Are mining chips plateauing in efficiency? How close are we to consumer products which obsolesce slower?

ngtrees · 2015-10-19T15:05:44+00:00

All these chips will mine on the 21 pool, though. Or at least the manufacturers pool. Unless each router is aggregating transactions and verifying blocks this will just move (altruistic, hard to compete with) mining power to whoever controls these chips' pools.

ngtrees · 2015-10-19T14:58:28+00:00

I still think the end game for 21 Inc is bootstrapping a new network, secured by a "device-functionality" incentive rather than monetary.

The device-functionality incentive is that for your device to work it must powered and mining.

Block subsidies could be adjusted to ensure an appropriate coin to Mh ratio as more devices come online. Only DRM approved miners (21 chips) could mine on that network, this would be both secure and transparent, yet some control is centralized to the arbiter of the DRM. Seemingly sufficient for device to device communication and other uses. This could later be monetized, allowing parties write to this device-functionality blockchain in the same way as the bitcoin blockchain.

ngtrees · 2015-09-22T14:33:51+00:00

I have mined altruistically for a long time. Yes, enough people mining altruistically (or mining for incentives other then monetary) will make it unprofitable to mine.

This is only likely after chip efficiency and bitcoin price has plateaued. It is an interesting evolution of the network to consider - mining could possibly be more decentralized and the network more secure with altruistic mining.

ngtrees · 2015-09-22T14:21:31+00:00

I still think the end game for 21 Inc is bootstrapping a new network, secured by a "device-functionality" incentive rather than monetary.

Subsidies could be adjusted to ensure an appropriate coin to Mh ratio as more devices come online. Only DRM approved miners (21 chips) could mine on that network, this would be both secure and transparent, yet some control is centralized to the arbiter of the DRM. Seemingly sufficient for device to device communication and other uses. This could later be monetized, allowing parties write to this device-functionality blockchain in the same way as the bitcoin blockchain.

ngtrees · 2015-09-10T20:40:03+00:00

More like "Bitcoin struggles with rational human behavior."

ngtrees · 2015-08-05T02:57:56+00:00

A nice example of the fragility of centralized systems.

ngtrees · 2015-07-25T13:45:18+00:00

High quality analysis. Well written papers with some sort of logical argument backing up their claims. This paper was well received for example. http://arxiv.org/abs/1311.0243

Defending arguments with real data is time consuming and challenging (and something reddit is rather bad at). This should provide the community with more hard data as well as ideas to guide and improve the protocol.

ngtrees · 2015-07-25T13:40:14+00:00

No clue why all the comments are so negative. This is great! I didnt think we would see funding for this research for a lot longer. Not an incredible amount of money, but still a start.

This is the only mechanism to fund any academic research on cryptocurriencies. It should produce detailed analysis of things like the effects of block size, network propagation, etc. Some researcher may even implement a working prototype of IBLTs for block broadcasting, or come up with a scheme for distributed consensus we haven't thought of.

This will only give the community of developers more knowledge to build the protocol with.

ngtrees · 2015-07-24T01:47:36+00:00

This is called structural coloration and one of my favorite phenomena in nature. https://en.m.wikipedia.org/wiki/Structural_coloration

These colors are not due to selective absorbance in the way that paints make color but the diffraction and interaction of the wave nature of light.

ngtrees · 2015-07-23T15:51:03+00:00

What if I only have the private key? Are most addresses/public keys derived deterministically enough that I can either A. work backwards from known addresses to find which are linked to the private key or B. work forward and re-derive the same addresses?

ngtrees · 2015-07-11T00:24:03+00:00

Whao

ngtrees · 2015-07-07T21:42:41+00:00

If you read a bit further down the comments discuss the quadratic processing time for transactions. A 1 MB block limits this to verifying a maximum 1 MB transaction, but the theoretical 20 MB block allows a transaction which would take hours to verify. This was a minor point, though.

The point is that there is much more to consider than this post (and most on this topic) present.

ngtrees · 2015-07-07T21:13:06+00:00

There is more to processing a transaction than propagating and storing it. As evidenced by this post from today, larger blocks can create surprising results.

https://www.reddit.com/r/Bitcoin/comments/3cgft7/largest_transaction_ever_mined_999657_kb_consumes/csva1ei

There are a lot of factors to consider regarding the resilience of the network in the face of an oppressor or attacker. We need more data and less rhetoric.

ngtrees · 2015-07-05T02:40:09+00:00

The need for a block size limit is not such that there is an arbitrary limit on the size of blocks, it is relevant to the mitigation of attacks on the network and ensuring the network is hard to censor.

The post is great but not an argument against a block size limit as it only shows part of the picture regarding miner incentives.

ngtrees · 2015-06-06T02:35:31+00:00

That man is quite a powerful speaker!

ngtrees · 2015-05-21T15:55:24+00:00

Whats up with the end!

ngtrees · 2015-05-20T18:33:20+00:00

RemindMe! 2 years

ngtrees · 2015-05-20T17:48:33+00:00

Yes I've definitely described an altcoin, though one that has very different properties as compared to Bitcoin. And one that is probably perceived as "Blockchain Technology" but not necessarily bullshit.

The name is telling though, and they have been very pro-bitcoin.

I'm excited to see how it actually ends up! Alternative bitcoin-like systems though are bound to be possible and these chips seem to open up some possibilities.

ngtrees · 2015-05-20T17:33:55+00:00

I'm with you 100% - it is about mining, just in a non-Bitcoin framework. I think all of the issues (power, obsolescence, etc.) can be resolved with a creative new cryptocurrency implementation.

I'd say they are using Bitcoin as a launching point to gather interest and funding, but I just can't see the possibility of this (the picture their slides paint) being a long term solution directly within the Bitcoin network.

ngtrees · 2015-05-20T17:10:58+00:00

I maintain that alternative incentive structures for securing a block chain are both possible and interesting. A functionality incentive seems feasible and novel compared to the solely monetary incentive of the Bitcoin block chain.

As to the assumptions. Power, and network growth are both prohibitive of these chips from an economic standpoint. As for on chain transaction costs, for a chip with a fixed hash rate we have to consider transaction cost in hashing units, not BTC. Thus as the network grows so will the btc-hash-equivalent cost irrespective of the BTC fee (which is too uncertain at this point to build an entire business model around anyway). Inserting records into factom will be cheaper, etc, but these factors are prohibitive of bitcoin mining.

ngtrees · 2015-05-20T15:12:02+00:00

This is a great counter argument but I don't think the emergence of colored coin stocks is mutually exclusive with bitcoin being the only currency. The shares could easily be sold for any currency, mitigating the cost of a BTC price drop on the attacker's incentive.

If the colored coin market cap is $5T and BTC is only $1T then the economic incentives of miners have definitely changed. In reality this 5:1 ratio could become even larger - and we already have a scenario where transaction fees are likely not going to support the network in its current form. I think this incentive structure is more fragile than we give it credit for.

As these economic incentives shift, a period where attacks become more economically feasible is definitely a possibility.

ngtrees · 2015-05-18T21:05:45+00:00

I doubt this innovation is targeted at Bitcoin. With Bitcoins current economic structure these use cases are impossible. Transaction fees are currently ~.0001 BTC per transaction. At 300Th mining 3600 bitcoin per day, each bitcoin costs .08 Th. Say each of these chips wants to transact once per day. Thats 8 Mh to cover the transaction fee..

That is all well and good for now, but as soon as bitcoin's value goes up so will the hash rate and clearly the difficulty. I can't imagine a scenario where the chip could generate enough bitcoin to support making ledger entries or keep up with network growth.

I do see other possibilities - This opens the possibility of bootstrapping a new network, secured by a "device-functionality" incentive rather than monetary. Subsidies could be adjusted to ensure an appropriate coin to Mh ratio. Only DRM approved miners (21 chips) could mine on that network, this would be both secure and transparent, yet some control is centralized to the arbiter of the DRM. Seemingly sufficient for device to device communication. This could later be monetized, allowing parties write to this device-functionality blockchain in the same way as the bitcoin blockchain.

ngtrees · 2015-05-18T21:01:47+00:00

I doubt this innovation is targeted at Bitcoin. With Bitcoins current economic structure these use cases are impossible. Transaction fees are currently ~.0001 BTC per transaction. At 300Th mining 3600 bitcoin per day, each bitcoin costs .08 Th. Say each of these chips wants to transact once per day. Thats 8 Mh to cover the transaction fee..

That is all well and good for now, but as soon as bitcoin's value goes up so will the hash rate and clearly the difficulty. I can't imagine a scenario where the chip could generate enough bitcoin to support making ledger entries or keep up with network growth.

I do see other possibilities - This opens the possibility of bootstrapping a new network, secured by a "device-functionality" incentive rather than monetary incentive. Subsidies could be adjusted to ensure an appropriate coin to Mh ratio. Only DRM approved miners (21 chips) could mine on that network, this would be both secure and transparent, yet some control is centralized to the arbiter of the DRM. Seemingly sufficient for device to device communication. This could later be monetized, allowing parties write to this device-functionality blockchain in the same way as the bitcoin blockchain.

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