Bitcoin's mining difficulty has increased by 41.9% over the last 30 days • Hacker News Board

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#101

Post by wernercd » Tue, Dec 22, 2015, 2:54 AM UTC

homogeneous wrote: post #64

urbanarson wrote: post #59

Earlier quoted context omitted.

For comparison, how much power does Visa, Mastercard, the Federal Reserve (and its printing presses), banks, and all of the buildings and employees that work in the traditional financial sector use? Now think about that in every single country on this planet. It's a lot more than 40MW. The Bitcoin network is a steal by comparison.

You're comparing the microscopic bitcoin economy to the financial infrastructure that services the entire planet; it's a ridiculous comparison. How would bitcoin's power consumption stack up if it were tasked with servicing tens of millions of transactions per second?

Agreed... lets keep it in terms we all understand and that make sense...

How many libraries of congress can they power with 40MW?

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#102

Post by gritzko » Tue, Dec 22, 2015, 2:55 AM UTC

craigyk wrote: post #81

sanswork wrote: post #56

Earlier quoted context omitted.

So less than half of one datacentre entirely owned by one company is enough to commit a 51% attack. I get that they say they are going to work on distribution these chips to ensure they don't end up in that position but let's be honest they just destroyed any claim that the network is powerful enough to avoid malicious control by one miner now. They've not even raised that much money.

At any point since bitcoin's inception there have been plenty of major govts that could have easily afforded the resources to pull off a 51% attack.

A real bad thing here is the asymmetry. To prevent 51%, the network has to burn enormous amounts of energy 24x7 forever while the attacker only needs his energy for the duration of the attack.

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#103

Post by geofft » Tue, Dec 22, 2015, 2:56 AM UTC

sowbug wrote: post #82

sanswork wrote: post #56

Earlier quoted context omitted.

So less than half of one datacentre entirely owned by one company is enough to commit a 51% attack. I get that they say they are going to work on distribution these chips to ensure they don't end up in that position but let's be honest they just destroyed any claim that the network is powerful enough to avoid malicious control by one miner now. They've not even raised that much money.

Malice isn't enough. The only special power of a 50% miner is to consistently resolve double-spend attempts in its favor. If this happened, it would surely lower the value of Bitcoin. This, an attacker must be not just malicious but also irrational enough to forfeit the $800,000 in Bitcoin that it creates daily by virtue of its 50% control of the network. (6 blocks/hour x 24 hours/day x 25 bitcoin/block x $450/bitcoi…

Stupid question: if control of 50% of the hash power is so unimportant, why does Bitcoin rely on hash power anyway? Why not simply have a consensus system without proof-of-anything?

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#104

Post by shmageggy » Tue, Dec 22, 2015, 2:59 AM UTC

mrb wrote: post #26

Nobody on HN pointed out who is behind the increase... This is BitFury who just launched a 40 megawatt data center filled up with their new 16 nm chips which reportedly achieve approximately 0.06 joule per gigahash. They also use immersion cooling which gives them an insane PUE of 1.02. So the mining capacity of this DC alone is ~650 Phash/s! We saw an increase of ~200 Phash/s in the last 30 days, so presumably they…

I will forever refuse to spend my 0.5 BitCoin just so one day I can say to my grandkids in a creaky old voice, "See! I mined that myself on my own computer in a couple of nights!"

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#105

Post by gritzko » Tue, Dec 22, 2015, 3:05 AM UTC

CyberDildonics wrote: post #87

homogeneous wrote: post #64

Earlier quoted context omitted.

You're comparing the microscopic bitcoin economy to the financial infrastructure that services the entire planet; it's a ridiculous comparison. How would bitcoin's power consumption stack up if it were tasked with servicing tens of millions of transactions per second?

> How would bitcoin's power consumption stack up if it were tasked with servicing tens of millions of transactions per second? It would stay almost the same since the hashing power is not connected to the number of transactions. Also by the way, no one does tens of millions of transactions per second, visa does something like 40,000 at their absolute peak.

No, no, no.

The amount of power wasted by BitCoin indirectly depends on the monetary turnover of the system. Because if somebody can spend $1mln to perform 51% attack and move around $1bln, that will likely be done. Hence, the power wasted is proportional to the turnover of the system. Otherwise, it does not work.

Also, when a bank charges me 1% for a wire transfer, they pay salaries from that money and some people buy food. The power burnt by BitCoin is actually literally immediately irrecoverably physically wasted.

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#106

Post by narrator » Tue, Dec 22, 2015, 3:06 AM UTC

danieltillett wrote: post #79

narrator wrote: post #72

Earlier quoted context omitted.

When the real interest rate is high, business retained earnings are more valuable. Thus, economic power is transferred from lending institutions to profitable corporations. Who do you think does a better job investing?

Well the theory of a bank is to act as an efficient mechanism to transfer capital from businesses and consumers with excess capital to those with a need for more capital. Of course in practice banks have got pretty good at capturing almost all the value out of this process. Business should not really be in the business of retaining earnings. If it was not for tax reasons it would be best to return any excess funds to…

This would be fine and good, except banks create money when they lend through the money multiplier effect.

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#107

Post by circlecrimson » Tue, Dec 22, 2015, 3:08 AM UTC

geofft wrote: post #103

sowbug wrote: post #82

Earlier quoted context omitted.

Malice isn't enough. The only special power of a 50% miner is to consistently resolve double-spend attempts in its favor. If this happened, it would surely lower the value of Bitcoin. This, an attacker must be not just malicious but also irrational enough to forfeit the $800,000 in Bitcoin that it creates daily by virtue of its 50% control of the network. (6 blocks/hour x 24 hours/day x 25 bitcoin/block x $450/bitcoi…

Stupid question: if control of 50% of the hash power is so unimportant, why does Bitcoin rely on hash power anyway? Why not simply have a consensus system without proof-of-anything?

I think the reason is because then there would be no way for new coins to be mined and given to those who are rewarded for ensuring the security of the network.

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#108

Post by douche » Tue, Dec 22, 2015, 3:09 AM UTC

feelix wrote: post #96

jacquesm wrote: post #47

Earlier quoted context omitted.

It's a race to the bottom. It will end with the party that manages to just win that race by making the smallest profit possible at the highest efficiency of Joules per hash computed. Bitcoin is interesting for many reasons, the real-world effects of a couple of configuration settings and some cleverly picked auto-scaling parameters are immense. The number of orders of magnitude that the protocol has survived with min…

Anywhere in the USA who has to pay USA power prices is going to be at a disadvantage by that alone then. It would seem that locating the hashing equipment to the place with the cheapest power possible would be a logical step when things start to get cut that fine. Unless that could be overcome with clever usage of naturally generated local power (such as solar power).

You'd think Canada would have more major data centers. They've got a lot of extremely cheap hydro power. You could surely lay ultra-high-speed fiber along the same right-of-ways that the transmission lines use. Also, it's cold as hell more often than not, so cooling is less of an issue than putting them out in the desert somewhere.

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#109

Post by throwaway45872 » Tue, Dec 22, 2015, 3:09 AM UTC

mrb wrote: post #26

Nobody on HN pointed out who is behind the increase... This is BitFury who just launched a 40 megawatt data center filled up with their new 16 nm chips which reportedly achieve approximately 0.06 joule per gigahash. They also use immersion cooling which gives them an insane PUE of 1.02. So the mining capacity of this DC alone is ~650 Phash/s! We saw an increase of ~200 Phash/s in the last 30 days, so presumably they…

(Note: Since most HN readers are technical, this comment is being downvoted by bitcoin enthusiasts among them. You won't see many replies from them to this comment, since their reaciton is political and not a technical statement. Still, I'll keep it up. This comment is currently at -2.)

To put this into context, by comparing it with a centralized version, an equivalent number of actual transactions could be done at a bank with a crud app running on a $5 complete desktop PC which the Raspberry Pi foundation just released[1]. It is a 1 ghz computer with 512 MB of RAM. It draws up to 0.7 Watts.

Wait, wait, wait. did I say an equivalent number? Since Bitcoin is limited to 7 TPS (7 transactions per second), I should modify this to 100x more transactions (700 transactions per second), if you wrote it in C, or if not a hundred times, then at least ten times as many in python. If it were a crud app running at a bank, a $5 computer could do 100 times the transactions that 650 Phash/s of wasted effort collectively give. And 40 megawatts.

Bitcoin is a supreme waste of resources through the proof of work hack. It is like emulating a GPU in a CPU...in javascript. I mean, sure, you can do that. You can run Open GL by emulating a GPU in single-threaded Javascript.

But it's a stupid, wrong solution. The basic idea sucks. It's bad.

(by the by my target price for btc is $600,000 based on a comparison with how bad gold is physically, and the market cap of gold. :-P.)

I love fiat currencies, they're one of the great achievements of modern civilization. (This sentence isn't ironic, it's actually how I feel.) Despite my target price I don't hold any bitcoins at all. I hope some of the numbers I've given can put into perspective why.

[1] https://www.raspberrypi.org/blog/raspberry-pi-zero/

Re: Bitcoin's mining difficulty has increased by 41.9% over the last 30 days

#110

Post by cgjaro » Tue, Dec 22, 2015, 3:10 AM UTC

sanswork wrote: post #89

craigyk wrote: post #81

Earlier quoted context omitted.

At any point since bitcoin's inception there have been plenty of major govts that could have easily afforded the resources to pull off a 51% attack.

And now a single company can. Progress!

It has always been the case that a single company could 51%-attack the network. No regression here. In fact the cost has continually increased over time. So, yes, progress.