London-based Wirex, a Bitcoin wallet and payment card provider, announces it is the 3rd crypto-enabled company to receive a e-money license from the UK financial regulators. Wirex can now issue electronic money and provide payment services throughout the EU and European Free Trade Association.
The World Bank and Commonwealth Bank of Australia have issued a A$100mm (USD$73.16mm) public bond exclusively on a blockchain network.
bitcoin mining profitable in the US? Where are my calculations off?
Someone tell me where my calculations are wrong. Amazon has this miner advertised: Antminer S9 ~14.0TH/s @ .098W/GH 16nm ASIC Bitcoin Miner So that would consume 14000*0.98=1372 watts. Given my electricity costs (0.12 $/kwhr), I would make $8.19 for every $1 of electricity. In a month, I would make $884. That can't be right. Where did I screw up? Here is a python script to calculate that:
edit: thanks to Personthingman2. 25 vs 12.5 block reward. when I change that, my script outputs: rev=0.000194444444444 cost=4.74798641087e-05 ratio=4.09530330582 profit per month=380.93219223 This is a $4000 unit, so it pays for itself in 10 months. OK. So whether I will ever make money on this depends heavily on the growth of the network hashing rate over time, and the increase in BTC price. edit2: I am guessing that the answer to my question is that I would be lucky for the unit to keep working long enough to pay for itself. It would likely break down before reaching that point.
[GUIDE] How you can help decentralize the network using p2pool and rented hashing power.
Hey guys, After seeing this ghash.io 51% drama play out for the second time I've decided to start contributing to the network using P2pool. I don't own any SHA256 mining hardware aside from a 330mh block erupter, so I started looking around for hashpower for rent that wouldn't cost me too much. I settled on using Betarigs and Nicehash, services that I already use to lease X13 hashpower on my GPU rigs. I found cheap hashing power on these services that would put me close to breaking even. So far the costs have been very small and I have put an average of 2TH on a local p2pool node. It's not much but every GH counts! I've made instructions for renting on both websites. Be warned that P2Pool has a high variance due to their low hashrate, so ideally you would want to mine for a sustained period with a lower hashrate to balance it out. The NiceHash method: You will need:
Create an account at NiceHash.com and add 0.01BTC on the deposit page.
go to http://www.bitcoinx.com/profit/ and work out the amount of coins you will earn per terahash (0.0428 at the time of writing) This is the target price for your order. (please note that orders at a higher price take priority so matching the highest order guarantees that you will get your hashrate but is more expensive)
Click the orders tab at the top of the page and create an order. Select SHA256 from the algorithm dropdown menu. The price per terahash should be slightly higher than the estimate you found on BitcoinX. Check which orders are going through on the front page and try to match that price. Limit the amount of mining power to 1 terahash per second to ensure your miner is going for as long as possible (this means there is less potential for variance).
Find a p2pool node that is close to you. You can use http://p2pool-nodes.info/ for this. Find a node that is close to you and click on the url. Check the efficiency is around 100%. If it isn't, go back and find another node. If the node does fit the criteria you can proceed to the next step.
Put the node URL (minus the http:// and port) into the pool address box on Nicehash. The port (usually 9332) should be put in the port box to the right.
Put your BTC address in the user field and x in the password field. Double check to verify everything is correct and place the order.
You should soon see the hashrate of the p2pool node you are connected to go up and your address show up in the stats field. If this doesn't happen within 20 minutes, either edit your order to have a higher price per TH or wait for the higher priced orders to finish. The Betarigs method This method is cheaper than using Nicehash as you are renting hardware rather than raw hashrate, which you pay a 'convenience fee' for. This is not as straightforward but will cost you less and give you more choice of the rig you want to rent. You will need:
A Betarigs.com account (Sign up on their site for free)
Sign up for a Betarigs account using the register link in the top right of the page and follow the steps to sign up.
At the top left of the page, go to rent a rig and select SHA-256.
Turn on results for all of the available rig sizes and hit search. You will see a list of rigs and their price per day, hashrate and price per TH on the right. The rigs displayed first are the cheapest per TH, placing them closer to breaking even with mining profit (while helping the network. Sweet!)
Find a rig with a low price per TH that is within your price range. You can pick up an Antminer S1 for around 0.008 per 24h, often cheaper. When you've found a rig you would like to rent, click the green 'Rent Rig!' button to the right of the result.
Double check that the information is correct and confirm that you would like to rent the rig. You will be taken to a page with fields for your pool, user and password.
Find a p2pool node that is close to you. You can use http://p2pool-nodes.info/ for this. Find a node that is close to you and click on the url. Check the node's efficiency is close to or above 100%. If it isn't, go back and find another node. If the node does fit the criteria you can proceed to the next step.
Put the node URL (minus the http://) into the pool address box on Nicehash. The port should go on the end of the url in this format - url:port
Put your BTC address in the user field and x in the password field. Double check to verify everything is correct and click 'update the target mining pool'.
Send the exact amount of BTC specified by Betarigs to the address displayed at the top of the control panel. After one confirmation, the rig will start to mine and you will be able to check your status on the p2pool node page soon!
I have around 1.5 TH (!1.2TH from NiceHash, ~300GH from Betarigs) pointed at a local p2pool node, 2-400gh of which should last for 3 days to 1 week. I decided to do this to decentralize the network rather than for profit although I do seem to be breaking even so far. P2Pool varies wildly so a lot of it is down to luck. I may add a picture tutorial if this picks up enough interest, as I aim to make this guide as noob friendly as possible. Please reply with any additions and I will add them to the OP. Thanks for reading and keep hashing! :)
Why Bitcoin will eventually need a constant, positive Inflation Rate - only practical solution for a long term secure network
I'm going to present numbers that show inflation is the ONLY way to secure the bitcoin network in the long term. this problem wont show up for quite a while, until the block reward is negligible...say in the late 2030's early 2040s, but i still think its important to think about early on. Some back ground numbers i will use in my calculations -Visa network handles about 2000 transactions per second = 63B tx/year -All monetary transactions (cash, cc, etc) = 20000 tx/second = 620B tx/year -$400 for a 1 terahash bitcoin mining rig, using about 500W of power -World M2 Money supply is about $60T (US m2 is about $15T) Lets assume bitcoin is the sole world currency. all bitcoins in the world are worth $60T, or about $3M/bitcoin. What is an acceptable cost to gain control of 51% of the network? $10B? no...apple has $80-$100B in just cash on its balance sheet. $100B? no, again see apple's cash. $500B? Defense dept spending is about that per year. Getting there, but i still think it should cost more. somethin in the range of $1T seems right. So we want the ANNUAL miners revenue to be say $1T on a monetary base of $60T (about 1.7%) Can this $1T come from transaction fees alone? no. Here's the numbers on a cost per tx basis. $1T/620B tx per year = $2.90 per transaction. Not feasible at all. Thats more expensive than credit cards, and its a fantasy if people believe the anonymity gains etc will be enough for people to agree to those insanely high fees. Does off blockchain transactions help? no. Again, the miners need to get that $1T somehow. off blockchain just means few tx numbers but higher per tx fees. The total product is still the same. which ultimately means cost per tx is the same whether its on or off blockchain. So transaction fees and/or off blockchain transactions wont help. What is the other solution? i submit that its a constant inflation rate in the form of an increasing block reward. the block reward should not trend to 0 btc per block by 2140, but instead be set at say 1-4%/year of the current number of bitcoins in existence. with 21M coins in 2040, 630K coins per year or 11 coins per block (instead of the less than 1 coin per block that is currently schedule in the bitcoin protocol). At 3% per year, there would be 30M coins by 2053, 50M coins by 2070, 100M by 2093. inflation is still a set 3% per year. what this does is allow us to get to that $1T/yr in mining revenue while still keeping cost per transaction at say less than 10 cents per tx. 3% of 60T = $1.8T...which would be a very secure network. someone realistically going to spend that much to gain 51% of the network? furthermore logistically it would be tough to get that much. math is tech wrong, but about right. using $400/terahash, that would mean 1.8T/400= 4.5B 1 terahash mining units, consuming 2.3 terawatts of energy. 15TW is average world wide use, so that would mean 2.3/15 = 15% of total energy usage goes to securing bitcoin. Again, these are extreme numbers. maybe i'm being overly paranoid, but i don't see anyone else crunching these numbers, and i'm not comfortable with "we'll deal with the problem when we get to it in 20 years)
Stability of the difficulty. A weakness you may not be aware of.
EDIT: Here's a TL;DR Sorry if I rambled on a bit there. I'll try to make my point a bit more concise here. TL;DR: If bitcoin starts to gain mainstream success, eventually a large percentage of the miners will be in it for the profit and not for the good of bitcoin. My fear is a crash in bitcoin's value after achieving general acceptance as a form of payment could cause a crash in hash rate from miners shutting down when the boss sees a drop in profitability. A crash in hash rate could possibly destroy bitcoin's usefulness as a form of exchange, driving the price down further, killing the currency. In my post I describe a possible solution to make scaling down difficulty to match a sudden drop in hash rate smother. If this interests you, then please read my post and share your thoughts. I feel like this is an obvious flaw in the protocol that was overlooked. Am I wrong? If so, please tell me because I'd like to have my worries eased. ASIC miners and the rapid increase in difficulty have created a new point of failure in the bitcoin network that was never that large of a problem before. No, I’m not talking about the increased centralisation of mining that you see so many people complaining about. I’m talking about the rising difficulty itself and the way the network scales the difficulty. It allows for smooth transitions in the upward direction, but a sharp decline in hash rate could kill bitcoin completely. The readjusting of the difficulty doesn’t really happen every two weeks, it’s really every 2,016 blocks which should be about two weeks in theory. If we were to lose a large chunk of the hash rate, lets say 66%, block discovery time will increase to 30 minutes per block. Maybe that’s not a huge deal, but it definitely impacts the convenience and usability of bitcoin as a means of exchange and would certainly impact the price negatively. Also, it’s possible that we would be stuck at this slow confirmation rate for 6 weeks in this example. Perhaps it is an unlikely scenario that such a large amount of hash rate is lost within a short span, but think about it this way. Imagine a point in the future where ASIC miners account for over 98% of the hash rate. Maybe bitcoin is well on it’s way into mainstream acceptance in this future. There may be large corporations that own large mining farms. These corporations may be publicly traded companies with a responsibility to maximize profits for their shareholders. If the value of bitcoin were to crash, there’s a good chance that some of these corporations may shut down their mining operations because it no longer has a good ROI in the opinion of their CEO. Maybe the next reward halving is coming up soon, that could also cause miners to shut down. This would slow down transaction confirmations, impacting it’s usefulness as a means of exchange and driving the price down even lower, driving even more miners to shut down. This would continue exponentially until the only remaining hashing power is us, the early adopters, true believers, and ASIC manufacturers. We could very easily end up in a situation with hour long confirmation times or longer, and the next difficulty adjustment being months away. That would essentially completely kill off bitcoin. It’s not logical to assume there will never be a large drop in hash rate between now and 2140. It’s not possible to predict political events that far into the future. Maybe world war 3 happens and China decides to unplug their whole country from the outside internet. Maybe Butterfly Labs successfully ships out 1,000,000 terahash miners that run on sunshine dust and unicorn farts and they quickly become the defacto standard, and then it’s discovered that they are a fire hazard. Many people are killed, homes are lost, and people just start turning them off out of fear. You just don't know what will happen that far into the future. I have an idea about how the protocol could be modified to protect against this sort of scenario and allow for a sharp decrease in hash rate without losing its usefulness as a means of exchange. There should be an emergency mode that drastically cuts the difficulty rate. This emergency mode can be requested by any node in the network but will only occur if the network has consensus from the nodes. The request could be triggered by two possible events. The first trigger event should be if no blocks are discovered for a certain span of time, lets say an hour and a half. The second event should be if a certain number of consecutive blocks take over 25 minutes to discover. The reason for using 25 minutes as the trigger is because that would require a loss of 55% so in theory a single person couldn't trigger it without having over 50% and in that scenario we have worse problems than the falling hash rate. Once the event is triggered, the difficulty should be slashed by a factor of 10x and reduce the block reward to 0. If it’s impossible to have no reward blocks, then use a dust amount of bitcoin like a few Satoshies. If the event was triggered by 25 minute confirmation times then the new emergency block discovery time will be 2.5 minutes. This will have the immediate effect of speeding up transactions that have possibly been waiting awhile for confirmations. The rapid block time will have the secondary effect of quickly and more accurately calculating the new hash rate of the network. (More data points over a shorter spread of time.) The removal of the block reward serves to disincentivize miners with lots of hashing power from trying to trigger the event on purpose so they could make more bitcoins at a lower difficulty rate and also prevents the creation of large amount of bitcoins since it would be moving into an unknown block discovery rate. This emergency event should not last long because miners would just shut down even faster with no block reward. Lets say it only lasts 96 blocks. Assuming 2.5 minute confirmation times, 96 blocks would take 4 hours to mine but that number could vary depending on how much hash rate was lost. Lets put this in perspective. A sudden loss of 55% of the hash rate would result in a loss of 4 hours of block rewards. A loss of 90% would be 16 hours with no block rewards. After 96 blocks have been mined, the network can make an estimation on the new hash rate based on the speed those blocks took, and generate a new difficulty to resume normal 10 minute confirmation times and normal block rewards. However, such a short span of time may not be enough to generate an accurate difficulty for the network. The network should recalculate the difficulty again after 432 blocks (3 days), and then resume the normal 2 week schedule. Each time an emergency event is triggered, the next scheduled halving of the block reward should be moved back by 96 blocks. That way these events have no effect on the mathematical total of bitcoins that can possibly be mined by 2140. Even if these events are very unlikely and it’s possible that this scenario will never play out, it would be added security to the value of bitcoin to have fail safes in place in the event of huge losses in hash rate. It could only add to the strength of bitcoin. It gives it the robustness it needs to survive a crash in price in a world where the miners are mostly interested in profits and ROI, not the good of bitcoin. EDIT: Here's another TL;DR of my proposed solution Basicly the nodes can request an emergency drop in hash rate if it notices block confirmation times rise above 25 minutes. This would require a loss of 55% of the hash rate. If the nodes have consensus on this request then the difficulty gets slashed by a factor of 10 and the network will mine 96 blocks with no block reward. That will take 4 hours with a 55% hash rate loss and 16 hours at a 90% hash rate loss. After the 96 blocks are mined, the network will calculate the appropriate difficulty based on the discovery rate that those blocks were mined. Normal block confirmations and block rewards will then resume at that point. What makes it nice is it will only be triggered by extreme cases. Also, mining for 4 to 16 hours for the good of bitcoin is an easier pill to swallow than just keep mining indefinitely into a possibly dying system for the good of bitcoin.
Where is the network difficulty headed, come November?
Reposted for accuracy. (Read: My math skills are the result of public education.) KNCMiner announced today that they're doing encapsulation on their new Scrypt ASIC chips, and then when they're completed, will be shipping to Stockholm for integration and testing, buildout and finally...shipping! I have read on forums that they have sold 3,000 Titans via pre-order, for batch 1, at 250MH/s nominal performance, each. I figured it was time to look at my "hashrate/difficulty prediction" again and see where it may actually be, by the time the snow's falling. All of the below is calculated with a Litecoin price of around $5. Let's assume for a moment that both Alpha Technology and Mining ASICs Technologies have also sold around 3,000 systems on pre-order (probably a safe bet) and all three expect to ship in September-October. 9,000 systems @ 250MH/s = 2,250,000MH/s. That's somewhere in the neighborhood of 2.25 TH/s being added to the network in roughly two months' time...that we can account for. The current network hashrate, as I post this? Not quite 1 TH/s...it's 896 GH/s. But at the current rate of network expansion, we're going to be 1 TH/s by the time these systems ship, easily. So...let's say we're looking at a 3.5 TH/s Litecoin network by November. What does that mean? When the Bitcoin network hit 3.5 TH/s back in May of 2011, the difficulty was around 244,000. Litecoin's difficulty is currently around 28,000. You can probably see where this is going, already. Fun with mining calculators time. Say you have one 250MH/s miner and deployed it TODAY (impossible, but for the sake of argument). You're looking at pulling in 9 LTC/day with it. If you pay $.10/kwh you're very lucky not to live in California, but we'll say that's the case. You pay around $4.50/day in power. So you walk away with $42.50 worth of Litecoin, at $5/each. If you somehow managed to freeze the network at that difficulty and the coin at that price, you'd pay off your $9,200 purchase of hardware in roughly seven months or so...or if you bought a Titan at $10,000 you're looking closer to eight. But since difficulty marches on, forget that entire concept. Now...say you get your system after all three companies have shipped and their customers have deployed them, and we've seen the network rocked to the tune of two-and-a-quarter terahashes per second. Oh, it's a rosy picture... Now, with the network difficulty having blown up to 244,000 the miner with a 250MH/s system is mining 1.03 Litecoin per day. And if my estimates are correct...this is NOVEMBER, we're talking about. At the current price of $5/LTC and $.10/kwh you are pulling down a healthy $0.80/day in profits, after power. If you again had the power to freeze the hashrate and price, you'd be able to pay off that hardware purchase in, oh...roughly 35 years. To have a REASONABLE shot at getting a return on your investment (around 5-6 months), Litecoin will need to be $70 by November and climbing steadily, in concert with network hashrate. Bear in mind, again that there is nowhere else for that hashrate to go but Litecoin. Nothing else will profit the Scrypt miner. So what will happen? There is built-in hardware cost here that has to be recouped and the only real way of doing that is by mining...and there's only one game in town for Scrypt mining: Litecoin. It's going to be a really, really wild fourth quarter for this year. Either the miners mine and hoard, decreasing supply and demand increases radically, or miners take heavy losses on hardware, can't afford to run them and the Litecoin network contracts until they CAN make money with them. In the interests of self-preservation, I have a feeling miners will start hoarding. Soon.
There was a post in the bitcoin sub and the onename guy came in and posted a link to his paper talking about how they believed F2Pool controlled over 60% of the namecoin hashrate. That's a problem, because that means they can block registrations of names and instead make sure their registrations go through, and of course, block name updates until they can register it themselves. Basically, it's an easy 51% attack that destroys the integrity of the whole system. I like Namecoin's model better than Onename's, but they have a very valid point for moving to the Bitcoin blockchain. Is there anything that can be done to diversify the mining? I have few terahashes merged mining solo, and of course have not found a block ever, but hey I'm mining at least. I know if any Bitcoin pool ever got over 45% miners would switch over to other pools, but that's not the case for Namecoin, where they're really only mining it because it's free with merged mining and they don't actually care much about Namecoin. Is it worth it to fork and end merged mining? I don't know the answer, I just don't like like the risk. I've taken to putting a warning text field in my names that says "if this name ever expires it can no longer be trusted as being accurate" to mitigate against the 51% blocking of update transactions.
Mining Bitcoin with pencil and paper: 0.67 hashes per day
This is the best tl;dr I could make, original reduced by 91%. (I'm a bot)
The idea is that Bitcoin miners group a bunch of Bitcoin transactions into a block, then repeatedly perform a cryptographic operation called hashing zillions of times until someone finds a special extremely rare hash value. The SHA-256 hash algorithm used by Bitcoin The SHA-256 hash algorithm takes input blocks of 512 bits, combines the data cryptographically, and generates a 256-bit output. Manual mining The video below shows how the SHA-256 hashing steps described above can be performed with pencil and paper. At this rate, hashing a full Bitcoin block would take 1.49 days, for a hash rate of 0.67 hashes per day. In comparison, current Bitcoin mining hardware does several terahashes per second, about a quintillion times faster than my manual hashing. Thus, mining can reuse the result of hashing the first 512 bits, and hashing a Bitcoin block typically only requires 128 rounds.
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