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[ANN][ANDROID MINING][AIRDROP] NewEnglandcoin: Scrypt RandomSpike

New England
New England 6 States Songs: https://www.reddit.com/newengland/comments/er8wxd/new_england_6_states_songs/
NewEnglandcoin
Symbol: NENG
NewEnglandcoin is a clone of Bitcoin using scrypt as a proof-of-work algorithm with enhanced features to protect against 51% attack and decentralize on mining to allow diversified mining rigs across CPUs, GPUs, ASICs and Android phones.
Mining Algorithm: Scrypt with RandomSpike. RandomSpike is 3rd generation of Dynamic Difficulty (DynDiff) algorithm on top of scrypt.
1 minute block targets base difficulty reset: every 1440 blocks subsidy halves in 2.1m blocks (~ 2 to 4 years) 84,000,000,000 total maximum NENG 20000 NENG per block Pre-mine: 1% - reserved for dev fund ICO: None RPCPort: 6376 Port: 6377
NewEnglandcoin has dogecoin like supply at 84 billion maximum NENG. This huge supply insures that NENG is suitable for retail transactions and daily use. The inflation schedule of NengEnglandcoin is actually identical to that of Litecoin. Bitcoin and Litecoin are already proven to be great long term store of value. The Litecoin-like NENG inflation schedule will make NewEnglandcoin ideal for long term investment appreciation as the supply is limited and capped at a fixed number
Bitcoin Fork - Suitable for Home Hobbyists
NewEnglandcoin core wallet continues to maintain version tag of "Satoshi v0.8.7.5" because NewEnglandcoin is very much an exact clone of bitcoin plus some mining feature changes with DynDiff algorithm. NewEnglandcoin is very suitable as lite version of bitcoin for educational purpose on desktop mining, full node running and bitcoin programming using bitcoin-json APIs.
The NewEnglandcoin (NENG) mining algorithm original upgrade ideas were mainly designed for decentralization of mining rigs on scrypt, which is same algo as litecoin/dogecoin. The way it is going now is that NENG is very suitable for bitcoin/litecoin/dogecoin hobbyists who can not , will not spend huge money to run noisy ASIC/GPU mining equipments, but still want to mine NENG at home with quiet simple CPU/GPU or with a cheap ASIC like FutureBit Moonlander 2 USB or Apollo pod on solo mining setup to obtain very decent profitable results. NENG allows bitcoin litecoin hobbyists to experience full node running, solo mining, CPU/GPU/ASIC for a fun experience at home at cheap cost without breaking bank on equipment or electricity.
MIT Free Course - 23 lectures about Bitcoin, Blockchain and Finance (Fall,2018)
https://www.youtube.com/playlist?list=PLUl4u3cNGP63UUkfL0onkxF6MYgVa04Fn
CPU Minable Coin Because of dynamic difficulty algorithm on top of scrypt, NewEnglandcoin is CPU Minable. Users can easily set up full node for mining at Home PC or Mac using our dedicated cheetah software.
Research on the first forked 50 blocks on v1.2.0 core confirmed that ASIC/GPU miners mined 66% of 50 blocks, CPU miners mined the remaining 34%.
NENG v1.4.0 release enabled CPU mining inside android phones.
Youtube Video Tutorial
How to CPU Mine NewEnglandcoin (NENG) in Windows 10 Part 1 https://www.youtube.com/watch?v=sdOoPvAjzlE How to CPU Mine NewEnglandcoin (NENG) in Windows 10 Part 2 https://www.youtube.com/watch?v=nHnRJvJRzZg
How to CPU Mine NewEnglandcoin (NENG) in macOS https://www.youtube.com/watch?v=Zj7NLMeNSOQ
Decentralization and Community Driven NewEnglandcoin is a decentralized coin just like bitcoin. There is no boss on NewEnglandcoin. Nobody nor the dev owns NENG.
We know a coin is worth nothing if there is no backing from community. Therefore, we as dev do not intend to make decision on this coin solely by ourselves. It is our expectation that NewEnglandcoin community will make majority of decisions on direction of this coin from now on. We as dev merely view our-self as coin creater and technical support of this coin while providing NENG a permanent home at ShorelineCrypto Exchange.
Twitter Airdrop
Follow NENG twitter and receive 100,000 NENG on Twitter Airdrop to up to 1000 winners
Graphic Redesign Bounty
Top one award: 90.9 million NENG Top 10 Winners: 500,000 NENG / person Event Timing: March 25, 2019 - Present Event Address: NewEnglandcoin DISCORD at: https://discord.gg/UPeBwgs
Please complete above Twitter Bounty requirement first. Then follow Below Steps to qualify for the Bounty: (1) Required: submit your own designed NENG logo picture in gif, png jpg or any other common graphic file format into DISCORD "bounty-submission" board (2) Optional: submit a second graphic for logo or any other marketing purposes into "bounty-submission" board. (3) Complete below form.
Please limit your submission to no more than two total. Delete any wrongly submitted or undesired graphics in the board. Contact DISCORD u/honglu69#5911 or u/krypton#6139 if you have any issues.
Twitter Airdrop/Graphic Redesign bounty sign up: https://goo.gl/forms/L0vcwmVi8c76cR7m1
Milestones
Roadmap
NENG v1.4.0 Android Mining, randomSpike Evaluation https://github.com/ShorelineCrypto/NewEnglandCoin/releases/download/NENG_2020_Q3_report/NENG_2020_Q3_report.pdf
RandomSpike - NENG core v1.3.0 Hardfork Upgrade Proposal https://github.com/ShorelineCrypto/NewEnglandCoin/releases/download/2020Q1_Report/Scrypt_RandomSpike_NENGv1.3.0_Hardfork_Proposal.pdf
NENG Security, Decentralization & Valuation
https://github.com/ShorelineCrypto/NewEnglandCoin/releases/download/2019Q2_report/NENG_Security_Decentralization_Value.pdf
Whitepaper v1.0 https://github.com/ShorelineCrypto/NewEnglandCoin/releases/download/whitepaper_v1.0/NENG_WhitePaper.pdf
DISCORD https://discord.gg/UPeBwgs
Explorer
http://www.findblocks.com/exploreNENG http://86.100.49.209/exploreNENG http://nengexplorer.mooo.com:3001/
Step by step guide on how to setup an explorer: https://github.com/ShorelineCrypto/nengexplorer
Github https://github.com/ShorelineCrypto/NewEnglandCoin
Wallet
Android with UserLand App (arm64/armhf), Chromebook (x64/arm64/armhf): https://github.com/ShorelineCrypto/NewEnglandCoin/releases/tag/v1.4.0.5
Linux Wallet (Ubuntu/Linux Mint, Debian/MX Linux, Arch/Manjaro, Fedora, openSUSE): https://github.com/ShorelineCrypto/NewEnglandCoin/releases/tag/v1.4.0.3
MacOS Wallet (10.11 El Capitan or higher): https://github.com/ShorelineCrypto/NewEnglandCoin/releases/tag/v1.4.0.2
Android with GNUroot on 32 bits old Phones (alpha release) wallet: https://github.com/ShorelineCrypto/NewEnglandCoin/releases/tag/v1.4.0
Windows wallet: https://github.com/ShorelineCrypto/NewEnglandCoin/releases/tag/v1.3.0.1
addnode ip address for the wallet to sync faster, frequently updated conf file: https://github.com/ShorelineCrypto/cheetah_cpumineblob/mastenewenglandcoin.conf-example
How to Sync Full Node Desktop Wallet https://www.reddit.com/NewEnglandCoin/comments/er6f0q/how_to_sync_full_node_desktop_wallet/
TWITTER https://twitter.com/newenglandcoin
REDDIT https://www.reddit.com/NewEnglandCoin/
Cheetah CPU Miner Software https://github.com/ShorelineCrypto/cheetah_cpuminer
Solo Mining with GPU or ASIC https://bitcointalk.org/index.php?topic=5027091.msg52187727#msg52187727
How to Run Two Full Node in Same Desktop PC https://bitcointalk.org/index.php?topic=5027091.msg53581449#msg53581449
ASIC/GPU Mining Pools Warning to Big ASIC Miners Due to DynDiff Algo on top of Scrypt, solo mining is recommended for ASIC/GPU miners. Further more, even for mining pools, small mining pool will generate better performance than big NENG mining pool because of new algo v1.2.x post hard fork.
The set up configuration of NENG for scrypt pool mining is same as a typical normal scrypt coin. In other word, DynDiff on Scrypt algo is backward compatible with Scrypt algo. Because ASIC/GPU miners rely on CPU miners for smooth blockchain movement, checkout bottom of "Latest News" section for A WARNING to All ASIC miners before you decide to dump big ASIC hash rate into NENG mining.
(1) Original DynDiff Warning: https://bitcointalk.org/index.php?topic=5027091.msg48324708#msg48324708 (2) New Warning on RandomSpike Spike difficulty (244k) introduced in RandomSpike served as roadblocks to instant mining and provide security against 51% attack risk. However, this spike difficulty like a roadblock that makes big ASIC mining less profitable. In case of spike block to be mined, the spike difficulty immediately serve as base difficulty, which will block GPU/ASIC miners effectively and leave CPU cheetah solo miners dominating mining almost 100% until next base difficulty reset.
FindBlocks http://findblocks.com/
CRpool http://crpool.xyz/
Cminors' Pool http://newenglandcoin.cminors-pool.com/
SPOOL https://spools.online/
Exchange
📷
https://shorelinecrypto.com/
Features: anonymous sign up and trading. No restriction or limit on deposit or withdraw.
The trading pairs available: NewEnglandcoin (NENG) / Dogecoin (DOGE)
Trading commission: A round trip trading will incur 0.10% trading fees in average. Fees are paid only on buyer side. buy fee: 0.2% / sell fee: 0% Deposit fees: free for all coins Withdraw fees: ZERO per withdraw. Mining fees are appointed by each coin blockchain. To cover the blockchain mining fees, there is minimum balance per coin per account: * Dogecoin 2 DOGE * NewEnglandcoin 1 NENG
Latest News Aug 30, 2020 - NENG v1.4.0.5 Released for Android/Chromebook Upgrade with armhf, better hardware support https://bitcointalk.org/index.php?topic=5027091.msg55098029#msg55098029
Aug 11, 2020 - NENG v1.4.0.4 Released for Android arm64 Upgrade / Chromebook Support https://bitcointalk.org/index.php?topic=5027091.msg54977437#msg54977437
Jul 30, 2020 - NENG v1.4.0.3 Released for Linux Wallet Upgrade with 8 Distros https://bitcointalk.org/index.php?topic=5027091.msg54898540#msg54898540
Jul 21, 2020 - NENG v1.4.0.2 Released for MacOS Upgrade with Catalina https://bitcointalk.org/index.php?topic=5027091.msg54839522#msg54839522
Jul 19, 2020 - NENG v1.4.0.1 Released for MacOS Wallet Upgrade https://bitcointalk.org/index.php?topic=5027091.msg54830333#msg54830333
Jul 15, 2020 - NENG v1.4.0 Released for Android Mining, Ubuntu 20.04 support https://bitcointalk.org/index.php?topic=5027091.msg54803639#msg54803639
Jul 11, 2020 - NENG v1.4.0 Android Mining, randomSpike Evaluation https://bitcointalk.org/index.php?topic=5027091.msg54777222#msg54777222
Jun 27, 2020 - Pre-Announce: NENG v1.4.0 Proposal for Mobile Miner Upgrade, Android Mining Start in July 2020 https://bitcointalk.org/index.php?topic=5027091.msg54694233#msg54694233
Jun 19, 2020 - Best Practice for Futurebit Moonlander2 USB ASIC on solo mining mode https://bitcointalk.org/index.php?topic=5027091.msg54645726#msg54645726
Mar 15, 2020 - Scrypt RandomSpike - NENG v1.3.0.1 Released for better wallet syncing https://bitcointalk.org/index.php?topic=5027091.msg54030923#msg54030923
Feb 23, 2020 - Scrypt RandomSpike - NENG Core v1.3.0 Relased, Hardfork on Mar 1 https://bitcointalk.org/index.php?topic=5027091.msg53900926#msg53900926
Feb 1, 2020 - Scrypt RandomSpike Proposal Published- NENG 1.3.0 Hardfork https://bitcointalk.org/index.php?topic=5027091.msg53735458#msg53735458
Jan 15, 2020 - NewEnglandcoin Dev Team Expanded with New Kickoff https://bitcointalk.org/index.php?topic=5027091.msg53617358#msg53617358
Jan 12, 2020 - Explanation of Base Diff Reset and Effect of Supply https://www.reddit.com/NewEnglandCoin/comments/envmo1/explanation_of_base_diff_reset_and_effect_of/
Dec 19, 2019 - Shoreline_tradingbot version 1.0 is released https://bitcointalk.org/index.php?topic=5121953.msg53391184#msg53391184
Sept 1, 2019 - NewEnglandcoin (NENG) is Selected as Shoreline Tradingbot First Supported Coin https://bitcointalk.org/index.php?topic=5027091.msg52331201#msg52331201
Aug 15, 2019 - Mining Update on Effect of Base Difficulty Reset, GPU vs ASIC https://bitcointalk.org/index.php?topic=5027091.msg52169572#msg52169572
Jul 7, 2019 - CPU Mining on macOS Mojave is supported under latest Cheetah_Cpuminer Release https://bitcointalk.org/index.php?topic=5027091.msg51745839#msg51745839
Jun 1, 2019 - NENG Fiat project is stopped by Square, Inc https://bitcointalk.org/index.php?topic=5027091.msg51312291#msg51312291
Apr 21, 2019 - NENG Fiat Project is Launched by ShorelineCrypto https://bitcointalk.org/index.php?topic=5027091.msg50714764#msg50714764
Apr 7, 2019 - Announcement of Fiat Project for all U.S. Residents & Mobile Miner Project Initiation https://bitcointalk.org/index.php?topic=5027091.msg50506585#msg50506585
Apr 1, 2019 - Disclosure on Large Buying on NENG at ShorelineCrypto Exchange https://bitcointalk.org/index.php?topic=5027091.msg50417196#msg50417196
Mar 27, 2019 - Disclosure on Large Buying on NENG at ShorelineCrypto Exchange https://bitcointalk.org/index.php?topic=5027091.msg50332097#msg50332097
Mar 17, 2019 - Disclosure on Large Buying on NENG at ShorelineCrypto Exchange https://bitcointalk.org/index.php?topic=5027091.msg50208194#msg50208194
Feb 26, 2019 - Community Project - NewEnglandcoin Graphic Redesign Bounty Initiated https://bitcointalk.org/index.php?topic=5027091.msg49931305#msg49931305
Feb 22, 2019 - Dev Policy on Checkpoints on NewEnglandcoin https://bitcointalk.org/index.php?topic=5027091.msg49875242#msg49875242
Feb 20, 2019 - NewEnglandCoin v1.2.1 Released to Secure the Hard Kork https://bitcointalk.org/index.php?topic=5027091.msg49831059#msg49831059
Feb 11, 2019 - NewEnglandCoin v1.2.0 Released, Anti-51% Attack, Anti-instant Mining after Hard Fork https://bitcointalk.org/index.php?topic=5027091.msg49685389#msg49685389
Jan 13, 2019 - Cheetah_CpuMiner added support for CPU Mining on Mac https://bitcointalk.org/index.php?topic=5027091.msg49218760#msg49218760
Jan 12, 2019 - NENG Core v1.1.2 Released to support MacOS OSX Wallet https://bitcointalk.org/index.php?topic=5027091.msg49202088#msg49202088
Jan 2, 2019 - Cheetah_Cpuminer v1.1.0 is released for both Linux and Windows https://bitcointalk.org/index.php?topic=5027091.msg49004345#msg49004345
Dec 31, 2018 - Technical Whitepaper is Released https://bitcointalk.org/index.php?topic=5027091.msg48990334#msg48990334
Dec 28, 2018 - Cheetah_Cpuminer v1.0.0 is released for Linux https://bitcointalk.org/index.php?topic=5027091.msg48935135#msg48935135
Update on Dec 14, 2018 - NENG Blockchain Stuck Issue https://bitcointalk.org/index.php?topic=5027091.msg48668375#msg48668375
Nov 27, 2018 - Exclusive for PC CPU Miners - How to Steal a Block from ASIC Miners https://bitcointalk.org/index.php?topic=5027091.msg48258465#msg48258465
Nov 28, 2018 - How to CPU Mine a NENG block with window/linux PC https://bitcointalk.org/index.php?topic=5027091.msg48298311#msg48298311
Nov 29, 2018 - A Warning to ASIC Miners https://bitcointalk.org/index.php?topic=5027091.msg48324708#msg48324708
Disclosure: Dev Team Came from ShorelineCrypto, a US based Informatics Service Business offering Fee for service for Coin Creation, Coin Exchange Listing, Blockchain Consulting, etc.
submitted by honglu69 to NewEnglandCoin [link] [comments]

The One Thing EVERYONE Must Know About the Dev Funding Plan: IT'S COMPLETELY FREE.

sigh I get so tired of having to stop working to put out a post explaining issues. If anyone else wants to join in I could use help. (actually I've seen Jonald F. do this before too, so thanks JF!)
Things are bad when even developers don't understand what's going on. So I'll try to clearly explain an important point on the Dev Funding Plan (DFP from now on) for the community: it's completely free. Yet we still get panicked posts saying Please Save Us from the TAX!!! Somebody Help!
You may be for or against the DFP, but either way please at least understand what you're forming an opinion on.
Let's start from the beginning. We know Bitcoin works on blocks and block coin rewards. The block reward, which started at 50 coins per block, and cuts in half approximately every 4 years, serves two purposes: it's a fair way to bring coins into circulation, but more importantly it provides security for the network.
For simplicity, please think of "security" as being measured in power bars. When the network first started, with just Satoshi and Hal Finney, there was 1 power bar. This power bar was made up of the electricity their combined computer hardware used to find blocks. They were the first miners. Bitcoin uses a difficulty level to adjust how hard or easy it is to find blocks. This level is important for a key reason: we want the inflation rate of coins (how fast they come into circulation) to stay about the same, regardless how many miners (computing power) suddenly comes online. If the difficulty is set at super easy, but suddenly a super computer comes online that computer can gobble up thousands of coins in minutes if not seconds, creating massive rapid inflation. So the first thing to understand is that due to the Difficulty Level Adjustment the rate of coins coming into circulation will always stay about the same, regardless how many miners join or leave the network.
Getting back to power bars. So the point of Bitcoin is there is no center, no fixed authority. The problem is we still need a decision made about which chain is valid. This is where proof-of-work comes in. Satoshi's fairly brilliant solution to a consensus decision, with no leader, was to simply look for the longest chain (technically the chain with most hashing work). The reasoning was: as there are far more ordinary people than there are governments and dictators a Bitcoin supported by the all the world's people should always be able to muster more hashrate than even rich governments.
So Bitcoin began and people saw the brilliance: even with a weak power bar level of 1 (a couple computers), Bitcoin was safe from 51% attacks and attacking govs competing for control of the chain because a super low hashrate meant Bitcoin wasn't popular and govs wouldn't bother paying attention. By the time Bitcoin was big enough for govs to worry about attacking it should also have so many participants the power bar level would be far higher, providing strong defense.
Let's say the ideal power bar level is 50,000. At this level no government on earth has enough resources to beat the grassroots network. We hear people brag about how much security BTC has. However, the marketcap for all of BTC is about $160B. Countries like the U.S. and China have GDP measured in many trillions; a trillion is 1,000 billion. Does 160B really seem untouchable? For numeric comparison the main U.S. federal food assistance program cost the government $70B in 2016, representing about 2% of the budget. So the entirety of the BTC market cap is about twice the size of one welfare program, representing 2% of the overall budget. Where should we place the current security power bars if we want guaranteed safety from a determined U.S. gov? If 50,000 is guaranteed safe we're far from it. I'd say BTC is more like 5,000. That's still pretty decent.
Of course, BCH split from BTC... and didn't carry over all the miners and accompanying security. That's not an immediate concern because if BTC isn't on government's radar yet BCH sure isn't. However, that doesn't mean BCH doesn't need security from hostile forces. It's still a valuable network and needs defenses. Where would we put power bars for BCH? If BTC is 5,000 and BCH only has 3% of that hashrate then BCH has just 150. That's it.
How the Developer Funding Plan Works
Back to the DFP. What this says is as a community we agree to break off a piece of the block reward and instead of giving 100% to miners we give a small percent to developers. If each block is 10 coins and the price is $300 then winning a block means winning $3,000. Of course that's not all profit because miners have electricity and other expenses to pay before calculating profit. So if we reduce the portion of the miner reward by 10% so they get just 9 coins per block yet the price stays the same what happens? It means miners receive $2,700 for the same effort. We've just made it more expensive to mine BCH from the point of view of miners. What would any miner then rationally do? Seek profitability elsewhere if available. Suddenly BTC SHA256 hashing looks slightly more attractive so they'll go there. Hashrate leaves BCH and goes to BTC, but the key important point is BOTH chains have a difficulty adjustment algorithm which adjusts to account for rising or lowering miners overall, which keeps the coin inflation rate steady. This means BTC total hashrate rises (more miners compete for BTC) and its Difficulty Level rises accordingly, so the same rate of BTC pumps out; on BCH total hashrate falls (less miners compete for BCH) and its Difficulty falls, so the same rate of BCH pumps out. Inflation remains about the same on both coins so the price of both coins doesn't change any, beyond what it normally does based on news/events etc.
So what difference is there? The difference is total network security. Hashrate totals have changed. BTC gains more miner securing hashrate while BCH loses it. So BTC goes from 5,000 to say 5,100 power bars. BCH goes from about 150 to 140.
Does any of that matter in the grand scheme of things? Not in the slightest. Part of the reason is due to our emergency circumstances with BCH we had to rework our security model. Our primary defense is an idea I came up with, which BitcoinABC implemented, saying it's not sheer hashpower that dictates what chain we follow. We won't replace a chain we're working on if a new one suddenly appears if it means changing more than 10 blocks deep of history. This prevents all the threatening hashrate hanging over our heads from mining a secret chain and creating havoc unleashing it causing 10+ confimed txs to be undone, while exchanges, gambling sites etc. have long since paid out real world money.
Switching $6M worth of block rewards from mining to devs just means we lose a bit of hashrate security, while we gain those funds for development. Nothing more. Nobody holding BCH pays in the form of inflation or any other way. It costs literally NOTHING BECAUSE The block reward is ALREADY ALLOCATED. It will EITHER go 100% to mining security if we do nothing, or go to both miners and devs if the plan is put into effect. Hopefully this helps.
:)
TL;DR: we switch security which we don't really need, for developer funding which we do.
submitted by cryptos4pz to btc [link] [comments]

Bitcoin (BTC)A Peer-to-Peer Electronic Cash System.

Bitcoin (BTC)A Peer-to-Peer Electronic Cash System.
  • Bitcoin (BTC) is a peer-to-peer cryptocurrency that aims to function as a means of exchange that is independent of any central authority. BTC can be transferred electronically in a secure, verifiable, and immutable way.
  • Launched in 2009, BTC is the first virtual currency to solve the double-spending issue by timestamping transactions before broadcasting them to all of the nodes in the Bitcoin network. The Bitcoin Protocol offered a solution to the Byzantine Generals’ Problem with a blockchain network structure, a notion first created by Stuart Haber and W. Scott Stornetta in 1991.
  • Bitcoin’s whitepaper was published pseudonymously in 2008 by an individual, or a group, with the pseudonym “Satoshi Nakamoto”, whose underlying identity has still not been verified.
  • The Bitcoin protocol uses an SHA-256d-based Proof-of-Work (PoW) algorithm to reach network consensus. Its network has a target block time of 10 minutes and a maximum supply of 21 million tokens, with a decaying token emission rate. To prevent fluctuation of the block time, the network’s block difficulty is re-adjusted through an algorithm based on the past 2016 block times.
  • With a block size limit capped at 1 megabyte, the Bitcoin Protocol has supported both the Lightning Network, a second-layer infrastructure for payment channels, and Segregated Witness, a soft-fork to increase the number of transactions on a block, as solutions to network scalability.

https://preview.redd.it/s2gmpmeze3151.png?width=256&format=png&auto=webp&s=9759910dd3c4a15b83f55b827d1899fb2fdd3de1

1. What is Bitcoin (BTC)?

  • Bitcoin is a peer-to-peer cryptocurrency that aims to function as a means of exchange and is independent of any central authority. Bitcoins are transferred electronically in a secure, verifiable, and immutable way.
  • Network validators, whom are often referred to as miners, participate in the SHA-256d-based Proof-of-Work consensus mechanism to determine the next global state of the blockchain.
  • The Bitcoin protocol has a target block time of 10 minutes, and a maximum supply of 21 million tokens. The only way new bitcoins can be produced is when a block producer generates a new valid block.
  • The protocol has a token emission rate that halves every 210,000 blocks, or approximately every 4 years.
  • Unlike public blockchain infrastructures supporting the development of decentralized applications (Ethereum), the Bitcoin protocol is primarily used only for payments, and has only very limited support for smart contract-like functionalities (Bitcoin “Script” is mostly used to create certain conditions before bitcoins are used to be spent).

2. Bitcoin’s core features

For a more beginner’s introduction to Bitcoin, please visit Binance Academy’s guide to Bitcoin.

Unspent Transaction Output (UTXO) model

A UTXO transaction works like cash payment between two parties: Alice gives money to Bob and receives change (i.e., unspent amount). In comparison, blockchains like Ethereum rely on the account model.
https://preview.redd.it/t1j6anf8f3151.png?width=1601&format=png&auto=webp&s=33bd141d8f2136a6f32739c8cdc7aae2e04cbc47

Nakamoto consensus

In the Bitcoin network, anyone can join the network and become a bookkeeping service provider i.e., a validator. All validators are allowed in the race to become the block producer for the next block, yet only the first to complete a computationally heavy task will win. This feature is called Proof of Work (PoW).
The probability of any single validator to finish the task first is equal to the percentage of the total network computation power, or hash power, the validator has. For instance, a validator with 5% of the total network computation power will have a 5% chance of completing the task first, and therefore becoming the next block producer.
Since anyone can join the race, competition is prone to increase. In the early days, Bitcoin mining was mostly done by personal computer CPUs.
As of today, Bitcoin validators, or miners, have opted for dedicated and more powerful devices such as machines based on Application-Specific Integrated Circuit (“ASIC”).
Proof of Work secures the network as block producers must have spent resources external to the network (i.e., money to pay electricity), and can provide proof to other participants that they did so.
With various miners competing for block rewards, it becomes difficult for one single malicious party to gain network majority (defined as more than 51% of the network’s hash power in the Nakamoto consensus mechanism). The ability to rearrange transactions via 51% attacks indicates another feature of the Nakamoto consensus: the finality of transactions is only probabilistic.
Once a block is produced, it is then propagated by the block producer to all other validators to check on the validity of all transactions in that block. The block producer will receive rewards in the network’s native currency (i.e., bitcoin) as all validators approve the block and update their ledgers.

The blockchain

Block production

The Bitcoin protocol utilizes the Merkle tree data structure in order to organize hashes of numerous individual transactions into each block. This concept is named after Ralph Merkle, who patented it in 1979.
With the use of a Merkle tree, though each block might contain thousands of transactions, it will have the ability to combine all of their hashes and condense them into one, allowing efficient and secure verification of this group of transactions. This single hash called is a Merkle root, which is stored in the Block Header of a block. The Block Header also stores other meta information of a block, such as a hash of the previous Block Header, which enables blocks to be associated in a chain-like structure (hence the name “blockchain”).
An illustration of block production in the Bitcoin Protocol is demonstrated below.

https://preview.redd.it/m6texxicf3151.png?width=1591&format=png&auto=webp&s=f4253304912ed8370948b9c524e08fef28f1c78d

Block time and mining difficulty

Block time is the period required to create the next block in a network. As mentioned above, the node who solves the computationally intensive task will be allowed to produce the next block. Therefore, block time is directly correlated to the amount of time it takes for a node to find a solution to the task. The Bitcoin protocol sets a target block time of 10 minutes, and attempts to achieve this by introducing a variable named mining difficulty.
Mining difficulty refers to how difficult it is for the node to solve the computationally intensive task. If the network sets a high difficulty for the task, while miners have low computational power, which is often referred to as “hashrate”, it would statistically take longer for the nodes to get an answer for the task. If the difficulty is low, but miners have rather strong computational power, statistically, some nodes will be able to solve the task quickly.
Therefore, the 10 minute target block time is achieved by constantly and automatically adjusting the mining difficulty according to how much computational power there is amongst the nodes. The average block time of the network is evaluated after a certain number of blocks, and if it is greater than the expected block time, the difficulty level will decrease; if it is less than the expected block time, the difficulty level will increase.

What are orphan blocks?

In a PoW blockchain network, if the block time is too low, it would increase the likelihood of nodes producingorphan blocks, for which they would receive no reward. Orphan blocks are produced by nodes who solved the task but did not broadcast their results to the whole network the quickest due to network latency.
It takes time for a message to travel through a network, and it is entirely possible for 2 nodes to complete the task and start to broadcast their results to the network at roughly the same time, while one’s messages are received by all other nodes earlier as the node has low latency.
Imagine there is a network latency of 1 minute and a target block time of 2 minutes. A node could solve the task in around 1 minute but his message would take 1 minute to reach the rest of the nodes that are still working on the solution. While his message travels through the network, all the work done by all other nodes during that 1 minute, even if these nodes also complete the task, would go to waste. In this case, 50% of the computational power contributed to the network is wasted.
The percentage of wasted computational power would proportionally decrease if the mining difficulty were higher, as it would statistically take longer for miners to complete the task. In other words, if the mining difficulty, and therefore targeted block time is low, miners with powerful and often centralized mining facilities would get a higher chance of becoming the block producer, while the participation of weaker miners would become in vain. This introduces possible centralization and weakens the overall security of the network.
However, given a limited amount of transactions that can be stored in a block, making the block time too longwould decrease the number of transactions the network can process per second, negatively affecting network scalability.

3. Bitcoin’s additional features

Segregated Witness (SegWit)

Segregated Witness, often abbreviated as SegWit, is a protocol upgrade proposal that went live in August 2017.
SegWit separates witness signatures from transaction-related data. Witness signatures in legacy Bitcoin blocks often take more than 50% of the block size. By removing witness signatures from the transaction block, this protocol upgrade effectively increases the number of transactions that can be stored in a single block, enabling the network to handle more transactions per second. As a result, SegWit increases the scalability of Nakamoto consensus-based blockchain networks like Bitcoin and Litecoin.
SegWit also makes transactions cheaper. Since transaction fees are derived from how much data is being processed by the block producer, the more transactions that can be stored in a 1MB block, the cheaper individual transactions become.
https://preview.redd.it/depya70mf3151.png?width=1601&format=png&auto=webp&s=a6499aa2131fbf347f8ffd812930b2f7d66be48e
The legacy Bitcoin block has a block size limit of 1 megabyte, and any change on the block size would require a network hard-fork. On August 1st 2017, the first hard-fork occurred, leading to the creation of Bitcoin Cash (“BCH”), which introduced an 8 megabyte block size limit.
Conversely, Segregated Witness was a soft-fork: it never changed the transaction block size limit of the network. Instead, it added an extended block with an upper limit of 3 megabytes, which contains solely witness signatures, to the 1 megabyte block that contains only transaction data. This new block type can be processed even by nodes that have not completed the SegWit protocol upgrade.
Furthermore, the separation of witness signatures from transaction data solves the malleability issue with the original Bitcoin protocol. Without Segregated Witness, these signatures could be altered before the block is validated by miners. Indeed, alterations can be done in such a way that if the system does a mathematical check, the signature would still be valid. However, since the values in the signature are changed, the two signatures would create vastly different hash values.
For instance, if a witness signature states “6,” it has a mathematical value of 6, and would create a hash value of 12345. However, if the witness signature were changed to “06”, it would maintain a mathematical value of 6 while creating a (faulty) hash value of 67890.
Since the mathematical values are the same, the altered signature remains a valid signature. This would create a bookkeeping issue, as transactions in Nakamoto consensus-based blockchain networks are documented with these hash values, or transaction IDs. Effectively, one can alter a transaction ID to a new one, and the new ID can still be valid.
This can create many issues, as illustrated in the below example:
  1. Alice sends Bob 1 BTC, and Bob sends Merchant Carol this 1 BTC for some goods.
  2. Bob sends Carols this 1 BTC, while the transaction from Alice to Bob is not yet validated. Carol sees this incoming transaction of 1 BTC to him, and immediately ships goods to B.
  3. At the moment, the transaction from Alice to Bob is still not confirmed by the network, and Bob can change the witness signature, therefore changing this transaction ID from 12345 to 67890.
  4. Now Carol will not receive his 1 BTC, as the network looks for transaction 12345 to ensure that Bob’s wallet balance is valid.
  5. As this particular transaction ID changed from 12345 to 67890, the transaction from Bob to Carol will fail, and Bob will get his goods while still holding his BTC.
With the Segregated Witness upgrade, such instances can not happen again. This is because the witness signatures are moved outside of the transaction block into an extended block, and altering the witness signature won’t affect the transaction ID.
Since the transaction malleability issue is fixed, Segregated Witness also enables the proper functioning of second-layer scalability solutions on the Bitcoin protocol, such as the Lightning Network.

Lightning Network

Lightning Network is a second-layer micropayment solution for scalability.
Specifically, Lightning Network aims to enable near-instant and low-cost payments between merchants and customers that wish to use bitcoins.
Lightning Network was conceptualized in a whitepaper by Joseph Poon and Thaddeus Dryja in 2015. Since then, it has been implemented by multiple companies. The most prominent of them include Blockstream, Lightning Labs, and ACINQ.
A list of curated resources relevant to Lightning Network can be found here.
In the Lightning Network, if a customer wishes to transact with a merchant, both of them need to open a payment channel, which operates off the Bitcoin blockchain (i.e., off-chain vs. on-chain). None of the transaction details from this payment channel are recorded on the blockchain, and only when the channel is closed will the end result of both party’s wallet balances be updated to the blockchain. The blockchain only serves as a settlement layer for Lightning transactions.
Since all transactions done via the payment channel are conducted independently of the Nakamoto consensus, both parties involved in transactions do not need to wait for network confirmation on transactions. Instead, transacting parties would pay transaction fees to Bitcoin miners only when they decide to close the channel.
https://preview.redd.it/cy56icarf3151.png?width=1601&format=png&auto=webp&s=b239a63c6a87ec6cc1b18ce2cbd0355f8831c3a8
One limitation to the Lightning Network is that it requires a person to be online to receive transactions attributing towards him. Another limitation in user experience could be that one needs to lock up some funds every time he wishes to open a payment channel, and is only able to use that fund within the channel.
However, this does not mean he needs to create new channels every time he wishes to transact with a different person on the Lightning Network. If Alice wants to send money to Carol, but they do not have a payment channel open, they can ask Bob, who has payment channels open to both Alice and Carol, to help make that transaction. Alice will be able to send funds to Bob, and Bob to Carol. Hence, the number of “payment hubs” (i.e., Bob in the previous example) correlates with both the convenience and the usability of the Lightning Network for real-world applications.

Schnorr Signature upgrade proposal

Elliptic Curve Digital Signature Algorithm (“ECDSA”) signatures are used to sign transactions on the Bitcoin blockchain.
https://preview.redd.it/hjeqe4l7g3151.png?width=1601&format=png&auto=webp&s=8014fb08fe62ac4d91645499bc0c7e1c04c5d7c4
However, many developers now advocate for replacing ECDSA with Schnorr Signature. Once Schnorr Signatures are implemented, multiple parties can collaborate in producing a signature that is valid for the sum of their public keys.
This would primarily be beneficial for network scalability. When multiple addresses were to conduct transactions to a single address, each transaction would require their own signature. With Schnorr Signature, all these signatures would be combined into one. As a result, the network would be able to store more transactions in a single block.
https://preview.redd.it/axg3wayag3151.png?width=1601&format=png&auto=webp&s=93d958fa6b0e623caa82ca71fe457b4daa88c71e
The reduced size in signatures implies a reduced cost on transaction fees. The group of senders can split the transaction fees for that one group signature, instead of paying for one personal signature individually.
Schnorr Signature also improves network privacy and token fungibility. A third-party observer will not be able to detect if a user is sending a multi-signature transaction, since the signature will be in the same format as a single-signature transaction.

4. Economics and supply distribution

The Bitcoin protocol utilizes the Nakamoto consensus, and nodes validate blocks via Proof-of-Work mining. The bitcoin token was not pre-mined, and has a maximum supply of 21 million. The initial reward for a block was 50 BTC per block. Block mining rewards halve every 210,000 blocks. Since the average time for block production on the blockchain is 10 minutes, it implies that the block reward halving events will approximately take place every 4 years.
As of May 12th 2020, the block mining rewards are 6.25 BTC per block. Transaction fees also represent a minor revenue stream for miners.
submitted by D-platform to u/D-platform [link] [comments]

Decred is insanely undervalued - A Confluence of Blockchain mechanics and Raw Scarcity

Decred is insanely undervalued - A Confluence of Blockchain mechanics and Raw Scarcity
Decred has caught a burst of long overdue wind today.
Below is my thesis on recent price action drivers and why I think Decred is insanely undervalued right now from an on-chain/blockchain mechanics perspective.
This is an expansion on a tweet I put out here https://twitter.com/_Checkmatey_/status/1190349477120552961
Fundamentally, the project is one of the most undervalued assets in the market and I believe the largest information asymmetry next to Bitcoin. The smart money know this. They have been accumulating. Looking at the volume of DCR moving on-chain, we can see a significant amount of DCR moving in 2019 at the current support range. We know that DCR is always on the move due to tickets so when we see high volume nodes like this, it supports the notion of actual accumulation in addition to the usual transaction flow. We have seen similar growth in the median and mean transaction sizes throughout 2019. Larger wallets, larger DCR purchases.
Update: Note how the 2019 volume node, if just looking at USD chart could be attributed to Dec-Apr period or the recent drawdown. However looking against the BTC chart confirms that the dominant accumulation has occurred during the recent period as the BTC price probes the lows. This is what I consider a high volume zone of support characterised by a large transfer of coins (miners selling, accumulating buyers).
On-chain DCR volume profile plotted against price for BTC (black) and USD (blue)
The recent price action drawdown in my opinion is a result of Miners going too hard to fast. ASICs were introduced in early 2018 and we see an explosion in PoW Difficulty. Mining is a leveraged play for DCR and in this case is unlike what occurred for BTC in that it was almost four years until ASICs were on the scene for Bitcoin. This means that Bitcoins naturally high early inflation had time to disperse before ASICs and serious hardware investment came online. ASICs are capital intensive, not hobbyist grade meaning coins mined must necessarily become coins sold.
We can compare the insane growth in Decred mining since Jan 2018 against the market to see this on a relative scale. Mind you, this is a bullish signal. Miners are committing heavy capital to the Decred chain security. They have done their due diligence and have high conviction. That is not something to ignore.
Full tweet on this here https://twitter.com/_Checkmatey_/status/1177650799050133504
Normalised difficulty growth (left) since Jan 2018 and (right) 2019 Year to Date
As miners over-extend without support of price appreciation, they must sell more coins to pay bills. Eventually the weak miners have to capitulate and difficulty ribbon squeezes as mining equipment is switched off. We have seen this play out for Bitcoin where squeezing of the difficulty ribbon indicates a valuable period for accumulation. Willy Woo talks about this here https://woobull.com/introducing-the-difficulty-ribbon-the-best-times-to-buy-bitcoin/.
What happens next is that the strong miners gain an increasing share of the hashrate. Their energy is thus rewarded with more DCR and so they can sell less of their income and Hodl more. This effectively begins to constrain supply rather than the oversaturation during capitulation. Over time this leads to a reversal in price action which further perpetuates the effect.
Price of a scarce asset must appreciate with reduced circulating supply assuming demand relatively remains stable or increases.
Decred total cumulative block subsidy paid (price x block reward DCR) and Difficulty ribbon
This is actually very healthy for Decred. Coins are being distributed by miners en-mass right now, nullifying the risk of miners holding too high of a supply within the staking system leading to centralisation. I would argue that this distribution of coins is one of the most important and bullish signals long term. We know that miners stake as well and thus they are able to generate income on Hodled coins. I expect this to actually soften the degree of miner capitulation as they can turn off power whilst still generating income.
For this reason, I do not suspect we will see photos of mountains of Decred ASICs being thrown out as we saw for Bitcoin in 2018. The machines are simply put on hold until price reverses to justify power consumption. This is a valuable business feasibility case for miners and a feature of long term sustainability in the chain security.
Decred Resilience
This is where the elegance of Decred resilience steps in.
As miners slow, supply saturates, price drops.
DCR Tickets become cheaper.
Stakeholders step in and accumulation begins.
The Ticket Price hit an ATH of 140+ DCR as Stakeholders begin accumulating and commit capital to secure the chain. The Hybrid PoW/PoS system works as a counter balance. When price is in a strong uptrend, stakeholders are provided an exit to capitalise on gains as miners have a strong case for expanding their operations (PoW dominant security). During price drawdowns, miners drop out and the cheap DCR stimulates Hodlers buying and locking capital which locks down available supply from attackers. An attack would thus drive price higher and the cycle repeats.
As above, showing the total DCR locked in tickets hits an ATH as price drops due to miner capitulation
PermabullNino made the observation that Decred functions as an elegant yet robust accounting system. His discussion on block subsidies are shown in the charts above and linked here https://medium.com/@permabullnino/decred-on-chain-a-look-at-block-subsidies-6f5180932c9b.Decred has a has past, present and future cash flows distributed to those who support it most. This puts Decred security in good hands- Miners 60%- Stakeholders 30%- Builders 10%
Price is currently hovering around the PoW total subsidy paid (red line) and means miners are indeed feeling the squeeze as this is the cost basis of all DCR paid to date. Once you factor in overheads and capital costs, it makes sense we are seeing DCR supply distribution. The last time we saw price dip to this line was early in Decreds history and was followed by a rapid repricing.
We now have three mechanisms at play which will act to constrain supply
  • Miners are distributing heavily but eventually will switch to hodling as the strong miners hash share grows.
  • Stakeholder are absorbing supply en mass and locking in tickets due to relatively cheap prices
  • Inflation rate is in a state of constant reduction
Scarcity
My recent work looking at the Decred stock-to-flow model (which does exist and is convincing, contrary to what the Bitcoin maxi community may want to believe), suggests that DCR is in the oversold range. It has deviated by 1.5 standard deviations from the S2F model mean which is near identical to Bitcoin at 50% supply mined. Historically for Bitcoin and Decred, this has been an opportune period for accumulation. More on this discussion in my tweet here https://twitter.com/_Checkmatey_/status/1184159137564889089
Note that Decred, likely due to the smooth issuance and difference in market awareness, is less volatile than Bitcoin. The significant undervaluation of Bitcoin at 50% mined was due to the first 2012 halving where it was a very different and far smaller market. I would expect DCR to be repriced sooner rather than later as the smart money steps in having now developed Bitcoin hindsight.
Standard deviations of DCR and BTC price from the respective stock-to-flow linear regression models
As a final note, if we look at Decred and Bitcoin market valuations plotted against ratio of 21M coins issued, which normalises for coin age, we see a fascinating similarity in these coins trajectory. Bitcoin was worth $127M at 50% coins mined and Decred was worth $180M. Considering we are in a log scale market, this is practically the same. Decred has achieved this value both benefiting from market awareness and size, but also in the face of heavy (albeit generally ill-equipped) alt-coin competition, quite remarkable.
Decred and Bitcoin Market and Realised Caps and S2F models plotted against ratio of 21M coins mined
Given that Decred has such insanely strong fundamentals, has developed a convincing monetary premium in it's short life and traverses the same stock-to-flow path as Bitcoin, I believe there is immense value flying under the markets radar.
The recent price action drawdown can reasonably be attributed to miners over-extending. However based on both prior Decred behaviour and drawing comparisons to Bitcoin history, there is a strong argument to be made that supply will soon be constrained on multiple fronts and the current value is both highly undervalued and being absorbed by the smart money.
Feedback, counter-points and discussions welcome.
Cheers,
CM.
submitted by __checkmatey__ to decred [link] [comments]

Possible hash rate reversal

Something very interesting that has happened which I haven't seen anyone comment on yet is the possible hash rate trend reversal. I've been keeping an eye on the bitcoin hash rate the last few weeks. As the price dropped I thought that with enough miners going offline there would be a chance of chain death, but watching it for 4 weeks I found my fears unfounded! However, I found it fascinating that even in this bear market, with price dropping for the past year, the hash rate still increased significantly until Oct. You can view the historical hash rate here:
https://bitinfocharts.com/comparison/bitcoin-hashrate.html#log
Since October, hash rate has been going down, which I was able to find also happened in Aug - Nov 2011. The bottom of the hash rate could be argued to be 20th / 27th Nov or 13th Dec. Price bottomed out during that time 21st November (I wasn't around during that time, have only been in the space for a year and was reading a coindesk article talking about price historical price highs and lows).
I've been watching hash rate for the last few weeks at this site:
https://bitcoinwisdom.com/bitcoin/difficulty
Looking at the most recent hash rate, it seems we're possibly back on the way up, with a hash rate reversal. I think it's still too early to know for sure, but seems to be a strong indication of hash rate rebounding. Another 12-24 hours I think should confirm it.
I am not calling the bottom, as there is no confirmed pattern here, more a hunch and some interesting metrics that are lining up, plus no one knows the future. However I am putting this forward as an interesting metric to discuss, as well as a possible reason for the increase in longs we've seen in the last few hours. Not sure if this is a lead measure or a lag measure, but worth discussing.
I'd be interested to hear what other people's thoughts are!
edit: Spelling and Grammar
edit2: This got a bit off topic, above when saying chain death, I was referring to chain death spiral, so not using correct terminology which may have contributed to the below discussion. Would prefer to move conversation to the original observation of hashing increase though.
submitted by longtermsugar to BitcoinMarkets [link] [comments]

Mining & hash rates explained

Would someone take the time and simply describe the comparison and benefits/drawbacks of hash rates

what causes hash rates to go up

and "bitcoin mining difficulty"
submitted by TheCon7022 to BitcoinMining [link] [comments]

EasyMine: WTF Happened?

UPDATE: VTC mining on Easymine back to normal, payouts have resumed. Zero fees for the rest of the month.
Here's a more detailed response to https://old.reddit.com/vertcoin/comments/96z77t/psa_easy_mine_problem/ - bear with me and put on your nerd hat for a few mins.
The stratum server for all EasyMine pools is node-merged-pool - a merge mining fork of node-stratum-pool. See my repo here @ https://github.com/nzsquirrell/node-merged-pool
This is what miners connect to for work and to submit valid shares on the search for blocks. The information that is exchanged in hex digits, and the data coming back from the miner includes the time, the job, ExtraNonce2 and nonce (see https://en.bitcoin.it/wiki/Stratum_mining_protocol#mining.submit). All of these fields are used to notify the server of valid work exceeding a specific difficulty.
Hex digits are not case-sensitive. So 'FF00AA11' is the same as 'ff00aa11'. Both equate to decimal 4278233617. So for the purposes of construction a block header, it doesn't matter if the hex digits are uppercase, lowercase, or a mixture of both - it all works out the same, and produces the same hash. Hold this thought.
The stratum server knows what shares each miner has submitted, it keeps a track of all of the data in an array. It checks every time that work is submitted that the same work hasn't been submitted before whilst searching for the next block. If it was submitted, then the new submission is rejected as duplicate work.
Now, where this has all gone wrong is that the way the data is stored in this array was a string containing the four fields mentioned above. Strings are case-sensitive and when making comparisons 'FF00AA11' != 'ff00aa11', as well as 'ff00aA11' and 'ff00AA11' and so on.... This allowed our attacker to submit the same work many many times, altering only the case of the hex digits (he was doing it to the nonce, but the other fields are also susceptible to the attack), so the logic to check for duplicate work wasn't firing, the shares were valid (as they produced a valid hash above difficulty), and our attacker was faking most of his hash-rate. A lot. A shit-ton of it.
I have fixed this in my fork of node-stratum-pool - the fix is very easy, we just make all the characters lower case before testing for duplicate shares. See https://github.com/nzsquirrell/node-merged-pool/commit/9d068535d042516835f565a859852c7cf715da98 for my fix.
My big concern is that the other forks I've seen for node-stratum-pool are susceptible to the attack, and quite possibly other pool software is too possibly even p2pool? I've not looked. If someone can check and let me know and I'll update this. p2pool has been confirmed as resilient to this type of attack.
So, Who-The-F&*k did this. This is what I have so far:
He's used the following VTC and NIX addresses:
I've seen connections coming in from the following IP addresses:
He is still attacking EasyMine, but it's not having any effect now. Actually the server keeps banning him now as it's detecting that he's submitting too many invalid shares. Take that.
The path forward
I have a big mess to clean up, he's made off with about 652 VTC and about 3576 NIX, essentially stolen from you miners. I will see what I can do to recover some of this (not all of it has been paid to him yet), but there is going to be a substantial shortfall. Mr Attacker, feel free to PM me and we can arrange a settlement :)
Payouts on both the VTC & NIX pools are suspended until i can clean this up, I hope this won't take more than a couple of days.
Thanks.
submitted by nzsquirrell to vertcoin [link] [comments]

📢📢📢 MinedBlock - Company overview

📢📢📢 MinedBlock - Company overview

https://preview.redd.it/3h2m3xgya7c31.png?width=788&format=png&auto=webp&s=6d7c3284f5995a75c26bd0b7026a788a8f9a616f
MinedBlock is a Fintech Crypto Mining & Infrastructure Service Provider specialising in transaction processing, or ‘mining’, for crypto currency transactions. The ‘Parent’ company MinedBlock Limited will own all of the assets, infrastructure and operation while the ‘Subsidiary’ company will own the ‘Service’. The reason behind this model is to tokenise equity in the subsidiary while retaining private ownership of all the assets in the parent company. 25% of revenues will be retained by the parent company to be used for ongoing expansion and operational costs. Miners, collectively, provide the backbone infrastructure network for cryptocurrency blockchains, the blockchain provides a single, distributed ledger across multiple ‘nodes’ (specialist mining hardware) which perform the activity of ‘mining’ transactions. The blockchain is a distributed, un-editable database which stores transaction information, crypto wallet* balances and details of minted (newly created) coins. Mining validates those transactions, processes payments and updates them to the distributed ledger in a new block. Each block contains a reward of new cryptocurrency which is awarded to the miner (minted) along with the transaction fees for the processed payments in that block. For example, a miner who mines a new bitcoin block would earn 12.5 Bitcoins plus 0.25** Bitcoin in transaction fees.

Problem Statement

Mining is a fundamental part of the blockchain for any crypto assets. Mining nodes host the distributed ledger of the network and this forms the basis of the decentralisation model of the Cryptocurrency. We are getting to a point where large amounts of mining or hash power, the key ingredient to solving blocks, is becoming centralised in ‘pools’ which is making it increasingly difficult for individuals to get involved with mining due to the financial investment required to mine competitively. A number of mining firms were formed and began operations during a ‘bullish’ crypto market and failed to consider their operational sustainability if the market had a downturn. The 2018 market managed to force a number of companies to cease their operations. Too many ‘bad actors’ have promised to start mining firms and never delivered, leaving investors out of pocket by millions of dollars. There are other solutions out there such as cloud mining services, but they aren’t transparent or cost effective for the average investors. See the comparison table on the next page. MinedBlock intends to change that.

Solution

MinedBlock plans to raise funding to enable us to build a corporate-scale mining operation. Our investors can rely on our team to look after the equipment and ensure they are working at maximum productivity 24x7 with the lowest operating costs. MinedBlock will create a dedicated mining facility which focuses on mining multiple coins from within the top 50 by market cap to ensure a diverse range of revenue streams for customers to benefit from. The priority of our operation will be to grow at a significant rate to swiftly position ourselves as the leading crypto mining company. One of MinedBlock’s key principles is providing transparency for our investors. We will be completely open with our plans, ongoing progress and revenue production. The company’s wallet addresses, and balances will be viewable by our investors in real-time, always, guaranteeing full verification and auditability. It also the offers an unparalleled way to analyse ongoing company performance.

Operating Model

Dual Token Strategy MinedBlock intends to deploy a dual token service strategy comprising a Security Token enabling a passive income and a Utility Token which enables access to a pay as you go mining service. Each token type will be offered through different methods and will have their own positive and negative features.
https://preview.redd.it/5r90uz5vb7c31.png?width=1139&format=png&auto=webp&s=688ef1d3654b818db36aaaabef32653e80841e2e
Mining Our mining activities will be continuously monitored and switched between coins when the difficulty and success rates fluctuate and there is an opportunity to focus our resources on a more profitable asset to mine. The goal will always be to maintain maximum efficiency and profitability. Mining equipment will be regularly resold, replaced and upgraded to keep up with technological development. There will be a split between suppliers of ASIC and GPU mining devices to prevent any kind of centralisation and to increase diversity available for our investors to utilise. From our initial start up period, we will intend to mine as part of an existing mining pool. Mining pools exist to allow multiple companies or miners to ‘pool’ their resources to improve the chances of success and increase returns. MinedBlock intends to grow rapidly to enable us to be reliant on our own mining output rather than having to mine as part of a pool
Masternodes We’re including hosting masternodes in our operating model as a fallback ‘insurance’ in case the crypto market experiences a significant downturn. Masternodes produce passive income, similar to interest payments in traditional bank accounts. They are cheap to run and produce predictable returns A ‘masternode’ is a crypto full node (computer hosted wallet) that supports the network by hosting a copy of the coin’s ledger in real time. In return, the Masternode will generate crypto coins as a reward from transaction fees. It is a great alternative to mining. Besides the coin rewards that you get from running a Masternode, here are more reasons why we should consider Masternode: - It increases the privacy of the transactions - It enables instant transactions - It allows the host to take part in governance as well as voting - It enables the treasury and budgeting system in cryptocurrencies. MinedBlock intends to host a number of different masternodes to further generate revenue for our token holders which will increase the ROI per month. The masternode enables you to earn some passive income from participating in network maintenance functions. However, there is no one-size-fits-all response on how much you can earn. Generally, it would depend on the following factors: - The coin then you select to invest in - The protocol that facilitates the Masternodes per coin - The rise in the eventual value of a coin into the future. Example: Running a Masternode for Dash is likely to earn you a reward of about 45%, while miners get 55% which is split to all Masternodes.

Roadmap

https://preview.redd.it/y5ipfdihc7c31.png?width=967&format=png&auto=webp&s=c11147ad929853265012a076b3ee77c330531a96

Learn more

✉️ Website: https://www.minedblock.io/ ✉️ Telegram Group (http://t.me/MinedBlockOfficial)
✉️ Telegram Channel (http://t.me/MinedBlock)
📈 WhitePaper (https://www.minedblock.io/assets/MinedBlockWhitepaper.pdf)
👤 Facebook (https://www.facebook.com/MinedBlock/)
🐥 Twitter (https://twitter.com/mined_block)
📢 Bounty (https://beta.bounty0x.io/hosts/MinedBlock)
🌧 Airdrop (https://forms.gle/8aJmB1A4Pbx2ES8F6)
📰 Reddit (https://www.reddit.com/MinedBlock)
Bounty0x username : @bandit
submitted by Bandugan to IcoInvestor [link] [comments]

POW

I did a write up on POW to try and understand it better. What do you think?
Advantages of POW
I decided to start writing my thoughts about some of the more debated aspects of cryptocurrencies in general. Today I am going to focus on “Proof of Work” or the consensus mechanism employed by BTC and other cryptocurrencies.
What is Proof of Work?
POW is the original consensus algorithm that governs the Bitcoin network. The mechanism is used to verify new transactions and create new blocks. The process of verifying transactions and creating new blocks in the blockchain is referred to as mining. Mining is basically having some “ASIC” mining equipment solving very difficult mathematical equations that would take a human years to complete (see the following link for more information on mining https://www.buybitcoinworldwide.com/mining/hardware/). These “miners” can complete the equation in a relatively short period of time. But the mining equipment is competing with miners all around the globe to solve the equations. Every ten minutes (on average) a block is filled with transactions approved by miners. Now this doesn’t mean that every block occurs in 10 minute intervals, but instead it means that the average is 10 mins. So there are some blocks that take 1 minute and some that take 15 minutes to be completed. The difficulty involved with BTC mining is adjusted every 2016 block or roughly every 2 weeks to ensure the mining process doesn’t become to difficult or easy. When a new block is formed 12.5 BTC are distributed to miners for their work. Every block that is created makes the BTC network more robust and more secure. Now some miners have a better “hash rate” than others due to more mining equipment. This means they will likely receive more BTC than a small time mining operation, but that doesn’t mean small time miners cant make some BTC for their troubles. The amount of BTC one receives for each block mined varies. Depending on how much you contributed to discovering the hash (answer) The equation that the mining equipment must solve are similar to what you saw in high school, except much more difficult. (EX: A = B + 3 * 25) To mine a block, a miner needs to hash (answer) the block’s header (mathematical equation) in a way that it is less than or equal to the “target.” Bitcoin uses an algorithm that is called “SHA-256” which is basically a 256 digit alpha numeric code that is a big part of the BTC network and is important to understand if you want to be a miner. (Secure Hash Algorithm) SHA was created by the National Institute of Standards & Technology, and they came with an improved version called SHA-256 where the number is represented as the hash length in bits. No matter what the input the output will always be represented by the 256 alpha numeric code. There is a website that you can actually see how this works by entering any word, from your name to the longest word you can come up with and it will show you exactly what the word you entered is in SHA-256 encryption. I entered my first name (Tim) and this was the results: “aac09a648fc382b6f78897595486e691d00de9dfc742f3ba1930464b56eecda6” So that is my name in SHA-256. (Just wanted to give you an idea of what we are dealing with) Here is the website I used to figure that information out https://md5hashing.net/hash/sha256/aac09a648fc382b6f78897595486e691d00de9dfc742f3ba1930464b56eecda6 Just for comparison I also entered “Mississippi” and the results were “8584ecbb1ea76935b74c3c313980c410cbe26b2ff48806950f2a70ff2ec82493”So the output was different, but the same amount of alpha numeric digits. The website can also decode the encrypted messages as well. So, if you copied and pasted the code I just shared you would see it decoded as Mississippi. This is how encryption works. There is a lot to discuss when it comes to SHA-256, but I feel we have spent enough time on that, so let’s move on to rewards. When Bitcoin was first created the mining rewards were set in stone. Every 4 Years roughly (Its really every 210,000 blocks) there is a “halving” that reduces mining rewards by half. The first halving occurred on 11/28/2012.The reward was reduced from 50 BTC mined per block to 25 BTC mined per block. There was a 2nd halving on 7/9/2016. The reward was cut in half then as well from 25 to 12.5 BTC produced every 10 minutes. The next halving will occur mid 2020. Reducing the reward from 12.5 BTC to 6.25 BTC produced with each block mined. The reason Bitcoin halves the rewards for mining is to basically stretch the mining process out and ensure not all BTC gets mined in 2 years. There are multiple reasons for the halving, but in my opinion keeping miners paid for their work is crucial. Of course, mining BTC is not all about the rewards you receive, but also about the transaction fees you get from the multiple transactions that occur on the BTC network. Many people fret over what will happen when mining rewards are so small that it becomes hard to imagine anyone would want to mine with the reward system being reduced every 4 years and the answer to that is transaction fees. People claim that miners wont work for only transaction fees, which is a valid point, but it fails to consider the growth of BTC. By the time the mining rewards are 0 the transactions on the BTC network will be immense. Not to mention transaction fees may
be raised if necessary. The difficulty in mining 1 block is astronomical. As of December 2018 your chances of mining 1 block was roughly 1 in 7 trillion. This level gets adjusted every 2016 blocks or every 2 weeks approximately. The more miners that are competing with one another the more difficult the “problem” or Bitcoin mining becomes. It also works the other way as well. If miners decide to stop mining the difficulty will then decrease. Now if this wasn’t tough enough for miners, they must also come up with the hash faster than the other miners to receive a reward. This has a lot to do with mining equipment and how much you have. The more mining equipment (“asic miners” or application specific integrated circuit) you have the more hashes you can put out and you obviously would stand a better chance of solving the hash and getting the block reward over someone with 1 asic machine running. Bitcoin once could be mined via a personal computer or laptop, but this has now become impractical and not profitable with the new and faster asic mining equipment that was designed specifically for mining BTC. This mining equipment requires plenty of electricity and it isn’t cheap to operate the equipment. Electrical costs alone could cost more than your net profits from mining. This has caused many small time mining operations to close either temporarily until it becomes profitable to mine once again or entirely and sell off their equipment. We discussed this earlier, but when miners leave it makes the difficulty become easier. It’s a perfectly balanced system if you ask me.
Now there is another option if you want to mine but cant afford the 1000 asic mining machines needed to be competitive. You could join “cloud mining” which is essentially a group of individual miners that pool their hash power together to become competitive and it gives them a better shot at solving the hash. The profit in mining pools is divvied up depending on many factors, but the main factor would be the amount of hash power you add to the pool. So if I had one asic and my friend Phil has 10, he would receive a bigger payout than me thanks to his contribution (which is larger obviously) Mining pools have become a popular way for small time mining operations to become more profitable. This is how the reward system works for BTC miners.
Proof of work is the only true way to be decentralized as control is not centralized in a server somewhere, but instead is distributed across the globe in an immutable “blockchain” that is transparent and not reversible. Naysayers claim POW is inefficient and claim POW is susceptible to “51% attacks” Which is accurate to a degree. People point out coins like Ethereum Classic and Verge as examples of how a 51% attack can occur on the BTC network. This fails to take into consideration the fundamentals of BTC and why it is so difficult and unlikely to be attacked. So, every ten minutes (approximately) a block is produced by the mining process, and when the block is produced it is distributed lightning fast to nodes across the globe and the chain is updated. The speed one would need to work at to attack BTC is astronomical. And the likelihood of failure is likely. Too much risk. But, achieving this feat is easy with smaller chains like Ethereum Classic, but when you consider the difficulty involved when attempting to attack Bitcoin one must consider the cost in mining equipment and electricity which makes an attack on the BTC blockchain so unlikely. Why attack BTC when you can go after smaller chains for much less overhead costs and walk away with quite a bit (like with Ethereum Classic) Im not saying it will never happen, but it will take a lot of work. Every block that gets mined makes BTC more robust and secure along with hash power. People point to mining pools as a likely suspect for future attacks on BTC, but those mining via cloud would all need to agree to attack BTC, all the while needing over half the hash rate of the entire network. Every scenario involving a 51% attack on BTC is extremely difficult and costly. Proof of Work is the only consensus mechanism that can be considered truly decentralized. With that being said not all POW coins are decentralized. Bitcoin is a beautiful example of how decentralized Blockchains should function. Secure and decentralized.
Written by Tim Pace 2/5/2019
submitted by HeisenbergBTC to Bitcoin [link] [comments]

Is Genesis Mining worth it? I created a Genesis Mining profitability calculator in Google sheets to find out.

TL;DR: I attempt to overcome the pitfalls of forecasting genesis mining contract profitability for Ethereum, Monero, and Zcash.
The original Medium post can be found here: https://medium.com/@spreadstreet/is-genesis-mining-worth-it-a-genesis-mining-profitability-calculator-youll-actually-use-a06d916bf7bc
BitPay is on pace to process over $1B annually in bitcoin payment acceptance and payouts, and has already grown their payments dollar volume 328% year-over-year, according to a recent blog post on the BitPay website.
The very nature of cryptocurrencies requires transactions to be verified by miners. What does this mean?
  1. Cryptocurrency transactions are verified by a network of nodes, then recorded in a publicly distributed ledger known as a “blockchain”, which authenticates the coins as monetary units of measurement – or money.
  2. Cryptocurrency mining refers to coins created as a reward in which the users of the network verify and record transactions on this very blockchain. Users who are able to successfully verify the transactions receive fees and rewards in the form of brand new coins.
And Genesis Mining stands as the largest cryptocurrency cloud mining company in the world.
A user can rent "hashing power" in the form of a two-year contract from Genesis for a one-time, upfront fee.
In turn, they receive daily payouts of whatever specific cryptocurrency they purchased the contract for.

THE PROBLEM

While Genesis Mining has done a great job breaking down a complex problem into an easy-to-understand business model, users consistently have one big question:
"How profitable is {x} contract?" - Everybody, ever
While the user is able to see the upfront cost, they are unable to get an idea of how many coins they will receive by the end of the contract.

WHY THE PROBLEM EXISTS

The problem exists, because of two major uncertainties surrounding cryptocurrencies:
  1. Where the price of the currency will fluctuate over time
  2. Where the network hashrate (aka, the mining power of the entire network) will fluctuate over time
Both of these inputs are extremely volatile, and have a huge degree of uncertainty in the near and distant future.
What I will attempt to do in this exercise, is build a profitability calculator for Ethereum, Monero, and Zcash. Each of these cryptocurrencies is currently available on the website as of 11/7/2017.
Each cryptocurrency has three contracts, and I will formulate 4 different scenarios to try and capture a profitability "range".
Note: Do not take any of the words in this post as financial advice or recommendations. These are merely simulations that have their own issues and pitfalls, and are not to be used as the end-all, be-all decision.

THE ASSUMPTIONS

Due to the difficulty in forecasting both price and nethash, I was forced into a few assumptions:
  1. The forecasted price method is a Monte Carlo simulation using a geometric Brownian Motion ran 1,000 times. I covered the full methodology in a prior blog post
  2. The base network hashrate follows along very closely with the movements in price. This assumption I am the least confident about, as network hash has been shown to deviate at certain times
  3. I attempt to cover the shortfall in network hash rate with two different scenarios (shown below).
  4. I assume we hold all coins until the end of the contract, and assign a value to the portfolio based on $USD
  5. I do not run any scenarios of converting a currency into another currency
  6. I do not account for any significant changes to the underlying algorithm, such as the "Casper" Ethereum update (see 'THE DIFFICULTY BOMB' below)
Obviously any slight change could drastically alter these assumptions, but let's take a look at the different scenarios.

THE SCENARIOS

Description of Scenarios
Instead of calculating just a base scenario (which every other calculator on the web does) I wanted to come up with different scenarios to get an idea of what could be.
  1. Base - Assume no change in price or network hashrate for the duration of the contract
  2. Median - Run a full 1,000 trial simulation of prices and network hash rate, and use the median values for each
  3. Conservative - The same as Median, but instead use a price forecast that is 1 standard deviation below the median price
  4. Aggressive - The same as Median, but instead use a price forecast that is 1 standard deviation above the median price

APIs USED

  1. Spreadstreet Google Sheets Add-in
  2. Bitfinex API - To pull in historical data for each currency
  3. WhatToMine API - For nethash statistics
  4. CoinMarketCap - Updated prices

ETHEREUM

The only way to utilize Ethereum is with the product from mining.
But this shortchanges the additional value of mining Ether. It is also absolutely required for securing the Ethereum network as it creates, verifies, publishes, and propagates blocks in the blockchain.
The overall term "Ethereum Mining" is the process of mining Ether. Ether is an absolute essential, as it serves as fuel for the smooth running of the Ethereum platform.
Ether is used as an incentive to motivate developers to create top notch applications.

THE DIFFICULTY BOMB

Sometime in the future (we can't be certain when), ethereum will likely switch from its proof-of-work consensus algorithm to Casper, a proof-of-stake system its developers are now in the throes of completing.
From Blockonomi:
As opposed to the PoW consensus protocol, the PoS protocol achieves consensus through stakers—sometimes referred to as minters, too—who “stake” their coins by locking them down in specialized wallets.
With these stakers at work, mining will become redundant, meaning the Ethereum network post-Casper will rely on stakers and staking pools instead of miners for its operability.
Genesis Mining has a prelim plan in place for this scenario:
The Ethererum Mining plans will run for a maximum of 24 months, however, should Ethereum (“ETH”) switch to proof-of-stake before the end of the term, we will use the leased hardware on a best-effort basis to mine the most profitable coin with that hardware for you.
Very simply put, this changes the economics of contract profitability significantly. We are going to ignore that update for now, but it may make sense to stay away from the contracts in the short-term.

THE CONTRACTS

Ethereum Mining Contracts Comparison

ONE-YEAR PRICE FORECAST

Ethereum One Year Price Simulation
Here we can see one of 1,000 price simulations run to inform our forecast for the Median, Conservative, and Aggressive scenarios.
*Why is the price so high? This is what happens when you have a volatile currency in a simulation that does not have changes in said volatility. When a currency can move 20% in one day, it is not uncommon to see price movements like this. I mean, shit, Ethereum grew 25x in one year.

RETURN ON INVESTMENT

Ethereum Profit and ROI Comparison

VERDICT

Base performance ranges from 30% to 39% ROI, and is higher than the Median scenario by ~10%.
The conservative scenario shows a loss of between 59-62%, and the aggressive scenario shows a gain between 318% and 347%.
Difficulty bomb in the near-future presents tremendous uncertainty.

MONERO

From Cryptocompare:
Monero (XMR) is a Cryptonote algorithm based cryptocurrency, it relies on Ring Signatures in order to provide a certain degree of privacy when making a transaction. Monero is a Proof of Work cryptocurrency that can be mined with computational power from a CPU or GPU. There are currently no ASICs for Monero, which means that anyone with a computer can mine it.

THE CONTRACTS

Monero Mining Contracts Comparison

ONE-YEAR PRICE FORECAST

MoneroOne Year Price Simulation
We run the same Monte Carlo simulation to inform our forecast for the Median, Conservative, and Aggressive scenarios.
Why is the price so high? See Ethereum up above.
How is it possible for the "Conservative" scenario to be higher than the base price? Good question, and i'm glad you brought it up. The Monero currency has been not only really volatile, but drifting upwards at a pretty high rate.
The results are also being skewed by a recent uptick on November 6th where the price jumped by ~18%.
This may represent an opportunity for contract investment, but more analysis is needed.

RETURN ON INVESTMENT

Monero Profit and ROI Comparison

VERDICT

Base performance ranges from 87% to 95% ROI, with performance in the Median scenario lower by 5-6%.
The conservative scenario shows a loss of between 63-64%, and the aggressive scenario shows a gain between 795% and 832%.
To reiterate, the aggressive scenario is very much influenced by the recent uptick in volatility, so be weary of those high numbers.

ZCASH

ZCash uses Equihash as an hashing algorithm, which is an asymmetric memory-hard PoW algorithm based on the generalized birthday problem (I don't know what the hell this means, but it sounds fancy).
It relies on high RAM requirements to bottleneck the generation of proofs and making ASIC development unfeasible, much like Ethereum.

THE CONTRACTS

Zcash Mining Contracts Comparison

ONE-YEAR PRICE FORECAST

Zcash One Year Price Simulation
Here we can see one of 1,000 price simulations run to inform our forecast for the Median, Conservative, and Aggressive scenarios.
*Why is the price so high? See: Ethereum up above.

RETURN ON INVESTMENT

Zcash Profit and ROI Comparison

VERDICT

Base performance ranges from 51% to 65% ROI, and surprisingly lags the Median scenario by 4-6%.
The conservative scenario shows a loss of between 56-60%, and the aggressive scenario shows a gain between 490% and 540%.

CONCLUSION

The initial upfront costs and potential profitability are hidden when investing in hashing power contracts like Genesis Mining.
However with some robust analysis, we can get a better idea of how to assess the potential profitability of a two-year deal.
As we continue to evolve our thinking, better methods and analysis will eventually surface. Hopefully this industry can become a great avenue for side income.
If you want your own copy of the analysis and calculations, you can find it here:
Genesis Mining Profit Calculator
Cheers, and happy hunting!

RELATED POSTS

How to Create an Ethereum Mining Calculator from Start to Finish
10 Statistical Price Predictions for 10 Cryptocurrencies
Bitcoin Madness: How to Simulate Bitcoin Prices in Google Sheets

ABOUT THE AUTHOR

John Young is the founder of Spreadstreet.io, former Financial Analyst for a big-ass company, and runner-up in the 6th grade spelling bee. He would have invested in Google if he knew about it...and had any money.
He is the author of the Spreadstreet blog, which has over 3 readers (not a typo). He hopes to hit 10, but honestly writing is a lot of work.
submitted by 1kexperimentdotcom to EtherMining [link] [comments]

Has the Bitcoin Hash Rate Peaked? Comparisons with Oil Show Interesting Findings

Has the Bitcoin Hash Rate Peaked? Comparisons with Oil Show Interesting Findings

https://preview.redd.it/85lpl2md4e221.png?width=690&format=png&auto=webp&s=2d3bab69f0570a96f55d790d25f1b1ab08c0a49b
https://cryptoiq.co/the-bitcoin-mining-hash-rate-has-similarities-to-peak-oil/
The Bitcoin mining hash rate had been exponentially increasing on average since the genesis block in 2009, from MH/s, to GH/s, to TH/s, to PH/s, to EH/s, and it reached an all-time record high of 62 EH/s on 26 August 2018. Since this peak was reached, the Bitcoin mining hash rate gradually plateaued and has now decreased. The chart of Bitcoin mining hash rate actually looks quite similar to a peak oil chart except on a much faster time-scale, as can be seen in the comparison between Bitcoin’s hash rate over the course of 2 years from Blockchain.com and North Sea oil production from an article in The Oil Drum: Europe by Euan Mearns. As explained below, the dynamics between peak oil and peak Bitcoin mining are similar, with the key difference that Bitcoin mining is decentralized and oil is not.

https://preview.redd.it/op5ept1g4e221.png?width=512&format=png&auto=webp&s=2b3b35eb631f31a64ed7beb01f283832bd231e4c

https://preview.redd.it/nfyhlf4h4e221.png?width=678&format=png&auto=webp&s=46a0ca7e11f274c5678f6421b1eebb788eab5197
Geologist M. King Hubbert is the founder of the peak oil theory, which states that there is a point when the maximum extraction rate of petroleum is reached, after which a terminal decline in production ensues. The peak rate of extraction of Bitcoin of course occurred during the period after the genesis block and before the first block halving, when the block reward was at its maximum of 50 Bitcoins. However, this is not the peak rate of mining profitability, since Bitcoin increased in price by orders of magnitude through the year 2017. The peak rate of Bitcoin mining profits undoubtedly was simultaneous with Bitcoin’s all-time record high of USD 20,000 in December 2017.
The reason the peak hash rate did not coincide with the peak rate of Bitcoin mining profits is because the rally happened so quickly that mining operations were not able to add rigs fast enough, so there was a lag effect. Even for mining operations with large amounts of capital it can take months to obtain the amount of mining equipment that they want, and for other mining operations it took even longer because they had to obtain investors, buy land, build infrastructure, and only then could they install the rigs and begin hashing.
The Bitcoin mining hash rate chart implicitly indicates that 30 EH/s of Bitcoin mining equipment has been taken offline due to lack of profitability, which represents tens of billions of USD of wasted rigs. This suggests that Bitcoin miners were caught by surprise by the decline in Bitcoin’s price from USD 20,000 to less than USD 4,000 as of 4 December 2018.
Coming back to the peak oil comparison, the current Bitcoin mining scene is like a rapid version of peak oil, combined with lack of coordination. Oil mining is a centralized and coordinated activity, where the oil is prospected, land is leased out and then an appropriate number of wells are drilled. With oil mining, companies cannot drill as many wells as they want, or drill wells on someone else’s lease, since this is all closely controlled by contractual agreements. Bitcoin mining is decentralized, and no one has a lease or contract to only mine with a certain amount of hash rate. Anyone in the world can run as much Bitcoin mining rigs as they can afford. The effect is that people all around the world are sticking their straws into the Bitcoin mining network all at the same time, and they sucked it dry. Essentially, so many people started up new mining operations at once without coordination, that the Bitcoin mining hash rate went way past its equilibrium, which hurt everyone involved. This is akin to if oil drilling was a decentralized process, and anyone who wanted to drill for oil could drill in the same field. The oil field would be sucked dry really quick, and then most of the drills would be shut down due to lack of profits.
There is hope for Bitcoin miners however. The price of Bitcoin simply has to rally, and all of the disenfranchised miners could restart their rigs, and then it would be back to the races and new rigs could begin being added. However, due to the decentralization of Bitcoin mining, the network hash rate will likely periodically rise past its equilibrium point, leading to catastrophic conditions for miners like we are experiencing today at points in the future. The only thing that could prevent the scenario we are experiencing today is a Bitcoin rally that lasts forever, which is obviously not possible.
James McAvity tweeted that Bitcoin mining is still profitable in the current environment, and does some simple linear calculations to prove this point. He also argues that miners are forced to keep mining due to business agreements, choose to HODL in expectation of a rally, and continue mining in expectation of a downward difficulty adjustment as other miners go offline.
https://twitter.com/jamesmcavity/status/1069669073552736256
Some of what McAvity says is true, but the reality is that Bitcoin mining is a highly non-linear system, and calculating the support level for mining is somewhat pointless, since it is different for every miner. Bitcoin mining profitability depends on Bitcoin’s price, the Bitcoin network hash rate which is directly correlated to mining difficulty, and the technological efficiency of Bitcoin mining rigs. These 3 factors are related in a non-linear and ever-changing way.
Instead of trudging away at trying to develop a set of equations that determine mining hash rate behavior, one could simply look at the Bitcoin mining hash rate chart at the beginning of this article to understand what is going on. Bitcoin mining profitability is different for each individual miner, and the hash rate has trended downwards as individual miners have made the decision to shut down rigs. Clearly there was a fundamental mining profitability support level in the USD 6,000-7,000 range, since that is where Bitcoin’s price was when mining peaked and plateaued. There are clearly numerous miners who became unprofitable on the descent from that level to less than USD 4,000 today, and now approximately 50% of the Bitcoin mining equipment that exists cannot profitably mine. The decrease in Bitcoin’s mining difficulty of 15% on 3 December 2018 could help bring some of those miners back online, at least if the price stays at current levels around USD 4,000, but this will not change the overall trend.
When it comes down to it, Bitcoin’s price is in control of Bitcoin mining profitability, and if the price goes up we could see a reversal of the hash rate downtrend and eventually a 2nd peak in Bitcoin’s network hash rate. However, if price continues to go down, the Bitcoin mining hash rate chart will follow a similar pattern to peak oil charts. The reality will likely be a combination of both. Bitcoin bear markets tend to last years, and get more severe, but eventually the rally comes and then Bitcoin exceeds its all-time record high. This would lead to a steady decrease in Bitcoin’s mining hash rate like the peak oil chart, followed by a rapid re-engagement of old mining rigs that have been taken offline, and then the addition of new generation Bitcoin mining rigs once the equilibrium hash rate exceeds 60 EH/s.
submitted by turtlecane to Bitcoin [link] [comments]

IRC Log from Ravencoin Open Developer Meeting - Sept 7, 2018

Hi all
Greetings and salutations!
two is a good number for lips
sup
how do you dooski?
{|}
Jesse is not going to make it.
master
salut
so what is todays topic
Yes, who's moderating? Announcements, etc.
well i guess thats chatturgas job
but hes not here so idk
I'm a poor substitute for Jesse. I'm moderating today.
lol
Just FYI, there is a testnet5 with unique assets. Build from release_2.0.5 branch.
Are we able to connect to the testnet v5 seed nodes?
Yes. Testnet seed nodes are working now.
Yes. Testnet5 seed nodes are working now.
https://medium.com/@Tronblack/ravencoin-asset-issuance-cost-52b553c507cb
Medium
Ravencoin — Asset Issuance Cost – Tron Black – Medium
Let me start by thanking everybody in the community that has passionately contributed thoughts and ideas on the economics of asset…
looks like im compiling the binaries lol
I wrote a blog post about the pros/cons of the various burn options.
If anyone wants to weigh-in on their preference.
Because of the simplicity, I lean towards the first two options listed.
2.0.5 isn't going to be put on the webpage as an official binary release is that right?
Yes, that's right.
But, I'd encourage anyone to build it and run it on testnet5
i personally prefer the halvening option
@russkidooski With a particular floor?
yep
500->250->125
the best option isn't listed, POM
tl what's POM?
Proof of Market
ah
zaab is the author and just joined
Yes
Hi Boo and Zaab
Also "Prisoner Of her Majesty"
Sorry on vacation so not all in on this conversation but felt it was importsnt to join
Hey Zaab, welcome!
Hi all. Just observing. Hope no one minds.
Thanks for taking the time to write that article Zaab, it was very thought provoking.
Hi s&l
If anything, that was its main purpose
hello
I prepped some questions i had before i realized i could make it
great
1. Why was a burn deemed necessary at all? What is the purpose of it? 2. How/why was the number 500 chosen. Was an economic analysis ran? Or was an analyzis done on how many assests could be reasonably handled (thus needed an asset amount cap)
3. Tell me the truth, how likely are you to impliment any alternative idea. Are we wasting our time making our cases?
Shotgun!
being in favor becauseit is simplicity is not a plan for success; POM is fairly simple and will give a true market pricing
And i dont mean nust my own
Just*
any code contribution with ideas would be appreciated and tested.
That's a lot of questions.
Burning RVN helps the economics of the coin. Fewer circulating supply (more scarcity) the higher the value of the coin (assuming all else equal).
Also, there should be a cost to creating asset names in the namespace.
that is only half the economic formula
Burn is necessary because there must be a cost to consume the resources of the network.
hi bw
I didnt realize making the coin economical was one of the purposes of the coin
We could've recycled the RVN back through the miners (like fees), but the burn economics should help RVN price.
IMHO, all the well designed coins have a good economic model behind them.
Also sorry i would code it if i could but im not a programmer, if that invalidates my ideas so be it
It doesn't Zaab
recycle seems much more complex than POM
Because you tie good economics to a good mining base which is what ultimately is needed for security
It doesn't invalidate your ideas, but some of the complexities introduced with your ideas may not be feasible before Oct 1 (RC goal date).
simplicity/predictability is the guiderail here on burn vs recycle
This is deadline does not feel healthy
The ideas in POM, which I'll address in a minute also cause some issues.
launch deadline should not be more important than a successful launch design
agreed!
My preference is burn with diminishing price over time.
When creating an asset, all nodes must agree on the price, and if that changes each block (or frequently), there may be issues. The signed transaction may sit in the mempool waiting for confirmation and the "price" in RVN may change.
To me a burn has 2 purposes only. One prevent a spam attack and two for the transaction id of the burn to act as a signature of authenticity of an asset
Zaab I'll tell the truth -- we want the best solution, but for all parties including application developers. Project planners like being able to budget and whole numbers.
simple is better
fix the price daily based on an avg; could taht solve
we don't want the nightmare of eth gas
The authenticity isn't an issue, because there are other ways to handle it.
What ive proposed at its maximum only increases under 2 rvn per day. Thats well within planning limits
@twolips An average of what?
POM formula being based on an avg of max burn and daily burn numbers
@Zaab If I understood your paper correctly (not a given) then it seems like the cost went down as more assets were created. Is that the case, or did I misunderstand the chart.
that ius healthy
^^
at that point, the value of RVN will increase
As assets are created the remaining burnable rvn drops. Thus price drops
because of function not scarcity
As rvn are mined the remaining burnable rvn increases thus price increases
POM seemed to show higher burnrate, lower RVN cost (-10 RVN delta).
hi X_K
hi
You need to burn 3,600,000 rvn daily just to keep up with mining. POM will almost certainly cause price to increase
That seems backwards to me -- from an economic standpoint.
Just like crypto is deflationary, its backwarsa
Backwards
So if fewer people are creating assets, the price increases?
sdrawkcaB
Yep
blink
That seems counterintuitive to the project tho
How so
To me, price determines demand, not the other way around
Again -- that seems backwards. "Nobody is coming into our store, now we have to sell these sofas for a $1,000,000"
Thought the whole idea of rvn was asset creation
there are 2 aspects, cost of creation and value of RVN
But theres no maximim to sofas in the world you could always make more
both cause moves
Not the case with rvn
What do you all think about the 5-4-3-2-1 model?
If not many are being created, the cost of creation should be lower.
The value of RVN is closely tied to mining hash rate, but not correlated with number of asset names created.
you sell the for 1,000,000 but that is in Venezuelan bolívar
bad example
@boodog The purpose of RVN is assets. Not necessarily asset issuance.
As far as mempool blockage i envisioned something similar to mining difficulty calculation. Where it checks the previous assets created in comparison to the current one within a valid range
Tron_: thanks for clarification
I expect lots of assets to be created, but even better would be some really quality assets with real use cases and transactions on the nodes.
How many assets can the network currently handle?
More than the real world needs
More then 42million?
none compare to POM
As coded, 6000 per block for issuances.
But those issuances would squeeze out transactions.
Ok
@zabb that would mean that some transactions in the mempool would be valid and some wouldn't because they were created at different time.
42million is maximum not including sub assets or unqiue assets or reissuing
If we hit high loads, there are some scalability improvements we can make.
Ya that part of the idea isnt fully worked out but i dont know whats techicnally possible
True, as coded 42,000,000 root level assets is a max.
42MM is not accurate because as some point there is a breaking point where we price ourselves out of business
I meant if we had 42mil assets could the network support it
Lots more, sub-level assets. So a market could form under "COM" for example.
hi Skan
@twolips the question was how much can the network handle. not pricing
demand for the rare RVN will be expensive and competition will come in with a much better idea
Hi everybody
and 42MM was mention as max...not a true number
@Zaab It could issue them, but transaction volume has its limits at about 20x what Bitcoin does (sans Lightning).
Also again how did the number 500 come up? Did you do an econmic analysis or is it set based on max workload of the network
the breaking point is probably, at best, near half of that
if you haven't, you should all read zaab's proposal
options 5,4,3,2,1 can not be fairly comment ed on withot reading POM
Link please?
https://medium.com/@Zaab/ravencoin-proof-of-market-an-asset-issuance-cost-alternative-c5b6f9457acf
Medium
Ravencoin — Proof of Market: An Asset Issuance Cost Alternative
9/5/2018 — In response to “Ravencoin — Asset Issuance Cost” by Tron Black
Ty
Hitting the maximum number of asset is not nearly as worrisome nor pressing of an issue as the economic design , in my opinion
discord #burn-discussion as ongoing convo on this topic
Ive got to go, id like the 3 questions i posted earlier answered if possible. Ill be around if anyone has any questions.
POM would be more compelling if there was a (-) in there somewhere.
Depending on question 3 i will be willing to write 2 more papers
One attacking my own idea
When I foresee obstacles in the future for RVN having used the coin to it's maximum potential is very low on the list
One defending it
Bye!
Take care everyone! Thank you for all the hard work!
peace
Later Zaab
Thanks Zaab!
To hit maximum number of assets and not be able to issue anymore means that RVN worked to the highest extent
it's hard to model; it's hard to predict
but there will be no adoption if budgeting isn't easy for application developers
imo
eth gas is a nightmare
true
The NASDAQ has ~3,300 companies on it. For reference and understanding this means if the NASDAQ completely converts all its companies to RVN, the total RVN burned will be….. ~1,650,000 or roughly 22% of the total RVN mined daily (until halving). Therefore, the amount of RVN burned will unlikely have any effect on the value of RVN if the proposed system is allowed to pass.
not only market flux but the MATHS
We will never come anywhere near that if the economic design makes it unappealing to issue assets on RVN. A decay to the cost as a safeguard against having become too expensive against dollars or investment of resources to model is necessary. Making so we can issue more assets than our wildwst dreams is a much lower priority and doesn't even matter unless the rest is figured out
Resources to mine*
i stand by the halvening model with a minimum
simple and effective
what about all the other assets we want to be tokenized
The most attractive thing to big time players is security, which implies hashrate, which implies value, which implies adoption (buy pressure)..
vehicles, land deeds, gold bars....
I think halving should be a safeguard not a regular thing, so iirc the chain has ways of knowing how many assets are being issued. I say we only even trigger an upcoming happening if assets being issued grinds to a halt, indicating price issues
I'm on halvening too althought I like the 5-4-3-2-1 flavor
Otherwise whatever the burn fee is is working fine, no reason to just always half it without context
halving is a sharp cost adjustment...talk about bidgeting issues
DGW for asset? lol
POm smooths this out
@skan that would allow people to attack the network by now issuing assets. forcing a halving
no Skan it needs to be predictable to normals because planning/budgeting
not*
the worse thing we can do is design limitations into the project
As it stands it costs 18 cents to issue assets on ethereum. Say what you will about the quality or lack of features, it's still a factor that we are competing against. Obviously RVN is different because there are only so many unique asset names and it has more complex and easier to use features, so it should be more expensive. But we are already starting our nearly x100 before we even go live
twolips it's not an algorithm -- it needs to interact with buyers/users or it's worthless
Skan yeah and did you read that smart contract code?
You're getting into ???
we're UTXO
i know
i dont know algos, i know user
thats the perspective i come from
You don't have to, their browser automatically singles out the important variables for you to change
yeah user want's cheap/easy
and predictable
@Tron what is your preference?
Why is Roshii so quiet? ;)
I say we code in a burn fee halvening that only triggers itself if no assets or very few assets have been issued for an extended period of time
relaxing from a talking section
@skan again that allows the network to the attacked
In this order: 500 RVN -> 500 RVN with halvening and 125 floor -> 500 RVN with 20% drop from original price each halvening.
@skan That doesn't work
when does it half?
@Tron Thnx
skan; have you read POM, kinda does that
Every 2,100,000 blocks. Should be roughly 4 years.
I'm on (3) in tron's list but (1) is ok too
Interesting, how so?
you have to read it
POM is not that -- it would be that with a (-) somewhere..
@skan, user, or miners wouldn't accepts asset transaction into blocks. Which would trigger a halving.
What @CORbie means is that the economics of POM as written seem backwards.
@skan, I'm not saying that would happen. But it is an easy attack vector that we can avoid.
The best part about flat rate of 500 is that if it becomes an issues down the road when more variables are known, we can reevaluate changing to a cheaper model.
Why make asset name creation cheaper when lots of names are being created?
^^
i think we are redesigning an economic model, that is the beauty
sounds like a recipe for spamming the network
a spam recipe? sounds dubious.. :)
again there are 2 values; the cost of creation and the value of a RVN
Absolutely should get more expensive or stay flat with high demand, not cheaper.
the halvening model tron is talking about seems to be the simplest and most predictable
^^
There is an interesting case study with the fixed cost to create a proposal in Dash. It was 5 Dash. That was really cheap at the time (under $5). The same 5 Dash went to $8000.
yes Russ -- the thing the 5-4-3-2-1 adds is legibility/budgetability to app developers (I don't think that's a word)
They haven't changed it, but there were solutions that were built around it.
if a lot are being created, RVN is succeeding, demand increases, RVN cost per creation goes down as value increases...keeping it affordable for all that desire to tokenize assets
And, the value of a Dash proposal went way up when the masternodes were kicking out millions.
Halvening model is my preference
how are we going to vote this?
on discord?
halving on a time schedule will not give a true market value
RVN already has market value
@twolips, you are associating asset creation to rvn value increasing. It doesn't work that way. It is almost always difficulty -> value increasing
@russkidooski By writing and running code :)
frog; you seem to be speaking from a miners perspective
A vote would be interesting - not binding - but really interesting.
the devs have a preference and people will ultimately follow them
@twolips, i am speaking from the perspective that the only thing that holds value is being able to make sure that the value is secure.
the devs have a preference and people MAY follow them
the devs.. those guys..
Would be interesting but could cause community issues if not chosen by devs. I am for no voting. Write and run code.
it is a complex issue; votes should only occur after big discussion
BW agree
let's take an informal vote now
Votes are never needed.
here it is
i vote for pizza
type 1 for 500, 2 for half, 3 for 5-4-3-2-1, 4 for POM, 5 for other
go
3
which one is the 5-4-3-2-1?
i forgot
and this is why no cvote should occure
20% discount at each halving.
like half but -20% orig value
o yea i like that one
3
not famil with the plan
20% discount at each halving. 500->400->300->200->100
Unique asset issuance cost 5->4->3->2->1
russ, how well do you know POM?
Nice round numbers.
not crazy well
but enough
i need to read up on it more
POM seems backwards to me.
same
have you read the proposal?
@twolips Are you recommending POM with the economics as written, or the opposite economics?
this is all backwards
6 (-) POM
yes
well
i see 2 votes
no but it is a great starting point
you guys are so opinionated!
the variables need to be analysed
KISS 54321
ok! there's #3
any more informal non-binding votes?
Is 3 winning?
3 has 3
no other votes
the beauty is when the cost of creation goes down, say to .05 RVN, the value of RVN will be 1,000
VeronicaBOTLast Friday at 3:00 PM
exaggerated for demenstration
if cost goe to 1kRVN, the value willbe .05
^^
twolips. Are you saying that as more assets are created the price decreases?
brb
not the 'price', the cost of creation, yes
okay.
there needs to be a thorough analysis of POM
in the beginning of the #burn-discussion, there are some simple spread sheet examples
but with zaabs proposal it is backwards
how so
more assets being created > price for creation goes down
that is just asking the network to be spammed
So, that only works if the price of raven in the real world follows it. If not, the cost of creation will get lower, and people will start to be able to spam the network with assets.
^
This will make the nodes use more databasing and memory to run RVN.
This is bad ^^
and if a node isnt in sync you can get a lot of problems
this keeps the reation cost stable...great for customer acqusition
but it isnt technically feasable, we dont want the problems ethereum has
can that be cured with avging?
So because it is good for customer aqusition it is okay? Even if it is bad for the network?
daily, weekly,monthy? avgs to adjust cost of creation?
a opposed to what zaab said; each transaction, cost changes?
Lot's of talk but only 3 votes?
type 1 for 500, 2 for half, 3 for 5-4-3-2-1, 4 for POM, 5 for other
6 (-) POM
the POM seems to be a simple formula to be coded in (maybe naive)
i vote 3 if my vote counts, i feel like it has to be a set number, it would be easy to change if needed in future.
idk about network issues
@xiztak agreed
there's 4 for #3 with no other voes -- make it 5
X changing it in the future shows a centralized coin
how
who makes that decision
3 but I'm not for voting
community
and when
it's informal BW just taking temp
community is talkin about it now
and voting
for a set number
uninformed
outline for me vote 2?
haha
haha
2 is following the halvening of coinbase -- 500 250 125 to some floor
1 o 3
of course the 500 magic number is up for debate in 1,2,3..
I agree it would be good to know where 500 came from.
Meaning the thinking behind that exact number
i suggest nybody serious about the importance of this topic, to join the active convo
Maybe @Tron_ can tell a story but it's just (starting_block_reward/10) in my mind..
important to the success of all your hard work
twolips I don't know what that means -- you mean Discord or something?
as far as i know, that is the most active
or do you mean there are like 4 cats in here?
why people in Discord when we here? talk about shouting at clouds..
5000 per block so 500 per aseet creation so 10% of mined coins per block? maybe
^^
interesting
@twolips is there a floor that the cost of issuance would get to on POM?
if attacked it could be 0 or 1 then its game over
seems in the rough spreadsht examples
corbie; here once a week...startin 3 weeks ago
and it's been fun!
a lot more fun in discord
i'm hjere al week...tip ur waitresses
-_-
Is there anything more we are going to discuss?
maybe Xiz concept may fit into POM
need zaab to think about
Nothing on my agenda -- final informal vote seems to favor 5-4-3-2-1
no real support for POM (zorry zaab)
Thanks everyone!
wow, an uninformed vote...impressive
you vote?
what's your vote twolips I don't think I got it
this vote is informal, it means nothing really
^^
exactly
so you don't want to make an informal meaningless vote twolips?
i case u haven't noticed...team POM
ok!!
but (-) or no?
because as is it makes no sense as many of us have pointed out..
haha
many uninformed
..
4 cats i think u called them
I can read and do basic math..
that was just a reference to nobody being here..
write up a retort to zaabs propasal explainin (-); would love to seeit
I like the idea of using ratio of coinbase to burn to set market, just has it in wrong direction
And I'm a (3) guy so don't think we want market anyway..
POM is a self regulating federal reserve
revolutionary and RVN could intro it to the world
Thanks for the discussion everyone -- I'm signing off. Buy RVN!
hope you are all putting a lil more thought into this...could be make or break
@twolips. We are 100% putting lots of thought into this
@twolips This is something that is very important to RVN
i know...hence my passion
and I truely believe POM can be revolutionary
It could be, sure. There are lots of different good option though tbh.
bring thm up...lets out the community to work
a lot of eager minds
POM needs to be more thoroughly developed
we also need working prototypes
it started with fixed burn number and progressed
Can someone point me to a good readup on POM
bring in some thoughts
#burn-discussion on discord
i (vincent) invited you on rvntalk
We're done thank you
submitted by Chatturga to Ravencoin [link] [comments]

Why is the 50% increase in total hash power over the past week going mostly into BTC when BCH is 1.42x more profitable to mine?

According to fork.lol BCH has been 1.42x more profitable over the past seven days than BTC. But over the same timeframe BCH has held only 24% of combined Bitcoin hashrate, rest with BTC. I'd expect rational miners to move to BCH at a faster rate than what we've seen, so there's more to the story than short term profitability.
Also, total hashrate has almost doubled since BCH hard fork on Aug 1st, from a rate of six exahashes per second to above ten. I don't know enough about how the math works (anyone?), but since BCH hash rate is mostly steady since the fork, it appears that almost all of the increase in total hash power has gone to mine BTC.
Where does this massive incremental hash power come from? Why does it mine BTC instead of BCH?
This to me looks like a concerted effort to manipulate the market, although I don't know exactly how. From my crypto neophyte understanding this could be a sign of either defending BTC, or trying to cause the "death spiral" of it due to the way difficulty adjustment on BTC works.
Building mining facilities are notoriously expensive. It took a month from the BCH fork for the total hash rate to start climbing. Did someone just throw millions of dollars to building a mine during August, to prop up or hurt one side?
(title of post wrong: the increase in hash power didn't all happen in the last week. Can't edit. I'm new here :( )
submitted by Crawsh to btc [link] [comments]

QRL Versus IOTA - An Overview of Quantum Resistant Cryptography

QRL and IOTA (iota) are quantum resistant cryptocurrencies - to my knowledge, they are the only such cryptocurrencies. I wanted to learn some more about the differences between the two and I thought it would be helpful to share my research with the QRL community.
Disclaimer: I own an amount of both QRL and IOTA.
QRL
QRL uses hash-based XMSS digital signatures and Winternitz OTS+ digital signatures for security. The QRL protocol is a custom POS algorithm which uses iterative hash-chains for randomness. (Source)
And we're in the weeds already. Here are some definitions:
Hash-based cryptography: This is the digital security which is implemented by a cryptocurrency. The different types of digital security are defined as digital signature schemes. There are many different signatures out there: Bitcoin uses Secure Hash Algorithm 256-bit (SHA-256); Ethereum uses Ethash; QRL uses XMSS - see below.
XMSS: A hash-based signature scheme (eXtended Merkle Signature Scheme). XMSS is designed specifically as an efficient post-quantum signature scheme. XMSS is PQ-CRYPTO recommended. ("PQ-Crypto is a forum for researchers to present results and exchange ideas on the topic of cryptography in an era with large-scale quantum computers." I won't go much more into this, although it appears to be a solid endorsement of the digital signatures chosen by QRL.)
Winternitz OTS+ (W-OTS+): A hash-based signature scheme, or more specifically a Winternitz type one-time signature scheme (W-OTS). Here is an extract from the QRL Whitepaper explaining the difference between OTS and OTS+ signatures:
Buchmann introduced a variant of the original Winternitz OTS by changing the iterating one-way function to instead be applied to a random number, x, repeatedly but this time parameterised by a key, k, which is generated from the previous iteration of fk(x). This is strongly unforgeable under adaptive chosen message attacks when using a pseudo random function (PRF) and a security proof can be computed for given parameters. It eliminates the need for a collision resistant hash function family by performing a random walk through the function instead of simple iteration. Huelsing introduced a further variant W-OTS+, enabling creation of smaller signatures for equivalent bit security through the addition of a bitmask XOR in the iterative chaining function. Another difference between W-OTS(2011 variant)/ W-OTS+ and W-OTS is that the message is parsed log2(w) bits at a time rather than w, decreasing hash function iterations but increasing keys and signature sizes.
Future improvements planned for QRL include second layer protocol enhancements: an Ephemeral messaging layer which uses lattice-based crypto to enable completely private, and cryptographically authenticated end-end post-quantum secure data channels. As these are not yet implemented, I will not dig into them.
IOTA
IOTA uses a custom hash-based signature called Kerl and implements Winternitz digital signatures for security. Kerl is written in ternary/trinary, as compared to the traditional binary.
Kerl is the recently upgraded version of Curl, which was upgraded due to the discovery of a security flaw. (The details of this flaw are best left for another post. I discovered this news while researching this post; I will assume Kerl solves the vulnerability issues of Curl for the purposes of this post.)
The official explanation of the quantum proof nature of IOTA is as follows (emphasis mine):
IOTA uses hash-based signatures (https://www.imperialviolet.org/2013/07/18/hashsig.html) instead of elliptic curve cryptography (ECC). Not only is hash-based signatures a lot faster than ECC, but it also greatly simplifies the overall protocol (signing and verification). What actually makes IOTA quantum-secure is the fact that we use Winternitz signatures. IOTA's ternary hash function is called Curl.
And here is the explanation direct from the IOTA Whitepaper:
4.3 Resistance to quantum computations
It is known that a (today still hypothetical) sufficiently large quantum computer can be very efficient for handling problems where only way to solve it is to guess answers repeatedly and check them. The process of finding a nonce in order to generate a Bitcoin block is a good example of such a problem. As of today, in average one must check around 268 nonces to find a suitable hash that allows to generate a block. It is known (see e.g. [13]) that a quantum computer would need Θ(√N) operations to solve a problem of the above sort that needs Θ(N) operations on a classical computer. Therefore, a quantum computer would be around √2 68 = 234 ≈ 17 billion times more efficient in Bitcoin mining than a classical one. Also, it is worth noting that if blockchain does not increase its difficulty in response to increased hashing power, that would lead to increased rate of orphaned blocks.
Observe that, for the same reason, the “large weight” attack described above would also be much more efficient on a quantum computer. However, capping the weight from above (as suggested in Section 4) would effectively fence off a quantum computer attack as well, due to the following reason. In iota, the number of nonces that one needs to check in order to find a suitable hash for issuing a transaction is not so huge, it is only around 38. The gain of efficiency for an “ideal” quantum computer would be therefore of order 34 = 81, which is already quite acceptable (also, remember that Θ(√N) could easily mean 10√N or so). Also, the algorithm is such that the time to find a nonce is not much larger than the time needed for other tasks necessary to issue a transaction, and the latter part is much more resistant against quantum computing.
Therefore, the above discussion suggests that the tangle provides a much better protection against an adversary with a quantum computer compared to the (Bitcoin) blockchain.
Conclusion
QRL and IOTA both use Winternitz-based digital signatures. Based on my understanding, these two are both reliably quantum resistant. However, QRL's Winternitz OTS+ has the edge on IOTA due to the introduction of additional randomized variables in the generation of the digital signatures. Whether this additional level of randomization is significant, I cannot say.
One takeaway from this research was the conclusion that both QRL and IOTA may be quantum resistant, but they do not appear to be quantum proof. However, like many elements of this analysis, that may not prove to be a significant distinction. In the event of a quantum attack on Bitcoin or another non-quantum resistant cryptocurrency, I would imagine the distinction disappears entirely (in the short term).
Please chime in if you see any errors or are able to shed light on any of the discussed topics. A healthy, critical discussion is good for QRL, for IOTA, and for all other cryptocurrencies.
References (some of these have been linked to already):
https://hacked.com/quantum-resistant-ledger-readies-battle-quantum-computing-hires-testers-seeks-feedback/ (This reference was particularly useful)
https://cryptopotato.com/qrl-taking-quantum-computers/
https://cs.stackexchange.com/questions/586/could-quantum-computing-eventually-be-used-to-make-modern-day-hashing-trivial-to/751#751
https://huelsing.files.wordpress.com/2013/05/wotsspr.pdf
The QRL Whitepaper
The IOTA Whitepaper
Previous comparison discussion: https://www.reddit.com/QRL/comments/6ywi2q/how_does_qrl_compare_to_iota/
submitted by HoagiesFortune to QRL [link] [comments]

New people please read this. [upvote for visibility please]

I am seeing too many new people come and and getting confused. Litecoin wiki isn't the greatest when it comes to summing up things so I will try to do things as best as I can. I will attempt to explain from what I have learned and answer some questions. Hopefully people smarter than me will also chime in. I will keep this post updated as much as I can.
Preface
Litecoin is a type to electronic currency. It is just like Bitcoin but it there are differences. Difference explained here.
If you are starting to mine now chances are that you have missed the Bitcoin mining train. If you really want your time and processing power to not go to waste you should mine LTC because the access to BTC from there is much easier.
Mining. What is it?
Let's get this straight. When making any financial commitment to this be prepared to do it with "throw away" money. Mining is all about the hashrate and is measured in KH/s (KiloHash/sec). Unlike the powerful ASICs (Application Specific Integrated Circuit) that are used to mine bitcoins using hashrates in the GH/s and even TH/s, litecoin mining has only been able to achieve at the very best MH/s. I think the highest I've seen is 130 MH/s so far. Which leads us to our next section.
Mining Hardware
While CPU mining is still a thing it is not as powerful as GPU mining. Your laptop might be able to get 1 a month. However, I encourage you to consult this list first. List of hardware comparison You will find the highest of processors can maybe pull 100 KH/s and if we put this into a litecoin mining calculator it doesn't give us much.
Another reason why you don't want to mine with your CPU is pretty simple. You are going to destroy it.
So this leaves us with GPUs. Over the past few months (and years) the HD 7950 has been the favourite because it drains less power and has a pretty good hashrate. But recently the introduction of the R9 290 (not the x) has changed the game a bit. People are getting 850 KH/s - 900 KH/s with that card. It's crazy.
Should I mine?
Honestly given the current difficulty you can make a solid rig for about $1100 with a hashrate of 1700 KH/s which would give you your investment back in about a month and a half. I am sure people out there can create something for much cheaper. Here is a good example of a setup as suggested by dystopiats
PCPartPicker part list / Price breakdown by merchant / Benchmarks
Type Item Price
CPU AMD Sempron 145 2.8GHz Single-Core Processor $36.01 @ Amazon
Motherboard ASRock 970 EXTREME4 ATX AM3+ Motherboard $99.48 @ OutletPC
Memory Crucial Ballistix Tactical Tracer 4GB (1 x 4GB) DDR3-1866 Memory $59.99 @ Newegg
Video Card Sapphire Radeon HD 7950 3GB Video Card (3-Way CrossFire) $245.38 @ Newegg
Video Card Sapphire Radeon HD 7950 3GB Video Card (3-Way CrossFire) $245.38 @ Newegg
Video Card Sapphire Radeon HD 7950 3GB Video Card (3-Way CrossFire) $245.38 @ Newegg
Power Supply SeaSonic Platinum 860W 80+ Platinum Certified Fully-Modular ATX Power Supply $146.98 @ SuperBiiz
Total
Prices include shipping, taxes, and discounts when available. $1078.60
Generated by PCPartPicker 2013-11-29 00:52 EST-0500
Estimated Hashrate (with GPU overclocking) : 1900 KH/s
Hardware Fundamentals
CPU - Do you need a powerful CPU? No but make sure it is a decent one. AMD CPUs are cheap to buy right now with tons of power. Feel free to use a Sempron or Celeron depending on what Motherboard you go with.
RAM - Try to get at least 4 GB so as to not run into any trouble. Memory is cheap these days. I am saying 4 GB only because of Windoze. If you are plan to run this on Linux you can even get away with less memory.
HDD Any good ol 7200 RPM hard drive will do. Make sure it is appropriate. No point in buying a 1TB hard drive. Since, this is a newbie's guide I assumed most won't know how to run linux, but incase you do you can get a USB flash drive and run linux from it thus removing the need for hard drive all toghether. (thanks dystopiats)
GPU - Consult the list of hardware of hardware I posted above. Make sure you consider the KH/s/W ratio. To me the 290 is the best option but you can skimp down to 7950 if you like.
PSU - THIS IS BLOODY IMPORTANT. Most modern GPUs are power hungry so please make sure you are well within the limits of your power consumption.
MOTHERBOARD - Ok, so a pretty popular board right now is Gigabyte GA-990FXA-UD3 and the ASRock 970 Extreme4. Some people are even going for Gigabyte GA-990FXA-UD5 and even the mighty Gigabyte GA-990FXA-UD7 because it has more PCI-E slots. 6 to be exact. However you may not need that much. With risers you can get more shoved into less.
PCI-E RISERS - These are called risers. They come in x16 to x16 and x1 to x16 connections. Here is the general rule of thumb. This is very important. Always get a POWERED riser otherwise you will burn a hole in your MoBo. A powered rise as a molex connector so that additional power from PSU can be supplied.
When it comes to hardware I've provided the most basic knowledge you need. Also, take a look at cryptobader's website. This is very helpful. Please visit the mining section of Litecoin Forums and the litecoinmining subreddit for more indepth info.
Mining Software
Now that you have assembled your hardware now you need to get into a pool. But before you do that you need a mining software. There are many different ones but the one that is most popular is cgminer. Download it and make sure you read the README. It is a very robust piece of software. Please read this if you want to know more. (thanks BalzOnYer4Head)
Mining Pools
Now that your hardware and software is ready. I know nothing about solo mining other than the fact that you have to be very lucky and respectable amount of hashing power to decrypt a block. So it is better to join pools. I have been pool hopping for a bit and really liked give-me-coin previously known to the community as give-me-ltc. They have a nice mobile app and 0% pool fees. This is really a personal preference. Take a look at this list and try some yourself.
How do I connect to a pool?
Most pools will give you a tutorial on how to but the basics are as follows:
  • Signup for a pool
  • Create a worker for your account. Usually one worker per rig (Yes people have multiple rigs) is generally a good idea.
  • Create a .run file. Open up notepad and type cgminer.exe -o (address_to_the_miningpool:port_number) -u (yourusername.workername) -p (your_worker_password_if_you_made_one). Then File>Save As>runcgminer.run (Make sure the drop down is set to "All Files" and .txt document.) and save in the same folder as cgminer. That's it.
  • Double click on runcgminer.run (or whatever you named it) and have fun mining.
Mining Profitability
This game is not easy. If it was, practically everyone would be doing it. This is strictly a numbers game and there are calculations available that can help you determine your risk on your investments. 4 variables you need to consider when you are starting to mine:
Hardware cost: The cost of your physical hardware to run this whole operation.
Power: Measured in $/KwH is also known as the operating cost.
Difficulty rate: To put it in layman's terms the increase in difficulty is inversely proportional to amount of coin you can mine. The harder the difficulty the harder it is to mine coin. Right now difficulty is rising at about 18% per 3 days. This can and will change since all you miners are soon going to jump on the band wagon.
Your sanity: I am not going to tell you to keep calm and chive on because quiet frankly that is stupid. What I will tell you not to get too carried away. You will pull you hair out. Seriously.
Next thing you will need is a simple tool. A mining profitability calculator. I have two favourite ones.
coinwarz
I like this one cause it is simple. The fields are self explanatory. Try it.
bitcoinwisdom
I like this one because it is a more real life scenario calculator and more complicated one (not really). It also takes increasing difficulty into account.
Please note: This is the absolute basic info you need. If you have more questions feel free to ask and or google it!
More Below.
submitted by craeyon to litecoin [link] [comments]

BITCOIN BREAKOUT! IS IT FOR REAL? WILL BTC SEE NEW HIGHS? BITCOIN DIFFICULTY ADJUSTMENT  Satoshi Nakamoto's Wallet  Market Analysis and Bitcoin News Does bitcoin hash rate Matter? Crypto Marketer Answers The Bitcoin Cash 12.5% Developer Fund Will Lower BCH Network Security as Hashrate Will Leave How to Maximise the mining hashrate  monero[XMR]  X-CASH [XCASH]

Difficulty is a measure of how difficult it is to find a hash below a given target. The Bitcoin network has a global block difficulty. Valid blocks must have a hash below this target. Mining pools also have a pool-specific share difficulty setting a lower limit for shares. How often does the network difficulty change? Every 2016 blocks. What Happens When Mining Difficulty Rises? On August 27, before the price took off, the difficulty of the network was: 7.5 TH, and it’s hashrate: 500 GH/s (approximately 16000 video cards). This price increase caused the hashrate to increase to 1.12 TH/s (1120 GH/s) (about 35000 video cards), and the difficulty flew up to 16,728 TH. Bitcoin Average hashrate (hash/s) per day Chart. Transactions Block Size Sent from addresses Difficulty Hashrate Price in USD Mining Profitability Sent in USD Avg. Transaction Fee Median Transaction Fee Block Time Market Capitalization Avg. Transaction Value Median Transaction Value Tweets GTrends Active Addresses Top100ToTotal Fee in Reward Bitcoin difficulty is a value used to show how hard is it to find a hash that will be lower than target defined by system. Bitcoin mining difficulty is changed every 2016 blocks. The difficulty charts show that it has increased significantly. Transactions Block Size Sent from addresses Difficulty Hashrate Price in USD Mining Profitability Sent in USD Avg. Transaction Fee Median Transaction Fee Block Time Market Capitalization Avg. Transaction Value Median Transaction Value Tweets Active Addresses Top100ToTotal Fee in Reward

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BITCOIN BREAKOUT! IS IT FOR REAL? WILL BTC SEE NEW HIGHS?

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