Slashdot Mirror
Bitcoin Security Endangered By Powerful Mining Pool
An anonymous reader writes Ars Technica reports that for the first time in Bitcoin's five-year history, a single entity has repeatedly provided more than half of the total computational power required to mine new digital coins, in some cases for sustained periods of time. It's an event that, if it persists, signals the end of crypto currency's decentralized structure."
But all the early-adopters / ponzi-schemers kept insisting that it was impossible.
Told. You. So.
Bwahahah!
Bill Stewart
New Fast-Compression-only CPR http://preview.tinyurl.com/dy575ks
Better than First Post!
And if this were Bitcoin, instead of Slashdot, I'd get to block the rest of you! Bwahahah! But it's not, so you'll probably crowd me out here soon enough.
Bill Stewart
New Fast-Compression-only CPR http://preview.tinyurl.com/dy575ks
The Bitcoin network doesn't control all the crypto currencies networks. It only controls the Bitcoin network. Even if a pool takes over, the other cryptos are safe from this particular takeover.
What's going to be interesting is watching the trade value for Bitcoin. As of this writing, the value is around 598$USD, it was around 530$USD earlier today.
One would assume that the thousands of other miners, if it was really that important to them, could easily step up their collective games and provide more hashing power than ghash can, even if ghash is actually claiming their entire rented-out customer base as their own (a rough equivalence of this would be if, say, Hertz was claimed to control more than half the roads because the cars on it are Hertz rent-a-cars).
Just because you're paranoid doesn't mean they aren't out to get you
Given enough of an incentive, has there ever been in history a man-made system, technical, political or otherwise, that hasn't been undermined and exploited by those with the capability and power to do so?
Probably best this happens to Bitcoin sooner rather than later. As fine as Bitcoin is, believing that technology alone can defeat human nature is a fools errand. We are betting off investing in creating more moral men and woman and a society that sustains them than technology that is supposed to be infallible against basic human nature.
Not yet anyways.
6 months ago GHash.IO promised they would (1) Take steps to prevent accumulating 51% hashing power, including: not accepting new miners, and (2) They would not attempt an attack, and (3) They would provide cex.io users an option to use another mining pool (They have apparently not implemented (3) yet).
A DDoS against the pool was reported to occur yesterday, which adversely affected mining. At one point... their hashrate was reported to have dropped to 7%. Then BitFury pulled 1 PH/s out of their pool.
Bitcoin stopped being a distributed system a long time ago. All the serious miners now have data-center sized installations of custom boards with custom ASICs. Some are liquid-cooled. The original idea was millions of end users running Bitcoin mining as a background job on their CPU. That's totally dead.
I wonder what happens if someone with more than enough CPU power to get 99% of the mining jumps in one night. What kind of Damage could they do in a short interval before people notice? What if their goals were not to steal bitcoins but rather to snatch all the coins from, say, Kim Jong Un, or Al Queda. E.g. for example the NSA or Samsung or Saudi arabia. They would not care about the loss of value in their stolen coins, the point is to deprive an adversaries use of them.
Does the Amazon or Azure networks have enough rentable time to pull this off?
Some drink at the fountain of knowledge. Others just gargle.
While the threat of a 51% attack may be blown out of proportion (a pool sells their cut of the coins that are mined and it is in their best interest that the coin remain as valuable as possible - attacking a coin would be counterproductive), some altcoin developers have stated that they will change their coin's proof-of-work algorithm if ASICs are developed for it. Vertcoin and Execoin's developers have both stated they'll do whatever it takes to keep ASICs out.
Most of the speculation that fuels the pump-and-dump world of altcoins is based on the belief that Bitcoin may not end up being the cryptocoin that average people use to buy pizza, pay their bills, etc.
---
DRM is like antifreeze, to the MPAA/RIAA it's sweet, to the consumers it's poison.
Isn't the point of bitcoin is that the block chain is decentralised? i.e. everyone has a copy of it? does it matter who mines the coins as long as the coins end up distributed around? also can't the bitcoin protocol just be tweaked by the developers or something?
Oh they promised! Well, color me convinced.
Bitcoin stopped being a distributed system a long time ago. All the serious miners now have data-center sized installations of custom boards with custom ASICs. Some are liquid-cooled. The original idea was millions of end users running Bitcoin mining as a background job on their CPU. That's totally dead.
This is absolutely hilarious. Not because it's a fake post (I honestly don't know if it is or not), but just the fact that someone would even think that this is a good enough idea to post that 'serious' miners are actually doing this. This is the California gold rush all over again... the only people making a profit off of the mining are the people selling the ASIC's/shovels. Mining isn't profitable and hasn't been for quite some time. While it might be if you ignore the hardware cost and only think of the electricity cost, you're still BARELY making a SLIGHT profit. That's only in places that you have very cheap electricity (or can find a way to make someone else pay for the electricity). And once again, that doesn't even count the cost of hardware in the first place. Lets not forget that there are other idiots funneling money into even faster hardware which makes your very expensive highly specialized and unable to be repurposed board basically worthless in a few months time, once the electricity cost passes what you'll make back from mining.
HINT: this is before you get your initial cost of hardware back out of the system. You will never make a net profit. Ever.
The only money in bitcoin right now is in speculating, and even then it's a suckers game. Your profits are based entirely on someone else guessing wrong and losing money into the system that you might be lucky enough to cash out at the right time. You can do that easier and without a datacenters worth of hardware with penny stocks. Also penny stocks are LEGAL! You don't have to worry about some new law negating all of your money like you have to do every day with bitcoin.
I'll just stop here because anyone that legit cares about bitcoin already had their opinion made before they even read a word of this comment.
"Well kids, you tried your best, and you failed. The lesson is, never try." -Homer Simpson
Oh they promised! Well, color me convinced.
And if they break it (like they did) a simple DDOS attack knocks them off the top spot, (like it did) and sets a scary precedent...
However, the large mining groups also make large targets. A simple DDOS makes them small potatoes again. http://www.cryptocoinsnews.com... A few of these and the big mining groups will start breaking up.
If I say I have it, and you say you have it - who has it ? whoever more than 51% of nodes say has it.
If you control 51% of the hashing power in the network, you can modify the block chain while simultaneously self-verifying your version as the one-and-true block chain.
This isn't really an issue.
If the number 1 mining pool is foolish enough to try something like the 51% attack, the perceived value of Bitcoins would plummet. Therefore, they won't do it. They would be the biggest losers from such a move.
It would be ironic if the brilliant and careful design of bitcoin gets taken down by the 80/20 rule.
Perhaps more thought needs to be given to the alternatives that try to address the computation race problem that leads to this distribution.
Ignorant, misinformed, and outspokenly opinionated? What an unusual combination!
Some asshole on slashdot.org claims that you can't make money mining bitcoin so it must be true.
That's why the network difficulty continues to get exponentially more difficult right? Cause there's just THAT MANY suckers burning up electricity at no profit?
Here's what ACTUALLY happened: you tried to compete in an industry with high barriers to entry, while GROSSLY under-capitalized, with limited-zero competitive advantage. You failed to turn a profit therefore all the people investing in 20nm fab & data-centers are just fools with too much money.
Learn something about how the world works before spewing nonsense on the interblags please. I come here for serious business.
That's why the network difficulty continues to get exponentially more difficult right? Cause there's just THAT MANY suckers burning up electricity at no profit?
in a word: Yes.
or do you think the shovel makers are just stupid enough to not to plug the usb cable into their own computer?
world was created 5 seconds before this post as it is.
THIS SPACE INTENTIONALLY LEFT BLANK.
And scrypt is ASIC resistant.
It was erroneously thought to be so. ASICs have taken over scrypt mining. Two $90 ASIC scrypt miners (720 kh/s) using 7-8 watts each can beat a Radeon R9 290 (850 kh/s). Their combined hash rate is slightly less but when you factor in power costs they win. Note the ASIC miners are usually controlled by a Raspberry Pi to reduce power costs.
This isn't really an issue.
If the number 1 mining pool is foolish enough to try something like the 51% attack, the perceived value of Bitcoins would plummet. Therefore, they won't do it. They would be the biggest losers from such a move.
Pool operators can't be hacked? Targeted malware can not launch a 51% attack?
> We are betting off investing in creating more moral men and woman
Attempts to do that have a not been as successful as we'd like. Religions, for example, have that as a primary goal. Unfortunately, religions are run by the same selfish, power-hungry humans who run all of our other systems.
Some of the founding fathers of the US wrote about attempting to create a system whereby the individual quest for money and power ends up benefiting the common good. Some native American tribes had such a system. In their tradition, every few years neighboring groups would gather to redistribute rankings - power and prestige. The ranking of each leader was determined by how much he gave away. A man of prestige would work a few years, carefully managing his capital to try to produce as much good stuff as he could in order to give away more than his neighbor, thereby retaining his title.
Free and open source software is similar - one gains prestige by contributing a lot. Recruiters have computer programs thatlook for people with a lot of commits on Github and elsewhere. My own contribution to the Linux kernel gives me some cachet that helps with getting a good job, etc.
Some US founders wanted to use that idea as much as possible, and they succeeded in one way. They reasoned that the President would want to keep his power, so he'd resist any attempt by the senate to increase their relative power. Similarly, the house would want to be powerful, so they wouldn't let senate or president roll over them. That worked pretty well for 200 years, then presidential power increased vis-a-vis Congress. Each house of Congress is still pretty powerful, though, so they do keep the president in check to some extent.
Perhaps we could find more eways to make doing "right" also be the most profitable / prestigious. If someone controls a capital asset such as a large cargo ship, they'll WANT to do good thing X because the benefit to them is Y. What might X and Y be? Alternatively, people want (money/power/recognition/sex), in order to get what they want, they might need to do (something that benefits society). How can society benefit from people's attempt to get money, or power, or sex?
Don't say it can't be done. For thousands of years societies traded sex for marriage. People wanted sex, society wanted stability, and it was decided that the society would expect you to get married before having sex. Most people complied.
So the cabal of moneyed elites with their mining super rigs who currently dominate the network, will be pushed out by black hats. I'm sure the future of bitcoin is in good hands.
No. That's actually not what happened.
What happened is exactly what people who understand cryptography said would happen. Bitcoin's cryptographic cost has gone up, number of miners has gone down, specialized pools have reached critical mass, and the TRUST IN THE CURRENCY (which is the only asset it ever had) is gone.
So you can call everyone else losers for not investing enough capital. (Gotta spend money to make money, right? But with Bitcoin that's only true if you're an idiot.)
Bitcoin is dead. The only people still "investing" in it are speculators and miners who are either playing with someone else's money or worriedly working it hoping to recoup their "investment" and the majority are not going to make it.
Time for the sociopaths to shut up while the cryptographers work around them.
" also can't the bitcoin protocol just be tweaked by the developers or something?"
Not if they want to be taken seriously as a real currency. You might be tempted to think "The Federal Reserve does that with the $". Sure, but the developers behind bitcoin (if they can even do this, I don't know) are not the Federal Reserve.
'serious' miners are actually doing this.
They are. Here's the biggest Bitcoin mining operation in North America as of Dec. 2013. (Annoying commercials, then skip ahead to 03:15). Generated $8 million/month at the time. Probably about $800K/month now; the difficulty has gone up 5x since then, and the price has dropped by half. It's in upstate Washington, where power is cheap and cooling is easy.
Who are they going to sue this time ? They put all the money of the Facebook lawsuit into Bitcions. And now they're going to lose it.. I'm a little sad for these two guys.
It appears that people who provide half of the mining power are so stupid to choose the most popular pool among the alternatives.
I've lived in Washington 40 years, and I'm never heard of a town/county named 'upstate'.
How much internet access does mining require? And how much should they care if they don't see every bitcoin (because of DoS) when they get to say which transaction is valid?
Why is this even necessary? I was under the impression that a mining pool would not be able to pull off an attack without it being immediately visible to the miners in the pool. Doesn't that mean that having a pool with majority of the processing power isn't enough to pull of an attack, you also need all miners in the pool to conspire to perform the attack?
Do you care about the security of your wireless mouse?
It's still distributed it's just not massively distributed anymore.
Bitcoin stopped being a distributed system a long time ago. All the serious miners now have data-center sized installations of custom boards with custom ASICs. Some are liquid-cooled. The original idea was millions of end users running Bitcoin mining as a background job on their CPU. That's totally dead.
This is absolutely hilarious. Not because it's a fake post (I honestly don't know if it is or not), but just the fact that someone would even think that this is a good enough idea to post that 'serious' miners are actually doing this. This is the California gold rush all over again... the only people making a profit off of the mining are the people selling the ASIC's/shovels. Mining isn't profitable and hasn't been for quite some time. While it might be if you ignore the hardware cost and only think of the electricity cost, you're still BARELY making a SLIGHT profit. That's only in places that you have very cheap electricity (or can find a way to make someone else pay for the electricity). And once again, that doesn't even count the cost of hardware in the first place. Lets not forget that there are other idiots funneling money into even faster hardware which makes your very expensive highly specialized and unable to be repurposed board basically worthless in a few months time, once the electricity cost passes what you'll make back from mining.
HINT: this is before you get your initial cost of hardware back out of the system. You will never make a net profit. Ever.
The only money in bitcoin right now is in speculating, and even then it's a suckers game. Your profits are based entirely on someone else guessing wrong and losing money into the system that you might be lucky enough to cash out at the right time. You can do that easier and without a datacenters worth of hardware with penny stocks. Also penny stocks are LEGAL! You don't have to worry about some new law negating all of your money like you have to do every day with bitcoin.
I'll just stop here because anyone that legit cares about bitcoin already had their opinion made before they even read a word of this comment.
Then perhaps you could explain why someone IS invested millions of dollars to attempt to mine bitcoins, because it certainly seems that the only intent to invest that kind of money into this only to find little or no profit is only doing it to destroy bitcoin completely.
And please don't sit here and point fingers towards penny stocks or any other investment vehicle sitting behind the most corrupt currency on the entire planet. We're worried about BTC miners capturing 50% of the market while ONE percent controls the overwhelming majority of the USD that you somehow think will remain stable. Corruption is the only thing keeping the USD a currency.
Sorry if you didn't catch that last part. I'll TRY AND SPEAK LOUDER SO YOU CAN HEAR ME OVER THE PRINTING PRESSES WORKING OVERTIME IN WASHINGTON.
The original idea was millions of end users running Bitcoin mining as a background job on their CPU. That's totally dead.
The author of the original idea bets to disagree:
Long before the network gets anywhere near as large as that, it would be safe
for users to use Simplified Payment Verification (section 8) to check for
double spending, which only requires having the chain of block headers, or
about 12KB per day. Only people trying to create new coins would need to run
network nodes. At first, most users would run network nodes, but as the
network grows beyond a certain point, it would be left more and more to
specialists with server farms of specialized hardware. A server farm would
only need to have one node on the network and the rest of the LAN connects with
that one node.
That is from Satoshi Nakamoto's post from 2008: http://www.mail-archive.com/cr...
there would be an entity with massive computing power available to take over any other crypto currency.
Except that massive computing power is in the form ASICs which are extremely optimized for computing SHA256^2 and nothing else.
So the largest part of the current computing power would be pretty much useless.
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
or do you think the shovel makers are just stupid enough to not to plug the usb cable into their own computer?
A market exists for mowing lawns. Do you consider John Deere too stupid to fuel up their own products and make a profit like that? A market exists for corn chips. Do you view the farmers as too stupid to grind and bake their own corn and bypass the middle men?
We don't see perfect vertical integration across all markets because sometimes, manufacturers want nothing to do with the end product. A lot of companies view BitCoin as a high risk opportunity; how do you get in on it while limiting exposure to that risk? Selling mining rigs looks like a pretty much ideal answer to that question, IMO. Now, could GAW or Butterfly potentially make more mining on their own gear? Currently, yes, they could. That doesn't mean they want that as a business model.
Not yet anyways.
6 months ago GHash.IO promised they would
(1) Take steps to prevent accumulating 51% hashing power, including: not accepting new miners, and
(2) They would not attempt an attack, and (3) They would provide cex.io users an option to use another mining pool
(They have apparently not implemented (3) yet).
A DDoS against the pool was reported to occur yesterday, which adversely affected mining.
At one point... their hashrate was reported to have dropped to 7%.
Then BitFury pulled 1 PH/s out of their pool.
Excellent post. BTC haters gonna hate, and I don't understand why.
Funny thing about pooled mining, it's run by the users. User's don't like it? They go away.
6th Street Radio @ddombrowsky
Not surprised. Bitcoins are a fantasy. Please stop wasting power on this nonsense.
Attempts to do that have a not been as successful as we'd like. Religions, for example, have that as a primary goal.
[citation needed]
Unfortunately, religions are run by the same selfish, power-hungry humans who run all of our other systems.
And they're also founded by them.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
People still think bitcoin is going to keep going strong?
I though most people had realized by now, that it's doomed to failure?
Your post skimmed over somethign quite important.
A lot of these "serious miners", work for companies with huge datacenters. And as such, they can ignore hardware and power costs..
For the first time in Bitcoin's five-year history, a single entity has repeatedly provided more than ...
Old news on Slashdot again...
Really? Is it so hard to figure out? The first time something happens repeatedly is different than the first time it happens. Think of it this way...people have been able to fall from tall building (without any safety gear: parachutes, air cushions, etc) and survive. Yet, as far as I know, nobody has every been able to do this repeatedly. If somebody managed to fall from a tall building multiple time in such a manner and survive every time, then they would be the first person to be able to do it repeatedly.
Also, since we are trying to nitpick wording here, what does bad grammar have to do with determining whether something is newsworthy, and whether or not it's old news?
you also need all miners in the pool to conspire to perform the attack?
You need most miners to either conspire or to not notice. To avoid conspiring; they have to detect that an attack is occuring and pull their hashing power out.
The pool essentially has control of what work the miners are being assigned, however.
A 51% premining attack would look like this:
(1) A miner in the pool discovers a block.
(2) Instead of the pool broadcasting the solution, it saves a copy of the solution, and starts distributing to miners work units for coming up with the _next_ block, without broadcasting the solution. It ignores a solution that any of the other pool's come up with
(3) The miners solve the following block; instead of broadcasting the solution, the pool saves the solution, and starts working on the next one....
Because the pool has more than 51% of the hashing capacity, it will eventually have mined a longer chain of blocks than any of the other pools.
Perhaps 6 or 7 blocks later; the pool conducting the selfish mining will broadcast all the solutions it came up with.
Since the selfish pool's chain is longer than the blockchain the rest of the network came up with (due to it having more hashing power), then the selfish pool's version will win.
A miner connected to the bitcoin network AND the pool, could in theory foil the attack. If all the miners were designed to broadcast any solution they come up with.... not /just/ to the pool, but also to the Bitcoin network, then the mining pool would not be
able to conduct premining.
And since the pool is not in direct control of the individual miners; they couldn't necessarily force arbitrary changes.
Researchers at Cornell say something, that doesn't mean it is true. See for example, https://blockchain.info/pools. It seems what they are saying is that there were a few specific periods of time where GHash was doing 51% of the work. Most of the time this isn't the case though.
This posting is provided 'AS IS' without warranty of any kind, implied or otherwise.
Don't say it can't be done. For thousands of years societies traded sex for marriage. People wanted sex, society wanted stability, and it was decided that the society would expect you to get married before having sex. Most people complied.
Still works that way, in a way.
When the government dramatically raised university feeds in my country, several commentators were half-jokingly commenting that politicians voted yes mostly in order to ensure a steady stream of young student prostitutes.
Money for sex usually also means money flowing from an older generation that had time to acquire it to a younger generation.
Yeah, it's a bit sad.
Assorted stuff I do sometimes: Lemuria.org
Reported last week. Reprimanded, but not fired. Resulting bitcoins were about 10% fof the computer cost.
If my understanding is correct, the alternative crypto-currency peercoin does not have this problem. It probably has other issues, but once it starts operating in purely proof-of-stake mode then the 51% attack simply disappears. Is that correct?
All your attention are belong to my old internet meme.
Is it 51% or 50%+1? There is a big difference. If it's 51% then DDOS as soon as someone gets 50%-1 would work to prevent an exploit. If it's 50%+ then now many false transactions could they make at 51% (or 50%+2) before the DDOS is activated? If it's 50%+ then maybe the DDOS needs to come at 49% or 48% by community agreement. It does set an unsettling precedent that there could be DDOS battles over percent hashing contributions.
On the other hand, maybe this is enforcement that a bitcoin fork needs -- explicit support for mining pools. Such that the ability to get to say 40% by any one actor (pool or individual) is explicitly guarded against. There could be some sort of enforced diminishing returns with viability consensus like transaction consensus. Surely if you are trusting transactions to hash consensus you could also trust "ability or degree to contribute" to the same mechanism. If no-one could get over 48% then no-one could get over 50%. Does anyone know if that's a possible solution?
Does a mining pool really provide the ability to perform a 50%+ attack? They aren't running custom clients are they? Would it require ALL members of the mining pool to collude in the exploit?
So the cabal of moneyed elites with their mining super rigs who currently dominate the network, will be pushed out by black hats. I'm sure the future of bitcoin is in good hands.
If the DDOS people are attacking because the mining group is gaming the system, who really has the black hat?
I've lived in Washington 40 years, and I'm never heard of a town/county named 'upstate'.
What's that now?
This has happened before will no ill effects. The situation got fixed with no ill effects. The possible effects of one pool having 50%+ of the mining power are significantly less harmful than reported.
Should be the phrase in Latin on their icon coin image.
"Win treats sysadmins better than users. Mac treats users better than sysadmins. Linux treats everyone like sysadmins."
If you control 51% of the hashing power in the network, you can modify the block chain while simultaneously self-verifying your version as the one-and-true block chain.
No you can't. You still have to output valid blocks or every node will reject it. Every node validates every block and rejects anything that breaks the rules.
A 51% attack can't steal coins, generate more coins, or change the past in any way other than by generating a parallel blockchain. It's considerably less harmful than people seem to think.
Err, no. It's going almost exactly as the 2008 plan said it would.
The most important thing to remember is:
THIS IS GREAT NEWS FOR BITCOIN!!
http://rocknerd.co.uk
Read the 2008 paper. The idea was never that everyone would mine, it's that mining was going to be taken over by specialized equipment and that the difficulty adjustment system and the free market would compensate for the ever increasing mining power. It worked out exactly like that.
This is always what happens.
1. You get the upper hand > 2. You get money to invest > 3. You gain even more advantage > GOTO 2
No, really, you should take the same amount of time it took you to type that sentence, scan the article, and you'll find the name of the company:
MegaBigPower with a PO Box in Silvana, WA
A market exists for mowing lawns. Do you consider John Deere too stupid to fuel up their own products and make a profit like that? A market exists for corn chips. Do you view the farmers as too stupid to grind and bake their own corn and bypass the middle men?
If John Deere could make a profit by rigging up its tractors in its factories to some pre-built servers, it would. If all it would take the farmers to make corn chips is to plug their corn silos into some pre-built servers, they would.
All your comparisons fail due to the huge difference in how easy it is to move from producing bit-coin machines to producing bitcoins. Especially if the bitcoin machines have to be tested with their final functionality, which is 100% indistinguishable from its end user utilization.
Now, could GAW or Butterfly potentially make more mining on their own gear? Currently, yes, they could. That doesn't mean they want that as a business model.
Why would they not? All they would have to do is to not unplug their bitcoin rigs from their testing harness. In short, it takes them more effort to stop being miners than it does to be miners. Why in god's name does anyone still think that there is some economic reason they don't mine bitcoins themselves? The only reason they even pretend they don't is because this way, they get up-front free capital for creating their own rigs. When the cost of a loan drops below the cost of servicing the miner purchases, that's when these operations will stop selling to end-users.
Those who can, do. Those who can't, sue.
A 51% attack can't steal coins, generate more coins, or change the past in any way other than by generating a parallel blockchain.
What do you call it when someone doubles (or triples, or quadruples) an existing transaction? What do you call it when someone invalidates a transaction? And what do you call it when 51% of the network generates a parallel blockchain that it calls the one true blockchain? Yes, you can fork it and have two official block chains, but at that point, bitcoin WILL be dead to everyone. It'd be like there suddenly were two US of A governments, each distributing their own, slightly different dollars, but with hugely different printing rules.
Yeah, this 51% business is as bad as people make it out to be.
Those who can, do. Those who can't, sue.
Because electro currency is inherently flawed. Once a threshold it reached, it will be in the bets interest of many large groups, like countries, to devise a way to break it.
And the can d so relatively anonymously.
The Kruger Dunning explains most post on
Really, the top of the pyramid makes the most money, you don't say?
It's like pointing the top of ta pyramid scheme and saying it's not a pyramid scheme becasue those people make money.
The Kruger Dunning explains most post on
When talking about currency, that sort of thing is very harmful.
The Kruger Dunning explains most post on
He answered your questions about why they don't just keep every unit they make and plug it in.
It's currently profitable, but risky.
They prefer the steady (safe) income of selling rigs over the potentially higher (but risky) income of mining BTC.
Even in a profitable gold rush, not everyone wants to find a stream and start panning.
o you can't. You still have to output valid blocks or every node will reject it.
Great. Who's "everyone?"
51% of the clients approve it, some small percentage of clients who're aware of the 51% attack try (pointlessly) to reject it, and the rest of the clients standardize of the one that the 51% push.
Why would they not?
Your question presupposes that every rational actor will always attempt to engage in the highest-profit activity possible without regard for external circumstances (or even simply personal preference). Why doesn't everyone become doctors-aspiring-to-play-pro-football?
In the John Deere and corn farmer examples, you quickly spotted the problem - John Deere doesn't want to mow lawns, they want to manufacture tractors; and yet, people do quite successfully buy Deere mowers and make a profit using them to mow lawns. Farmer Brown doesn't want to work in snackfood manufacturing, he wants to work the soil; and yet, Frito Lay manages to make a profit taking Farmer Brown's corn and turning it into Doritos.
Now, in the case of Bitcoin, your question has a simple, direct answer based on external factors: price volatility. If the US government bans Bitcoin tomorrow, would you want a multi-million dollar inventory of dedicated mining rigs on-hand? That doesn't mean they can't make money mining today, it just means they don't have all their eggs in the "make money mining for the next quarter" basket.
Especially if the bitcoin machines have to be tested with their final functionality, which is 100% indistinguishable from its end user utilization.
Given the lead times to order most ASIC rigs, I highly suspect the manufacturer's do keep them around for "testing" a good bit longer than strictly necessary. That still doesn't mean they want to operate a server farm as their core business rather than building and selling mining rigs for others.
Why would they not? All they would have to do is to not unplug their bitcoin rigs from their testing harness. In short, it takes them more effort to stop being miners than it does to be miners.
That doesn't even come close to "all" they would have to do. Capital has costs, ROI does not equal ROIC, and engaging in manufacturing conveys tax breaks that operating a server farm does not. It sounds great to say "just don't sell them", until you consider that that means, at the very least, writing down the cost of all on-hand inventory at the time and restating the past year's tax statements to reflect purchases for use rather than purchases for resale. Okay, you say, so they get a loan to cover the switch, and then start building just to mine - Good luck convincing any bank of that business plan! "We want you to finance our switch from high-tech manufacturing to bitcoin mining"...I can hear the laughter already.
I get your point, but I think you have massively oversimplified the differences between making ASIC rigs for resale vs making them to run in-house; you have also overlooked a variety of reasons one might want to do the former but not the latter. Whether or not they could make more doing the latter today actually comes pretty low on the list of reasons they should or shouldn't.
Even in a profitable gold rush, not everyone wants to find a stream and start panning.
The difference, again, is in how much effort is expended to move from one to the other. Gold panning is difficult and unpredictable. Bitcoin mining is very predictable (if you take into account current valuations), very easy to turn off, requires nothing you aren't already running, and its only downside is the impact of a drop in bitcoin valuation, which changes for how long you can run you mining rig before you want to ship it out.
People might start out thinking "I'm gonna sell shovels to the miners!", and then they quickly discover that they have created an automated shovel, and that the gold mine is in the electric outlet.
Those who can, do. Those who can't, sue.
What part of your story is related to marriage at all?
The end if crypto currencies decentralized structure?
You guys talk like proof of stake doesn't exist now.
Look dude, you don't have to like or have any faith in the US dollar, but calling it " the most corrupt currency on the entire planet" (emphasis added) is a bit of an exaggeration. When you extremely exaggerate and spew hyperbole, people tend to tune you out and label you a nut job.
The 51% (which technically is a 50%+1 as you said) would simply allow them to double spend coins in the short term.
Trouble is, since double spending is theft, and since the transactions are all visible, it is relatively easy to show that this double spending it occurring than get the regular police involved. Double spending by unknown thieves is bad, double spending by large identifiable collective is less so.
The part where sex is exchanged for another valuable.
Here's a free pro hint for next time: Read, comprehend, comment - in that order.
Assorted stuff I do sometimes: Lemuria.org
Finding the bitcoin might be easy, but managing power loads, working deals with local utilities or other involved parties, and managing the actual sales of the bitcoin (because unless you can turn a bitcoin into actual cash, the value of a bitcoin is ZERO) is whole lot more work than plugging in a board.
If you are mining without communicating with the rest of the bitcoin network, you are putting somebody else in charge of that communication, which means you are giving somebody the power to cheat. Any miner not intending to cheat should be considering that to be a vulnerability in the mining software.
In other words, any miner not intending to cheat have an interest in running mining software, that does communicate with the rest of the bitcoin network, even if the rest of the mining pool doesn't.
Do you care about the security of your wireless mouse?
If you are mining without communicating with the rest of the bitcoin network, you are putting somebody else in charge of that communication, which means you are giving somebody the power to cheat.
I agree with that, but I believe 98% of miners are using standard mining tools which communicate with the selected pool only; the mining pool has connections to the network, but the miners themselves don't have direct communications with a node on the bitcoin peer to peer network.
By the way... running a full blown bitcoind requires a lot of RAM, so I don't think most individual miners even have a node on the network.
What i'd like to see happen is a pool cross-submission scheme, where: instead of miners having just one pool configured, they have at least 3 configured, and: while they may only be requesting work units from 1 pool; they could send a 'heads up' to all the secondary pools, when a new block is detected...
The 'secondary pools' ought to allow these unsolicited valid blocks to be received, and then relayed to their own Bitcoin network nodes.
Furthermore.... they could add a mechanism for miners to query information about the current block, and alert the other pools: if for some reason, there is a disagreement about which block is the most recent one in the blockchain.
You either fundamentally understand this already... or you will soon be discarded as trash upon actual trash.
Allow me to explain, for the latter 10% of you:
Banks had one simple double negative purpose: Hold our money and never not hold it.
Charge us a fee for your 'service' if you must (not a thousand misc. bullshit fees) and maybe store the money somewhere "safe," like a big metal box or SHA256 encrypted in a packet of electricity you could magically route through a series of tubes to one or more persons unique and predesignated electric packet repository.. or whatever. Our only stipulation was to just keep having our money and never not hold it. A paltry task! Yet somehow, shattering your usefulness to us forevermore, you went and did the opposite of that one thing: Took our money and did, in fact, a lot of not holding it. Such a simple thing you failed to achieve (suspiciously en masse), blatantly disregarding that one tiny mandatory stipulation. According to my calculations you have a 100% failure rate. No other business in the history of mankind has that kind of track record and still makes record profits. Not only are you still employed, but are somehow in possesion of fresh food, warm houses, and parachutes made of gold.
Not for long.
You then did something truly atrocious: After we bled more blue collar dollars into your BIG bail out, you immediately craw-fished and foreclosed on the very same people who did not foreclose on you. Hundreds of thousands of families. Women, children, back breaking laborers, your saviors...... discarded like a wet newspaper into the gutter; hungry, afraid, alone and hopelessly entangled eternally in your debt web of compounding deceit.
Surprise, surprise, when all the dust settled not long after, it came to light that you lost our money to each other quite intentionally. This final straw sowed strong the seed of your demise. We will NEVER forget this. Not my generation, nor any generations influenced by me or my brethren forever after, so help me Spaghetti Monster.
Central Bankers: You are dismissed.
We will allow you and your immediate family members (temporary) safe passage to any and all garbage landfills in the world, where you and your few remaining generations will rot slowly from disease and starvation till your genes are passed on no more. This befits the nature of your crimes against humanity. Just as you audibly declared value in paper coupons, we declare you permanently exiled and welcome to the world The BlockChain, a system most efficient for evolving.
The BlockChain will propel Humanity
To The Moooon.
All we have left is one easy peezy tisky task: Scrub clean the world of your inky black sickness and weed out your greed by rinsing and repeating the Exile every four score or so. Oh, and please take all those dirty pieces of fiat paper with you. You worked so hard to own almost 90% of it. Let them be your toilet paper. Because you earned that.
-RawrJ45istheW0rkH0rseEtherbeast
-RawrJ45istheW0rkH0rseEtherbeastisnotanAnonymousCoward
-RawrJ45istheW0rkH0rseEtherbeastisnotanAnonymousCoward
-RawrJ45istheW0rkH0rseEtherbeastisnotanAnonymousCoward and is now all up in your slashdot.
People still think bitcoin is going to keep going strong?
I though most people had realized by now, that it's doomed to failure?
People witnessed the demise of Myspace said Facebook was "doomed to failure" but then major corporations started creating accounts and official pages and utilizing the billion+ powerhouse of marketing madness. Point is, once Crisco and Goodyear have invested resources and reputation, it is in their best interest to help Facebook succeed from then on. Not long ago, you couldn't search anything on Pintrest without child porn images appearing in the list of results. Major companies started climbing on board the Pinterest train and there is now a concerted e]effort to clean it up so major corporations will put their rep on the line to be part of it. This is where I prove you are an idiot with no foresight/common sense: I can pay for my degree at New York's Kings College in bitcoins, buy almost anything a credit card can, or just take my girl to a movie using the "doomed to failure" currency hundreds of global corporations have already started accepting. This will pave the way to a big fat "Told You So" and I'll be here to rub it in your face every single day. Global companies that accept bitcoin now (to name a few): Expedia, Richard Branson/Virgin Galactic, Overstock.com, TigerDirect, Lord & Taylor, your mom, Amazon, Target, CVS, Subway, VictoriaÃ(TM)s Secret, Sacramento Kings, Chicago Sun Times, Bloomberg.com, Bing by Microsoft,Home Depot, KMart, Sears, Gamestop Gap and JCPenny via eGifter, Your mom again, Dish Network, the list is huuuge and bigger every day. I think it is you who is doomed to failure. Do some research and quit being the central banking industries stool pigeon, Jebus.
Wow you just got served old old old school!
Name 1 pos coin that lived to reap it's interest bearing rewards. There is no value in it other than to draw out the bag holder hot potato game
Bitcoin is still valued at about six-hundred times that of the US dollar. Ghash.io gaining 51% of the mining hashrate for a few hours had no real effect on the price. So this is doomsday?
So, we are dealing with a (minor) weakness in the standard mining tools.
Sounds like a reasonable solution.
Do you care about the security of your wireless mouse?
Religions are often founded by people who are not selfish or power-hungry. Unfortunately, the direct impact of the founder is typically gone in a few generations, and the only way the religion will survive is to have some sort of church structure, which either dies out or becomes somewhat powerful, attracting the selfish and power-hungry.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
I think it's a wonderful testament to /.'s interest in technology and the common good that we're willing to point at a security flaw and wave 'I told you so' flags and spout hyperbole instead of coming up with a way to harden it. Keep up the good work, guys!
So, we are dealing with a (minor) weakness in the standard mining tools.
Perhaps so. Keep in mind; if the miners did have to communicate with the pools constantly and synchronously with their mining, it could slow down their mining, and therefore give them a competitive disadvantage.
On the other hand... the insertion of an additional "status reporter/cheating detector/squealing engine/preemptive information sharing mechanism" could serve to partially mitigate risks that they unwittingly assist a large pool in conducting an attack.
Actually.... if the cheat detection was setup in this manner; it's suddenly difficult to imagine just exactly what an attack from a large pool would have to consist of ---- without persuading a majority of miners not to run cheat protection, in order to be successful.
Some of the founding fathers of the US wrote about attempting to create a system whereby the individual quest for money and power ends up benefiting the common good. Some native American tribes had such a system. In their tradition, every few years neighboring groups would gather to redistribute rankings - power and prestige. The ranking of each leader was determined by how much he gave away. A man of prestige would work a few years, carefully managing his capital to try to produce as much good stuff as he could in order to give away more than his neighbor, thereby retaining his title.
Isn't this just buying elections? Just let the rich pay the poor for their votes. Worked well enough in Chicago...
Go to Heaven for the climate, Hell for the company -- Mark Twain
There is a similarity, and also a very, very important difference. What you normally see in the US is that the politicians take money from the people, then "buy votes" through spending the people's own money. Obama doesn't buy Obama phones" and give them away - you pay for those. He didn't withdraw several billion from his bank account and give it to his campaign bundlers who own solar companies. He had you and I withdraw billions from OUR bank accounts to give to his top supporters.
The current American system is about taking from one group and "giving" what's taken to another group. The native system I referred to is about the potential leader giving away his own possessions. It's about both generosity and competence, effectiveness. A guy who spent the year trying to grow rice in the dry earth will have nothing to give away. The guy who planted a variety of beans,maize, etc will have some grow well and have bags of food to give away. This is good for the community, that fools do not become leaders. Those who make effective decisions get and keep leadership positions, since the requirement for getting the position is that you effectively manage your resources to produce the maximum amount of goods to give out. The US system has no such constraint - politicians can be wasteful and ineffective. When they waste resources, they just take more from the taxpayers.
This is absolutely hilarious. Not because it's a fake post (I honestly don't know if it is or not), but just the fact that someone would even think that this is a good enough idea to post that 'serious' miners are actually doing this.
Uh, everything he posted is factually accurate, not that you would know per your own admission. I'm not sure what you mean by "good enough idea to post" - I'm not sure why adding facts to a discussion about Bitcoin wouldn't be a good idea.
He never claimed that the serious miners were making money. His point was that Bitcoin mining wasn't really a distributed operation any longer - at least not in the sense of everybody and their uncle doing it with 10% of their spare CPU capacity.
I won't disagree that trying to make money by mining Bitcoin doesn't make sense right now, because there is far more supply of mining than there is demand for it. If at some point the value settles down and it actually gets used in some significant volume of commerce then there would be a steady demand for mining, and it would be possible to make a very modest profit for mining once all the enthusiasm dies out. As you say, right now there is a gold rush which has created a bubble.
Bitcoin was never designed to give out free money to miners. They're a necessary part of the operation of the system, but as their supply goes up so does the difficulty level and the value of transaction costs right now is low since there aren't many transactions and half the miners will bless transactions for free.
The concentration of mining operations is a real problem for the protocol.
You still have to output valid blocks or every node will reject it.
The problem here is that you have a definition of "every node" which excludes 51+% of the nodes.
Distributed systems like this are often susceptible to commandeering by somebody willing to throw enough brute force at it. If the NSA spun up a million tor nodes then a significant percentage of network traffic would travel entirely through nodes they control and thus they could trace it trivially. If you go and play poker with a table full of people who are conspiring against you, then you're going to lose out big. Bitcoin is just another case of this - if the majority of the network is out to take advantage of you, and it is a consensus-based network, then you're in trouble.
True. I was assuming it was obvious, that the communication had to be asynchronous. And I can't see any reason to communicate with other pools more often than once per block.
Once a node has started computing, it should be able to go on for quite a while without any communication. If the node doesn't hear anything else, it should just keep doing whatever it was doing. The only thing that can render the continued computation completely pointless for the node is if a node somewhere (in the same pool or any other pool) successfully mines a block. If communication has been totally dead for an hour, it is probably a waste of energy to keep trying to mine a block, since somebody else likely mined it already. But if you haven't heard anything for five minutes, just keep trying to mine the same block you were already working on.
This means the most important information to get synchronized between nodes is the fact that somebody mined a block. This should be totally independent of the pool, so this can be communicated between nodes even if they are in separate pools.
The other information a node needs to receive is information about which transactions to include in the block. It's no big deal if that information is lagging a bit behind. You could update the list of transactions multiple times while trying to complete a block, but if it lags a couple of blocks behind, nothing is going to break.
Do you care about the security of your wireless mouse?
> there has been a huge reduction in government employees [census.gov]
Your link says:
> Looking back to the previous census, the number of full-time equivalent state and local government employees decreased 1.3 percent from the 2007 Census of Governments to 16.2 million in the 2012 Census of Governments.
A decrease of 1.3%. Wow, that's huge. Over the same period of time, the unemployment rate jumped from 4.6% to 8.1%. In the private sector, 4% of people lost their jobs. That's THREE times as many as the 1.3% in government. So over that time period, government's share of employment INCREASED - a higher percentage of jobs were government jobs in 2012 then were in 2007.
So, you look at an increase and call it a "huge decrease". You then come to conclusions that make just as much sense.
I work for a government agency that gets awards for efficiency. We're one of the most efficient government agencies in the country. I've never seen a private business nearly as inefficient as this agency, though I'm sure there are some. That's not a bad thing, though, democracy isn't SUPPOSED to be efficient.
The government of North Korea is efficient. Lil Kim issues an order and it's done. If you get in the way, he can just kill you, no problem. That's not the American way. The US government is supposed to be fair, it's supposed to be accountable. The US government respects the religious, racial, other sexual identity traditions of it's employees and citizens. We're make sure that we are fair to the transgender community. Do you think North Korea's government employees have annual sensitivity training? Our way of government is not supposed to be efficient. It's supposed to respect the rights and opinions of each individual. We have public hearings, approval processes that sometimes take years. That's so that members of the public can come and voice their opinion. That's good. Criminal cases can spend years to make it through various levels of hearings and appeals to ensure fairness. That's not efficient - it's not supposed to be.
Don't ask for efficient government. Efficient government would spend a few minutes to convict you of a felony. Ask for fair and open government. That also means that when you do want efficiency, don't look to the government for that. They are set up for fairness, for democracy, not for efficiency. Efficient government would run like an efficient business - where the boss is the boss and what the boss says goes. You don't have 435 people argue about each decision if you want efficiency.
I don't want to be a dick here, since we are clearly on the same side of most of this. However, you can't really call a decrease in government employment an increase because the private sector lost more jobs. That is faulty logic. In addition, during the sort of recession we've been through, you WANT to spend more government dollars to promote demand. The fact that government spending has gone down for the last 4 years (as a percent of GDP) is due to misguided nonsense like saying that government employment and private employment are a zero sum game. Not even close to being true.
I am really just pointing out that government is already pretty efficient. You claim to work in an agency that is really efficient, but you say that it isn't as efficient as any business. You probably haven't worked in business much. I've worked in various large, successful computer companies over the years (cisco and apple spring to mind. Cisco in particular is 'known' for being cheap), and they are all incredibly inefficient, starting projects and then canning them, buying lots of crap they don't need when they are having a good year, running parallel development efforts, and laying off whole teams they will just need to rebuild in a year. Other things include buying shit nobody needs because "if you don't use up your budget, they will cut it next year". At cisco, there are about 20 labs, each of which have thousands of routers for 'testing and development'. In my racks, at least 80% of the machines were powered on and unused most of the time. This was true of most of the other racks. The power waste must have been 10s of millions of dollars per year, with equivalent air conditioning costs. Nobody cared.
I get what you are saying about government, and not wanting it to be efficient, but that is wrong. Government is obviously not a business (which is why business guys like Bush and Cheney don't really understand it;) it has different goals. However, given a mandate and resources, it should effectively fulfill that mandate using the least amount of resources possible. Serving the most people with the given resources is a matter of pride for many in government (state government, and I suspect federal government.)
The post office won't ever make a profit, but, as you say, that isn't its purpose.
Go to Heaven for the climate, Hell for the company -- Mark Twain
And then the value of all bitcoins will quickly approach 0 and the entity that spent so much money to acquire all the bitcoins will be broke.
There are crypto-currencies designed to be resistant to ASIC mining (though some are starting to get hit with GPU mining), by using algorithms that take enough memory or other complexities that are easy to do in CPU but hard to do on non-general platforms. Litecoin's one example.
Some of them might have enough market depth that a stolen-CPU botnet mining farm could actually make money on them. There was a recent hack where somebody mined a lot of DogeCoins, and supposedly got about $200K worth - it's just appalling, because while DogeCoin is supposed to be ASIC-resistant, it's also supposed to be worth so little that it's purely for fun and nobody could actually make real money mining it.
Bill Stewart
New Fast-Compression-only CPR http://preview.tinyurl.com/dy575ks