1b) Any pool that does NOT share transaction fees should be rejected from consideration (which, unfortunately, is most, if not all, Chinese based pools)
2) Reasonable variance – You need to get paid often enough to be happy. This is a tough one.
Variance is the close cousin to “Luck”.
The luckier a pool is, the more blocks it finds relative to its hashing speed, and the less variance it will have. But its not a real thing! “Luck” could change any microsecond. “Luck” is just mathematical statistics – over a long enough time period, all pools will average out to 100% luck.
Luck Statistik for 14 Blocks
You need to understand Variance:
A big pool finds more blocks, but distributes the earnings out to more miners.
A small pool is just the reverse: it finds fewer blocks, but pays those earnings to fewer people. Over the long run, Rule #1, well, rules.
3) Wind-up/Wind-down time – Most pools use some leveling algorithm.
4) User Interface – That doesn’t matter much if you have a few miners. If you have hundreds, the difference can be thousands of dollars a Year.
Notes:
A)In the long run #2 & #3 really don’t matter much. Both pools show your hashing rate in minutes, payouts just lag on Kano compared to Slushpool, but would continue longer if you changed in the future
B) Bigger is not better. Sure Antpool is #1 in size, in no small part to Bitmain using their own pool (no fees for them!). Your profit will be determined mostly by rule #1 – lower fees mean more profit.
C) More, smaller, pools is healthier for the blockchain. If you can live with the variance, support the pool with the longest average payout you are happy with.
D) For pools with long ramp up times that are relatively small, like Kano, you MIGHT suffer due to difficulty changes while you ramp up.
For smaller pools, make sure you understand what happens to your efforts (based on their scoring system) when a difficulty change occurs.
Cryptocurrency markets are volatile enough without making simple, easily avoidable mistakes.
Investing in cryptocurrencies and digital assets is now easier than ever before. Online brokers, centralized exchanges and even decentralized exchanges give investors the flexibility to buy and sell tokens without going through a traditional financial institution and the hefty fees and commissions that come along with them.
Cryptocurrencies were designed to operate in a decentralized manner. This means that while they’re an innovative avenue for global peer-to-peer value transfers, there are no trusted authorities involved that can guarantee the security of your assets. Your losses are your responsibility once you take your digital assets into custody.
Here we’ll explore some of the more common mistakes that cryptocurrency investors and traders make and how you can protect yourself from unnecessary losses.
Losing your keys
Cryptocurrencies are built on blockchain technology, a form of distributed ledger technology that offers high levels of security for digital assets without the need for a centralized custodian. However, this puts the onus of protection on asset holders, and storing the cryptographic keys to your digital asset wallet safely is an integral part of this.
On the blockchain, digital transactions are created and signed using private keys, which act as a unique identifier to prevent unauthorized access to your cryptocurrency wallet. Unlike a password or a PIN, you cannot reset or recover your keys if you lose them. This makes it extremely important to keep your keys safe and secure, as losing them would mean losing access to all digital assets stored in that wallet.
Lost keys are among the most common mistakes that crypto investors make. According to a report from Chainalysis, of the 18.5 million Bitcoin (BTC) mined so far, over 20% has been lost to forgotten or misplaced keys.
Storing coins in online wallets
Centralized cryptocurrency exchanges are probably the easiest way for investors to get their hands on some cryptocurrencies. However, these exchanges do not give you access to the wallets holding the tokens, instead offering you a service similar to banks. While the user technically owns the coins stored on the platform, they are still held by the exchange, leaving them vulnerable to attacks on the platform and putting them at risk.
There have been many documented attacks on high-profile cryptocurrency exchanges that have led to millions of dollars worth of cryptocurrency stolen from these platforms. The most secure option to protect your assets against such risk is to store your cryptocurrencies offline, withdrawing assets to either a software or hardware wallet after purchase.
Not keeping a hard copy of your seed phrase
To generate a private key for your crypto wallet, you will be prompted to write down a seed phrase consisting of up to 24 randomly generated words in a specific order. If you ever lose access to your wallet, this seed phrase can be used to generate your private keys and access your cryptocurrencies.
Keeping a hard copy record, such as a printed document or a piece of paper with the seed phrase written on it, can help prevent needless losses from damaged hardware wallets, faulty digital storage systems, and more. Just like losing your private keys, traders have lost many a coin to crashed computers and corrupted hard drives.
Fat-finger error
A fat-finger error is when an investor accidentally enters a trade order that isn’t what they intended. One misplaced zero can lead to significant losses, and mistyping even a single decimal place can have considerable ramifications.
One instance of this fat-finger error was when the DeversiFi platform erroneously paid out a $24-million fee. Another unforgettable tale was when a highly sought-after Bored Ape nonfungible token was accidentally sold for $3,000 instead of $300,000.
Sending to the wrong address
Investors should take extreme care while sending digital assets to another person or wallet, as there is no way to retrieve them if they are sent to the wrong address. This mistake often happens when the sender isn’t paying attention while entering the wallet address. Transactions on the blockchain are irreversible, and unlike a bank, there are no customer support lines to help with the situation.
This kind of error can be fatal to an investment portfolio. Still, in a positive turn of events, Tether, the firm behind the world’s most popular stablecoin, recovered and returned $1 million worth of Tether (USDT) to a group of crypto traders who sent the funds to the wrong decentralized finance platform in 2020. However, this story is a drop in the ocean of examples where things don’t work out so well. Hodlers should be careful while dealing with digital asset transactions and take time to enter the details. Once you make a mistake, there’s no going back.
Over diversification
Diversification is crucial to building a resilient cryptocurrency portfolio, especially with the high volatility levels in the space. However, with the sheer number of options out there and the predominant thirst for outsized gains, cryptocurrency investors often end up over-diversifying their portfolios, which can have immense consequences.
Over-diversification can lead to an investor holding a large number of heavily underperforming assets, leading to significant losses. It’s vital to only diversify into cryptocurrencies where the fundamental value is clear and to have a strong understanding of the different types of assets and how they will likely perform in various market conditions.
Not setting up a stop-loss arrangement
A stop-loss is an order type that enables investors to sell a security only when the market reaches a specific price. Investors use this to prevent losing more money than they are willing to, ensuring they at least make back their initial investment.
In several cases, investors have experienced huge losses because of incorrectly setting up their stop losses before asset prices dropped. However, it’s also important to remember that stop-loss orders aren’t perfect and can sometimes fail to trigger a sale in the event of a large, sudden crash.
That being said, the importance of setting up stop losses to protect investments cannot be understated and can significantly help mitigate losses during a market downturn.
Crypto investing and trading is a risky business with no guarantees of success. Like any other form of trading, patience, caution and understanding can go a long way. Blockchain places the responsibility on the investor, so it’s crucial to take the time to figure out the various aspects of the market and learn from past mistakes before putting your money at risk.
Cryptocurrency markets are volatile enough without making simple, easily avoidable mistakes.
Investing in cryptocurrencies and digital assets is now easier than ever before. Online brokers, centralized exchanges and even decentralized exchanges give investors the flexibility to buy and sell tokens without going through a traditional financial institution and the hefty fees and commissions that come along with them.
Cryptocurrencies were designed to operate in a decentralized manner. This means that while they’re an innovative avenue for global peer-to-peer value transfers, there are no trusted authorities involved that can guarantee the security of your assets. Your losses are your responsibility once you take your digital assets into custody.
Here we’ll explore some of the more common mistakes that cryptocurrency investors and traders make and how you can protect yourself from unnecessary losses.
Losing your keys
Cryptocurrencies are built on blockchain technology, a form of distributed ledger technology that offers high levels of security for digital assets without the need for a centralized custodian. However, this puts the onus of protection on asset holders, and storing the cryptographic keys to your digital asset wallet safely is an integral part of this.
On the blockchain, digital transactions are created and signed using private keys, which act as a unique identifier to prevent unauthorized access to your cryptocurrency wallet. Unlike a password or a PIN, you cannot reset or recover your keys if you lose them. This makes it extremely important to keep your keys safe and secure, as losing them would mean losing access to all digital assets stored in that wallet.
Lost keys are among the most common mistakes that crypto investors make. According to a report from Chainalysis, of the 18.5 million Bitcoin (BTC) mined so far, over 20% has been lost to forgotten or misplaced keys.
Storing coins in online wallets
Centralized cryptocurrency exchanges are probably the easiest way for investors to get their hands on some cryptocurrencies. However, these exchanges do not give you access to the wallets holding the tokens, instead offering you a service similar to banks. While the user technically owns the coins stored on the platform, they are still held by the exchange, leaving them vulnerable to attacks on the platform and putting them at risk.
There have been many documented attacks on high-profile cryptocurrency exchanges that have led to millions of dollars worth of cryptocurrency stolen from these platforms. The most secure option to protect your assets against such risk is to store your cryptocurrencies offline, withdrawing assets to either a software or hardware wallet after purchase.
Not keeping a hard copy of your seed phrase
To generate a private key for your crypto wallet, you will be prompted to write down a seed phrase consisting of up to 24 randomly generated words in a specific order. If you ever lose access to your wallet, this seed phrase can be used to generate your private keys and access your cryptocurrencies.
Keeping a hard copy record, such as a printed document or a piece of paper with the seed phrase written on it, can help prevent needless losses from damaged hardware wallets, faulty digital storage systems, and more. Just like losing your private keys, traders have lost many a coin to crashed computers and corrupted hard drives.
Fat-finger error
A fat-finger error is when an investor accidentally enters a trade order that isn’t what they intended. One misplaced zero can lead to significant losses, and mistyping even a single decimal place can have considerable ramifications.
One instance of this fat-finger error was when the DeversiFi platform erroneously paid out a $24-million fee. Another unforgettable tale was when a highly sought-after Bored Ape nonfungible token was accidentally sold for $3,000 instead of $300,000.
Sending to the wrong address
Investors should take extreme care while sending digital assets to another person or wallet, as there is no way to retrieve them if they are sent to the wrong address. This mistake often happens when the sender isn’t paying attention while entering the wallet address. Transactions on the blockchain are irreversible, and unlike a bank, there are no customer support lines to help with the situation.
This kind of error can be fatal to an investment portfolio. Still, in a positive turn of events, Tether, the firm behind the world’s most popular stablecoin, recovered and returned $1 million worth of Tether (USDT) to a group of crypto traders who sent the funds to the wrong decentralized finance platform in 2020. However, this story is a drop in the ocean of examples where things don’t work out so well. Hodlers should be careful while dealing with digital asset transactions and take time to enter the details. Once you make a mistake, there’s no going back.
Over diversification
Diversification is crucial to building a resilient cryptocurrency portfolio, especially with the high volatility levels in the space. However, with the sheer number of options out there and the predominant thirst for outsized gains, cryptocurrency investors often end up over-diversifying their portfolios, which can have immense consequences.
Over-diversification can lead to an investor holding a large number of heavily underperforming assets, leading to significant losses. It’s vital to only diversify into cryptocurrencies where the fundamental value is clear and to have a strong understanding of the different types of assets and how they will likely perform in various market conditions.
Not setting up a stop-loss arrangement
A stop-loss is an order type that enables investors to sell a security only when the market reaches a specific price. Investors use this to prevent losing more money than they are willing to, ensuring they at least make back their initial investment.
In several cases, investors have experienced huge losses because of incorrectly setting up their stop losses before asset prices dropped. However, it’s also important to remember that stop-loss orders aren’t perfect and can sometimes fail to trigger a sale in the event of a large, sudden crash.
That being said, the importance of setting up stop losses to protect investments cannot be understated and can significantly help mitigate losses during a market downturn.
Crypto investing and trading is a risky business with no guarantees of success. Like any other form of trading, patience, caution and understanding can go a long way. Blockchain places the responsibility on the investor, so it’s crucial to take the time to figure out the various aspects of the market and learn from past mistakes before putting your money at risk.
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
Apollo BTC – A Bitcoin ASIC Miner and Desktop Class Computer running a Full Node
Introducing the FutureBit Apollo BTC
Six CPU Cores. 44 ASIC Cores. 1TB NVMe Based SSD Drive. Quiet. Less than 200 Watts of Power. Made in the USA. This is what the Future of Bitcoin looks like.
FutureBit Apollo BTC is the world’s first vertically integrated platform bringing the full power of Bitcoin and it’s mining infrastructure in a small, quiet, easy to use desktop device designed for everyday people.
We have iterated and learned much from our first Apollo product. We realized early on that we focused too much on the mining aspect, and not enough on the software, applications, and services that run Bitcoin. Too many of these services have moved to online centralized websites, and many users have given up on running the core software that powers Bitcoin.
This must change, as Bitcoin will not continue to be the free, un-censorable, decentralized system it is today if only a few control the mining that powers it, and the nodes that control it.
At the heart of the new Apollo BTC product is a revamped SBC (Single Board Computer), that is as powerful as any consumer grade desktop system and can run almost any Bitcoin Application natively on the device 24/7. Take it out of the Box, plug it in, power it on, and you are already running a full Bitcoin node without needing to do anything.
Install a wallet of your choice, use any hardware wallet, run BTCPayServer, run a block explorer, run a Lightning Node. All of this is possible with our six core ARM based CPU with 4GB of RAM, and a 1TB NVMe drive that can easily store a FULL non pruned Bitcoin Node. It can power through a Full Node Sync in under 48 hours, which is a record for a device of its class! This is almost an order of magnitude faster than any Raspberry Pi 4 based Node.
On top of this we have taken our 6 years of experience building ASIC mining devices, and engineered the only American Made TeraHash range Bitcoin mining device that can be silent on your desk, mine Bitcoin in the background 24/7, and only use the power of one light bulb to do it.
We did this with our optimized PCB design that has carefully placed all 44 hash cores underneath our custom cold-forged aluminum induction heatsink, which draws up to 200 Watts of heat away from the device with our new nearly silent 25mm fan. This results in the Apollo BTC in Turbo Mode being just as quiet as the Apollo LTC in Eco Mode!
Like our previous products, we are super proud that we can continue manufacturing the Apollo BTC in the USA, and are now the only USA based company that delivers Bitcoin ASIC products with a supply chain whole owned in the western hemisphere (no more reliance on Chinese based ASICS, and their willingness to only sell to large farms and the highest bidder).
OPTIONS
Full Apollo Package: This is our Full Package option that comes with everything you need in the box. The Apollo BTC Unit with our latest controller built in, and our 200W Power supply with power cable.
Full Apollo Package NO Power Supply: We are also offering the Full Package with no power supply for people that want the plug-n-play experience but have spare 12v ATX power supply.
Standard: This option is ONLY the Apollo ASIC Miner, with no controller or power supply. Our new hashboard has a micro USB port, and can be used as a USB device. The Full Apollo Node can control multiple standard units through its USB ports. We wanted to give our customers an option to expand their hash power in a cost effective way. If you already have a Raspberry Pi, or Linux/Windows Desktop Computer and a power supply with two PCIE power ports you can also control our Standard unit in this way with our stand alone miner software (please note this setup will be for more advanced users, and the software will be command line based on launch).
Standard + Power Supply: Same as our Standard unit above, but comes with our 200W Power supply. This is a plug and play solution if you already have a Full Apollo Package. Take it out of the box, plug in the power supply, plug in the micro USB cable to the back of your Full Apollo BTC and it will automatically recognize the second hashboard and start mining!
Compact All-In-One Desktop Bitcoin System (4x6x4in) that mines Bitcoin and any SHA256 based crypto (Bitcoin Cash etc).
Powerful 6 ARM Core CPU with 4GB of LPDDR4 RAM and 1TB NVMe SSD (NOT included in the Standard or Standard + package).
Comes Pre-Installed with a Bitcoin node, and you can install almost any Bitcoin Application
Very wide range of operation modes with preset ECO (quiet) mode, BALANCED, and TURBO mode.
2-3.8 TH/s of SHA256 performance per miner (+/- 5%)
125 Watts in ECO mode, and 200 Watts in TURBO * +/- 10%
Can be used as a full Desktop computer with a monitor keyboard and mouse (not included), or through our Web UI
Connect almost any peripheral with our USB 3.0 ports, USB C port, HDMI, AC Wifi, and Bluetooth
Clocks and Power is fully customizable by user with easy to use interface
Hashboard now monitors both voltage and power draw for accurate measurements*
Custom designed cold forged hexagonal pin heatsink with leading thermal performance for the quietest ASIC miner in operation!
1k-5k RPM Quiet Dual Ball Bearing Fan with automatic thermal management with onboard temperature sensor
Controlled via local connection on a web browser similar to antminers. You can simply set it up via smartphone browser. No crazy driver installs, hard to use miner software or scripts needed.
Two Six Pin PCIE power connectors for wide-range of power draw
Custom Designed all Aluminum case
Ships with our own custom built 200W 94% efficient PSU and is ready to run out of the box! (Does NOT come with Standard package).
Requirements:
Router with an Ethernet cable for initial setup OR Monitor with keyboard and mouse
At least a 250 watt 12v power supply with two 6 Pin PCIE connector is required (unless you order our packages that come with our power supply). This is the same connector used by all modern GPUs. Please note even standard units NEED a power supply, they cant be powered through the USB port on the full package unit.
As I am the owner of two of these beauties, that I have on my office as you saw in the photo above, I took the liberty to make Free-Publicity for the FutureBit Apollo Btc Miner.
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
Bitcoin surges after accidentally released Treasury statement
Prices of Bitcoin and other cryptocurrencies have soared following the apparent accidental release of a U.S. Treasury statement on Biden’s expected executive order on digital assets.
The premature statement by Treasury Secretary Yellen, which was dated March 9, has since been removed.
“President Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy. This approach will support responsible innovation that could result in substantial benefits for the nation, consumers, and businesses.
It will also address risks related to illicit finance, protecting consumers and investors, and preventing threats to the financial system and broader economy.”
Quote from the now deleted statement
At the time of writing, Bitcoin is up nearly 8% in the last 24 hours.
Biden’s executive order aims to regulate the crypto market while also reaping the benefits of digital currencies.
So far, like most countries in the world, the US has tended to react to developments and has limited itself to pointing to a political-economic approach that is yet to be developed.
Statement by Secretary of the Treasury Janet L. Yellen on President Biden’s Executive Order on Digital Assets
March 9, 2022
WASHINGTON – U.S. Secretary of the Treasury Janet L. Yellen released the following statement on President Biden’s executive order on digital assets.
“President Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy. This approach will support responsible innovation that could result in substantial benefits for the nation, consumers, and businesses. It will also address risks related to illicit finance, protecting consumers and investors, and preventing threats to the financial system and broader economy.
Under the executive order, Treasury will partner with interagency colleagues to produce a report on the future of money and payment systems. We’ll also convene the Financial Stability Oversight Council to evaluate the potential financial stability risks of digital assets and assess whether appropriate safeguards are in place. And, because the questions raised by digital assets often have important cross-border dimensions, we’ll work with our international partners to promote robust standards and a level playing field.
This work will complement ongoing efforts by Treasury. Already, the Department has worked with the President’s Working Group on Financial Markets, the FDIC, and OCC to study one particular kind of digital asset – stablecoins– and to make recommendations. Under the executive order, Treasury and interagency partners will build upon the recently published National Risk Assessments, which identify key illicit financing risks associated with digital assets.
As we take on this important work, we’ll be guided by consumer and investor protection groups, market participants, and other leading experts. Treasury will work to promote a fairer, more inclusive, and more efficient financial system, while building on our ongoing work to counter illicit finance, and prevent risks to financial stability and national security.”
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
Assigning the most powerful supercomputer to mine bitcoin would be comparable to hiring a grandmaster chess player to move a pile of bricks by hand.
The job would get done eventually but the chess player is much better at thinking and playing chess than exerting energy to repetitively move bricks.
Likewise, combining the computing power of the most powerful supercomputers in the world and using them to mine bitcoin would essentially be pointless when compared to the ASIC machines used today.
ASICs are designed to do one thing as quickly and efficiently as possible, whereas a supercomputer is designed to do complicated tasks or math problems.
Since Bitcoin mining is a lottery based on random trial and error rather than complex math, specialization (ASICs)beatsgeneral excellence (supercomputers) everytime.
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
The Times – January 3, 2009Bitcoin Genesis Block Mined 03 January 2009Cypherpunks Write CodeCODE IS LAW THE SOONER HUMANKIND ACCEPTS IT, THE SOONER IT CAN BUILD AROUND ITYeah.. I wonder Why 😂Bitcoin made easyHow a Bitcoin transaction worksA humble MinerHow Bitcoin Mining WorksMining DifficultyBitcoin HalvingBitcoin Previous HalvingsPoolsBitcoin WalletsBitcoin StakeholdersBitcoin FactsPower to the PeopleTotalitarian Governments can kiss my 256-bit keyBitcoin – People’s MoneyBitcoin cannot be Shut DownThe power of the long tail…Central Bank’s 3 StrategiesF**k them, Enough !!!Upcoming Smart Contracts NetworksBitcoin Yearly CandlesBitcoin Price History – Log ScaleBitcoin Mining Ecosystem MapDefi Ecosystem in EthereumDeFi Stack: Product& Application ViewSyscoin EcosystemSyscoinBSC EcosystemPopular CryptocurrencyCrpto EcosystemPublic Companies that own BitcoinTop Banks investing in CryptoBitcoin Inflation vs. TimeWhen you’re Ready…Choose WiselyMake bitcoin thrive, let fiat become humus…Veritas non Auctoritas Facit Legem
Most people misunderstand what bitcoin miners actually do, and as a result they don’t fully grasp the level of security provided by bitcoin’s hashrate.
In this article, we’ll explain proof of work in a non-technical way so that you’ll be able to counter the misinformation about supercomputers and quantum computers attacking the Bitcoin network in the future.
Simply put, mining is a lottery to create new blocks in the Bitcoin blockchain. There are two main purposes for mining:
To permanently add transactions to the blockchain without the permission of any entity.
To fairly distribute the 21 million bitcoin supply by rewarding new coins to miners who spend real world resources (i.e. electricity) to secure the network.
To understand what is actually happening in this lottery system, let’s look at a simple analogy where every Bitcoin hash is equivalent to a dice roll.
Luck, Gambling, and SHA-256
Imagine that miners in the Bitcoin Network are all individuals gambling at a casino. In this example, each of these gamblers have a 1000 sided dice. They roll their die as quickly as possible, trying to get a number less than 10. Statistically, this may take a very long time, but as more gamblers join the game, the time it takes to hit a number less than 10 gets reduced. In short, more gamblers equals quicker rounds.
Once somebody successfully rolls a number less than 10, all gamblers at the table can look down and verify the number. This lucky gambler takes the prize money and the next round begins.
Ultimately, the process of mining bitcoin is very similar. All miners on the network are using Application Specific Integrated Circuits (ASICs), which are specialized computers designed to compute hashes as quickly as possible.
To “compute a hash” simply means plugging any random input into a mathematical function and producing an output.
More hashes per second (i.e. higher hashrate) is equivalent to more dice rolls per second, and thus a greater probability of success.
Miners propose a potential Bitcoin block of transactions, and use this for an input. The block is plugged into the SHA256 hash function which yields a fixed-sized output, known as a hash. A single hash can be computed in less than a millisecond, as it involves no complex math.
If the hash value is lower than the Bitcoin Network difficulty, then the miner who proposed the block wins. If not, then the miner continues trying by computing more hashes.
The successful miner’s block is then added to the blockchain, the miner is rewarded with newly issued bitcoin for their work, and the “next round” begins.
Sources :
https://wikipedia.com/
https://braiins.com/
https://blockdata.com/
https://coin98analytics.com/
https://scoopwhoop.com/
https://stakingrewards.com/
https://syscoin.org/
https://galaxydigitalresearch.com/
https://surveycrest.com/
The Times
The Economist
"Internet of Money" - Andreas Antonopoulus
Hal Finney Quotes
Timothy C. May Quote
Free Spirit Digital Art
!°! If I forgot someone, sorry ! Do tell and I'll add you as a source of inspiration on the list !!! Thanks for understanding !!!
Questions, opinions, critics and requests always welcomed and as time allows will be accomodated !!! 🤓 🙂 😉
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What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
“A mysterious new technology emerges, seemingly out of nowhere, but actually the result of two decades of intense research and development by nearly anonymous researchers.
Political idealists project visions of liberation and revolution onto it; establishment elites heap contempt and scorn on it.
On the other hand, technologists – nerds – are transfixed by it.
They see within it enormous potential and spend their nights and weekends tinkering with it.
Eventually mainstream products, companies and industries emerge to commercialize it; its effects become profound; and later, many people
wonder why its powerful promise wasn’t more obvious from the start.
What technology am I talking about?
Personal computers in 1975, the Internet in 1993, and – I believe – Bitcoin in 2014….
The practical consequence of solving this problem is that Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer.
The consequences of this breakthrough are hard to overstate.
What kinds of digital property might be transferred in this way?
Think about digital signatures, digital contracts, digital keys (to physical locks, or to online lockers), digital ownership of physical assets such as cars and houses, digital stocks and bonds …
and digital money”.
– Marc Andreessen, Founder of Netscape & well-known venture capitalist, 2014
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
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What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
Mining Pool Payouts explained: PPS vs. FPPS vs. PPLNS vs. PPS+
What is a Mining Pool?
Mining Pools
A Mining pools is a hub where a group of Crypto currency miners share their processing power to the network in order to solve the blocks quicker.
The rewards will be split equally based on the amount of shares that they contributed in finding a block.
Pool mining was introduced during early Bitcoin mining days when solo mining became non-viable.
The more powerful your hardware is, the more shares you’ll submit, the more shares you submit, the more you’ll earn.
In order for the pool to pay its miners each pool uses its own payment scheme. Two of the most popular option is PPS and PPLNS.
Pay-Per-Share (PPS)Pay-Per-Last-N-Shares (PPLNS)
The first thing a miner has to decide is which pool mining payout is best for their requirements.
PROP (proportional), FPPS (Full Pay Per Share), SMPPS (Shared Maximum Pay Per Share), ESMPPS (Equalized Shared Maximum Pay Per Share), CPPSRB (Capped Pay Per Share with Recent Backpay), PPS (Pay Per Share), PPLNS (Pay Per Last N Share) and lastly PPS+ (Pay Per Share Plus).
Among them PPS and PPLNS are the two types of payment models that are mostly used by mining pools currently. Before we explain both PPS and PPLNS we’ll make a short note on mining pool.
There are numerous payment systems (over 15), but the vast majority of the pools operate on a PPS, FPPS, PPS+ and PPLNSbasis.
However, before trying to understand the different settlement models, it is important to come to a consensus on some terms used in crypto mining.
Block Reward: Block reward refers to the new coins issued by the network to miners for each successfully solved block.
Hashing Power: Hash rate is the speed at which a computer completes an operation in the cryptocurrency’s code. A higher hashrate increases a miner’s opportunity of finding the next block.
Luck: Luck, in mining, is the probability of success. Imagine that each miner is given a lottery ticket for a certain amount of hashing power they provide. If they are to provide 1 TH/s hashing power when the overall hashing power in the network is 10 TH/s, then they would receive 1 of 10 total lottery tickets. The probability of winning the lottery (in this case finding the block reward) would be 10%.
Transaction Fees: Some networks (like Bitcoin) also have substantial amounts of transaction fees rewarded to miners. These fees are the total fees paid by users of the network to execute transactions.
Pay-Per-Share (PPS)
PPS offers an instant flat payout for each share that is solved. With this payment method, a miner gets a standard payout rate for each share completed. Each share is worth a certain amount of mineable cryptocurrency.
After deducting the mining pool fees, the miners are given a fixed income every day. Therefore, under the PPS mode, the returns are relatively stable. Miners are exposed to risk here. They may not get the transaction fees.
It is ideal for low priced orders for an extended period. This model becomes lucrative during a bearish run of a particular coin.
Pay-Per-Last-N-Shares (PPLNS)
With this payout, profits will be allocated based on the number of shares miners contribute. This kind of allocation method is closely related to the block mined out. If the mining pool excavates multiple blocks in a day, the miners will have a high profit; if the mining pool is not able to mine a block during the whole day, the miner’s profit during the whole day is zero.
Notably, in the short term, the PPLNS model is highly correlated with a pool’s luck. If the luck factor of a particular mining pool decreases in the short term, the miner’s income will also decrease accordingly (the opposite case of the mining pool being lucky in the short term is possible too). However, in the long term, the luck factor tends to average out to the mean.
Hence, this model is ideal for fixing orders on a big pool that has a high chance of finding a block within the order time limit. Or a standard order which will have miners connected for a longer time.
Pay Per Share + (PPS+)
PPS+ is a blend of two modes mentioned above, PPS and PPLNS. The block reward is settled according to the PPS model. And the mining service charge /transaction fee is settled according to the PPLNS mode.
That is to say, in this mode, the miner can additionally obtain the income of part of the transaction fee based on the PPLNS payment method. This was a major drawback in the PPS model.
Full Pay Per Share (FPPS)
With this pool payout, both the block reward and the mining service charge are settled according to the theoretical profit. Calculate a standard transaction fee within a certain period and distribute it to miners according to their hash power contributions in the pool. It increases the miners’ earnings by sharing some of the transaction fees.
With the PPS and FPPS payment methods, you will get paid no matter if the pool finds a block or not. This is the most significant advantage over PPLNS. The risks and rewards are higher with the PPLNS plan.
The decision on which mining plan to choose from needs to be preceded by the decision of choosing the right mining infrastructure.
Difference between PPS vs PPLNS payment models?
PPLNS
PPLNS stands for Pay Per Last (luck) N Shares. This method calculates your payments based on the number of shares you submitted during a shift.
It includes shift system which is time based or by number of shares submitted by the miners on the pool.
Your pool may find blocks consistently or in overtime it may have huge variations in winning a block and that ultimately affects your payments. PPLNS greatly involves luck factor and you’ll notice huge fluctuations in your 24 hour payout.
If you maintain your mining on a single pool then your payouts will remain consistent and it only differs when new miners join or leave the pool.
PPS
Pay Per Share pays you an average of the number of shares that you contributed to the pool in finding blocks.
PPS pays you on solid rate and is more of a direct method which completely eliminates luck factor.
In PPS method regardless of the pools lucky at winning blocks you’re going to get 100% payout at the end of the day. This is because there is a standard payout set for each miners based on their hash power.
It won’t be more than 100% or less than that and with this PPS method you can easily calculate your potential earnings.
On the other hand with PPLNS payment system on average you can either get more than 100% or less than that. It is based on how lucky the pool is at finding blocks.
Should I choose PPS or PPLNS?
This is one of the common questions most miners have initially.
Should I choose Pay Per Share or Pay Per Last N Share pools?
If you are the person who don’t switch pools often then PPLNS is definitely for you as such pools are good at rewarding its loyal miners.
Pay Per Share: No matter what, if you need a fixed payouts at the end of the day to liquidate or for whatsoever reason then your choice would be PPS.
Pay Per Share works well for large mining farms who can calculate and have statistics based on their mining power.
PPS is good for large miners but really bad for pool owners as there is a guaranteed payout for work no matter if the pool hits the block or not.
For this reason and because of pool hoppers (not loyal miners of the pool) most of the mining pools have switched to PPLNS payment model.
Pay Per Last N Shares: If you are the one that is looking to accumulate and hold more coins then PPLNS is recommended.
For each block that your pool finds you’ll get a share based on your hashrate.
Unlike PPS, in PPLNS you’ll get payouts more often and in the long run you’ll be rewarded more with PPLNS than PPS.
However due to huge variance it’s really hard to calculate your mining income.
PPLNS is good for both mid-range miners and pool owners as the payouts is only based on the blocks found.
If your pool is more lucky then you’ll see payments more often. This is the reason why miners stick to a pool where there is more hash power assuming the pool finds block very often.
You can find more comparison of mining pools payment system here.
How to find out if a pool is PPS or PPLNS?
Cryptocurrency mining can be a lucrative process. However it’s very important that you find out what payment scheme your pool is using before committing your hashing power.
Most of the mining pools has this information listed on FAQ page or at payouts page. If you’re unable to find this information then the only option is to contact the pool support.
Hope the information on this page is helpful for you to decide the right mining pool.
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
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Bitcoin’s most recent halving occurred on May 11, 2020. To explain what a Bitcoin halving is, we must first explain a bit about how the Bitcoin network operates.
Bitcoin’s underlying technology, blockchain, basically consists of a collection of computers (or nodes) that run Bitcoin’s software and contain a partial or complete history of transactions occurring on its network.
Each full node, or a node containing the entire history of transactions on Bitcoin, is responsible for approving or rejecting a transaction in Bitcoin’s network.
To do that, the node conducts a series of checks to ensure that the transaction is valid. These include ensuring that the transaction contains the correct validation parameters, such as nonces, and does not exceed the required length.
A transaction occurs only after all the parties operating in Bitcoin’s network approve it within the block on which the transaction exists. After approval, the transaction is appended to the existing blockchain and broadcast to other nodes.
The blockchain serves as a pseudonymous record of transactions (i.e., its contents are visible to everyone, but it is difficult to identify transacting parties in the network). This is because the blockchain assigns encrypted addresses to each transacting party in the network. That said, even those who do not participate in the network as a node or miner can view these transactions taking place live by looking at block explorers.
More computers (or nodes) added to the blockchain increase its stability and security.
There are currently 12,035 nodes estimated to be running Bitcoin’s code. Though anyone can participate in Bitcoin’s network as a node, as long as they have enough storage to download the entire blockchain and its history of transactions, not all of them are miners.
KEY TAKEAWAYS
A Bitcoin halving event is when the reward for mining bitcoin transactions is cut in half.
This event also cuts in half Bitcoin’s inflation rate and the rate at which new bitcoins enter circulation.
Both previous halvings have correlated with intense boom and bust cycles that have ended with higher prices than prior to the event.
Bitcoin last halved on May 11, 2020, around 3 p.m. EST, resulting in a block reward of 6.25 BTC.
Bitcoin Mining
Bitcoin mining is the process by which people use their computers to participate in Bitcoin’s blockchain network as a transaction processor and validator.
Bitcoin uses a system called proof of work (PoW). This means that miners must prove they have put forth effort in processing transactions to be rewarded. This effort includes the time and energy it takes to run the computer hardware and solve complex equations.
Faster computers with certain types of hardware yield larger block rewards and some companies have designed computer chips specifically built for mining. These computers are tasked with processing Bitcoin transactions, and they are rewarded for doing so.
The term mining is not used in a literal sense but as a reference to the way precious metals are gathered.
Bitcoin miners solve mathematical problems and confirm the legitimacy of a transaction. They then add these transactions to a block and create chains of these blocks of transactions, forming the blockchain.
When a block is filled up with transactions, the miners that processed and confirmed the transactions within the block are rewarded with bitcoins.
Transactions of greater monetary value require more confirmations to ensure security. This process is called mining because the work performed to get new bitcoins out of the code is the digital equivalent to the physical work done to pull gold out of the Earth.
El Salvador made Bitcoin legal tender on June 9, 2021. It is the first country to do so. The cryptocurrency can be used for any transaction where the business can accept it. The U.S. dollar continues to be El Salvador’s primary currency.
Bitcoin Halving
After every 210,000 blocks mined, or roughly every four years, the block reward given to Bitcoin miners for processing transactions is cut in half.
This cuts in half the rate at which new bitcoins are released into circulation. This is Bitcoin’s way of using a synthetic form of inflation that halves every four years until all bitcoins are released into circulation.
This system will continue until around the year 2140.
At that point, miners will be rewarded with fees for processing transactions, which network users will pay. These fees ensure that miners still have the incentive to mine and keep the network going. The idea is that competition for these fees will cause them to remain low after the halvings are finished.
The halving is significant because it marks another drop in the rate of new Bitcoins being produced as it approaches its finite supply: the total maximum supply of bitcoins is 21 million. As of October 2021, there are about 18.85 million bitcoins already in circulation, leaving just around 2.15 million left to be released via mining rewards.
In 2009, the reward for each block in the chain mined was 50 bitcoins. After the first halving, it was 25, and then 12.5, and then it became 6.25 bitcoins per block as of May 11, 2020.
To put this in another context, imagine if the amount of gold mined out of the Earth was cut in half every four years. If gold’s value is based on its scarcity, then a “halving” of gold output every four years would theoretically drive its price higher.
Coin Metrics logarithmic chart of Bitcoin price action following halvings.
Halving Implications
These halvings reduce the rate at which new coins are created and thus lower the available amount of new supply, even as demand might increase.
This can cause some implications for investors as other assets with low or finite supply, like gold, can have high demand and push prices higher.
In the past, these Bitcoin halvings have correlated with massive surges in Bitcoin’s price.
The first halving, which occurred on Nov. 28, 2012, saw an increase from $12 to $1,217 on Nov. 28, 2013.
The second Bitcoin halving occurred on July 9, 2016. The price at that halving was $647, and by Dec. 17, 2017, a bitcoin’s price had soared to $19,800. The price then fell over the course of a year from this peak down to $3,276 on Dec. 17, 2018, a price 506% higher than its pre-halving price.
The most recent halving occurred on May 11, 2020. On that date, a bitcoin’s price was $8,787. On April 14, 2021, a bitcoin’s price soared to $64,507 (an astonishing 634% increase from its pre-halving price). A month later, on May 11, 2021, a bitcoin’s price was $54,276, representing a 517% increase that seems more consistent with the behavior of the 2016 halving.
On May 12, 2021, Elon Musk, CEO of Tesla, announced that Tesla would no longer accept Bitcoin as payment, resulting in further price fluctuations.
In the week that followed Musk’s statements, the price of a bitcoin plunged below $40,000 after Chinese regulators announced restrictions banning financial institutions and payment companies from providing cryptocurrency-related services.
Though these two announcements may have temporarily created a price drop in Bitcoin, there is the potential that the price fluctuations are more related to the halving behavior we have observed previously.
The theory of the halving and the chain reaction that it sets off works something like this:
The reward is halved → half the inflation → lower available supply → higher demand → higher price → miners incentive still remains, regardless of smaller rewards, as the value of Bitcoin is increased in the process
In the event that a halving does not increase demand and price, then miners would have no incentive. The reward for completing transactions would be smaller, and the value of Bitcoin would not be high enough.
To prevent this, Bitcoin has a process to change the difficulty it takes to get mining rewards, or in other words, the difficulty of mining a transaction.
In the event that the reward has been halved, and the value of Bitcoin has not increased, the difficulty of mining would be reduced to keep miners incentivized.
This means that the quantity of bitcoins released as a reward is still smaller, but the difficulty of processing a transaction is reduced.
This process has proved successful twice. So far, the result of these halvings has been a ballooning in price followed by a large drop.
The crashes that have followed these gains, however, have still maintained prices higher than before these halving events.
For example, as mentioned above, the 2017 to 2018 bubble saw the value of a bitcoin rise to around $20,000, only to fall to around $3,200. This is a massive drop, but a bitcoin’s price before the halving was around $650.3
Though this system has worked so far, the halving is typically surrounded by immense speculation, hype, and volatility, and how the market will react to these events in the future is unpredictable.
The third halving occurred not only during a global pandemic, but also in an environment of heightened regulatory speculation, increased institutional interest in digital assets, and celebrity hype. Given these additional factors, where Bitcoin’s price will ultimately settle in the aftermath remains unclear.
What Happens When Bitcoin Halves?
The term “halving” as it relates to Bitcoin has to do with how many Bitcoin tokens are found in a newly created block.
Back in 2009, when Bitcoin launched, each block contained 50 BTC, but this amount was set to be reduced by 50% roughly every four years.
Today, there have been three halving events, and a block now only contains 6.25 BTC.
When the next halving occurs, a block will only contain 3.125 BTC.
When Have the Halvings Occurred?
The first bitcoin halving occurred on Nov. 28, 2012, after a total of 10,500,000 BTC had been mined. The next occurred on July 9, 2016, and the latest was on May 11, 2020. The next is expected to occur in early 2024.
Why Are the Halvings Occurring Less Than Every Four Years?
The Bitcoin mining algorithm is set with a target of finding new blocks once every 10 minutes.
However, if more miners join the network and add more hashing power, the time to find blocks will decrease.
This is remedied by resetting the mining difficulty (or how hard it is for a computer to solve the mining algorithm) once every two weeks or so to restore a 10-minute target.
As the Bitcoin network has grown exponentially over the past decade, the average time to find a block has consistently remained below 10 minutes (roughly 9.5 minutes).
Does Halving Have Any Effect on the Bitcoin Price?
The price of Bitcoin has risen steadily and significantly from its launch in 2009, when it traded for mere pennies or dollars, to April 2021 when the price of one bitcoin traded for over $63,000.3
Because halving the block reward effectively doubles the cost to miners, who are essentially the producers of bitcoins, it should have a positive impact on price because producers will need to adjust their selling price to their costs.
Empirical evidence does show that Bitcoin prices tend to rise in anticipation of a halvening, often several months prior to the actual event.
What Happens When There Are No More Bitcoins Left in a Block?
Around the year 2140, the last of the 21 million bitcoins ever to be mined will have been mined.
At this point, the halving schedule will cease because there will be no more new bitcoins to be found.
Miners, however, will still be incentivized to continue validating and confirming new transactions on the blockchain because the value of transaction fees paid to miners is expected to rise into the future, the reasons being that a greater transaction volume that has fees will be attached, plus bitcoins will have a greater nominal market value.
What Is Inflation? Inflation is a rise in prices, which can be translated as the decline of purchasing power over time. The rate at which purchasing power drops can be reflected in the … Continue reading Learn about Inflation Folks!→
Hy there my fellow citizens of this amazingly beautiful Mother Earth of… Not Ours !!! We tend to forget that and treat it as if we would have another habitable sphere on wich … Continue reading Free Spirit’s Library→
The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel, situated in Bretton … Continue reading What is Bretton Woods ?!?→
A smart contract is a computerized transaction protocol that executes the terms of a contract. The general objectives of smart contract design are to satisfy common contractual conditions (such as payment terms, liens, … Continue reading Smart Contracts by Nick Szabo-1994→
20 Rules for Security in bitcoin Here’s a short list of common sense Rules, to use and implement for a better Security while using bitcoin and other cryptocurrencies. In the hopes that they … Continue reading 20 Security Rules for bitcoin→
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BitHouse 