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Bitmain, the largest mining hardware company, made around $4B last year

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Re: Bitmain, the largest mining hardware company, made around $4B last year

#81

Post by drngdds »

snitko wrote: post #78
kenneth wrote: post #9

As an engineer, it saddens me to see the huge inefficiencies inherent to cryptocurrency mining these days. Surely, when we're spending in the billions on wasteful hashing, we could dedicate a small fraction of that to engineering better consensus algorithms. Unfortunately, we have an ecosystem where everyone is incentivized to ignore the problem because they're too invested in maintaining the price of Bitcoin and oth…

Have a sense of proportion. Think about how much electricity, paper, waste and money is spent to keep up the banking industry, anti-fraud departments, AML/KYC compliance teams, clerks and all that show. Bitcoin is actually an improvement.

I feel like preventing fraud and money laundering (incidentally, two things you can't prevent when using cryptocurrency) is actually not wasteful

Re: Bitmain, the largest mining hardware company, made around $4B last year

#82

Post by curuinor »

curyous wrote: post #75
kenneth wrote: post #9

As an engineer, it saddens me to see the huge inefficiencies inherent to cryptocurrency mining these days. Surely, when we're spending in the billions on wasteful hashing, we could dedicate a small fraction of that to engineering better consensus algorithms. Unfortunately, we have an ecosystem where everyone is incentivized to ignore the problem because they're too invested in maintaining the price of Bitcoin and oth…

Bitcoin mining seems inefficient now, but when the network is carrying 100x more or 10,000x more transactions, won't it be extremely efficient? (On a per-transaction basis)

There have now been about a half-dozen various suggestions to get the network to carry more transactions, all of which are mostly failures, except for Lightning Network, which is now in the process of becoming a failure.

Re: Bitmain, the largest mining hardware company, made around $4B last year

#83

Post by trixie_ »

nosuchthing wrote: post #40
bogomipz wrote: post #19

Earlier quoted context omitted.

>" we could dedicate a small fraction of that to engineering better consensus algorithms." Can you elaborate on what the shortcomings of the current consensus algorithms are?

Immense waste, and lack of egalitarianism. Proof-of-Work consensus algorithms (so far) work by wasting more and more energy. Max efficiency peaks in the network with a very basic CPU PoW algorithm merely sets a lottery number granting write access for a single computer Every additional increase in processing power reduces efficiency by increasing the size of the number to be guessed All PoW does is increase the capit…

If all the power eventually comes from renewables. Is it still wasteful?

Re: Bitmain, the largest mining hardware company, made around $4B last year

#84

Post by proofofmoon »

curyous wrote: post #75
kenneth wrote: post #9

As an engineer, it saddens me to see the huge inefficiencies inherent to cryptocurrency mining these days. Surely, when we're spending in the billions on wasteful hashing, we could dedicate a small fraction of that to engineering better consensus algorithms. Unfortunately, we have an ecosystem where everyone is incentivized to ignore the problem because they're too invested in maintaining the price of Bitcoin and oth…

Bitcoin mining seems inefficient now, but when the network is carrying 100x more or 10,000x more transactions, won't it be extremely efficient? (On a per-transaction basis)

O(n) total world energy expenditure on Bitcoin scales to O(1) transactions, so it currently only gets worse as more energy is poured into the system for the same transaction output.

There's a few solutions proposed:

- off-chain transactions (Lightning Network) - unknown complexity

- increased block size (Bitcoin Cash) - O(n) -> some larger O(1)

- a different consensus system (proof of stake blockchain, distributed proof of stake blockchain, Tangle, etc.) - varies

It's possible that the Bitcoin ecosystem will adopt one of these solutions in the future, but there doesn't appear to be a silver bullet right now.

Re: Bitmain, the largest mining hardware company, made around $4B last year

#85

Post by seanwilson »

nosuchthing wrote: post #63
wyldfire wrote: post #56

Earlier quoted context omitted.

Nano uses dPOS and does not mint any new coins with PoS nor does not charge any tx fees. Instead of "Give the rich more money" it's more like "preserve the value of my money by fulfilling the promise of this coin".

Nano (aka Raiblocks) is basically a scam. How was the supply produced and distrubited? https://raiblocks.net/page/frontiers.php?limit=100 Nano/Raiblocks were created from software, a reproducable distributed database protocol. Except in the case of Nano, the vast majority of the tokens are in control of the owners with a few being given away to the public for clicking captchas. https://www.youtube.com/results?search_…

> Except in the case of Nano, the vast majority of the tokens are in control of the owners

Do you have evidence of this?

Re: Bitmain, the largest mining hardware company, made around $4B last year

#86

Post by mrb »

vernon99 wrote: post #13
kenneth wrote: post #9

As an engineer, it saddens me to see the huge inefficiencies inherent to cryptocurrency mining these days. Surely, when we're spending in the billions on wasteful hashing, we could dedicate a small fraction of that to engineering better consensus algorithms. Unfortunately, we have an ecosystem where everyone is incentivized to ignore the problem because they're too invested in maintaining the price of Bitcoin and oth…

This is a one-sided comment. There’s a lot of research going into different variations of proof-of-stake. 4 out of 10 largest crypto (by market cap) are PoS. There’s a lot of work Ethereum community (Casper), Cardano folks, Tendermint etc are doing to create better consensus models.

The ugly truth is that proof-of-stake systems, at least current ones, give up decentralization properties. Users with the most funds (stakes) can effectively validate and rewrite the blockchain. Or in the case of a network split, the 2 chains can no longer be merged (because they implement "safety" mechanism such as preventing nodes from rewriting more than X blocks.)

Re: Bitmain, the largest mining hardware company, made around $4B last year

#87

Post by tlrobinson »

wyldfire wrote: post #57
tlrobinson wrote: post #17

Is that $4B worth of USD/CNY, or BTC? If it’s BTC then a) the real figure is much lower because they can’t sell $4B of BTC without drastically moving the market, b) what portion of that is due to their BTC holdings increasing in value by more than 1000% in the past year? Either way it’s still a lot of money, though.

It doesn't matter much what the denomination is. Most sane businesses would convert to the currency of whatever their expenses are anchored in. a) I think you're mistaken. $4B per annum is unlikely to move the markets much.

I’m guessing Bitmain can’t pay for electricity with BTC.

Are there estimates of how much (fiat) money flowed into cryptocurrencies in the last year? It would have to be much more than $4B for Bitmain to be able to sell $4B worth of BTC and still see the 1000% gain.

Re: Bitmain, the largest mining hardware company, made around $4B last year

#88

Post by Anderkent »

nosuchthing wrote: post #58
adadad3442 wrote: post #51

Earlier quoted context omitted.

>Now imagine a financial system where all the wealthy have to do simply own money... to get more money. You mean the current system?

PoS is literally get paid for doing nothing but owning lottery tickets. Normal capital flow with bonds, stocks, etc allow a legally binding agreement for mutually beneficial transfer of capital between parties.

Well, they get paid for putting that capital at risk and for keeping it locked into the system to provide consensus. It's a kind of a service.

Re: Bitmain, the largest mining hardware company, made around $4B last year

#89

Post by twiceaday »

nosuchthing wrote: post #36
twiceaday wrote: post #25

Earlier quoted context omitted.

Doesn't PoS generate money out of thin air? It's just a matter of putting your dollars into stake vs hardware and electricity.

Only for the largest account holders, whom statistically will receive most of the newly generated money (and even more as they continue to accumulate newly printed PoS tokens).

PoW distributes block rewards proportionally to hash power and these proceeds can be used to buy more hash power to achieve a compounding effect. From what I understand all of the viable PoS systems offer a fixed rate of return on the stake. This is like PoW forcing everybody to use the exact same hardware; a benefit to the little guy at the expense of the large account holders.

Re: Bitmain, the largest mining hardware company, made around $4B last year

#90

Post by wmf »

snitko wrote: post #78
kenneth wrote: post #9

As an engineer, it saddens me to see the huge inefficiencies inherent to cryptocurrency mining these days. Surely, when we're spending in the billions on wasteful hashing, we could dedicate a small fraction of that to engineering better consensus algorithms. Unfortunately, we have an ecosystem where everyone is incentivized to ignore the problem because they're too invested in maintaining the price of Bitcoin and oth…

Have a sense of proportion. Think about how much electricity, paper, waste and money is spent to keep up the banking industry, anti-fraud departments, AML/KYC compliance teams, clerks and all that show. Bitcoin is actually an improvement.

It's funny you mention anti-fraud departments and AML/KYC compliance teams since Bitcoin does not provide those and thus their cost exists in addition to the cost of mining.
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