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 supply of Bitcoin is fixed at 21 million BTC, and as a hard coded monetary policy of the protocol, the fixed supply of the dominant cryptocurrency cannot be altered.
Former Google Product Director Steve Lee stated that only 1 percent of the world’s population can own more than 0.28 BTC, due to the fixed supply of Bitcoin.
If you own 0.28 BTC and HODL, you can be certain no more than 1% of the current world's population can EVER own more BTC than you. A modest investment of $1,830 today can ensure you are a 1%er in a future Bitcoin world. https://t.co/9k3XZa09Yo
In late 2017, Chainalysis, a blockchain forensics company that monitors and investigates cryptocurrency transactions, revealed in a research paper that up to four million BTC are permanently lost on the blockchain as a result of theft, loss of wallets and private keys, and the dormant wallet of Bitcoin creator Satoshi Nakamoto, which experts have said is no longer accessible.
Kim Grauer, Senior Economist at Chainalysis, said at the time, that the lost supply of BTC is not taken into consideration by the market cap.That means, the real price of BTC could be substantially higher, as 4 to 6 million BTC are estimated to be lost.
Based on the estimate that the supply of Bitcoin is around 17 million, only 0.8 percent of the world population can own more than 0.28 BTC and less than 0.2 of the world population can own more than 1 BTC.
The 0.28 BTC figure introduced by Lee assumes the supply of Bitcoin to be 21 million, as it divides 21 million by 0.28 and divides the outcome of that by the world population that is 7.442 billion. If the research of Chainalysis is accurate and that 4 to 6 million BTC are lost on the blockchain, the supply of Bitcoin should be closer to around 16 to 17 million
The fact that any investor in the global market can be within the 1 percent of the world population with a $1,830 investment demonstrates that the cryptocurrency market is still at its early phase, and in terms of adoption, market development, infrastructure, and regulation, the sector can still grow significantly in the mid to long-term.
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→
In Roman mythology, Veritas, meaning Truth, is the goddess of Truth, a daughter of Chronos, the God of Time.
For my dearest copăcel Emily,
Wish that you’ll find a drop of wisdom in an ocean of words!
Because never forget Papi, the ocean was formed drop by drop 🙂🥰🙃
“Enlightenment is man’s release from his self-incurred tutelage.
Tutelage is man’s inability to make use of his understanding without direction from another.
Self-incurred is this tutelage when its cause lies not in lack of reason but in lack of resolution and courage to use it without direction from another.
Sapere aude!
‘Have courage to use your own reason!’- that is the motto of enlightenment.”
Immanuel Kant, “An Answer to the Question: What Is Enlightenment?”
“Honesty is the first chapter in the book of wisdom.”
Thomas Jefferson
“I’m for truth, no matter who tells it.
I’m for justice, no matter who it is for or against.
I’m a human being, first and foremost, and as such I’m for whoever and whatever benefits humanity as a whole.”
Malcolm X
“The reason I talk to myself is because I’m the only one whose answers I accept.”
George Carlin
“The truth is rarely pure and never simple.”
Oscar Wilde, “The Importance of Being Earnest”
“I believe in everything until it’s disproved.
So I believe in fairies, the myths, dragons. It all exists, even if it’s in your mind.
Who’s to say that dreams and nightmares aren’t as real as the here and now?”
John Lennon
“In a time of deceit telling the truth is a revolutionary act.”
George Orwell
“Facts do not cease to exist because they are ignored.”
Aldous Huxley
“The unexamined life is not worth living.”
Socrates
“Man is least himself when he talks in his own person.
Give him a mask, and he will tell you the truth.”
Oscar Wilde
“Never be afraid to raise your voice for honesty and truth and compassion against injustice and lying and greed.
If people all over the world…would do this, it would change the earth.”
William Faulkner
“Rather than love, than money, than fame, give me truth.”
Henry David Thoreau, “Walden”
“The most important kind of freedom is to be what you really are.
You trade in your reality for a role.
You trade in your sense for an act.
You give up your ability to feel, and in exchange, put on a mask.
There can’t be any large-scale revolution until there’s a personal revolution, on an individual level.
It’s got to happen inside first.”
Jim MORRISON
“There are three types of lies — lies, damn lies, and statistics.”
Benjamin Disraeli
“Everything we hear is an opinion, not a fact.
Everything we see is a perspective, not the truth.”
Marcus Aurelius , “Meditations”
“Illegal aliens have always been a problem in the United States.
Ask any Indian.”
Robert Orben
“A thinker sees his own actions as experiments and questions–as attempts to find out something.
Success and failure are for him answers above all.”
Friedrich Nietzsche
“Wrong does not cease to be wrong because the majority share in it.”
Leo Tolstoy, “A Confession”
“Who is more humble? The scientist who looks at the universe with an open mind and accepts whatever the universe has to teach us, or somebody who says everything in this book must be considered the literal truth and never mind the fallibility of all the human beings involved?”
Carl Sagan
“It is better to offer no excuse than a bad one.”
George Washington
“For me, it is far better to grasp the Universe as it really is than to persist in delusion, however satisfying and reassuring.”
Carl Sagan
“There are two ways to be fooled.
One is to believe what isn’t true; the other is to refuse to believe what is true.”
Soren Kierkegaard
“1492.
As children we were taught to memorize this year with pride and joy as the year people began living full and imaginative lives on the continent of North America.
Actually, people had been living full and imaginative lives on the continent of North America for hundreds of years before that.
1492 was simply the year sea pirates began to rob, cheat, and kill them.”
Kurt Vonnegut
“Being in a minority, even in a minority of one, did not make you mad.
There was truth and there was untruth, and if you clung to the truth even against the whole world, you were not mad.”
George Orwell, “1984”
“If the road is easy, you’re likely going the wrong way.”
Terry Goodkind
“If someone is able to show me that what I think or do is not right, I will happily change, for I seek the truth, by which no one was ever truly harmed.
It is the person who continues in his self-deception and ignorance who is harmed.”
Marcus Aurelius, “Meditations”
“Believe those who are seeking the truth.
Doubt those who find it.”
Andre Gide
“You never know how much you really believe anything until its truth or falsehood becomes a matter of life and death to you.”
C.S. Lewis
“I am not bound to win, but I am bound to be true.
I am not bound to succeed, but I am bound to live up to what light I have.”
Abraham Lincoln
“Our truest life is when we are in dreams awake.”
Henry David Thoreau
“The truth is always an abyss.
One must — as in a swimming pool — dare to dive from the quivering springboard of trivial everyday experience and sink into the depths, in order to later rise again — laughing and fighting for breath — to the now doubly illuminated surface of things.”
Franz Kafka
“The truth is not always beautiful, nor beautiful words the truth.”
Lao Tzu, Tao Te Ching
“A thinker sees his own actions as experiments and questions–as attempts to find out something. Success and failure are for him answers above all.”
Friedrich Nietzsche
“Belief can be manipulated.
Only knowledge is dangerous.”
Frank Herbert
“For me, it is far better to grasp the Universe as it really is than to persist in delusion, however satisfying and reassuring.”
Carl Sagan
“If you look for truth, you may find comfort in the end; if you look for comfort you will not get either comfort or truth only soft soap and wishful thinking to begin, and in the end, despair.”
C.S. Lewis
“Wrong does not cease to be wrong because the majority share in it.”
Leo Tolstoy, “A Confession”
“The essence of being human is that one does not seek perfection.”
George Orwell
“Man is always prey to his truths. Once he has admitted them, he cannot free himself from them.”
Albert Camus
C”herish those who seek the truth but beware of those who find it.”
Voltaire
“The opposite of a correct statement is a false statement. But the opposite of a profound truth may well be another profound truth.”
Niels Bohr
“You’re not obligated to win. You’re obligated to keep trying. To the best you can do everyday.”
Jason Mraz
“If you would be a real seeker after truth, it is necessary that at least once in your life you doubt, as far as possible, all things.”
René Descartes
“The truth knocks on the door and you say, “Go away, I’m looking for the truth,” and so it goes away. Puzzling.”
Robert M. Pirsig, “Zen and the Art of Motorcycle Maintenance: An Inquiry Into Values” (Phaedrus, #1)
“Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple.
But it’s worth it in the end because once you get there, you can move mountains.”
Steve Jobs
“Prediction is very difficult, especially about the future.”
Niels Bohr
“It is truth that liberates, not your effort to be free.”
Jiddu Krishnamurti, “The First and Last Freedom”
“Like all dreamers I confuse disenchantment with truth.”
Jean Paul Sarte
“I will no longer mutilate and destroy myself in order to find a secret behind the ruins.”
Hermann Hesse, Siddhartha
“The most beautiful thing we can experience is the mysterious.
It is the source of all true art and all science.
He to whom this emotion is a stranger, who can no longer pause to wonder and stand rapt in awe, is as good as dead: his eyes are closed.”
Albert Einstein
“Truth is not something outside to be discovered, it is something inside to be realized.”
Osho
“Religious doctrines … are all illusions, they do not admit of proof, and no one can be compelled to consider them as true or to believe in them.”
Sigmund Freud, “The Future of an Illusion”
“You should not honor men more than truth.”
Plato
“Either you repeat the same conventional doctrines that everybody else is saying,… [o]r else you say something which in fact is true, and it will sound like it’s from Neptune.”
Noam Chomsky, “Propaganda and the Public Mind”
“The truth may be puzzling.
It may take some work to grapple with.
It may be counterintuitive.
It may contradict deeply held prejudices.
It may not be consonant with what we desperately want to be true.
But our preferences do not determine what’s true.”
Carl Sagan
“Life is infinitely stranger than anything which the mind of man could invent.”
Arthur Conan Doyle
“We all know that Art is not truth.
Art is a lie that makes us realize truth at least the truth that is given us to understand.
The artist must know the manner whereby to convince others of the truthfulness of his lies.”
Pablo Picasso
“Honest is how I want to look.
The truth doesn’t glitter and shine.”
Chuck Palahniuk, “Survivor”
“Time is precious, but truth is more precious than time.”
Benjamin Disraeli
“Above all, do not lie to yourself.
A man who lies to himself and listens to his own lie comes to a point where he does not discern any truth either in himself or anywhere around him, and thus falls into disrespect towards himself and others.
Not respecting anyone, he ceases to love, and having no love, he gives himself up to passions and coarse pleasures in order to occupy and amuse himself, and in his vices reaches complete beastiality, and it all comes form lying continually to others and himself.
A man who lies to himself is often the first to take offense. it sometimes feels very good to take offense, doesn’t it?
And surely he knows that no one has offended him, and that he himself has invented the offense and told lies just for the beauty of it, that he has exaggerated for the sake of effect, that he has picked up on a word and made a mountain out of a pea–he knows all of that, and still he is the first to take offense, he likes feeling offended, it gives him great pleasure, and thus he reaches the point of real hostility…”
Fyodor Dostoevsky, “The Brothers Karamazov”
“Convictions are more dangerous foes of truth than lies.”
Nietzsche
“It is not easy to keep silent when silence is a lie.”
Victor Hugo
“I always tell the truth.
Even when I lie.”
Al Pacino
“Our society is run by insane people for insane objectives.”
John Lennon
“Truth is so obscure in these times, and falsehood so established, that, unless we love the truth, we cannot know it.”
Blaise Pascal
“Truth is ever to be found in the simplicity, and not in the multiplicity and confusion of things.”
Isaac Newton
“When everything gets answered, it’s fake.”
Sean Penn
“We are like chameleons, we take our hue and the color of our moral character, from those who are around us.”
John Locke
“Beware: Ignorance Protects itself. Ignorance Promotes suspicion. Suspicion Engenders fear. Fear quails, Irrational and blind, Or fear looms, Defiant and closed. Blind, closed, Suspicious, afraid, Ignorance Protects itself, And protected, Ignorance grows.”
Octavia E. Butler, “Parable of the Talents”
“The seeker after truth should be humbler than the dust.
The world crushes the dust under its feet, but the seeker after truth should so humble himself that even the dust could crush him.
Only then, and not till then, will he have a glimpse of truth.”
Mahatma Gandhi
“I believe that Gandhi’s views were the most enlightened of all the political men in our time.
We should strive to do things in his spirit: not to use violence in fighting for our cause, but by non-participation in anything you believe is evil.”
Albert Einstein
“Knowledge is a destination.
Truth, the journey.”
Terry Goodkind
“But what is liberty without wisdom and without virtue?
It is the greatest of all possible evils; for it is folly, vice, and madness, without tuition or restraint.
Those who know what virtuous liberty is, cannot bear to see it disgraced by incapable heads, on account of their having high-sounding words in their mouths.”
Edmund Burke
“Love speaks in flowers.
Truth requires thorns.”
Leigh Bardugo, “The Language of Thorns: Midnight Tales and Dangerous Magic”
“We are what we believe we are!”
C.S. Lewis
“If someone can prove me wrong and show me my mistake in any thought or action, I shall gladly change.
I seek the truth, which never harmed anyone: the harm is to persist in one’s own self-deception and ignorance.”
Marcus Aurelius, “Meditations”
“People who fit don’t seek.
The seekers are those that don’t fit.”
Shannon L. Alder
“It is man’s natural sickness to believe that he possesses the truth.”
Blaise Pascal
“Errors do not cease to be errors simply because they’re ratified into law.”
E.A. Bucchianeri, “Brushstrokes of a Gadfly”
“Every beginning has an end and every end is a new beginning.”
Santosh Kalwar
Science, my boy, is made up of mistakes, but they are mistakes which it is useful to make, because they lead little by little to the truth.”
Jules Verne, “Journey to the Center of the Earth”
“At times to be silent is to lie.
You will win because you have enough brute force.
But you will not convince.
For to convince you need to persuade.
And in order to persuade you would need what you lack: Reason and Right.”
Miguel de Unamuno
…something to strive for.…leave a trail.Sapere Aude
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→
“You never change things by fighting the existing reality.
To change something, build a new model that makes the existing model obsolete.”
Buckminster Fuller
Strenght in NumbersDare to knowBitcoin / bitcoin / blockchainDYOR – Do Your Own Research LandArise…Bitcoin – People’s MoneyCypherPunks Write CodeBitcoin Genesis BlockCode Is LawA new day…Bitcoin – The Peaceful RevolutionVeritas Non Auctoritas Facit Legem🔵 or 🟠 The Choice is Yours…
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→
First time/Small miner reference for getting started.
If you want to start mining here is what you need… and what you need to know.
This is written for home miners/small farms, but can be used as a guideline for most operations. Use this as a reference for what you need to research, or what questions you need to ask before jumping in.
What you need to mine can be broken down into the following categories:
You CAN NOT meaningfully mine bitcoin today with CPU, GPU or even FPGAs. Bitcoin difficulty adapts to match the amount of mining done on the network and has reached levels trillions of times too high to mine meaningfully with PCs, laptops, tablets, phones, webpages, javascript, GPUs, and even generalised SHA hardware.
Even if you combined all the computers in the world, including all known supercomputer, you would not even approach 0.1% of the bitcoin hashrate today.
There isn’t any point attempting to mine bitcoin with CPU or GPU even in the interests of learning as it shares almost nothing with how bitcoin is mined with ASICs and will not teach you anything.
Hardware
Asic Miner:
Here is a list of the companies currently manufacturing Miners for public purchase.
Each one has their Pro’s and Con’s it is up to you to do your research and decide what is best for you.
A few points to consider while researching are :
efficiency
reliability
warranty period/policy
power draw
Each company has a different way of handling warranty repairs, depending on your situation and the policy repairs can become cost prohibitive. I will touch more on efficiency and power draw in the electricity section.
• Current list of competitive hardware
Power supply: You will need to purchase a power supply to run your miners. You will find ATX and Server grade PSU’s, the latter being preferred for mining BTC.
When it comes to selecting a PSU purchase something with a capacity 25% higher than your miner is rated to draw. This will have you operating within the 80% rule.(explained further in the electricity section)
EX. Miner draws 1000 PSU should be able to provide 1250W.
** Many current generation miners are now being manufactured with Integrated PSU. Again do your research to see if your unit comes with or without. Generally you will still need to source a power cable.**
Auxilliaries – Avalon miners require an external controller, 1 per 20 miners. You may have to run additional fans for intake and exhaust depending on your location.
PSU’s can be purchased large enough to run 2 Miners; or the opposite 1 Miner fed by 2 PSU’s. Ensure the PSU you have selected will have the correct amount of PCI-E connectors required to operate your miner(s)
You can also find a large supply of used miners and PSU’s. Again it’s up to you to do your research as these often are a no return transaction.
Electricity
Follow all local codes and regulations
This is the number 1 factor in whether mining is right for you. As discussed with Miners being a 24/7 machine drawing power those costs will make it cost prohibitive for some people to mine. You need to be aware of what your costs/kWh are and run the numbers.
This will be done in a profitability calculator. This is just an example of 1 there are many out there.
( Miner usage in kW ) * ( Hours run per day ) 24 * ( Cost/kWh ) = Cost per Day to Operate
( Ideally less than the FIAT value of BTC mined )
The second part to the electrical requirements of mining is the available service; written for North America.
You will need to figure out the amperage you can spare, what circuits and receptacles you have in place, are you setting up on 220V or 110V. You will need to make sure that you have the right cord end for your PSU to match the receptacle, picking the wrong one can cost you a few days of mining if it has to be shipped.
If you can try and set up on a 220V circuit for 2 reasons :
– You will pull half the amps, and it is more efficient.
– Doing so requires 2 breaker spaces in your panel. Breaker sizing will depend on how many miners you plan to run. Here is the formula for calculating amps.
Watts / Voltage = Amps
Here is where you will bring the 80% rule back into play by sizing the continuous miner load to 80% of the breaker rating. 12 Amps on a 15 Amp breaker, 16 Amps max on a 20 Amp breaker, 24 Amps on a 30 amp breaker.
If/when you increase the amount of miners you are running you may want to look into PDU’s, as opposed to more receptacles.
Location
This is something that is often overlooked to the headache and frustration of many would be miners. These machines are loud and hot . You essentially have an electric heater that also uses an industrial fan to keep it from melting itself. This space will need to have the electrical requirements as discussed previously.
So make sure you have a space that is well ventilated with a plan to exhaust heat, and bring in fresh dust free air. I say this as using AC to cool the room will eat into your profits and may even make mining unprofitable.
The noise issue is a consideration you can sort out depending on whats available. (garage, basement, remote building)
Both of these issues can be handled with hosting, which is further explained in the information section.
Internet connection
Some miner setups have the option to use wifi. It is advisable to use a wired connection where available. This will provide a more stable connection and ensure you are submitting the expected amount of shares which is directly related to your payouts.
Please note that mining uses a negligible amount of bandwidth, and will not affect your other internet usage.
Information
You can use this information in this post as a good baseline to get you going. In addition to this you will want to research network difficulty; this readjusts every 2016 blocks to maintain a 10 minute block time on average. While this can go down it generally increases.
Solo or Pool?
You can solo mine but this is essentially a lottery even as a large scale miner. Should you chose this you can check this out as a starting point.
solo.ckpool.org 1% fee solo mining USA/DE 250 blocks solved!
Odds are most of you will join a pool. I will only say that it is in your best interest to mine at a pool that pays transaction fees (miner rewards). Then you will want to consider the fees associated with the pool.
When it comes to these pools you want them to be large enough that they are getting at least 1 block every Difficulty adjustment period. Larger pools will offer smaller rewards paid out more frequently, and vice versa.
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→
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→
This is a glossary of all cryptocurrency terms and lingo you might come across when reading about mining and mining pools. Just refer to this page when you see an unfamiliar word or phrase.
A
ADDRESS – a cryptocurrency address is a string, containing numbers and letters, from which you can send and receive crypto payments.
ALGORITHM – kit of rules, which are solving a problem via calculations, using a computer. It’s encrypting and transferring data, which makes it mining’s base when it comes to extracting cryptocurrencies.
ASIC – (Application Specific Integrated Circuit) a dedicated mining device, which is able to extract coins, working with on one particular algorithm.
ASIC-RESISTANCE – memory hard algorithms that are hardly cooperating with ASICs, because they are built to be resistance to this kind of devices.
ATTACK 51% – a miner possess 51% of the pool’s hash rate, so he’s able to manipulate the network.
B
BANDWIDTH – the maximum capacity of the network to transmit data.
BLOCK – a piece of the blockchain, containing transactions.
BLOCKCHAIN – a public ledger, which contains lots of data, encrypted in separate block in the form of hashes (messages). Considered immutable and unable to manipulate.
BLOCK HEADER – a string long 80 bytes, which miners hash with the nonce to find the solution of the block.
BLOCK REWARD – this is what a miner gets for successfully calculating a valid hash in the block when performing a mining process.
BLOCK SIZE – this is a limit of bytes that the block might contain (also limits of transactions in one piece).
BLOCK TIME – the average time needed to find a block’s solutions. It’s different for each coin.
BLOCK SYNCHRONIZATION – the time requested for the blockchain to sync with your device (for full nodes usually).
C
CENTRALIZATION – an organization or system, which is controlled by a central authority.
CLOUD MINING – performing a mining process via rented hashing power from a third-party provider.
COIN – a term used to describe units of blockchain value.
CONFIRMATION – the process of validating if a transaction is including on the blockchain.
CONSENSUS – a rule all participant agrees on when operating on the same network.
CONTRIBUTION SHARE – the hash rate a miner puts into the pool to contribute.
CPU – (Central Processing Unit) a processor, which coordinates the work of all the other part of a computer.
D
DAO (Decentralized Anonymous Organization) – organization running smart contracts.
DIFFICULTY – a measure of how difficult might be to mine a new block.
DIFFICULTY BOMB – malicious attack, increasing difficulty that much, that the reward doesn’t cover the expenses to mine.
DISTRIBUTION – percentage of each pool from all the ones available in the network for this coin.
DOUBLE SPENDING – general issue of the decentralized conception or spending a same amount twice.
DOWNTIME – a period when a machine isn’t working.
E
EXCHANGE – a platform to buy, trade and sell cryptocurrencies.
F
FIAT MONEY – national currency of a central government.
FORK – changing in the rules of the consensus, which might be able to exist with the old established rules (soft fork) or not (hard fork).
FPGA – a modern mining device, improving the ASIC, which can mine coins from one particular algorithm. The interesting here is that you can modify it to mine a different algorithm if you decide to change the coin you mine.
FULL NODE – storing the blockchain data locally on your PC.
G
GAINS – increasing profits (reward).
GENESIS BLOCK – the first block, computationally created in the blockchain. It contains the initial transaction.
GPU (Graphic Processing Unit) – a graphic card, also known as a video card (part of a computer), which is successfully used for mining purposes.
H
HASH FUNCTION – encrypted message with fixes size and unique value.
HASH RATE – a unit to measure the computational power by which a miner contributes in the mining process.
HASH RENTAL – a rented computing power for mining purposes by a cloud mining provider.
HARD FORK – this is a protocol change, which results in splitting into two different chains and the longer one continuous existing. If both of them do – we have a chain split. These changes cannot cooperate with the old rules and require an update.
HARD DISK SPACE – the storage a user needs to locally store the blockchain data on a desktop PC.
Halving – decreasing the reward of gained coins per block using a particular formula.
I
ICO (Initial Coin Offering) – crowdfunding via crypto coins for the purpose of gaining capital for a particular project.
IMMUTABLE – unable to change in time.
K
KYC (Know Your Customer) – an identification process for the users in the network.
L
LEDGER – a piece of record of data, which is immutable.
LIGHT CLIENT – not storing the entire blockchain data but using just parts of it (a block’s header). To have some more information, they trust a full node.
LIGHTNING NETWORK – an additional layer of the blockchain to perform faster transactions between the nodes participating in the network.
LIQUIDITY – the ease to buying and selling, without bothering the market’s price.
M
MARKET CAPITALIZATION – a cryptocurrency’s price, according the total supply.
MARKET SHARE – the hash share of the market with which the pool operates.
MINEABLE – a coin which can be mined in return of reward.
MINER – either the device or the person who’s performing the mining process.
MINER’s FEE – this is the reward a miner receives for its contribution to the network by validating transactions. Normally, miners choose transactions with higher fees to add in the next block to profit more and faster.
MINING – a process of extracting a cryptocurrency by adding and verifying transactions to the blockchain, respectively gaining a reward for it.
MINING POOL – group of miners, combining their power to find a block faster and sharing the reward from it too.
MINING RIG – this is a set of multiple mining hardware, combined to mine with higher hash rate and find a block faster.
N
NODE – a computer that keeps a copy of the blockchain.
NONCE – an arbitrary number in a cryptographic communication. It is generated during the hashing process and can be used only once.
O
ORPHAN BLOCK – a valid block, which isn’t part of the blockchain and occurs when two miners find the same block in the same time. The one which is late becomes orphan.
P
PAYOUT LIMIT – the minimum amount of coins which you can withdraw from your account.
POOL DISTRIBUTION – a percentage of each pool, possessed for this particular coin.
POOL FEES – the fees requested from the pool for maintenance.
POW (Proof-of-Work) – when it comes to mining this is a consensus mechanism where miners are using a nonce to search the block’s solutions and get rewarded proportionally of their contribution (work). There’s no need of trust, since everybody’s “work” (share) is visible in the network.
PPS – (Pay Per Share) a type of rewarding system, based on contribution.
PPLNS – (Pay Per Last N Shares) a type of rewarding system, based on time a contribution.
PRIVATE KEY – this is the “password” which helps you to access your public address. It’s the one and only, which let you read the hashes (messages) sent to your public key.
PROP – (Proportional) a type of rewarding system, based on a proportional relation between contribution and luck.
PUBLIC KEY – this is a recipient’s address to receive any crypto assets in the form of a hash, which might be read with only one specific private key.
Q
QR-CODE – a graphic sign, which can be scanned via smartphone camera to read a wallet’s public address and send some coins within it.
R
REWARDING SYSTEM – a method of rewarding the miners, depending on their contribution to the network.
REPOSITORY – a software where you keep all your information, which might be retrieved at some point.
S
STALE SHARE – when two miners send a share to the network to affirm, they found a block, the one which is late is a stale one.
SPV (Simple Payment Verification) – a client which checks on transactions, using only the headers of the blocks, which is considered a proof of inclusion.
T
TRAFFIC (incoming & outcoming) – the traffic from one point to another (movement of data and actions). It’s important when it’s up to cryptocurrencies because it can define your speed when broadcasting a transaction.
TRANSACTION FEE – a payment to broadcast your transaction on the network.
U
UPTIME – the time during which a mining machine is properly working.
UTXO (Unspent Transaction Output) – a value, calculating the balance of unspent coins, based on all the previously spent outputs and inputs, based on the public ledger’s history of transactions.
V
VALID BLOCK – there’s a signal that the block is mined and the user’s waiting for confirmation from other nodes to gain the reward.
VARDIFF (Variable Difficulty) – the share’s difficulty might rise or fall, depending on the hash rate.
VPS (Virtual Private Server) – a PC with static IP, supporting the network.
W
WALLET – a digital wallet to store, send and receive crypto assets.
WORKER – either a mining device, either an account in the mining pool configuration.
This is a glossary of all cryptocurrency terms and lingo you might come across when reading about mining and mining pools. Just refer to this page when you see an unfamiliar word or phrase.
A
ADDRESS – a cryptocurrency address is a string, containing numbers and letters, from which you can send and receive crypto payments.
ALGORITHM – kit of rules, which are solving a problem via calculations, using a computer. It’s encrypting and transferring data, which makes it mining’s base when it comes to extracting cryptocurrencies.
ASIC – (Application Specific Integrated Circuit) a dedicated mining device, which is able to extract coins, working with on one particular algorithm.
ASIC-RESISTANCE – memory hard algorithms that are hardly cooperating with ASICs, because they are built to be resistance to this kind of devices.
ATTACK 51% – a miner possess 51% of the pool’s hash rate, so he’s able to manipulate the network.
B
BANDWIDTH – the maximum capacity of the network to transmit data.
BLOCK – a piece of the blockchain, containing transactions.
BLOCKCHAIN – a public ledger, which contains lots of data, encrypted in separate block in the form of hashes (messages). Considered immutable and unable to manipulate.
BLOCK HEADER – a string long 80 bytes, which miners hash with the nonce to find the solution of the block.
BLOCK REWARD – this is what a miner gets for successfully calculating a valid hash in the block when performing a mining process.
BLOCK SIZE – this is a limit of bytes that the block might contain (also limits of transactions in one piece).
BLOCK TIME – the average time needed to find a block’s solutions. It’s different for each coin.
BLOCK SYNCHRONIZATION – the time requested for the blockchain to sync with your device (for full nodes usually).
C
CENTRALIZATION – an organization or system, which is controlled by a central authority.
CLOUD MINING – performing a mining process via rented hashing power from a third-party provider.
COIN – a term used to describe units of blockchain value.
CONFIRMATION – the process of validating if a transaction is including on the blockchain.
CONSENSUS – a rule all participant agrees on when operating on the same network.
CONTRIBUTION SHARE – the hash rate a miner puts into the pool to contribute.
CPU – (Central Processing Unit) a processor, which coordinates the work of all the other part of a computer.
D
DAO (Decentralized Anonymous Organization) – organization running smart contracts.
DIFFICULTY – a measure of how difficult might be to mine a new block.
DIFFICULTY BOMB – malicious attack, increasing difficulty that much, that the reward doesn’t cover the expenses to mine.
DISTRIBUTION – percentage of each pool from all the ones available in the network for this coin.
DOUBLE SPENDING – general issue of the decentralized conception or spending a same amount twice.
DOWNTIME – a period when a machine isn’t working.
E
EXCHANGE – a platform to buy, trade and sell cryptocurrencies.
F
FIAT MONEY – national currency of a central government.
FORK – changing in the rules of the consensus, which might be able to exist with the old established rules (soft fork) or not (hard fork).
FPGA – a modern mining device, improving the ASIC, which can mine coins from one particular algorithm. The interesting here is that you can modify it to mine a different algorithm if you decide to change the coin you mine.
FULL NODE – storing the blockchain data locally on your PC.
G
GAINS – increasing profits (reward).
GENESIS BLOCK – the first block, computationally created in the blockchain. It contains the initial transaction.
GPU (Graphic Processing Unit) – a graphic card, also known as a video card (part of a computer), which is successfully used for mining purposes.
H
HASH FUNCTION – encrypted message with fixes size and unique value.
HASH RATE – a unit to measure the computational power by which a miner contributes in the mining process.
HASH RENTAL – a rented computing power for mining purposes by a cloud mining provider.
HARD FORK – this is a protocol change, which results in splitting into two different chains and the longer one continuous existing. If both of them do – we have a chain split. These changes cannot cooperate with the old rules and require an update.
HARD DISK SPACE – the storage a user needs to locally store the blockchain data on a desktop PC.
Halving – decreasing the reward of gained coins per block using a particular formula.
I
ICO (Initial Coin Offering) – crowdfunding via crypto coins for the purpose of gaining capital for a particular project.
IMMUTABLE – unable to change in time.
K
KYC (Know Your Customer) – an identification process for the users in the network.
L
LEDGER – a piece of record of data, which is immutable.
LIGHT CLIENT – not storing the entire blockchain data but using just parts of it (a block’s header). To have some more information, they trust a full node.
LIGHTNING NETWORK – an additional layer of the blockchain to perform faster transactions between the nodes participating in the network.
LIQUIDITY – the ease to buying and selling, without bothering the market’s price.
M
MARKET CAPITALIZATION – a cryptocurrency’s price, according the total supply.
MARKET SHARE – the hash share of the market with which the pool operates.
MINEABLE – a coin which can be mined in return of reward.
MINER – either the device or the person who’s performing the mining process.
MINER’s FEE – this is the reward a miner receives for its contribution to the network by validating transactions. Normally, miners choose transactions with higher fees to add in the next block to profit more and faster.
MINING – a process of extracting a cryptocurrency by adding and verifying transactions to the blockchain, respectively gaining a reward for it.
MINING POOL – group of miners, combining their power to find a block faster and sharing the reward from it too.
MINING RIG – this is a set of multiple mining hardware, combined to mine with higher hash rate and find a block faster.
N
NODE – a computer that keeps a copy of the blockchain.
NONCE – an arbitrary number in a cryptographic communication. It is generated during the hashing process and can be used only once.
O
ORPHAN BLOCK – a valid block, which isn’t part of the blockchain and occurs when two miners find the same block in the same time. The one which is late becomes orphan.
P
PAYOUT LIMIT – the minimum amount of coins which you can withdraw from your account.
POOL DISTRIBUTION – a percentage of each pool, possessed for this particular coin.
POOL FEES – the fees requested from the pool for maintenance.
POW (Proof-of-Work) – when it comes to mining this is a consensus mechanism where miners are using a nonce to search the block’s solutions and get rewarded proportionally of their contribution (work). There’s no need of trust, since everybody’s “work” (share) is visible in the network.
PPS – (Pay Per Share) a type of rewarding system, based on contribution.
PPLNS – (Pay Per Last N Shares) a type of rewarding system, based on time a contribution.
PRIVATE KEY – this is the “password” which helps you to access your public address. It’s the one and only, which let you read the hashes (messages) sent to your public key.
PROP – (Proportional) a type of rewarding system, based on a proportional relation between contribution and luck.
PUBLIC KEY – this is a recipient’s address to receive any crypto assets in the form of a hash, which might be read with only one specific private key.
Q
QR-CODE – a graphic sign, which can be scanned via smartphone camera to read a wallet’s public address and send some coins within it.
R
REWARDING SYSTEM – a method of rewarding the miners, depending on their contribution to the network.
REPOSITORY – a software where you keep all your information, which might be retrieved at some point.
S
STALE SHARE – when two miners send a share to the network to affirm, they found a block, the one which is late is a stale one.
SPV (Simple Payment Verification) – a client which checks on transactions, using only the headers of the blocks, which is considered a proof of inclusion.
T
TRAFFIC (incoming & outcoming) – the traffic from one point to another (movement of data and actions). It’s important when it’s up to cryptocurrencies because it can define your speed when broadcasting a transaction.
TRANSACTION FEE – a payment to broadcast your transaction on the network.
U
UPTIME – the time during which a mining machine is properly working.
UTXO (Unspent Transaction Output) – a value, calculating the balance of unspent coins, based on all the previously spent outputs and inputs, based on the public ledger’s history of transactions.
V
VALID BLOCK – there’s a signal that the block is mined and the user’s waiting for confirmation from other nodes to gain the reward.
VARDIFF (Variable Difficulty) – the share’s difficulty might rise or fall, depending on the hash rate.
VPS (Virtual Private Server) – a PC with static IP, supporting the network.
W
WALLET – a digital wallet to store, send and receive crypto assets.
WORKER – either a mining device, either an account in the mining pool configuration.
Joseph Werner: Diana of Ephesus as allegory of Nature, c. 1680
Mother Nature (sometimes known as Mother Earth or the Earth Mother) is a personification of nature that focuses on the life-giving and nurturing aspects of nature by embodying it, in the form of the mother.
Mother Nature image, 17th century alchemical text, Atalanta Fugiens
The word “nature” comes from the Latin word, “natura”, meaning birth or character (see nature (philosophy)). In English, its first recorded use (in the sense of the entirety of the phenomena of the world) was in 1266. “Natura” and the personification of Mother Nature were widely popular in the Middle Ages.
As a concept, seated between the properly divine and the human, it can be traced to Ancient Greece, though Earth (or “Eorthe” in the Old English period) may have been personified as a goddess. The Norse also had a goddess called Jörð (Jord, or Erth).
“… Mother Nature is punishing us, …, for our greed and selfishness.
We torture her at all hours by iron and wood, fire and stone.
We dig her up and dump her in the sea.
We sink mine shafts into her and drag out her entrails – and all for a jewel to wear on a pretty finer.
Who can blame her if she occasionally quivers with anger?”
Pliny, Pg. 176 – Robert Harris, Pompeii
“Harmony is about bringing things into balance and knowing how to go from sunrise to sunset.
Mother Nature teaches this to us, in so many ways, each and every day.”
Jaeda DeWalt
“Those who train their hearts in natural wonder shall forever know the rivers, forests, wildflowers, and oceans, as friends.”
Atalina Wright, ”Wild Riverbanks”
“Nature isn’t cruel, but unconcerned with human frailty.”
Melissa Febos
“The simplicity of life is universal. Mother Nature is a wonderful teacher.”
Steve Leasock
“Autumn is the time of year when Mother Nature says, “Look how easy, how healthy, and how beautiful letting go can be.”
Toni Sorenson
“The Earth is nothing but phlegm spat out by the Sun, and our immediate solar system a whirlwind of boulders.
There is no “delicate balance.”
A.E. Samaan, From a “Race of Masters” to a “Master Race”: 1948 to 1848
If you can’t be in awe of Mother Nature, there’s something wrong with you.
Alex Trebek
“Only after the last tree has been cut down.
Only after the last river has been poisoned.
Only after the last fish has been caught, only then will you find that money cannot be eaten.”
Cree Indian Prophecy
“Earth provides enough to satisfy every man’s needs, but not every man’s greed.”
Mahatma Gandhi
“Look deep into nature and then you will understand everything better.”
Albert Einstein
“Nature does not hurry, yet everything is accomplished.”
Lao Tzu
“Nature is man’s teacher.
She unfolds her treasures to his search, unseals his eye, illumines his mind, and purifies his heart; an influence breathes from all the sights and sounds of her existence.”
Alfred Billings Street
“We are all visitors to this time, this place.
We are just passing through.
Our purpose here is to observe, to learn, to grow, to love, and then we return home.”
Australian Aboriginal
“The world is not to be put in order.
The world is order, incarnate.
It is for us to put ourselves in unison with this order.”
Henry Miller
“O Nature, gracious mother of us all, Within thy bosom myriad secrets lie Which thou surrenderest to the patient eye That seeks and waits.”
Margaret Junkin Preston
“Nature, like a loving mother, is ever trying to keep land and sea, mountain and valley, each in its place, to hush the angry winds and waves, balance the extremes of heat and cold, of rain and drought, that peace, harmony and beauty may reign supreme.”
Elizabeth Cady Stanton
“The world will burn for a hundred years.
Fire will consume the things we made from wood and plastic and rubber and cloth, then water and wind and time will chew the stone and steel into dust.
How baffling it is that we imagined cities incinerated by alien bombs and death rays when all they needed was Mother Nature and time.“
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→
Hy there to all of you out there, white, black, yellow and avatar 😋🤣 people around the WordPress world !
Hope you are all well and safe in these troubled times we live on this beautiful planet of ours !
I come before you, to ask for your opinion and what you would like to see explained in my posts !?! Just let me know and I will try my best to accomodate your requests !
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→
My aim is for any brand new miner to be able to determine just how unlikely any run of bad luck is, and so reduce the overall level of panic amongst miners.
Mining panic has been exacerbated by reports of accidental block withholding attacks, and a stratum vulnerability.
Wouldn’t you prefer to know if your panic was actually warranted?
• 1. Gambler’s fallacy
For miners who have been around for more than a year or two seen good and bad luck (unless they mine at a “Pay per share” pool, in which case they are not subject to luck at all) and know that it will even out in the long term.
However, every new miner striking a run of bad luck will flail around, looking to escape to another pool that is not having bad luck. This sort of response to random events can be thought of as a type of gambler’s fallacy.
• 2. Bad Luck lasts longer
Another reason that makes us mis-judge mining luck is that when we mine, we mostly experience bad luck.
In fact if you go to the trouble of working it out, your hours of mining will be about one-quarter good luck and three quarters bad luck. Why? Bad luck takes longer, good luck rounds take much less time.
• 3. Assessing luck over time instead of blocks
Another mistake made by novice miners is to assume that the extremes of luck will be the same for all pool over any time frame. This is wrong for two related reasons:
The more blocks are solved the closer luck approaches 100%
Because the timeframe for luck to to approach 100% varies depending on number of blocks solved, comparing various pools’ luck over the same time period is invalid. Instead we need to compare luck over similar number of blocks.
• 4. The luck statistic, the Erlang distribution, PDFs and CDFs
I’ll try to avoid terms like “variance” and “median” and “maths” in order to not scare away too many readers, but we do need a definition:
Luck = Mean (expected shares per round / actual shares per round)
Luck statistic = mean (actual shares per round / expected shares per round)
i.e. Luck = 1/Luck statistic
I would much rather just refer to the ‘Luck statistic’ as luck, but due to our psychological preference to assign luck a scale where bigger is better, we need both measures – “Luck” as a shorthand for “How much am I earning as a percent of what I expect to earn”, and the “Luck” statistic. Just keep in mind the larger the ‘luck’ statistic, the worse the ‘luck’.
The luck statistic is negative binomially distributed, but can be very closely approximated by a known and well understood distribution ( Erlang distribution ) which makes calculating probabilities simpler.
The approximation becomes more accurate as difficulty increases – think of Euler’s (1 + 1/n)^n approximation to e as the comparison of an exponentially distributed random variable (Erlang distribution shape parameter = 1) and a geometrically distributed random variable (Negative binomial distribution, size parameter = 1, probability = 1/n).
In case you’re worried about the approximation leading to significant error, at current difficulty you’ll won’t see a probability error greater than 0.0000000001.
Visualising the Erlang distribution:
The PDF is the probability density function, which indicates how probable it is that the luck statistic will be some arbitrary value.
The CDF is the cumulative distribution function, which indicates how probable it is that the luck statistic will be greater than or equal to arbitrary value.
Both plots illustrate:
The luck statistic tends closer to 1.0 as the number of blocks over which the statistic is averaged increases
Extremes of luck are more likely when the luck statistic is averaged over fewer blocks.
• 5. Managing Income Variance
Luck averaged over more blocks means fewer extremes, so more blocks in less time means as a miner you will experience less variation in payout – but also means that you’ll be increasing the size of pools that are already large.
You can avoid this by adjusting your timescale expectations – try to focus on weekly income, or income per retarget and you’ll be less affected by income variations. Wait about one hundred blocks and income will be around +/- 20% of expected.
Your other option is to mine at a pool that has a pay per share (PPS) reward method, but this has a couple of downsides. The first is that since the pool is smoothing out the income variations for you, if they don’t manage that risk properly they could bankrupt themselves, and leaving you with lost income. The other problem is that since PPS is risky not many pools want to provide it so you won’t have many options about where you can mine.
• 6. How can you calculate the CDF probability yourself?
If you want to manage your expectations without using a PPS pool you need to know what to expect. Not just the reward per share but the typical range of values you might encounter in some time frame. So, how can you calculate the CDF probability yourself? If you have some experience with statistics or coding knowledge can use R or mathematica or even python, but you can also use the Wolfram Alpha website. By entering the luck statistic and the number of blocks over which the statistic was averaged, you get the lower tail probability of that statistic occurring.
For example, if the luck statistic was 1.1 over one hundred blocks is that quite unlucky or just a little unlucky? Enter:
CDF [ErlangDistribution[100, 100], 1.1] The result is 0.84, so for 84 times out of one hundred re-runs of one blocks, we’d see luckier blocks. Not that unlucky – 1 in every six re-runs would be unluckier.
• 6. How can you calculate the probable luck outcomes yourself?
Rather than assess how lucky or unlucky your pool has been, planning requires you to estimate how unlucky is could be in future. Let’s say you plan to be able to manage a monthly worst case of 0.999 (one one in a thousand re-runs of the months blocks would be worse), and your expect your pool to solve around 50 blocks in that time.
quantile(ErlangDistribution[50, 50], 0.999) This results in a luck statistic of ~1.495, or a luck of 1/1.495 = 66.9%
• 7. I need something easier. Or less statisticky, anyway.
OK, I hear you. My fun != your fun. This chart gives you the expected luck percentage (and it’s all bad luck) for bad luck with a 1/3 chance of that luck or worse occurring (not very unlucky) to bad luck with a 1/10000 chance of that luck or worse occurring (really quite unlucky). Use it to either plan for the future or get an idea of how lucky you’ve been.
For example, my pool solves ten blocks at a luck of 80%, is that really bad? Not really. It’ll happen around 20% of the time (1/5 chance of that luck or worse occurring). Maybe I just want to make sure I can cope with a 1/thousand bad luck run of five hundred blocks (~67.5%).
8. Summary
Variance in income reduces as a function of number of blocks solved.
Variance in income is not a function of time.
Learn how to plan for bad luck, and to check that your pool’s luck is not impossibly bad.
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