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Inside One of the World's Largest Bitcoin Mines

thecoinsman.com

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Re: Inside One of the World's Largest Bitcoin Mines

#21

Post by bdonlan »

joosters wrote: post #16
CatsoCatsoCatso wrote: post #3

This just strikes me as a colossal waste of energy & time. I understand that there may be good profit in doing it, but that doesn't shirk off any of my feelings.

I agree completely. It seems such a waste, especially given that mining bitcoin is deliberately made difficult. The main cost/waste of bitcoin mining is electricity, and yet we could reduce the cost to almost nothing. In an ideal world, imagine instead a variant of bitcoin that works like this: * All miners do their hashing & number crunching for a second or so, then report their peak hashing rates to each other. * I…

The problem with this is that mining isn't just about reporting hash rates, it's a critical part of the Byzantine failure tolerant consensus algorithm that was bitcoin's key contribution. If miners had a lower duty cycle as you suggest, any dishonest miner could execute a majority attack with little resistance, absent some other kind of mitigation.

While proofs of work are wasteful, the only alternative I know of is simply entrusting some third party with control of the network.

Re: Inside One of the World's Largest Bitcoin Mines

#22

Post by qnr »

CatsoCatsoCatso wrote: post #3

This just strikes me as a colossal waste of energy & time. I understand that there may be good profit in doing it, but that doesn't shirk off any of my feelings.

I blame Satoshi for choosing the unfortunate word "mining" as the name of the technical process that confirms bitcoin transactions. I feel it is responsible for a big part of the scammy reputation Bitcoin has today.

If only it was called something like "transaction security auditing" or "ledger integrity verification" so that people would take it more seriously for what it really is.

Re: Inside One of the World's Largest Bitcoin Mines

#23

Post by jacquesm »

The scale of this is impressive regardless of whether or not you're a bitcoin believer (I'm neutral, if it works long term, great, if not something better will come along).

This bit in particular is impressive:

"The mine operators told me that each warehouse took fifteen days to construct, and an additional ten days to fill up with hardware and get it all hashing away. The concrete was still drying on some of the buildings."

8 of those... I wonder who supplied the chips that do the mining and how much energy that facility uses.

"This entire facility has several petahashes of mining power, accounting for perhaps 5% of the entire bitcoin network. Damn."

I like their cooling solution as well!

Re: Inside One of the World's Largest Bitcoin Mines

#24

Post by angersock »

maxmcd wrote: post #6
CatsoCatsoCatso wrote: post #3

This just strikes me as a colossal waste of energy & time. I understand that there may be good profit in doing it, but that doesn't shirk off any of my feelings.

More inefficient than producing and maintaining paper currency? Than mining actual gold? They really are just throwing tons of electricity and hardware at "nothing", but if this kind of activity helps replace the current inefficient systems of currency, then I'm all for it.

That's a pretty big if, sir or madam.

Re: Inside One of the World's Largest Bitcoin Mines

#25

Post by JoeAltmaier »

jacquesm wrote: post #23

The scale of this is impressive regardless of whether or not you're a bitcoin believer (I'm neutral, if it works long term, great, if not something better will come along). This bit in particular is impressive: "The mine operators told me that each warehouse took fifteen days to construct, and an additional ten days to fill up with hardware and get it all hashing away. The concrete was still drying on some of the bui…

It is a crying shame that all the CO2 is being pissed away to produce imaginary points. What hubris humans have.

Re: Inside One of the World's Largest Bitcoin Mines

#26

Post by joosters »

bdonlan wrote: post #21
joosters wrote: post #16

Earlier quoted context omitted.

I agree completely. It seems such a waste, especially given that mining bitcoin is deliberately made difficult. The main cost/waste of bitcoin mining is electricity, and yet we could reduce the cost to almost nothing. In an ideal world, imagine instead a variant of bitcoin that works like this: * All miners do their hashing & number crunching for a second or so, then report their peak hashing rates to each other. * I…

The problem with this is that mining isn't just about reporting hash rates, it's a critical part of the Byzantine failure tolerant consensus algorithm that was bitcoin's key contribution. If miners had a lower duty cycle as you suggest, any dishonest miner could execute a majority attack with little resistance, absent some other kind of mitigation. While proofs of work are wasteful, the only alternative I know of is…

You could keep the blockchain and run with vastly reduced difficulty, but with one alteration: the next block needs to include a specific magic secret number. This magic key is unknowable in advance of a specific time, preventing workers from doing the hash work until the key is 'published'. This forces the miners to pause and not do any hashing for a set time.

Now, this gets to the real issue: We need a source for these magic numbers, it needs to be trusted and available and verifiable by everyone, and it needs to be unpredictable and unknowable until a specific time.

What possible sources are there? You could imagine a centralized system, where some computer on the internet spits out a random number for the next 'magic key' every minute. But of course, you have to trust the owner of this computer and so we'd lose all the decentralized features of Bitcoin.

Another possibility: Tie the magic key to some public knowledge, e.g. the value of the NASDAQ at a specific time. Again, this still has problems as 1) there's a limited range of possible values, so miners could pre-compute various versions, and 2) the value could be gamed by market traders.

Anyway, I don't have an answer for the ideal source of these 'magic keys', but if someone could come up with one, you could keep all of bitcoin's mechanisms while vastly reducing its energy waste

Re: Inside One of the World's Largest Bitcoin Mines

#27

Post by nmjohn »

joosters wrote: post #16
CatsoCatsoCatso wrote: post #3

This just strikes me as a colossal waste of energy & time. I understand that there may be good profit in doing it, but that doesn't shirk off any of my feelings.

I agree completely. It seems such a waste, especially given that mining bitcoin is deliberately made difficult. The main cost/waste of bitcoin mining is electricity, and yet we could reduce the cost to almost nothing. In an ideal world, imagine instead a variant of bitcoin that works like this: * All miners do their hashing & number crunching for a second or so, then report their peak hashing rates to each other. * I…

> Obviously, this has massive flaws.

You just answered your own question on why bitcoin was deliberately made difficult. Security and fairness.

There has yet to be a proposal that has come close to offering a better solution without massive exploitable flaws.

Re: Inside One of the World's Largest Bitcoin Mines

#28

Post by fennecfoxen »

UweSchmidt wrote: post #17
maxmcd wrote: post #6

Earlier quoted context omitted.

More inefficient than producing and maintaining paper currency? Than mining actual gold? They really are just throwing tons of electricity and hardware at "nothing", but if this kind of activity helps replace the current inefficient systems of currency, then I'm all for it.

Bitcoin could become a means for payment and other things, but can not possibly replace the current systems of currency, since those are essential political instruments. Consider the impact of minimal fluctuations of exchange and interest rates. No one could just say "fuck it" and buy into a completely unpredictable new system. Governments would give up control, and random people who happened to have mined Bitcoin un…

Governments have given up control before... small governments, where after running their existing currencies into the ground with hyperinflation they adopted the US dollar.

Currencies can only be political instruments up until a point -- and then people get tired of it and start looking for other mediums of exchange, units of account, and stores of value. Bitcoin is theoretically something people could turn to for one or more of those, though it would have to be a pretty bad situation to make Bitcoin's volatility look good.

(Disclaimer. The overall likelihood of this happening at a large scale is not something endorsed by this post.)

Re: Inside One of the World's Largest Bitcoin Mines

#29

Post by billyhoffman »

lutusp wrote: post #20
billyhoffman wrote: post #15

Earlier quoted context omitted.

This only holds true if you believe that finding new colossal prime numbers is a good use of time/power. Given the application of new primes is far less than, say, sending humans to live on the mars, I imagine the vast majority of people would not.

> Given the application of new primes is far less than, say, sending humans to live on the mars ... Yes, but researching primes is way, way less expensive than sending humans to the Red Planet. It's all about cost versus benefit. As one example, some mathematicians think the Riemann Zeta function might reveal something basic about primes, and if so, it would be well worth our time spent studying it, and primes in gen…

I get what you are saying. And I think primes research may be a good thing. But to say, all the heat and power and physical hardware waste of Bitcoin/altcoin mining is offset even somewhat by the helping primes research is kind of silly.

I could say that my handling and use of physical dollar bills could help microbiologists understand how organisms can spread. Technically true, but of dubious value at best.

Re: Inside One of the World's Largest Bitcoin Mines

#30

Post by Retr0spectrum »

qnr wrote: post #22
CatsoCatsoCatso wrote: post #3

This just strikes me as a colossal waste of energy & time. I understand that there may be good profit in doing it, but that doesn't shirk off any of my feelings.

I blame Satoshi for choosing the unfortunate word "mining" as the name of the technical process that confirms bitcoin transactions. I feel it is responsible for a big part of the scammy reputation Bitcoin has today. If only it was called something like "transaction security auditing" or "ledger integrity verification" so that people would take it more seriously for what it really is.

I agree. When I first heard of bitcoin mining, I assumed it was some method of cracking the bitcoin security to illegitimately gain bitcoins.
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