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Decred Journal – September 2018

Note: you can read this on GitHub (link), Medium (link) or old Reddit (link).

Development

Final version 1.3.0 of the core software was released bringing all the enhancements reported last month to the rest of the community. The groundwork for SPV (simplified payment verification) is complete, another reduction of fees is being deployed, and performance stepped up once again with a 50% reduction in startup time, 20% increased sync speed and more than 3x faster peer delivery of block headers (a key update for SPV). Decrediton's integrations of SPV and Politeia are open for testing by experienced users. Read the full release notes and get the downloads on GitHub. As always, don't forget to verify signatures.
dcrd: completed several steps towards multipeer downloads, improved introduction to the software in the main README, continued porting cleanups and refactoring from upstream btcd.
Currently in review are initial release of smart fee estimator and a change to UTXO set semantics. The latter is a large and important change that provides simpler handling, and resolves various issues with the previous approach. A lot of testing and careful review is needed so help is welcome.
Educational series for new Decred developers by @matheusd added two episodes: 02 Simnet Setup shows how to automate simnet management with tmux and 03 Miner Reward Invalidation explains block validity rules.
Finally, a pull request template with a list of checks was added to help guide the contributors to dcrd.
dcrwallet: bugfixes and RPC improvements to support desktop and mobile wallets.
Developers are welcome to comment on this idea to derive stakepool keys from the HD wallet seed. This would eliminate the need to backup and restore redeem scripts, thus greatly improving wallet UX. (missed in July issue)
Decrediton: bugfixes, refactoring to make the sync process more robust, new loading animations, design polishing.
Politeia: multiple improvements to the CLI client (security conscious users with more funds at risk might prefer CLI) and security hardening. A feature to deprecate or timeout proposals was identified as necessary for initial release and the work started. A privacy enhancement to not leak metadata of ticket holders was merged.
Android: update from @collins: "Second test release for dcrandroid is out. Major bugs have been fixed since last test. Latest code from SPV sync has been integrated. Once again, bug reports are welcome and issues can be opened on GitHub". Ask in #dev room for the APK to join testing.
A new security page was added that allows one to validate addresses and to sign/verify messages, similar to Decrediton's Security Center. Work on translations is beginning.
Overall the app is quite stable and accepting more testers. Next milestone is getting the test app on the app store.
iOS: the app started accepting testers last week. @macsleven: "the test version of Decred Wallet for iOS is available, we have a link for installing the app but the builds currently require your UDID. Contact either @macsleven or @raedah with your UDID if you would like to help test.".
Nearest goal is to make the app crash free.
Both mobile apps received new design themes.
dcrdata: v3.0 was released for mainnet! Highlights: charts, "merged debits" view, agendas page, Insight API support, side chain tracking, Go 1.11 support with module builds, numerous backend improvements. Full release notes here. This release featured 9 contributors and development lead @chappjc noted: "This collaboration with @raedahgroup on our own block explorer and web API for @decredproject has been super productive.".
Up next is supporting dynamic page widths site wide and deploying new visual blocks home page.
Trezor: proof of concept implementation for Trezor Model T firmware is in the works (previous work was for Model One).
Ticket splitting: updated to use Go modules and added simnet support, several fixes.
docs: beginner's guide overhaul, multiple fixes and cleanups.
decred.org: added 3rd party wallets, removed inactive PoW pools and removed web wallet.
@Richard-Red is building a curated list of Decred-related GitHub repositories.
Welcome to new people contributing for the first time: @klebe, @s_ben, @victorguedes, and PrimeDominus!
Dev activity stats for September: 219 active PRs, 197 commits, 28.7k added and 18.8k deleted lines spread across 6 repositories. Contributions came from 4-10 developers per repository. (chart)

Network

Hashrate: started and ended the month around 75 PH/s, hitting a low of 60.5 and a new high of 110 PH/s. BeePool is again the leader with their share varying between 23-54%, followed by F2Pool 13-30%, Coinmine 4-6% and Luxor 3-5%. As in previous months, there were multiple spikes of unidentified hashrate.
Staking: 30-day average ticket price is 98 DCR (+2.4). The price varied between 95.7 and 101.9 DCR. Locked DCR amount was 3.86-3.96 million DCR, or 45.7-46.5% of the supply.
Nodes: there are 201 public listening nodes and 325 normal nodes per dcred.eu. Version distribution: 5% are v1.4.0(pre) dev builds (+3%), 30% on v1.3.0 (+25%), 42% on v1.2.0 (-20%), 15% on v1.1.2 (-7%), 6% on v1.1.0. More than 76% of nodes run v1.2.0 and higher and therefore support client filters. Data as of Oct 1.

ASICs

Obelisk posted two updates on their mailing list. 70% of Batch 1 units are shipped, an extensive user guide is available, Obelisk Scanner application was released that allows one to automatically update firmware. First firmware update was released and bumped SC1 hashrate by 10-20%, added new pools and fixed multiple bugs. Next update will focus on DCR1. It is worth a special mention that the firmware source code is now open! Let us hope more manufacturers will follow this example.
A few details about Whatsminer surfaced this month. The manufacturer is MicroBT, also known as Bitwei and commonly misspelled as Bitewei. Pangolinminer is a reseller, and the model name is Whatsminer D1.
Bitmain has finally entered Decred ASIC space with their Antminer DR3. Hash rate is 7.8 TH/s while pulling 1410 W, at the price of $673. These specs mean it has the best GH/W and GH/USD of currently sold miners until the Whatsminer or others come out, although its GH/USD of 11.6 already competes with Whatsminer's 10.5. Discussed on Reddit and bitcointalk, unboxing video here.

Integrations

Meet our 17th voting service provider: decredvoting.com. It is operated by @david, has 2% fee and supports ticket splitting. Reddit thread is here.
For a historical note, the first VSP to support ticket splitting was decredbrasil.com:
@matheusd started tests on testnet several months ago. I contacted him so we could integrate with the pool in June this year. We set up the machine in July and bought the first split ticket on mainnet, using the decredbrasil pool, on July 19. It was voted on July 30. After this first vote on mainnet, we opened the tests to selected users (with more technical background) on the pool. In August we opened the tests to everyone, and would call people who want to join to the #ticket_splitting channel, or to our own Slack (in Portuguese, so mostly Brazilian users). We have 28 split tickets already voted, and 16 are live. So little more than 40 split tickets total were bought on decredbrasil pool. (@girino in #pos-voting)
KuCoin exchange listed DCBTC and DCETH pairs. To celebrate their anniversary they had a 99% trading fees discount on DCR pairs for 2 weeks.
Three more wallets integrated Decred in September:
ChangeNow announced Decred addition to their Android app that allows accountless swaps between 150+ assets.
Coinbase launched informational asset pages for top 50 coins by market cap, including Decred. First the pages started showing in the Coinbase app for a small group of testers, and later the web price dashboard went live.

Adoption

The birth of a Brazilian girl was registered on the Decred blockchain using OriginalMy, a blockchain proof of authenticity services provider. Read the full story in Portuguese and in English.

Marketing

Advertising report for September is ready. Next month the graphics for all the ads will be changing.
Marketing might seem quiet right now, but a ton is actually going on behind the scenes to put the right foundation in place for the future. Discovery data are being analyzed to generate a positioning strategy, as well as a messaging hierarchy that can guide how to talk about Decred. This will all be agreed upon via consensus of the community in the work channels, and materials will be distributed.
Next, work is being done to identify the right PR partner to help with media relations, media training, and coordination at events. While all of this is coming up to speed, we believe the website needs a refresher reflecting the soon to be agreed upon messaging, plus a more intuitive architecture to make it easier to navigate. (@Dustorf)

Events

Attended:
Upcoming:
We'll begin shortly reviewing conferences and events planned for the first half of 2019. Highlights are sure to include The North American Bitcoin Conference in Miami (Jan 16-18) and Consensus in NYC (May 14-16). If you have suggestions of events or conferences Decred should attend, please share them in #event_planning. In 2019, we would like to expand our presence in Europe, Asia, and South America, and we're looking for community members to help identify and staff those events. (@Dustorf)

Media

August issue of Decred Journal was translated to Russian. Many thanks to @DZ!
Rency cryptocurrency ratings published a report on Decred and incorporated a lot of feedback from the community on Reddit.
September issue of Chinese CCID ratings was published (snapshot), Decred is still at the bottom.
Videos:
Featured articles:
Articles:

Community Discussions

Community stats:
Comm systems news: Several work channels were migrated to Matrix, #writers_room is finally bridged.
Highlights:
Twitter: why decentralized governance and funding are necessary for network survival and the power of controlling the narrative; learning about governance more broadly by watching its evolution in cryptocurrency space, importance of community consensus and communications infrastructure.
Reddit: yet another strong pitch by @solar; question about buyer protections; dcrtime internals; a proposal to sponsor hoodies in the University of Cape Town; Lightning Network support for altcoins.
Chats: skills to operate a stakepool; voting details: 2 of 3 votes can approve a block, what votes really approve are regular tx, etc; scriptless script atomic swaps using Schnorr adaptor signatures; dev dashboard, choosing work, people do best when working on what interests them most; opportunities for governments and enterprise for anchoring legal data to blockchain; terminology: DAO vs DAE; human-friendly payments, sharing xpub vs payment protocols; funding btcsuite development; Politeia vote types: approval vote, sentiment vote and a defund vote, also linking proposals and financial statements; algo trading and programming languages (yes, on #trading!); alternative implementation, C/C++/Go/Rust; HFTs, algo trading, fake volume and slippage; offline wallets, usb/write-only media/optical scanners vs auditing traffic between dcrd and dcrwallet; Proof of Activity did not inspire Decred but spurred Decred to get moving, Wikipedia page hurdles; how stakeholders could veto blocks; how many votes are needed to approve a proposal; why Decrediton uses Electron; CVE-2018-17144 and over-dependence on single Bitcoin implementation, btcsuite, fuzz testing; tracking proposal progress after voting and funding; why the wallet does not store the seed at all; power connectors, electricity, wiring and fire safety; reasonable spendings from project fund; ways to measure sync progress better than block height; using Politeia without email address; concurrency in Go, locks vs channels.
#support is not often mentioned, but it must be noted that every day on this channel people get high quality support. (@bee: To my surprise, even those poor souls running Windows 10. My greatest respect to the support team!)

Markets

In September DCR was trading in the range of USD 34-45 / BTC 0.0054-0.0063. On Sep 6, DCR revisited the bottom of USD 34 / BTC 0.0054 when BTC quickly dropped from USD 7,300 to 6,400. On Sep 14, a small price rise coincided with both the start of KuCoin trading and hashrate spike to 104 PH/s. Looking at coinmarketcap charts, the trading volume is a bit lower than in July and August.
As of Oct 4, Decred is #18 by the number of daily transactions with 3,200 tx, and #9 by the USD value of daily issuance with $230k. (source: onchainfx)
Interesting observation by @ImacallyouJawdy: while we sit at 2018 price lows the amount locked in tickets is testing 2018 high.

Relevant External

ASIC for Lyra2REv2 was spotted on the web. Vertcoin team is preparing a new PoW algorithm. This would be the 3rd fork after two previous forks to change the algorithm in 2014 and 2015.
A report titled The Positive Externalities of Bitcoin Mining discusses the benefits of PoW mining that are often overlooked by the critics of its energy use.
A Brief Study of Cryptonetwork Forks by Alex Evans of Placeholder studies the behavior of users, developers and miners after the fork, and makes the cases that it is hard for child chains to attract users and developers from their parent chains.
New research on private atomic swaps: the paper "Anonymous Atomic Swaps Using Homomorphic Hashing" attempts to break the public link between two transactions. (bitcointalk, decred)
On Sep 18 Poloniex announced delisting of 8 more assets. That day they took a 12-80% dive showing their dependence on this one exchange.
Circle introduced USDC markets on Poloniex: "USDC is a fully collateralized US dollar stablecoin using the ERC-20 standard that provides detailed financial and operational transparency, operates within the regulated framework of US money transmission laws, and is reinforced by established banking partners and auditors.".
Coinbase announced new asset listing process and is accepting submissions on their listing portal. (decred)
The New York State Office of the Attorney General posted a study of 13 exchanges that contains many insights.
A critical vulnerability was discovered and fixed in Bitcoin Core. Few days later a full disclosure was posted revealing the severity of the bug. In a bitcointalk thread btcd was called 'amateur' despite not being vulnerable, and some Core developers voiced their concerns about multiple implementations. The Bitcoin Unlimited developer who found the bug shared his perspective in a blog post. Decred's vision so far is that more full node implementations is a strength, just like for any Internet protocol.

About This Issue

This is the 6th issue of Decred Journal. It is mirrored on GitHub, Medium and Reddit. Past issues are available here.
Most information from third parties is relayed directly from source after a minimal sanity check. The authors of Decred Journal have no ability to verify all claims. Please beware of scams and do your own research.
Feedback is appreciated: please comment on Reddit, GitHub or #writers_room on Matrix or Slack.
Contributions are also welcome: some areas are adding content, pre-release review or translations to other languages.
Credits (Slack names, alphabetical order): bee, Dustorf, jz, Haon, oregonisaac, raedah and Richard-Red.
submitted by jet_user to decred [link] [comments]

Frequently Asked Questions

NOTICE

This post is a temporary resting place for FAQs while we wait for the release of VertDocs.

What is Vertcoin?

Vertcoin is a digital peer to peer currency focused on decentralization and ASIC resistance. Vertcoin is aiming to be easily accessible to the everyday user without extensive technical knowledge. Vertcoin has started to lower the barrier of entry with lots of video guides and the development of the One Click Miner (OCM).

Why does ASIC Resistance Matter?

ASICs (Application Specific Integrated Circuits) are dedicated mining devices that can only mine one algorithm. Coins like Bitcoin and Litecoin both made GPU mining obsolete when SHA-256 and Scrypt ASICs were created.
ASIC Resistance and How it Makes Vertcoin Decentralized
Vertcoin believes that ASIC resistance goes hand in hand with decentralization.
ASICs are made by companies like Bitmain and almost all the original sellers of ASICs sell on a preorder basis. When pre ordering an ASIC you are buying from a limited batch that the ASIC company has produced. Often times the batch will not be fully filled and the ASIC company will often have left over ASICs. When the ASIC company has left over ASICs they will put them to work mining. Soon enough the ASIC company will have a very large amount of unsold ASICs that are mining and slowly the ASIC company starts to own a large part of the network’s hashrate. When an ASIC company(s) starts to own a large majority of the hashrate the network can become very centralized after a while.
Having your network consist of a few large companies can be very dangerous as they could eventually get 51% hashing power and 51% attack your network, destabilizing the network. When your network is made out of a lot of smaller miners, like Vertcoin, it is much harder for your network to be 51% attacked, therefore increasing network security. By having centralized hashing power your coin effectively centralizing the network as the centralized hashing power can deny transactions and stop any activity they don’t want.

What Ways is Vertcoin Superior to Litecoin and Bitcoin?

Network Difficulty Adjustments with Kimoto Gravity Well
Vertcoin uses a difficulty adjustment called Kimoto Gravity Well which adjusts the difficulty every block, whereas Bitcoin and Litecoin’s difficulty changes every 2016 blocks. By adjusting the difficulty every block Vertcoin’s block time can stay consistent by adjusting for the fluctuation in network hash rate from hash rate renting and part time miners. If a large miner switches off Bitcoin or Litecoin mining the network could be slowed to a crawl until 2016 blocks are mined and the difficulty can change to adjust for the new network hash rate. We observed this happen to Bitcoin when Bitcoin Cash became more profitable than Bitcoin and Bitcoin’s network hash rate saw a steep fall off, slowing the network to a crawl. If this was to happen with Vertcoin the difficulty would adjust after 1 block was mined, allowing Vertcoin to always be profitable to mine.
Anyone can Meaningfully help Verify Transactions
In Proof-of-Work crypto currencies miners help secure the blockchain and get rewarded with the block reward. In ASIC mineable coins like Bitcoin and Litecoin you can’t meaningfully verify transactions unless you pay 1000-2000$ for a ASIC miner. When you mine with a CPU or GPU in a ASIC mineable coin you make no meaningful impact on the network. It is like trying to break concrete with a shovel while everyone else has a jackhammer.
Simple Upgrades Aren’t Held back by 1-2 Large Miners
In ASIC market people buy ASICs in batches in a preorder. With Bitcoin ASICs there is not enough demand for ASICs so the batch often doesn’t get sold out so now the manufacturer has spare ASICs. Now that the manufacturer has spare ASICs they will often start mining with them and eventually the ASIC company has one of the highest hash rates. If the ASIC company doesn’t want a certain upgrade to go through, for example SegWit, they can vote with their hash rate to hold back the upgrade forever or at least until people who want SegWit get more hash rate.
You Have a Say in Protocol Rules and Consensus
In Bitcoin you are a passive observer because you can only issue transactions and you have no part in the process after that. In Vertcoin you can be apart of the process for deciding the ordering of transactions and deciding what transactions get into blocks.
Block Rewards and Transaction Fees are Distributed Evenly
In Bitcoin and Litecoin the block rewards and transaction fees are often given to the large miners in China due to mining centralization created by ASICs. Vertcoin distributes its mining rewards to people all around the world thanks to the mining decentralization.

When will Atomic Swaps Be Ready?

Atomic Swaps can be done in two flavors: On-chain and Off-chain (via Lightning Network). On-chain swaps were actually done already using Blocknet, you can see it in use on Youtube. We're looking into doing it again using Interledger.
However our main focus is to do off-chain Atomic Swaps using Lightning Network technology. Because it has the same benefits as Lightning transactions: No network fees and instant transactions.
For off-chain swaps we need Lightning Network to be fully operational. It's difficult to give an ETA on that since we aren't the ones developing it. U/gertjaap posted a video on the current state of the Lightning Network for Vertcoin a while ago, which you can see here.
This was actually the "bleeding edge" of Lightning Network at the time. was able to use it on VTC's main net, meaning that our blockchain is ready for the good stuff. As you can see however, it can't yet be considered production ready (most users would want a little better UX than a command line app).
Now off-chain Atomic Swaps is a technique based on the same principles as Lightning Network, but adds an extra complexity for it being across chains. So it's basically the same as a "multi hop" Lightning payment, which is not yet built by any of the implementations. They're still working hard on making the single-hop payments robust. So in order for AS to be possible, LN has to be fully operational.
A timeline cannot be given at this time, because frankly we don't know. The implementation of Lightning Network we feel has the most potential is LIT, because it supports multiple currencies in its protocol (where LND is bitcoin-only at the time and requires significant work to support other currencies, which is an essential part of being able to work across multiple blockchains).
LIT is open source and there's nothing secretive about its progress, you can see the development on Github. We even have our lead dev James Lovejoy (u/jamesl22) close to the action and contributing to it where possible (and our team as well through testing it on the Vertcoin chain).
So we're not developing LN or AS ourselves, we're just ready with our blockchain technology whenever it becomes available.
If we have any real progress that has some substance, you can expect us to let the world know. We're not interested in fluffy marketing - we post something when we achieve real progress. And we are not keeping that secret.

How do I Choose the Right Vertcoin Wallet?

Deciding what Vertcoin wallet you should choose can be a difficult process. You can choose between three different wallets: Core, Electrum and Paper. Once you decide you can use the "How to Setup Your Vertcoin Wallets" video guide to assist you.

Core

The Core wallet is the wallet that most people should use. It will store the entire blockchain (~2GB) on your computer. The Core wallet is the only wallet that fully supports P2Pool mining. You will also have to use the Core wallet if you plan to run a P2Pool node or any Vertcoin related server.

Electrum

The Electrum wallet is a light wallet for Vertcoin. You do not have to download the blockchain on your computer, but you will still have your own private keys on your computer. This is recommended for people who don't need to store Vertcoins for very long and just need a quick but secure place to store them.

Paper

The Paper wallet is as the name implies, a physical paper wallet. When generating a paper wallet you will get a pdf that will need to print out. A paper wallet is normally used for long term storage since it is the safest way to store Vertcoins. A paper wallet can also be called "cold storage." Cold storage references the storage of your coins offline, preventing you from getting hacked over the internet.

Ledger Nano S

The Ledger Nano S is a hardware wallet designed by Ledger. A hardware wallet is similar to a paper wallet since it is normally used for cold storage. The hardware wallet is on par with the security of a paper wallet while being easy to use and setup. Note: You should never mine directly to a Ledger hardware wallet.

How do I start mining Vertcoin?

We have many guides available for you to use depending on your computer specifications.
Nvidia GPUs on Windows
Nvidia GPUs on Linux
AMD GPUs on Windows WARNING: Very unprofitable, AMD optimized miner is coming very soon.

Where can I get the One Click Miner (OCM)

You can get the latest version of the One Click Miner in the Vertcoin Discord. The download is pinned to the top of the #oneclick channel.

What do all the Numbers Mean on P2Pool’s Web Interface

I've seen a lot of confusion from new miners on public p2pool nodes, so here's a primer for the most common static node page style, for first time miners: https://imgur.com/K48GmMw

Active Miners on this Node

Address - This is the list of addresses currently mining on this node. If your address does not show up here, you are not mining on this node.
Hashrate
This is a snapshot of your hashrate as seen by the node. It will fluctuate up to 15% from the hashrate you are seeing on your mining software, but will average out to match the output in your mining software.
Rejected Hashrate
This is the amount of your hashing contribution that is rejected, both in hashrate and as a percentage of your total contribution. Running your own p2pool node minimizes this number. Mining on a node that is geographically close to reduce lag also minimizes this number. Ideally you would like it to be less than 1%, but most people seem happy keeping it under 3%.
Share Difficulty
This speaks for itself, it is the difficulty of the share being currently worked on. Bigger numbers are more difficult.
Time to Share
This is how long you need to mine before you will receive any payouts, or any "predicted payout." The lower your hashrate, the higher your time to share.
Predicted Payout
This is the reward you would receive if a block was found by p2pool right now. If it reads "no shares yet" then you have not yet been mining the requisite amount of time as seen in the previous "time to share" column.

Status

Network Hashrate
This is the total hashrate of all the miners mining vertcoin everywhere, regardless of where or how.
Global Pool Hashrate
This is the total hashrate of all the miners mining vertcoin on this p2pool network, be it the first network or the second network.
Local Pool Hashrate
This is the total hashrate of all the miners mining Vertcoin on this node.
Current Block Value
This is the reward that will be given for mining the current block. The base mining reward is currently 50 VTC per block, so any small decimal over that amount is transaction fees being paid by people using the network.
Network Block Difficulty
This is the difficulty of the block being mined. The higher the number, the higher the difficulty. This number rises as the "Network Hashrate" rises, so that blocks will always be found every 2.5 minutes. Inversely, this number falls when the "Network Hashrate" lowers as well.
Expected Time to Block
This is a guess at how much time will elapse between blocks being found by this p2pool network. This guess is accurate on average, but very inaccurate in the short term. Since you only receive a payout when the network finds a block, you can think of this as "Estimated Time to Payout."

Why is P2Pool Recommended Over Traditional Pools?

Decentralisation

P2Pool is peer to peer allowing a decentralized pool mining system. There are many nodes setup around the world that connect to each other too mine together. Many other coins have 1 very large pool that many miners connect to and sometimes the largest pool can have 51% or more of the network hash rate which makes the network vulnerable to a 51% attack. If P2Pool is the largest network then that prevents the Vertcoin network to be susceptible to a 51% attack as P2Pool is decentralized.

PPLNS Payout System

P2Pool uses a PPLNS (Pay Per Last N Shares) payout system which awards miners more the longer they mine, sort of like a loyalty system. A drawback to this system is that part time miners that aren't 24/7 won't be able to earn that much.

2 Networks

While Network 1 is catered towards 24/7 miners and people who have dedicated mining rigs, Vertcoin has a second P2Pool network where part time miners and miners under 100 MH/s can go to mine.

Mines Directly to Your Wallet

P2Pool mines directly to your wallet and cuts out the middleman. This reduces the likely hood that the pool will run away with your coins.

No Downtime

Since P2Pool is decentralized and has different nodes for you to choose from there will be no downtime because the P2Pool network does not die if one node goes down. You can setup a backup server in your miner so that you will have no downtime when mining.

Anonymity and Security

When using P2Pool you use a wallet address making your real identity anonymous, you are simply known by a random 34 letter string. Along with using a wallet address instead of a username there is no password involved P2Pool preventing the possibility of cracking your pool account (If you were on a traditional pool,) and stealing all your coins.

How do I Find a Nearby P2Pool Node

You can find the public p2pool nodes the the P2Pool Node Scanners. If you want to find a network 1 node go here. If you want to find a network 2 node go here.

How do I setup a P2Pool Node?

Linux P2Pool Setup
Windows P2Pool Setup (Text)
Windows P2Pool Setup (Video) This guide setups a network 2 node. When downloading Python download the 32bit version, not the 64bit. Downloading the 64bit version causes problems with the twisted install.
How do I setup a change my node to network 1 or network 2?
In the P2Pool startup script when you type the --network flag add vertcoin1 for network 1 and vertcoin2 for network 2 right after.

How do I Buy Vertcoin?

You can see a video guide on Youtube, "How to Buy Vertcoin with Fiat Using Bittrex and Coinbase"

How can I get help with "X problem?"

The quickest way for you to get help is for you to join the Vertcoin Discord Group. We almost always have knowledgable Vertans, whether that be developers or experienced Vertans, online to help you with whatever problems you may have.

How can I donate to the Developers?

You can donate to the dev fund at https://vertcoin.org/donate/. You can select what you want your funds to go to by donating to the corresponding address. You can also see how much funding is required and how much we have donated.

Where can I see what exchanges Vertcoin is on?

You can see what exchanges Vertcoin is listed on at CoinMarketCap. You can see what exchanges Vertcoin has applied to be on at this google docs spreadsheet.

Where can I see Vertcoin's Roadmap?

The Vertcoin developers currently have a trello board where you can see the goals and what the status of said goal is. You can also vote on what you want the Vertcoin developers to focus on next.

What is the Status of the AMD Optimized Miner?

The AMD Optimized Miner internal beta is aiming to be ready by the end of September. The AMD Optimized Miner is currently being developed by @turekaj on the Vertcoin Discord. He currently does not have a Reddit account and Discord is the only way you can contact him.

What Does Halving Mean?

Halving means that the block reward for miners will be split in half. Halving happens around every 4 years for Vertcoin or 840,000 blocks. This means around December miners will only receive 25 VTC per block instead of the current 50 VTC per block.
If you would like to add another question to this list please comment it and I will get around to adding it ASAP.
submitted by asianboygames to vertcoin [link] [comments]

Decred Journal — May 2018

Note: New Reddit look may not highlight links. See old look here. A copy is hosted on GitHub for better reading experience. Check it out, contains photo of the month! Also on Medium

Development

dcrd: Significant optimization in signature hash calculation, bloom filters support was removed, 2x faster startup thanks to in-memory full block index, multipeer work advancing, stronger protection against majority hashpower attacks. Additionally, code refactoring and cleanup, code and test infrastructure improvements.
In dcrd and dcrwallet developers have been experimenting with new modular dependency and versioning schemes using vgo. @orthomind is seeking feedback for his work on reproducible builds.
Decrediton: 1.2.1 bugfix release, work on SPV has started, chart additions are in progress. Further simplification of the staking process is in the pipeline (slack).
Politeia: new command line tool to interact with Politeia API, general development is ongoing. Help with testing will soon be welcome: this issue sets out a test plan, join #politeia to follow progress and participate in testing.
dcrdata: work ongoing on improved design, adding more charts and improving Insight API support.
Android: design work advancing.
Decred's own DNS seeder (dcrseeder) was released. It is written in Go and it properly supports service bit filtering, which will allow SPV nodes to find full nodes that support compact filters.
Ticket splitting service by @matheusd entered beta and demonstrated an 11-way split on mainnet. Help with testing is much appreciated, please join #ticket_splitting to participate in splits, but check this doc to learn about the risks. Reddit discussion here.
Trezor support is expected to land in their next firmware update.
Decred is now supported by Riemann, a toolbox from James Prestwich to construct transactions for many UTXO-based chains from human-readable strings.
Atomic swap with Ethereum on testnet was demonstrated at Blockspot Conference LATAM.
Two new faces were added to contributors page.
Dev activity stats for May: 238 active PRs, 195 master commits, 32,831 added and 22,280 deleted lines spread across 8 repositories. Contributions came from 4-10 developers per repository. (chart)

Network

Hashrate: rapid growth from ~4,000 TH/s at the beginning of the month to ~15,000 at the end with new all time high of 17,949. Interesting dynamic in hashrate distribution across mining pools: coinmine.pl share went down from 55% to 25% while F2Pool up from 2% to 44%. [Note: as of June 6, the hashrate continues to rise and has already passed 22,000 TH/s]
Staking: 30-day average ticket price is 91.3 DCR (+0.8), stake participation is 46.9% (+0.8%) with 3.68 million DCR locked (+0.15). Min price was 85.56. On May 11 ticket price surged to 96.99, staying elevated for longer than usual after such a pump. Locked DCR peaked at 47.17%. jet_user on reddit suggested that the DCR for these tickets likely came from a miner with significant hashrate.
Nodes: there are 226 public listening and 405 normal nodes per dcred.eu. Version distribution: 45% on v1.2.0 (up from 24% last month), 39% on v1.1.2, 15% on v1.1.0 and 1% running outdaded versions.

ASICs

Obelisk team posted an update. Current hashrate estimate of DCR1 is 1200 GH/s at 500 W and may still change. The chips came back at 40% the speed of the simulated results, it is still unknown why. Batch 1 units may get delayed 1-2 weeks past June 30. See discussions on decred and on siacoin.
@SiaBillionaire estimated that 7940 DCR1 units were sold in Batches 1-5, while Lynmar13 shared his projections of DCR1 profitability (reddit).
A new Chinese miner for pre-order was noticed by our Telegram group. Woodpecker WB2 specs 1.5 TH/s at 1200 W, costs 15,000 CNY (~2,340 USD) and the initial 150 units are expected to ship on Aug 15. (pow8.comtranslated)
Another new miner is iBelink DSM6T: 6 TH/s at 2100 W costing $6,300 (ibelink.co). Shipping starts from June 5. Some concerns and links were posted in these two threads.

Integrations

A new mining pool is available now: altpool.net. It uses PPLNS model and takes 1% fee.
Another infrastructure addition is tokensmart.io, a newly audited stake pool with 0.8% fee. There are a total of 14 stake pools now.
Exchange integrations:
OpenBazaar released an update that allows one to trade cryptocurrencies, including DCR.
@i2Rav from i2trading is now offering two sided OTC market liquidity on DCUSD in #trading channel.
Paytomat, payments solution for point of sale and e-commerce, integrated Decred. (missed in April issue)
CoinPayments, a payment processor supporting Decred, developed an integration with @Shopify that allows connected merchants to accept cryptocurrencies in exchange for goods.

Adoption

New merchants:
An update from VotoLegal:
michae2xl: Voto Legal: CEO Thiago Rondon of Appcívico, has already been contacted by 800 politicians and negotiations have started with four pre-candidates for the presidency (slack, source tweet)
Blockfolio rolled out Signal Beta with Decred in the list. Users who own or watch a coin will automatically receive updates pushed by project teams. Nice to see this Journal made it to the screenshot!
Placeholder Ventures announced that Decred is their first public investment. Their Investment Thesis is a clear and well researched overview of Decred. Among other great points it noted the less obvious benefit of not doing an ICO:
By choosing not to pre-sell coins to speculators, the financial rewards from Decred’s growth most favor those who work for the network.
Alex Evans, a cryptoeconomics researcher who recently joined Placeholder, posted his 13-page Decred Network Analysis.

Marketing

@Dustorf published March–April survey results (pdf). It analyzes 166 responses and has lots of interesting data. Just an example:
"I own DECRED because I saw a YouTube video with DECRED Jesus and after seeing it I was sold."
May targeted advertising report released. Reach @timhebel for full version.
PiedPiperCoin hired our advisors.
More creative promos by @jackliv3r: Contributing, Stake Now, The Splitting, Forbidden Exchange, Atomic Swaps.
Reminder: Stakey has his own Twitter account where he tweets about his antics and pours scorn on the holders of expired tickets.
"Autonomy" coin sculpture is available at sigmasixdesign.com.

Events

BitConf in Sao Paulo, Brazil. Jake Yocom-Piatt presented "Decentralized Central Banking". Note the mini stakey on one of the photos. (articletranslated, photos: 1 2 album)
Wicked Crypto Meetup in Warsaw, Poland. (video, photos: 1 2)
Decred Polska Meetup in Katowice, Poland. First known Decred Cake. (photos: 1 2)
Austin Hispanic Hackers Meetup in Austin, USA.
Consensus 2018 in New York, USA. See videos in the Media section. Select photos: booth, escort, crew, moon boots, giant stakey. Many other photos and mentions were posted on Twitter. One tweet summarized Decred pretty well:
One project that stands out at #Consensus2018 is @decredproject. Not annoying. Real tech. Humble team. #BUIDL is strong with them. (@PallerJohn)
Token Summit in New York, USA. @cburniske and @jmonegro from Placeholder talked "Governance and Cryptoeconomics" and spoke highly of Decred. (twitter coverage: 1 2, video, video (from 32 min))
Campus Party in Bahia, Brazil. João Ferreira aka @girino and Gabriel @Rhama were introducing Decred, talking about governance and teaching to perform atomic swaps. (photos)
Decred was introduced to the delegates from Shanghai's Caohejing Hi-Tech Park, organized by @ybfventures.
Second Decred meetup in Hangzhou, China. (photos)
Madison Blockchain in Madison, USA. "Lots of in-depth questions. The Q&A lasted longer than the presentation!". (photo)
Blockspot Conference Latam in Sao Paulo, Brazil. (photos: 1, 2)
Upcoming events:
There is a community initiative by @vj to organize information related to events in a repository. Jump in #event_planning channel to contribute.

Media

Decred scored B (top 3) in Weiss Ratings and A- (top 8) in Darpal Rating.
Chinese institute is developing another rating system for blockchains. First round included Decred (translated). Upon release Decred ranked 26. For context, Bitcoin ranked 13.
Articles:
Audios:
Videos:

Community Discussions

Community stats: Twitter 39,118 (+742), Reddit 8,167 (+277), Slack 5,658 (+160). Difference is between May 5 and May 31.
Reddit highlights: transparent up/down voting on Politeia, combining LN and atomic swaps, minimum viable superorganism, the controversial debate on Decred contractor model (people wondered about true motives behind the thread), tx size and fees discussion, hard moderation case, impact of ASICs on price, another "Why Decred?" thread with another excellent pitch by solar, fee analysis showing how ticket price algorithm change was controversial with ~100x cut in miner profits, impact of ticket splitting on ticket price, recommendations on promoting Decred, security against double spends and custom voting policies.
@R3VoLuT1OneR posted a preview of a proposal from his company for Decred to offer scholarships for students.
dcrtrader gained a couple of new moderators, weekly automatic threads were reconfigured to monthly and empty threads were removed. Currently most trading talk happens on #trading and some leaks to decred. A separate trading sub offers some advantages: unlimited trading talk, broad range of allowed topics, free speech and transparent moderation, in addition to standard reddit threaded discussion, permanent history and search.
Forum: potential social attacks on Decred.
Slack: the #governance channel created last month has seen many intelligent conversations on topics including: finite attention of decision makers, why stakeholders can make good decisions (opposed to a common narrative than only developers are capable of making good decisions), proposal funding and contractor pre-qualification, Cardano and Dash treasuries, quadratic voting, equality of outcome vs equality of opportunity, and much more.
One particularly important issue being discussed is the growing number of posts arguing that on-chain governance and coin voting is bad. Just a few examples from Twitter: Decred is solving an imagined problem (decent response by @jm_buirski), we convince ourselves that we need governance and ticket price algo vote was not controversial, on-chain governance hurts node operators and it is too early for it, it robs node operators of their role, crypto risks being captured by the wealthy, it is a huge threat to the whole public blockchain space, coin holders should not own the blockchain.
Some responses were posted here and here on Twitter, as well as this article by Noah Pierau.

Markets

The month of May has seen Decred earn some much deserved attention in the markets. DCR started the month around 0.009 BTC and finished around 0.0125 with interim high of 0.0165 on Bittrex. In USD terms it started around $81 and finished around $92, temporarily rising to $118. During a period in which most altcoins suffered, Decred has performed well; rising from rank #45 to #30 on Coinmarketcap.
The addition of a much awaited KRW pair on Upbit saw the price briefly double on some exchanges. This pair opens up direct DCR to fiat trading in one of the largest cryptocurrency markets in the world.
An update from @i2Rav:
We have begun trading DCR in large volume daily. The interest around DCR has really started to grow in terms of OTC quote requests. More and more customers are asking about trading it.
Like in previous month, Decred scores high by "% down from ATH" indicator being #2 on onchainfx as of June 6.

Relevant External

David Vorick (@taek) published lots of insights into the world of ASIC manufacturing (reddit). Bitmain replied.
Bitmain released an ASIC for Equihash (archived), an algorithm thought to be somewhat ASIC-resistant 2 years ago.
Three pure PoW coins were attacked this month, one attempting to be ASIC resistant. This shows the importance of Decred's PoS layer that exerts control over miners and allows Decred to welcome ASIC miners for more PoW security without sacrificing sovereignty to them.
Upbit was raided over suspected fraud and put under investigation. Following news reported no illicit activity was found and suggested and raid was premature and damaged trust in local exchanges.
Circle, the new owner of Poloniex, announced a USD-backed stablecoin and Bitmain partnership. The plan is to make USDC available as a primary market on Poloniex. More details in the FAQ.
Poloniex announced lower trading fees.
Bittrex plans to offer USD trading pairs.
@sumiflow made good progress on correcting Decred market cap on several sites:
speaking of market cap, I got it corrected on coingecko, cryptocompare, and worldcoinindex onchainfx, livecoinwatch, and cryptoindex.co said they would update it about a month ago but haven't yet I messaged coinlib.io today but haven't got a response yet coinmarketcap refused to correct it until they can verify certain funds have moved from dev wallets which is most likely forever unknowable (slack)

About This Issue

Some source links point to Slack messages. Although Slack hides history older than ~5 days, you can read individual messages if you paste the message link into chat with yourself. Digging the full conversation is hard but possible. The history of all channels bridged to Matrix is saved in Matrix. Therefore it is possible to dig history in Matrix if you know the timestamp of the first message. Slack links encode the timestamp: https://decred.slack.com/archives/C5H9Z63AA/p1525528370000062 => 1525528370 => 2018-05-05 13:52:50.
Most information from third parties is relayed directly from source after a minimal sanity check. The authors of Decred Journal have no ability to verify all claims. Please beware of scams and do your own research.
Your feedback is precious. You can post on GitHub, comment on Reddit or message us in #writers_room channel.
Credits (Slack names, alphabetical order): bee, Richard-Red, snr01 and solar.
submitted by jet_user to decred [link] [comments]

Bitcoin Mining & The Beauty Of Capitalism

Authored by Valentin Schmid via The Epoch Times,
While the price of bitcoin drops, miners get more creative... and some flourish.
The bitcoin price is crashing; naysayers and doomsayers are having a field day. The demise of the dominant cryptocurrency is finally happening — or is it?
Bitcoin has been buried hundreds of times, most notably during the brutal 90 percent decline from 2013 to 2015. And yet it has always made a comeback.
Where the skeptics are correct: The second bitcoin bubble burst in December of last year and the price is down roughly 80 percent from its high of $20,000. Nobody knows whether and when it will see these lofty heights again.
As a result, millions of speculators have been burned, and big institutions haven’t showed up to bridge the gap.
This also happened on a smaller scale in 2013 after a similar 100x run-up, and it was necessary.

Time to Catch Up

What most speculators and even some serious proponents of the independent and decentralized monetary system don’t understand: Bitcoin needs these pauses to make improvements in its infrastructure.
Exchanges, which could not handle the trading volumes at the height of the frenzy and did not return customer service inquiries, can take a breather and upgrade their systems and hire capable people.
The technology itself needs to make progress and this needs time. Projects like the lightning network, a system which delivers instant bitcoin payments at very little cost and at virtually unlimited scale is now only available to expert programmers.
A higher valuation is only justified if these improvements reach the mass market.
And since we live in a world where everything financial is tightly regulated, for better or worse, this area also needs to catch up, since regulators are chronically behind the curve of technological progress.
And of course, there is bitcoin mining. The vital infrastructure behind securing the bitcoin network and processing its transactions has been concentrated in too few hands and in too few places, most notably China, which still hosts about 70 percent of the mining capacity.

The Case For Mining

Critics have always complained that bitcoin mining consumes “too much” electricity, right now about as much as the Czech Republic. In energy terms this is around 65 terawatt hours or 230,000,000 gigajoules, costing $3.3 billion dollars according to estimates by Digiconomist.
For the non-physicists among us, this is around as much as consumed by six million energy-guzzling U.S. households per year.
All those estimates are imprecise because the aggregate cannot know how much energy each of the different bitcoin miners consumes and how much that electricity costs. But they are a reasonable rough estimate.
So it’s worth exploring why mining is necessary to begin with and whether the electricity consumption is justified.
Anything and everything humans do consumes resources. The question then is always: Is it worth it? And: Who decides?
This question then leads to the next question: Is it worth having and using money? Most people would argue yes, because using money instead of barter in fact makes economic transactions faster and cheaper and thus saves resources, natural and human.

_Merchants exchange goods with the inhabitants of Tidore, Indonesia, circa 1550. Barter was supplanted by using money because it is more efficient. (Archive/Getty Images)_If we are generously inclined, we will grant bitcoin the status of a type of money or at least currency as it meets the general requirements of being recognizable, divisible, portable, durable, is accepted in exchange for other goods and services, and in this case it is even limited in supply.
So having any type of money has a price, whether it’s gold, dollar bills, or numbers on the screen of your online banking system. In the case of bitcoin, it’s the electricity and the capital for the computing equipment, as well as the human resources to run these operations.
If we think having money in general is a good idea and some people value the decentralized and independent nature of bitcoin then it would be worth paying for verifying transactions on the bitcoin network as well as keeping the network secure and sound: Up until the point where the resources consumed would outweigh the efficiency benefits. Just like most people don’t think it’s a bad idea to use credit cards and banks, which consume electricity too.
However, bitcoin is a newcomer and this is why it’s being scrutinized even more so than the old established players.

Different Money, Different Costs

How many people know how much electricity, human lives, and other resources gold mining consumes or has consumed in the course of history? What about the banking system? Branches, servers, air-conditioning, staff? What about printing dollar notes and driving them around in armored trucks?
What about the social effects of monetary mismanagement of bank and government money like inflation as well as credit deflations? Gold gets a pass here.
Most people haven’t asked that question, which is why it’s worth pointing out the only comprehensive study done on the topic in 2014. In “An Order of Magnitude” the engineer Hass McCook analyzes the different money systems and reaches mind-boggling conclusions.
The study is a bit dated and of course the aggregations are also very rough estimates, but the ball park numbers are reasonable and the methodology sound.
In fact, according to the study, bitcoin is the most economic of all the different forms of money.
Gold mining in 2014 used 475 million GJ, compared to bitcoin’s 230 million in 2018. The banking system in 2014 used 2.3 billion gigajoules.
Over 100 people per year die trying to mine gold. But mining costs more than electricity. It consumes around 300,000 liters of water per kilogram of gold mined as well as 150 kilogram (330 pounds) of cyanide and 1500 tons of waste and rubble.
The international banking system has been used in all kinds of fraudulent activity throughout history: terrorist financing, money laundering, and every other criminal activity under the sun at a cost of trillions of dollars and at an order of magnitude higher than the same transactions done with cryptocurrency and bitcoin.
And of course, while gold has a relatively stable value over time, our bank and government issued money lost about 90 percent of its purchasing power over the last century, because it can be created out of thin air. This leads to inflation and a waste of physical and human resources because it distorts the process of capital allocation.

_The dollar has lost more than 90 percent of its value since the creation of the Federal Reserve in 1913. (Source: St. Louis Fed)_This is on top of the hundreds of thousands of bank branches, millions of ATMs and employees which all consume electricity and other resources, 10 times as much electricity alone as the bitcoin network.
According to monetary philosopher Saifedean Ammous, author of “The Bitcoin Standard,” the social benefit of hard money, i.e. money that can’t be printed by government decree, cannot even be fathomed; conversely, the true costs of easy money—created by government fiat and bank credit—are difficult to calculate.
According to Ammous, bitcoin is the hardest money around, even harder than gold because its total supply is capped, whereas the gold supply keeps increasing at about 1-2 percent every year.
“Look at the era of the classical gold standard, from 1871, the end of the Franco–Prussian War, until the beginning of World War I. There’s a reason why this is known as the Golden Era, the Gilded Age, and La Belle Epoque. It was a time of unrivaled human flourishing all over the world. Economic growth was everywhere. Technology was being spread all over the world. Peace and prosperity were increasing everywhere around the world. Technological innovations were advancing.
“I think this is no coincidence. What the gold standard allowed people to do is to have a store of value that would maintain its value in the future. And that gave people a low time preference, that gave people the incentive to think of the long term, and that made people want to invest in things that would pay off over the long term … bitcoin is far closer to gold. It is a digital equivalent of gold,” he said in an interview with The Epoch Times.
Of course, contrary to the gold standard that Ammous talks about, bitcoin doesn’t have a track record of being sound money in practice. In theory it meets all the criteria, but in the real world it hasn’t been adopted widely and has been so volatile as to be unusable as a reliable store of value or as the underlying currency of a productive lending market.
The proponents argue that over time, these problems will be solved the same way gold spread itself throughout the monetary sphere replacing copper and seashells, but even Ammous concedes the process may take decades and the outcome is far from certain. Gold is the safe bet for sound money, bitcoin has potential.
There is another measure where bitcoin loses out, according to a recent study by researchers from the Oak Ridge Institute in Cincinnati, Ohio.
It is the amount of energy expended per dollar for different monetary instruments. One dollar worth of bitcoin costs 17 megajoules to mine versus five for gold and seven for platinum. But the study omits the use of cyanide, water, and other physical resources in mining physical metals.
In general, the comparisons in dollar terms go against bitcoin because it is worth relatively less, only $73 billion in total at the time of writing. An issue that could be easily fixed at a higher price, but a higher price is only justified if the infrastructure improves, adoption increases, volatility declines, and the network proves its resilience to attacks over time.
In the meantime, market participants still value the fact they can own a currency independent of the government, completely digital, easily fungible, and limited in supply, and relatively decentralized. And the market as a whole is willing to pay a premium for these factors reflected in the higher per dollar prices for mining bitcoin.

The Creativity of Bitcoin Mining

But where bitcoin mining lacks in scale, it makes up for it in creativity.
In theory—and in practice—bitcoin mining can be done anywhere where there is cheap electricity. So bitcoin mining operations can be conducted not where people are (banking) or where government is (fiat cash) or where gold is (gold mining)—it can be done everywhere where there is cheap electricity
Some miners are flocking to the heat of the Texan desert where gas is virtually available for free, thanks to another oil revolution.
Other miners go to places where there is cheap wind, water, or other renewable energy.
This is because they don’t have to build bank branches, printing presses, and government buildings, or need to put up excavators and conveyor belts to dig gold out of the ground.
All they need is internet access and a home for the computers that look like a shipping container, each one of which has around 200 specialized bitcoin mining computers in them.
“The good thing about bitcoin mining is that it doesn’t matter where on earth a transaction happens, we can verify it in our data center here. The miners are part of the decentralized philosophy of bitcoin, it’s completely independent of your location as well,” said Moritz Jäger, chief technology officer at bitcoin Mining company Northern Bitcoin AG.

Centralized Mining

But so far, this decentralization hasn’t worked out as well as it sounds in theory.
Because Chinese local governments had access to subsidized electricity, it was profitable for officials to cut deals with bitcoin mining companies and supply them with cheap electricity in exchange for jobs and cutbacks. Sometimes the prices were as low as 2 dollar cents to 4 dollar cents per kilowatt hour.
This is why the majority of bitcoin mining is still concentrated in China (around 70 percent) where it was the most profitable, but only because the Chinese central planners subsidized the price of electricity.
This set up led to the by and large unwanted result that the biggest miner of bitcoin, a company called Bitmain, is also the biggest manufacturer of specialized computing equipment for bitcoin mining. The company reported revenues of $2.8 billion for the first half of 2018.

Tourists walk on the dunes near a power plant in Xiangshawan Desert in Ordos of Inner Mongolia, in this file photo. bitcoin miners have enjoyed favorable electricity rates in places like Ordos for a long time. (Feng Li/Getty Images)Centralized mining is a problem because whenever there is one player or a conglomerate of players who control more than 50 percent of the network computing power, they could theoretically crash the network by spending the same bitcoin twice, the so called “double spending problem.“
They don’t have an incentive to do so because it would probably ruin the bitcoin price and their business, but it’s better not to have to rely on one group of people controlling an entire money system. After all, we have that exact same system with central banking and bitcoin was set up as a decentralized alternative.
So far, no player or conglomerate ever reached that 51 percent threshold, at least not since bitcoin’s very early days, but many market participants always thought Bitmain’s corner of the market is a bit too close for comfort.
This favorable environment for Chinese bitcoin mining has been changing with a crack down on local government electricity largess as well as a crackdown on cryptocurrency.
Bitcoin itself and mining bitcoin remain legal in China but cryptocurrency exchanges have been banned since late 2017.
But more needs to be done for bitcoin to become independent of the caprice of a centralized oppressive regime and local government bureaucrats.

Northern Bitcoin Case Study

Enter Northern Bitcoin AG. The company isn’t the only one which is exploring mining opportunities with renewable energies in locations other than China.
But it is special because of the extraordinary set up it has for its operations, the fact that it is listed on the stock exchange in Germany, and the opportunities for scaling it discovered.
The operations of Northern Bitcoin combine the beauties of bitcoin and capitalism in one.
Like Texas has a lot of oil and free gas and it makes sense to use the gas rather than burn it, Norway has a lot of water, especially water moving down the mountains due to rainfall and melting snow.
And it makes sense to use the power of the movement of the water, channel it through pipes into generators to create very cheap and almost unlimited electricity. Norway generates north of 95 percent of its total electricity from hydropower.

A waterfall next to a hydropowerplant near Sandane, Norway, Oct. 25, 2018. (Valentin Schmid/The Epoch Times)Capitalism does not distinguish between renewable and fossil. It uses what is the most expedient. In this case, it is clearly water in Norway, and gas in Texas.
As a side note on the beauties of real capital and the fact that capital and the environment need not be enemies, the water in one of the hydropowerplants close to the Northern Bitcoin facility is piped through a generator made in 1920 by J.M. Voith AG, a company from Heidenheim Germany.
The company was established in 1867 and is still around today. The generator was produced in 1920 and is still producing electricity today.

Excess Power

In the remote regions of Northern Norway, there aren’t that many people or industry who would use the electricity. And rather than transport it over hundreds of miles to the industrial centers of Europe, the industries of the future are moving to Norway to the source of the cheap electricity.
Of course, it is not just bitcoin mining, but other data and computing heavy operations like server farms for cloud computing that can be neatly packaged into one of those containers and shipped up north.
“The containers are beautiful. They are produced in the middle of Germany where the hardware is enabled and tested. Then we put it on a truck and send it up here. When the truck arrives on the outside we lift it on the container vehicle. Two hours after the container arrives, it’s in the container rack. And 40 hours later we enable the cooling, network, power, other systems, and it’s online,” said Mats Andersson, a spokesman for the Lefdal Mine data center in Måløy, Norway, where Northern Bitcoin has its operations. Plug and play.

A Northern Bitcoin data container inside the Lefdal Mine data center, in Måløy, Norway. (Northern Bitcoin)If the cheap electricity wasn’t enough—around 5 cents per kilowatt hour compared to 17 cents in Germany—Norway also provides the perfect storage for these data containers, which are normally racked up in open air parks above the ground.
Also here, the resource allocation is beautiful. Instead of occupying otherwise useful and beautiful parcels of land and nature, the Northern Bitcoin containers and others are stored in the old Lefdal olivine mine.
Olivine is a mineral used for steel production and looks green. Very fitting. Hence also the name of the data center: Lefdal Mine.
“We take the green mineral out and we take the green IT in,” said Andersson.

Efficiency, Efficiency

Using the old mine as storage for the data center makes the whole process even more resource efficient.
Why? So far, we’ve only been talking about bitcoin mining using a lot of energy. But what for? Before you have actually seen the process in action—and it is similar for other computing operations—you cannot imagine how bizarre it is.
Most of the electricity is used to prevent the computers from overheating. So it’s not even the processors themselves; it’s the fans which cool the computer that use the most juice.
This is where the mine helps, because it’s rather cool 160 meters (525 feet) below sea level; certainly cooler than in the Texas desert.
But it gets even better. On top of the air blow-cooling the computer, the Lefdal data center uses a fresh water system to pump through the containers in pipes.
The fans can then circulate air over the cool pipes which transfer the heat to the water. One can feel the difference when touching the different pipes.
The fresh water closed circle loop then completes the “green” or resource efficiency cycle by transferring its heat to ice cold water from the nearby Fjord.
The water is sucked in through a pipe from the Fjord, the heat gets transferred without the water being mixed, and the water flows back to the Fjord, without any impact on the environment.
To top it all off, the mine has natural physical security far better than open air data centers and is even protected from an electromagnetic pulse blast because it’s underground.

_The Nordfjord near Måløy, Norway. The Lefdal data center takes the cold water from the fjord and uses it to cool the computer inside the mine. (Valentin Schmid/The Epoch Times)_Company Dynamics

Given this superlative set up, Northern Bitcoin wants to ramp up production as fast as possible at the Lefdal mine and other similar places in Norway, which have more mountains where data centers can be housed.
At the moment, Northern Bitcoin has 15 containers with 210 mining machines each. The 15 containers produce around 5 bitcoin per day at a total cost of around $2,500 dollars at the end of November 2018 and after the difficulty of solving the math problems went down by ~17 percent.
Most of it is for electricity; the rest is for leasing the containers, renting the mine space, buying and writing off the mining computers, personnel, overhead, etc.
Even at the current relatively depressed prices of around $4000, that’s a profit of $1500 per bitcoin or $7,500 per day.
But the goal is to ramp it up to 280 containers until 2019, producing 100 bitcoin per day. Again, the company is in the sweet spot to do this.
As opposed to the beginning of the year when one could not procure a mining computer from Bitmain even if one’s life depended on it, the current bear market has made them cheap and relatively available both new and second had from miners who had to cease operations because they can’t produce at low bitcoin prices.

Northern Bitcoin containers inside the Lefdal Mine data center in Måløy, Norway. (Northern Bitcoin)What about the data shipping containers? They are manufactured by a company called Rittal who is the world market leader. So it helps that the owner of Rittal also owns 30 percent of the Lefdal mine, providing preferential access to the containers.
Northern Bitcoin said it has enough capital available for the intermediate goal of ramping up to 50 containers until the end of year but may tap the capital markets again for the next step.
The company can also take advantage of the lower German corporate tax rate because revenue is only recorded when the bitcoin are sold in Germany, not when they are mined in Norway.
Of course, every small-cap stock—especially bitcoin companies—have their peculiarities and very high risks. As an example, Northern Bitcoin’s financial statements, although public, aren’t audited.
The equipment in the Lefdal mine in Norway is real and the operations are controlled by the Lefdal personnel, but one has to rely on exclusive information from the company for financials and cost figures, so buyer beware.

Norway Powerhouse?

Northern Bitcoin wants to have 280 containers, representing around 5 percent of the network’s computing power.
But the Lefdal mine alone has a capacity to power and cool 1,500 containers in a 200 megawatt facility, once it is fully built out.
“Here you have all the space, power, and cooling that you need. … Here you can grow,” said Lefdal’s Andersson.

A mine shaft in the Lefdal Mine data center in Måløy, Norway. The whole mine will have a capacity for 1500 containers once fully built out. (Valentin Schmid/The Epoch Times)The Norwegian government was behind an initiative to bring computing power to Norway and make it one of the prime destinations for data centers at the beginning of this decade.
To that effect, the local governments own part of the utility companies which operate the power plants and own part of the Lefdal Mine and other locations. But even without notable subsidies (i.e. cash payments to companies), market players were able to figure it out, for everybody’s benefit.
The utilities win because they can sell their cheap electricity close to home. The computing companies like IBM and Northern Bitcoin win because they can get cheap electricity, storage, and security. Data center operators like Lefdal win because they can charge rent for otherwise unused and unneeded space.
However, in a recent about face, the central government in Oslo has decided to remove cryptocurrency miners from the list of companies which pay a preferential tax rate on electricity consumption.
Normally, energy intensive companies, including data centers, pay a preferential tax on electricity consumed of 0.48 øre ($0.00056 ). According to a report by Norwegian media Aftenposten, this tax will rise to 16.58 øre ($0.019) in 2019 for cryptocurrency miners exclusively.
The argument by left wing politician Lars Haltbrekken who sponsored the initiative: “Norway cannot continue to provide huge tax incentives for the most dirty form of cryptocurrency output […] [bitcoin] requires a lot of energy and generates large greenhouse gas emissions globally.”
Since Norway generates its electricity using hydro, precisely the opposite is true: No greenhouse gas emissions, or any emissions for that matter would be produced, if all cryptomining was done in Norway. As opposed to China, where mining is done with coal and with emissions.
But not only in Norway is the share of renewable and emission free energy high. According to research by Coinshares, Bitcoin’s consumes about 77.6 percent of its energy in the form of renewables globally.
However self-defeating the arguments against bitcoin mining in Norway, the political initiative is moving forward. What it means for Northern Bitcoin is not clear, as they house their containers in Lefdal’s mixed data center, which also has other clients, like IBM.
“It’s not really decided yet; there are still big efforts from IT sectors and parties who are trying to change it. If the decision is taken it might apply for pure crypto sites rather than mixed data centers, like ours,” said Lefdal’s Andersson.
Even in the worst-case scenario, it would mean an increase from ~5 cents to ~6.9 cents per kilowatt hour, or 30 percent more paid on the electricity by Northern Bitcoin, which at ~$3250 would still rank it among the most competitive producers in the world.
Coinshares estimates the average production price at $6,800 per Bitcoin at $0,05 per kilowatt hour of electricity and an 18-months depreciation schedule, but concedes that a profitable miner could “[depreciate] mining gear over 24-30 months, or [pay] less for mining gear than our estimates.”
Jäger says Northern Bitcoin depreciates the equipment over three years and has obtained very favorable prices from Bitmain, making its production much more competitive than the average despite the same cost of electricity. In addition, the natural cooling in the mine also reduces electricity costs overall.

Cheap Producer Advantage

At the moment, however, the tax could be the least of any miners worry, as the bitcoin price is in free-fall.
But what happens when the price crashes further? Suffice it to say that there was bitcoin mining when the dollar price was less than 1 cent and there will be bitcoin mining at lower prices thanks to the design of the network.
Mao Shixing, the founder of mining pool F2pool estimated 600,000 miners have shut down since the November crash in price, according to a report by Coindesk.
As it should be in a competitive system, the most energy intensive and obsolete machines are shut down first.
As with every other commodity, when the price drops, some miners will leave the market, leaving space for cheaper competitors to capture a bigger share. But with bitcoin this is a bit simpler than with copper or gold for example.
When a big copper player goes bankrupt, its competitors have to ramp up production and increase cost to increase their market share. With bitcoin, if 3,000 computers get taken off the total mining pool, they won’t be able to mine the approximately 5 bitcoin any longer.
However, because the difficulty of solving the computationally intensive cryptographic tasks of bitcoin decreases automatically when there are fewer computers engaged in the task, the other players just have to leave their machines running at the same rate for the same cost and they will split the 5 bitcoin among them.
“The moment the price goes down, our production price will go down as well,” said Jäger, a process that already happened from November to December when the difficulty decreased twice in November and the beginning of December.
This naturally favors players like Northern Bitcoin, which are producing at the lower end of the cost spectrum. They will be the ones who shut down last.
And this is a good thing. The more companies like Northern Bitcoin, and countries like Norway—even with the extra tax—the more decentralized the bitcoin system.
The more computers there are in different hands mining bitcoin, the more secure the system becomes, because it will be ever more difficult for one player to reach the 50 percent threshold to crash the system. It is this decentralized philosophy which has kept the bitcoin system running for 10 years. Whether at $1 or $20,000.
submitted by rotoreuters to zerohedge [link] [comments]

MAD Doge - Market Analysis 1/18/2014 (Afternoon Edition) - Such Mining

After days of a somewhat stable market, one thing has gone to a dog eat Doge world and that is mining.

What happened to mining?

Where will the price go?

What we must recall is that DogeCoin, as with the Doge meme is highly affected by the hype behind it

What's the short-term outcome?

Halving - The Rocket Booster

News:

I'll end this with a question: Who do you think should start accepting DogeCoin?
SHIBE ON!
submitted by DRKMSTR to MADDOGE [link] [comments]

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