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Bitcoin mining difficulty soars as hashing power nudges 1 Petahash, September 17, 2013.

Bitcoin mining difficulty soars as hashing power nudges 1 Petahash, September 17, 2013. submitted by Doomnificent to Bitcoin [link] [comments]

How EpiK Protocol “Saved the Miners” from Filecoin with the E2P Storage Model?

How EpiK Protocol “Saved the Miners” from Filecoin with the E2P Storage Model?

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On October 20, Eric Yao, Head of EpiK China, and Leo, Co-Founder & CTO of EpiK, visited Deep Chain Online Salon, and discussed “How EpiK saved the miners eliminated by Filecoin by launching E2P storage model”. ‘?” The following is a transcript of the sharing.
Sharing Session
Eric: Hello, everyone, I’m Eric, graduated from School of Information Science, Tsinghua University. My Master’s research was on data storage and big data computing, and I published a number of industry top conference papers.
Since 2013, I have invested in Bitcoin, Ethereum, Ripple, Dogcoin, EOS and other well-known blockchain projects, and have been settling in the chain circle as an early technology-based investor and industry observer with 2 years of blockchain experience. I am also a blockchain community initiator and technology evangelist
Leo: Hi, I’m Leo, I’m the CTO of EpiK. Before I got involved in founding EpiK, I spent 3 to 4 years working on blockchain, public chain, wallets, browsers, decentralized exchanges, task distribution platforms, smart contracts, etc., and I’ve made some great products. EpiK is an answer to the question we’ve been asking for years about how blockchain should be landed, and we hope that EpiK is fortunate enough to be an answer for you as well.
Q & A
Deep Chain Finance:
First of all, let me ask Eric, on October 15, Filecoin’s main website launched, which aroused everyone’s attention, but at the same time, the calls for fork within Filecoin never stopped. The EpiK protocol is one of them. What I want to know is, what kind of project is EpiK Protocol? For what reason did you choose to fork in the first place? What are the differences between the forked project and Filecoin itself?
Eric:
First of all, let me answer the first question, what kind of project is EpiK Protocol.
With the Fourth Industrial Revolution already upon us, comprehensive intelligence is one of the core goals of this stage, and the key to comprehensive intelligence is how to make machines understand what humans know and learn new knowledge based on what they already know. And the knowledge graph scale is a key step towards full intelligence.
In order to solve the many challenges of building large-scale knowledge graphs, the EpiK Protocol was born. EpiK Protocol is a decentralized, hyper-scale knowledge graph that organizes and incentivizes knowledge through decentralized storage technology, decentralized autonomous organizations, and generalized economic models. Members of the global community will expand the horizons of artificial intelligence into a smarter future by organizing all areas of human knowledge into a knowledge map that will be shared and continuously updated for the eternal knowledge vault of humanity
And then, for what reason was the fork chosen in the first place?
EpiK’s project founders are all senior blockchain industry practitioners and have been closely following the industry development and application scenarios, among which decentralized storage is a very fresh application scenario.
However, in the development process of Filecoin, the team found that due to some design mechanisms and historical reasons, the team found that Filecoin had some deviations from the original intention of the project at that time, such as the overly harsh penalty mechanism triggered by the threat to weaken security, and the emergence of the computing power competition leading to the emergence of computing power monopoly by large miners, thus monopolizing the packaging rights, which can be brushed with computing power by uploading useless data themselves.
The emergence of these problems will cause the data environment on Filecoin to get worse and worse, which will lead to the lack of real value of the data in the chain, high data redundancy, and the difficulty of commercializing the project to land.
After paying attention to the above problems, the project owner proposes to introduce multi-party roles and a decentralized collaboration platform DAO to ensure the high value of the data on the chain through a reasonable economic model and incentive mechanism, and store the high-value data: knowledge graph on the blockchain through decentralized storage, so that the lack of value of the data on the chain and the monopoly of large miners’ computing power can be solved to a large extent.
Finally, what differences exist between the forked project and Filecoin itself?
On the basis of the above-mentioned issues, EpiK’s design is very different from Filecoin, first of all, EpiK is more focused in terms of business model, and it faces a different market and track from the cloud storage market where Filecoin is located because decentralized storage has no advantage over professional centralized cloud storage in terms of storage cost and user experience.
EpiK focuses on building a decentralized knowledge graph, which reduces data redundancy and safeguards the value of data in the distributed storage chain while preventing the knowledge graph from being tampered with by a few people, thus making the commercialization of the entire project reasonable and feasible.
From the perspective of ecological construction, EpiK treats miners more friendly and solves the pain point of Filecoin to a large extent, firstly, it changes the storage collateral and commitment collateral of Filecoin to one-time collateral.
Miners participating in EpiK Protocol are only required to pledge 1000 EPK per miner, and only once before mining, not in each sector.
What is the concept of 1000 EPKs, you only need to participate in pre-mining for about 50 days to get this portion of the tokens used for pledging. The EPK pre-mining campaign is currently underway, and it runs from early September to December, with a daily release of 50,000 ERC-20 standard EPKs, and the pre-mining nodes whose applications are approved will divide these tokens according to the mining ratio of the day, and these tokens can be exchanged 1:1 directly after they are launched on the main network. This move will continue to expand the number of miners eligible to participate in EPK mining.
Secondly, EpiK has a more lenient penalty mechanism, which is different from Filecoin’s official consensus, storage and contract penalties, because the protocol can only be uploaded by field experts, which is the “Expert to Person” mode. Every miner needs to be backed up, which means that if one or more miners are offline in the network, it will not have much impact on the network, and the miner who fails to upload the proof of time and space in time due to being offline will only be forfeited by the authorities for the effective computing power of this sector, not forfeiting the pledged coins.
If the miner can re-submit the proof of time and space within 28 days, he will regain the power.
Unlike Filecoin’s 32GB sectors, EpiK’s encapsulated sectors are smaller, only 8M each, which will solve Filecoin’s sector space wastage problem to a great extent, and all miners have the opportunity to complete the fast encapsulation, which is very friendly to miners with small computing power.
The data and quality constraints will also ensure that the effective computing power gap between large and small miners will not be closed.
Finally, unlike Filecoin’s P2P data uploading model, EpiK changes the data uploading and maintenance to E2P uploading, that is, field experts upload and ensure the quality and value of the data on the chain, and at the same time introduce the game relationship between data storage roles and data generation roles through a rational economic model to ensure the stability of the whole system and the continuous high-quality output of the data on the chain.
Deep Chain Finance:
Eric, on the eve of Filecoin’s mainline launch, issues such as Filecoin’s pre-collateral have aroused a lot of controversy among the miners. In your opinion, what kind of impact will Filecoin bring to itself and the whole distributed storage ecosystem after it launches? Do you think that the current confusing FIL prices are reasonable and what should be the normal price of FIL?
Eric:
Filecoin mainnet has launched and many potential problems have been exposed, such as the aforementioned high pre-security problem, the storage resource waste and computing power monopoly caused by unreasonable sector encapsulation, and the harsh penalty mechanism, etc. These problems are quite serious, and will greatly affect the development of Filecoin ecology.
These problems are relatively serious, and will greatly affect the development of Filecoin ecology, here are two examples to illustrate. For example, the problem of big miners computing power monopoly, now after the big miners have monopolized computing power, there will be a very delicate state — — the miners save a file data with ordinary users. There is no way to verify this matter in the chain, whether what he saved is uploaded by himself or someone else. And after the big miners have monopolized computing power, there will be a very delicate state — — the miners will save a file data with ordinary users, there is no way to verify this matter in the chain, whether what he saved is uploaded by himself or someone else. Because I can fake another identity to upload data for myself, but that leads to the fact that for any miner I go to choose which data to save. I have only one goal, and that is to brush my computing power and how fast I can brush my computing power.
There is no difference between saving other people’s data and saving my own data in the matter of computing power. When I save someone else’s data, I don’t know that data. Somewhere in the world, the bandwidth quality between me and him may not be good enough.
The best option is to store my own local data, which makes sense, and that results in no one being able to store data on the chain at all. They only store their own data, because it’s the most economical for them, and the network has essentially no storage utility, no one is providing storage for the masses of retail users.
The harsh penalty mechanism will also severely deplete the miner’s profits, because DDOS attacks are actually a very common attack technique for the attacker, and for a big miner, he can get a very high profit in a short period of time if he attacks other customers, and this thing is a profitable thing for all big miners.
Now as far as the status quo is concerned, the vast majority of miners are actually not very well maintained, so they are not very well protected against these low-DDOS attacks. So the penalty regime is grim for them.
The contradiction between the unreasonable system and the demand will inevitably lead to the evolution of the system in a more reasonable direction, so there will be many forked projects that are more reasonable in terms of mechanism, thus attracting Filecoin miners and a diversion of storage power.
Since each project is in the field of decentralized storage track, the demand for miners is similar or even compatible with each other, so miners will tend to fork the projects with better economic benefits and business scenarios, so as to filter out the projects with real value on the ground.
For the chaotic FIL price, because FIL is also a project that has gone through several years, carrying too many expectations, so it can only be said that the current situation has its own reasons for existence. As for the reasonable price of FIL there is no way to make a prediction because in the long run, it is necessary to consider the commercialization of the project to land and the value of the actual chain of data. In other words, we need to keep observing whether Filecoin will become a game of computing power or a real value carrier.
Deep Chain Finance:
Leo, we just mentioned that the pre-collateral issue of Filecoin caused the dissatisfaction of miners, and after Filecoin launches on the main website, the second round of space race test coins were directly turned into real coins, and the official selling of FIL hit the market phenomenon, so many miners said they were betrayed. What I want to know is, EpiK’s main motto is “save the miners eliminated by Filecoin”, how to deal with the various problems of Filecoin, and how will EpiK achieve “save”?
Leo:
Originally Filecoin’s tacit approval of the computing power makeup behavior was to declare that the official directly chose to abandon the small miners. And this test coin turned real coin also hurt the interests of the loyal big miners in one cut, we do not know why these low-level problems, we can only regret.
EpiK didn’t do it to fork Filecoin, but because EpiK to build a shared knowledge graph ecology, had to integrate decentralized storage in, so the most hardcore Filecoin’s PoRep and PoSt decentralized verification technology was chosen. In order to ensure the quality of knowledge graph data, EpiK only allows community-voted field experts to upload data, so EpiK naturally prevents miners from making up computing power, and there is no reason for the data that has no value to take up such an expensive decentralized storage resource.
With the inability to make up computing power, the difference between big miners and small miners is minimal when the amount of knowledge graph data is small.
We can’t say that we can save the big miners, but we are definitely the optimal choice for the small miners who are currently in the market to be eliminated by Filecoin.
Deep Chain Finance:
Let me ask Eric: According to EpiK protocol, EpiK adopts the E2P model, which allows only experts in the field who are voted to upload their data. This is very different from Filecoin’s P2P model, which allows individuals to upload data as they wish. In your opinion, what are the advantages of the E2P model? If only voted experts can upload data, does that mean that the EpiK protocol is not available to everyone?
Eric:
First, let me explain the advantages of the E2P model over the P2P model.
There are five roles in the DAO ecosystem: miner, coin holder, field expert, bounty hunter and gateway. These five roles allocate the EPKs generated every day when the main network is launched.
The miner owns 75% of the EPKs, the field expert owns 9% of the EPKs, and the voting user shares 1% of the EPKs.
The other 15% of the EPK will fluctuate based on the daily traffic to the network, and the 15% is partly a game between the miner and the field expert.
The first describes the relationship between the two roles.
The first group of field experts are selected by the Foundation, who cover different areas of knowledge (a wide range of knowledge here, including not only serious subjects, but also home, food, travel, etc.) This group of field experts can recommend the next group of field experts, and the recommended experts only need to get 100,000 EPK votes to become field experts.
The field expert’s role is to submit high-quality data to the miner, who is responsible for encapsulating this data into blocks.
Network activity is judged by the amount of EPKs pledged by the entire network for daily traffic (1 EPK = 10 MB/day), with a higher percentage indicating higher data demand, which requires the miner to increase bandwidth quality.
If the data demand decreases, this requires field experts to provide higher quality data. This is similar to a library with more visitors needing more seats, i.e., paying the miner to upgrade the bandwidth.
When there are fewer visitors, more money is needed to buy better quality books to attract visitors, i.e., money for bounty hunters and field experts to generate more quality knowledge graph data. The game between miners and field experts is the most important game in the ecosystem, unlike the game between the authorities and big miners in the Filecoin ecosystem.
The game relationship between data producers and data storers and a more rational economic model will inevitably lead to an E2P model that generates stored on-chain data of much higher quality than the P2P model, and the quality of bandwidth for data access will be better than the P2P model, resulting in greater business value and better landing scenarios.
I will then answer the question of whether this means that the EpiK protocol will not be universally accessible to all.
The E2P model only qualifies the quality of the data generated and stored, not the roles in the ecosystem; on the contrary, with the introduction of the DAO model, the variety of roles introduced in the EpiK ecosystem (which includes the roles of ordinary people) is not limited. (Bounty hunters who can be competent in their tasks) gives roles and possibilities for how everyone can participate in the system in a more logical way.
For example, a miner with computing power can provide storage, a person with a certain domain knowledge can apply to become an expert (this includes history, technology, travel, comics, food, etc.), and a person willing to mark and correct data can become a bounty hunter.
The presence of various efficient support tools from the project owner will lower the barriers to entry for various roles, thus allowing different people to do their part in the system and together contribute to the ongoing generation of a high-quality decentralized knowledge graph.
Deep Chain Finance:
Leo, some time ago, EpiK released a white paper and an economy whitepaper, explaining the EpiK concept from the perspective of technology and economy model respectively. What I would like to ask is, what are the shortcomings of the current distributed storage projects, and how will EpiK protocol be improved?
Leo:
Distributed storage can easily be misunderstood as those of Ali’s OceanDB, but in the field of blockchain, we should focus on decentralized storage first.
There is a big problem with the decentralized storage on the market now, which is “why not eat meat porridge”.
How to understand it? Decentralized storage is cheaper than centralized storage because of its technical principle, and if it is, the centralized storage is too rubbish for comparison.
What incentive does the average user have to spend more money on decentralized storage to store data?
Is it safer?
Existence miners can shut down at any time on decentralized storage by no means save a share of security in Ariadne and Amazon each.
More private?
There’s no difference between encrypted presence on decentralized storage and encrypted presence on Amazon.
Faster?
The 10,000 gigabytes of bandwidth in decentralized storage simply doesn’t compare to the fiber in a centralized server room. This is the root problem of the business model, no one is using it, no one is buying it, so what’s the big vision.
The goal of EpiK is to guide all community participants in the co-construction and sharing of field knowledge graph data, which is the best way for robots to understand human knowledge, and the more knowledge graph data there is, the more knowledge a robot has, the more intelligent it is exponentially, i.e., EpiK uses decentralized storage technology. The value of exponentially growing data is captured with linearly growing hardware costs, and that’s where the buy-in for EPK comes in.
Organized data is worth a lot more than organized hard drives, and there is a demand for EPK when robots have the need for intelligence.
Deep Chain Finance:
Let me ask Leo, how many forked projects does Filecoin have so far, roughly? Do you think there will be more or less waves of fork after the mainnet launches? Have the requirements of the miners at large changed when it comes to participation?
Leo:
We don’t have specific statistics, now that the main network launches, we feel that forking projects will increase, there are so many restricted miners in the market that they need to be organized efficiently.
However, we currently see that most forked projects are simply modifying the parameters of Filecoin’s economy model, which is undesirable, and this level of modification can’t change the status quo of miners making up computing power, and the change to the market is just to make some of the big miners feel more comfortable digging up, which won’t help to promote the decentralized storage ecology to land.
We need more reasonable landing scenarios so that idle mining resources can be turned into effective productivity, pitching a 100x coin instead of committing to one Fomo sentiment after another.
Deep Chain Finance:
How far along is the EpiK Protocol project, Eric? What other big moves are coming in the near future?
Eric:
The development of the EpiK Protocol is divided into 5 major phases.
(a) Phase I testing of the network “Obelisk”.
Phase II Main Network 1.0 “Rosetta”.
Phase III Main Network 2.0 “Hammurabi”.
(a) The Phase IV Enrichment Knowledge Mapping Toolkit.
The fifth stage is to enrich the knowledge graph application ecology.
Currently in the first phase of testing network “Obelisk”, anyone can sign up to participate in the test network pre-mining test to obtain ERC20 EPK tokens, after the mainnet exchange on a one-to-one basis.
We have recently launched ERC20 EPK on Uniswap, you can buy and sell it freely on Uniswap or download our EpiK mobile wallet.
In addition, we will soon launch the EpiK Bounty platform, and welcome all community members to do tasks together to build the EpiK community. At the same time, we are also pushing forward the centralized exchange for token listing.
Users’ Questions
User 1:
Some KOLs said, Filecoin consumed its value in the next few years, so it will plunge, what do you think?
Eric:
First of all, the judgment of the market is to correspond to the cycle, not optimistic about the FIL first judgment to do is not optimistic about the economic model of the project, or not optimistic about the distributed storage track.
First of all, we are very confident in the distributed storage track and will certainly face a process of growth and decline, so as to make a choice for a better project.
Since the existing group of miners and the computing power already produced is fixed, and since EpiK miners and FIL miners are compatible, anytime miners will also make a choice for more promising and economically viable projects.
Filecoin consumes the value of the next few years this time, so it will plunge.
Regarding the market issues, the plunge is not a prediction, in the industry or to keep learning iteration and value judgment. Because up and down market sentiment is one aspect, there will be more very important factors. For example, the big washout in March this year, so it can only be said that it will slow down the development of the FIL community. But prices are indeed unpredictable.
User2:
Actually, in the end, if there are no applications and no one really uploads data, the market value will drop, so what are the landing applications of EpiK?
Leo: The best and most direct application of EpiK’s knowledge graph is the question and answer system, which can be an intelligent legal advisor, an intelligent medical advisor, an intelligent chef, an intelligent tour guide, an intelligent game strategy, and so on.
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The deepest report: Bitmain's self-help history

The deepest report: Bitmain's self-help history
The original intention of this article is to let readers understand the causes and consequences of Bitmain internal fighting, but after writing it, I found that it is not so much internal fighting as it is a long history of self-help.
The story is very long. Let's adjust the timeline to the eve of December 17, 2018. That was one of Bitmain's most critical moments and the beginning of a series of subsequent stories.
1. Self-immolation In September 2018, Bitmain's financial department warned management that the company's cash flow has become very tight and operating costs must be reduced to allow the company to continue. The blockchain unicorn, which is valued at more than 15 billion U.S. dollars, is crippled in the run and struggling to break the corner.
In 2017, Bitmain made a profit of 1 billion US dollars In the first half of 2018, Bitmain made a profit of 1 billion US dollars Three rounds of financing, a total of 800 million US dollars Net assets should exceed 3 billion U.S. dollars In September 2018, Bitmain had tight cash flow and was on the verge of bankruptcy
A simple comparison, it is not difficult to see that Bitmain's ability to make money is incredible, and its ability to burn money is even more extreme.
How does Bitmain burn money? Do you pour cash into gasoline and burn it, or hire a lot of employees to stuff the banknotes one by one into the shredder? The actual situation is closer to the latter.
The following data can help readers quickly learn Bitmain's money burning skills.
At the beginning of 2018, the entire cryptocurrency market has entered a bear market, but Bitmain's monthly operating costs have been rising wildly. Operating costs have risen from 10 million US dollars at the beginning of the year to 50 million US dollars at the end of the year.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
Operating costs are just the tip of the iceberg. Excessive chip trial production can become a classic case of project management courses. Readers who pay attention to Cryptocurrency mining can easily find that Bitmain is still working hard to clear the inventory of Antminer S9 in 2019. As the co-CEO, Ketuan Zhan did not listen to the advice or even warnings of the Finance Department, insisting on the implementation of Excessive chip trial production, resulting in a large accumulation of inventory and tight capital turnover. Another CEO, Jihan Wu, once revealed that the loss of Excessive chip trial production to the company was approximately US$1.5 billion.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
The BM1393 chip incident is even more incredible. Chip expert Ketuan Zhan invested a lot of money on a failed chip, and finally failed again. From 2017 to 2018, Bitmain has failed Trial production of mining machine chips at least 4 times, including 16nm, 12nm and 10nm chips, of which 16nm Trial production failed twice, thus losing at least US$1.2 billion.
It is rumored that Bitmain still holds a billion U.S. dollars worth of cryptocurrency in a state of floating loss. In view of the rebound in the market in 2020, we will not comment temporarily, waiting for the correct answer from the cryptocurrency market. But the losses pointed out in the previous article are all irreversible.
2. Sole power
In September 2018, Bitmain's management realized the seriousness of the problem. It turned out that the company's money could be squandered. As a result, the management began to discuss self-help plans, and the most reasonable and effective way was obviously to lay off employees.
The probation period for newly hired employees at Bitmain is half a year, and the probationary salary is 100% of the official salary, there is no difference. Once layoffs are made, new employees who have not passed the probationary period will be the main layoff targets. The department managed by Ketuan Zhan will face large-scale layoffs. The layoff plan is strongly opposed by Ketuan Zhan. Bitmain can only temporarily abandon the layoffs and replace it with continuous reductions. For marketing and travel expenses, a budget committee was established to strictly approve every expenditure. At the same time, employee benefits, such as reimbursement of taxi expenses, breakfast supply, snacks and drinks, etc., have also been abolished, and even the tradition of giving employees 400 yuan worth of BTC/BCH every month has been stopped.
In the face of huge cash flow pressure, trivial savings is obviously of no avail. Soon, the management again discussed the layoff plan, and it has reached the point where it has to be laid off.
In December 2018, Jihan Wu began to organize all entrepreneurial veterans and business backbones to persuade Ketuan Zhan to agree to layoffs, but Ketuan Zhan still insisted not to layoffs. The persuasion process was very unsuccessful. After many meetings and intense debates, Bitmain executives were caught in a dilemma of wasting time with Ketuan Zhan.
In this process, the shortcomings of the dual CEO system began to appear, and the relationship between the two CEOs gradually deteriorated.
On the night of December 16th, Ketuan Zhan reconvened the management meeting, and more than 30 managements who were present were asked to hand over their mobile phones. At this time, Jihan Wu was on a business trip in Hong Kong and was busy with listing related work.
In the meeting, Ketuan Zhan's core content was three items:
(1) Bitmain cannot have two CEOs, only one CEO and must be Ketuan Zhan. Ketuan Zhan said that he met an old leader during a business trip. He hadn't seen each other for many years. The old leader suggested that the company can only have one CEO, and it must be him. Ketuan Zhan feels that this is a kind of fate, an opportunity given by God.
(2) Ketuan Zhan believes that the company's cash flow problems, the biggest responsibility is the inability of the financial department. To prove his point, Ketuan Zhan announced Bitmain's financial data at the meeting. In the evening, employees in Taiwan began to post messages on social media, saying that the company's capital chain was broken and the top management was split.
(3) If Ketuan Zhan is not supported, the option will be cancelled and the equity will be voided.
Hearing about this, Jihan Wu, who lives in Hong Kong, sent a WeChat message to the management who are attending the meeting.

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On the afternoon of December 17, 2018, Jihan Wu returned to Beijing to negotiate with Ketuan Zhan all night, and finally reached a consensus in the early morning. Bitmain co-founder Yuesheng Ge announced the results of the negotiations. Jihan Wu and Ketuan Zhan ceased to serve as CEOs, and Haichao Wang served as CEO. Jihan Wu voluntarily backed down and Ketuan Zhan served as chairman.
The "12.17 Incident" had a very bad impact on Bitmain, especially the disclosure of Bitmain's financial status, which caused vendors to start dunning. The loan that had just been negotiated with the Bank of Beijing was cancelled the next day. Jihan Wu's resignation as CEO caused an uproar in the industry, and it became a hot topic among Cryptocurrency mining, blockchain practitioners, and investor communities. The media focused their interpretation on Bitmain's series of incidents, and generally looked down upon its ongoing Hong Kong IPO, believing that the high-level changes had already signaled the failure of the IPO in advance.
On Christmas December 24, 2018, Bitmain finally began to implement the layoff plan. This long-delayed “correct decision” was achieved after a stalemate for nearly three months. The AI ​​teams in Beijing, Singapore, Taiwan, and Shanghai have laid off more than 50% of their employees. The Israeli R&D center was closed and Shenzhen New Species Technology Co., Ltd., which had been acquired for only ten months, was dissolved, and all employees were laid off. Copernicus, Bitmain's top blockchain development team, was not spared and was wiped out in this layoff. Copernicus and some of the laid-off employees joined the new company Matrixport co-founded by Jihan Wu and Yuesheng Ge, headquartered in Singapore.
3. Past events when starting a business
After the "12.17 Incident", Jihan Wu gradually faded out of Bitmain's management affairs and turned his attention to the IPO and new company. And this is one of Jihan Wu's major mistakes, he began to let Ketuan Zhan manage Bitmain alone.
In fact, as early as 2013, Jihan Wu planted hidden dangers.
Jihan Wu, an investment banker, was the earliest translator of the Bitcoin white paper. He began to get involved in the cryptocurrency mining industry in 2012. The disappearance of Kaomao and Nangua Zhang's ticket skipping led Jihan Wu to decide to develop his own chip.
In 2013, Jihan Wu established his own mining machine company. Together with Yuesheng Ge, who was only 20 years old, he found Ketuan Zhan, an integrated circuit designer of the Chinese Academy of Sciences, to create the protagonist of this article, and later the digital Cryptocurrency mining giant, Bitmain.
Jihan Wu promised Ketuan Zhan that every time a mining machine chip was successfully developed, he would give some shares to the Ketuan Zhan team. At that time, the company founded by Ketuan Zhan was on the eve of falling apart. In order to regroup the team, Ketuan Zhan promised to share half of his shares with the team members. Unfortunately, this is just a bad check. With the rapid development of Bitmain and higher and higher valuations, the expanding Ketuan Zhan almost monopolized all the shares.
Like many startups, Bitmain encountered many difficulties in its early days, and many jobs had to be done by the boss. For example, in the chip design and production process in the second half of 2013, Bitmain was caught in a dilemma of insufficient funds. Jihan Wu personally raised funds and met with TSMC’s sales to persuade TSMC to accept the production needs of a start-up company. Jihan Wu also participated in the selection of the thermodynamic parameters of the heat sink in the Antminer S1.
In 2014, Jihan Wu discovered that this company was independently operated by Ketuan Zhan, which had huge problems. Forcing Jihan Wu to continue to participate in company management.
At that time, Bitmain's mining machine chips had just achieved a certain lead in the standard design process. Jihan Wu believes that the next step must be to develop full customization technology, but Ketuan Zhan plans to invest resources in the research of mobile payment chips.
Ketuan Zhan met a mysterious person from the Party Central Security Bureau who claimed to be able to manipulate the Party Central Committee’s decision-making process for the next generation of mobile payment cryptography standards, but this direction is likely to lead to the fact that Bitmain has just gained the lead in the mining machine market. Regained.
Jihan Wu said that as a graduate of the School of Economics, with a little memory of his high school stage and the knowledge reserve of a computer technology amateur, he retrieves various materials and papers every day, learns theories related to full customization, and goes to Ketuan Zhan conducts persuasion work there.
Fortunately, in the direction of full customization technology, Ketuan Zhan finally listened to Jihan Wu's opinion. Bitmain quickly integrated the technical experts from the United States and Russia introduced by Jihan Wu, which greatly improved the design level of chips and complete machines.
In 2015, Jihan Wu suggested that Ketuan Zhan consider the direction of artificial intelligence. But Ketuan Zhan is not here, he prefers the CPU direction. After staying asleep at night, coupled with in-depth analysis by the Bitmain investment team, Ketuan Zhan finally agreed with this direction. It is a pity that after the Tianshi Chen brothers made major breakthroughs in theory and practice, Bitmain officially invested in the relevant direction, and it was still a step behind.
In the two years from 2016 to 2017, Bitmain's business performance has achieved rapid development, becoming a unique super unicorn in the blockchain industry. According to Froth & Sullivan, in 2017, Bitmain Technology Holdings was the second largest fabless chip design company in China and the tenth largest fabless chip design company in the world, and the fourth largest fabless ASIC chip design company in the world, accounting for 74.5% of global cryptocurrency market share.
However, the huge crisis has long been buried in the early days of entrepreneurship.
Ketuan Zhan's decision on major directions revealed his weakness of extremely lack of business understanding. But every mistake he made was blocked by the company's core employees. His overconfidence in his management ability led to the gradual intensification of conflicts, and the management differences between the two founders became more serious.
4.The giant gets lost
The contradiction between the two broke out on December 17, 2018. Ketuan Zhan used extreme means to force the management to compromise with him by canceling the option, so as to achieve the goal of sole control of the company. Jihan Wu returned to Beijing from Hong Kong overnight and negotiated with Ketuan Zhan all night. In the end, the two resigned as CEO. Jihan Wu retired. Ketuan Zhan has the exclusive rights of chairman in exchange for the implementation of the layoff plan.
Jihan Wu's voluntary retreat has intensified Ketuan Zhan's management to do whatever he wants.
A Bitmain employee commented on Ketuan Zhan's management skills, summed up in two letters-SM.
After becoming the sole helm of the company, Ketuan Zhan quickly "rectified" the department in charge of Jihan Wu as the chairman of the board. He guided the sales of mining machines at the dinner, and pointed out that the sales performance is not due to the sales staff. Ability is strong, but the company provides opportunities. Take two sales leaders as examples, saying that if the company hadn't given the opportunity, they would still be losers. In addition, Ketuan Zhan also instructed the sales staff on how to toast and imparted the wine table culture and experience.
After the meal, Ketuan Zhan came to the conclusion that the quality of Bitmain sales staff was too poor, and Huawei’s blood needs to be injected to drive the company’s progress. Soon, the marketing and sales director from Huawei officially took over Bitmain, opening the era of brand premium for Antminer.
In order to further understand and guide the sales work, Ketuan Zhan asked to meet the customers with the sales staff. During the negotiation process, Ketuan Zhan had a heated discussion with customers on the issue of Chinese and Western medicine, and had also forced the sales staff to be able to ship 10,000 machines due to insufficient production capacity.
Although the requirements for sales personnel are strict, Ketuan Zhan has provided a lot of convenience for "Mainland Ark". In addition to selling mining machines at a more favorable price, Bitmain's mining machines are also hosted in Ming Wang at a higher price than the market price. Mine. It is reported that both Ketuan Zhan and Ming Wang are shareholders of Ark.
The new sales strategy of Huawei's executives has also brought very obvious changes to Bitmain. The self-righteous brand premium reduces the price-performance ratio of Antminer, causing competing products to eat away at Bitmain's market share. Later, Bitmain found that the strategy was wrong and started to cut prices, and found that the mining machine market was saturated and the purchase demand of miners had decreased.
More dangerous than the sales strategy is that the technical advantages of Antminer are being chased by competing products, and even overtaken. At the same time, the two mining pools under Bitmain also lost their first and second positions. The AI ​​business, which Jihan Wu placed high hopes and Ketuan Zhan personally supervised, became a laughing stock in the industry. Not only did it fail to make a profit, it almost brought down Bitmain.
Blindly introducing senior executives from Huawei to occupy important positions completely destroys the company's internal cultural foundation. The bureaucracy within Bitmain began to corrode from high-level employees to ordinary employees. Ketuan Zhan is not aware of this. He is still keen on recruiting Huawei employees, imitating Huawei's organizational structure and strategy, letting HR do sales and R&D personnel to do HR.
The organizational structure adjustment in October 2019 was the fuse for Ketuan Zhan to completely anger Bitmain management. This time, Ketuan Zhan completely marginalized Bitmain’s veteran employees, and suddenly promoted some of the “airborne soldiers” who had just joined the company to the position of person in charge, which caused the former person in charge to report to the new employees. The two managers who were originally equal The hierarchy becomes the subordinate relationship, the operation and development of different business lines are merged into a large department, the upward reporting process becomes more cumbersome, and the relationship between employees becomes delicate.
5. Headwind
On October 29, 2019, Jihan Wu urgently held a staff meeting. Prior to this, the legal representative of Beijing Bitmain has been changed to Jihan Wu, including the parent companies Hong Kong Bitmain and Cayman Bitmain. Jihan Wu stood in the lobby of Building 25, B1, announcing that Ketuan Zhan has been relieved of all duties. Any employee in the Bitmain Group shall no longer execute Ketuan Zhan’s instructions and participate in any meetings convened by Ketuan Zhan. If there is any violation, the company will demotion and expel the company based on the severity of the circumstances. If losses are caused to the company, the company will be held accountable.
Jihan Wu's speech is very long, which can be summarized as follows:
(1) Ketuan Zhan has been relieved of all duties. Also expelled from the original Huawei company HR Zhi Wang introduced by Ketuan Zhan at the end of 2018. Zhi Wang’s reputation on Bitmain was extremely poor and was ridiculed by employees as "nine thousand years" (In ancient China, the emperor was called "ten thousand years old", and the prince was "eight thousand years old." However, in the Ming Dynasty, there was an eunuch who caused harm to the country and the people. He called himself "nine thousand years old", meaning that he was only A little lower than the emperor's level).
(2) Ketuan Zhan's ability to control the company's option incentive plan has disappeared, and it is no longer possible to cancel employees' options at will.
(3) The organizational structure adjustment plan led by Ketuan Zhan was suspended.
(4) We are optimistic about the future of AI business, but the premise is that the main business can continue to make profits in order to support the company's continued investment in AI business.
In the speech, Jihan Wu also told employees the whole story of the "12.17 Incident" and bluntly said that the company is not in good condition. If no measures are taken, Bitmain is likely to go bankrupt in three quarters and he must come back to save the company.
At this time, Ketuan Zhan, who was on a business trip in Shenzhen, finally experienced the situation of Jihan Wu in the "12.17 Incident".
After the official return, Jihan Wu began to clearly point out the company's various problems in operation and management, and went deep into each business line to understand the situation. In the mining machine sales department meeting, employees spoke enthusiastically, reflecting on the difficulties and opinions encountered in the work, the marketing and sales director from Huawei asked with a surprised look, "Why didn't these issues be reported to me before?", and soon , The director was interviewed and "voluntarily resigned."
On November 2, 2019, Jihan Wu announced a salary increase for all employees. Bitmain’s last salary increase dates back to 2018. In principle, Bitmain has two salary increases every year.
On November 7, 2019, Ketuan Zhan spoke on social media for the first time, describing his hardship in starting a business, and condemning Jihan Wu for “stabbing a knife in the back”. At the end of the article, he also set himself a KPI for 2020, that is, the mining machine market share will reach 90%, and the AI ​​business will earn 1 billion.
But Ketuan Zhan's majestic plan did not make Bitmain employees feel emotional, but ridiculed him instead. Employees exposed that he insulted employees, advocated Chinese medicine, believed in Buddhism, drank in meetings, practiced Qigong...
However, there is less than half a year before the halving of Bitcoin production, and the cryptocurrency market shows no signs of recovery, which makes Bitmain management very anxious.
On January 6, 2020, Bitmain ushered in another round of layoffs, with a layoff ratio of about 1/3. This time the layoffs have caused many employees who have just increased their salaries to feel very grieved. On the one hand, they were looking forward to Jihan Wu's return. On the other hand, the compensation for this layoff was less than 18 years.
Ketuan Zhan, who has been unable to enter the Bitmain office area, once again spoke on social media and firmly opposed to layoffs. We do not need to lay off staff and we cannot commit suicide.
During the Spring Festival, Covid-19 broke out. Mainland China has begun to extend the Spring Festival holiday and advocate working from home. Under the chain reaction caused by Covid-19, most companies have chosen to cut salaries or even lay off employees. In the first two months of 2020, China's exports fell by 17%, U.S. stocks were broken four times in a row, Bitcoin plunged 40% in 24 hours on March 12, 2020, and crude oil futures fell by 300% on April 20, 2020...
Obviously, Jihan Wu can't predict, but this layoff seems to be the right decision again. In addition, from January to April 2020, Bitmain's revenue exceeded US$400 million amid the spread of Covid-19 and the collapse of the financial market.
6. Fight to the death
When Jihan Wu tried to get the company back on track, Ketuan Zhan was not helpless. On April 28, 2020, Ketuan Zhan finally rolled back the legal representative of Beijing Bitmain to before October 28, 2019 by repeatedly submitting administrative reconsiderations, and restored his status as a legal representative.
On the morning of May 8, 2020, a piece of news about Bitmain quickly appeared on the real-time hot search rankings, and even dominated the headlines of the day. At window 52 on the second floor of the Haidian District Government Affairs Center, when Ketuan Zhan, the legal person of Beijing Bitmain Company, was receiving the business license, a group of unidentified people snatched the business license from the industrial and commercial administrative staff. A source at the scene said that the number of unidentified people in the group was about 60 people, of which Luyao Liu was directing at the scene.
This is a skillful piece of news. It first leads readers to think that Ketuan Zhan is a victim, using 60 people to grab business licenses as the focus. The masses accused Jihan Wu of lawlessness, but ignored whether the government affairs center could have 60 personnel. As for Hong Kong Bitmain to have the right to appoint a representative to obtain a business license, this is a deeper level of thinking.
The follow-up report restored the real situation at the scene. Only more than ten people were present, and both sides were equipped with security personnel. Bitmain employees also broke the news in the circle of friends, claiming that Ketuan Zhan's bodyguard had injured Bitmain's authorized person, and said in a threatening tone, "Be careful!"
However, the subsequent plot reversal did not have much effect. Jihan Wu's reputation has been greatly affected. From a bloody soldier who rescued the company in trouble to a lawless criminal, it can be said to be a world of war. do not.
Ketuan Zhan, who succeeded in the first battle, began to counterattack Bitmain continuously. On the afternoon of June 3, 2020, Ketuan Zhan led a team to pry open the back door of the Beijing Bitmain office and formally occupied the deserted Beijing headquarters.
On June 4, 2020, Ketuan Zhan called on Bitmain employees to resume work and promised to expand the company's market value to more than US$50 billion within three to five years. After that, Ketuan Zhan began to contact employees by phone, trying to acquire the options in the hands of employees at a valuation of 4 billion US dollars.
Subsequently, Ketuan Zhan recalled Huawei's executives and issued a series of personnel appointments and removals. As of June 9, 2020, Ketuan Zhan has successively eliminated CFO Luyao Liu, and Wenguang Wang, the head of the mining center. Luyao Liu is responsible for controlling Bitmain's IPO plan. He also appointed Yanwu Ma as the HR director, Gang Ren as the head of the mining center, Yonggang Sun as the head of the supply chain, Ling Gu as the financial director, and Bin Zhu as the head of the mining machine business department. Bin Zhu is the senior executive of Huawei who was interviewed and left as mentioned in the previous article. During his tenure, he reduced Antminer’s 90% market share to 50%, and received a large number of complaints from miners. Internal employees once speculated that he might be Compete against the spies sent by the company.
In addition to recalling senior executives of Huawei, Ketuan Zhan also urged employees to return to work. They can receive a bonus of 10,000 yuan when they return to work on the same day, which is only half the next day. Ketuan Zhan showed a very kind side. Every time the elevator door is opened, Ketuan Zhan's hot gaze can be met, shaking hands, taking photos, and receiving money. As there is no personnel information, Ketuan Zhan does not know whether the person receiving the money is a Bitmain employee, and these people did not resume work the next day.
The effect of gentleness was not good, Ketuan Zhan began to force employees to return to work. Seeing that there are still very few respondents, Ketuan Zhan threatened employees through SMS, phone calls, EMS, emails and other harassment, issued multiple threats such as termination of contract, suspension of payment of social insurance, suspension of wages, and even used personal information saved by employees to form a group of employees. Domicile threats, requiring employees to perform "work handover", trying to force employees to return work computers, etc.
On June 10, 2020, the media revealed that Ketuan Zhan had controlled Bitmain's Shenzhen factory and prohibited employees from delivering normal shipments to paid customers, which caused difficulties in the operation of the Bitmain mining machine department.
On June 13, 2020, Hong Kong Bitmain, the parent company of Beijing Bitmain, issued a statement accusing Ketuan Zhan of signing a "Sales Agency Agreement" with the Ark Data Technology Co., Ltd. in which it holds shares, in an attempt to embezzle Beijing Bit's assets.
On June 17, 2020, the media revealed that Ketuan Zhan started selling 14,000 T17+ series mining machines at low prices.
On June 20, 2020, Hong Kong Bitmain officially suspended the supply of chips to the Shenzhen factory.
On July 13, 2020, in the "A Letter to All My colleagues in the Shenzhen Factory" released by Bitmain in Hong Kong, more details were added on the series of Ketuan Zhan's actions in June.
The legal person Feng Zhou of the Shenzhen plant is related to Ketuan Zhan. After being relieved of Ketuan Zhan's post, Jihan Wu flew to Shenzhen to have a long talk with Feng Zhou. Jihan Wu believes that Feng Zhou is the right person to manage the factory and help the company overcome difficulties, and decides to leave Feng Zhou to continue to manage the factory.
This wrong decision staged a story of a farmer and a snake. When Ketuan Zhan began to counterattack Bitmain, Feng Zhou was also quickly instigated and began to assist Ketuan Zhan in seizing customer machines and transferring 17,000 T17 mining machines in the warehouse. Hainan Continental Ark Data Technology Co., Ltd., which is held by Ketuan Zhan, sold them at a low price.
In order to protect the interests of customers, Jihan Wu had to make a compromise and paid the payment for some goods to a bank account controlled by Ketuan Zhan in exchange for delivery. However, after the other party received a payment of 109 million, the delivery stopped. On July 8, 2020, 5600 mining machines have been overdue.
At the same time, the factory defaulted on suppliers’ accounts payable as much as 200 million yuan. Bank acceptance bills issued by the factory, exceeding 36 million yuan, will expire on July 17, and more than 34 million yuan will expire on July 23. It is understood that Ketuan Zhan, after receiving the bank's dunning call, made it clear that he would not repay the loan, which would destroy the company and the entire group's credit in financial institutions.
7、 This is not the end
So far, the power struggle between the founders of Bitmain has been more than half a year. The office building already occupied by Ketuan Zhan is still empty, and most employees choose to work from home. Some chip developers returned to the office with the acquiescence of Jihan Wu and continued to maintain research and development to reduce the impact of infighting on technological iteration and competitiveness.
This giant ship that once stood on top of the supercomputer chip is crashing into the iceberg due to the madness of the former helm. Ketuan Zhan's madness and Jihan Wu's compromise made mistakes again and again. Bitmain tried to save himself many times, but was unable to get out of the black hole.
If the time goes back to that day in 2013, would Jihan Wu and Yuesheng Ge still choose to dial Ketuan Zhan?
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The deepest report: Bitmain's self-help history

The deepest report: Bitmain's self-help history
The original intention of this article is to let readers understand the causes and consequences of Bitmain internal fighting, but after writing it, I found that it is not so much internal fighting as it is a long history of self-help.
The story is very long. Let's adjust the timeline to the eve of December 17, 2018. That was one of Bitmain's most critical moments and the beginning of a series of subsequent stories.
1. Self-immolation In September 2018, Bitmain's financial department warned management that the company's cash flow has become very tight and operating costs must be reduced to allow the company to continue. The blockchain unicorn, which is valued at more than 15 billion U.S. dollars, is crippled in the run and struggling to break the corner.
In 2017, Bitmain made a profit of 1 billion US dollars In the first half of 2018, Bitmain made a profit of 1 billion US dollars Three rounds of financing, a total of 800 million US dollars Net assets should exceed 3 billion U.S. dollars In September 2018, Bitmain had tight cash flow and was on the verge of bankruptcy
A simple comparison, it is not difficult to see that Bitmain's ability to make money is incredible, and its ability to burn money is even more extreme.
How does Bitmain burn money? Do you pour cash into gasoline and burn it, or hire a lot of employees to stuff the banknotes one by one into the shredder? The actual situation is closer to the latter.
The following data can help readers quickly learn Bitmain's money burning skills.
At the beginning of 2018, the entire cryptocurrency market has entered a bear market, but Bitmain's monthly operating costs have been rising wildly. Operating costs have risen from 10 million US dollars at the beginning of the year to 50 million US dollars at the end of the year.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
Operating costs are just the tip of the iceberg. Excessive chip trial production can become a classic case of project management courses. Readers who pay attention to Cryptocurrency mining can easily find that Bitmain is still working hard to clear the inventory of Antminer S9 in 2019. As the co-CEO, Ketuan Zhan did not listen to the advice or even warnings of the Finance Department, insisting on the implementation of Excessive chip trial production, resulting in a large accumulation of inventory and tight capital turnover. Another CEO, Jihan Wu, once revealed that the loss of Excessive chip trial production to the company was approximately US$1.5 billion.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
The BM1393 chip incident is even more incredible. Chip expert Ketuan Zhan invested a lot of money on a failed chip, and finally failed again. From 2017 to 2018, Bitmain has failed Trial production of mining machine chips at least 4 times, including 16nm, 12nm and 10nm chips, of which 16nm Trial production failed twice, thus losing at least US$1.2 billion.
It is rumored that Bitmain still holds a billion U.S. dollars worth of cryptocurrency in a state of floating loss. In view of the rebound in the market in 2020, we will not comment temporarily, waiting for the correct answer from the cryptocurrency market. But the losses pointed out in the previous article are all irreversible.
2. Sole power
In September 2018, Bitmain's management realized the seriousness of the problem. It turned out that the company's money could be squandered. As a result, the management began to discuss self-help plans, and the most reasonable and effective way was obviously to lay off employees.
The probation period for newly hired employees at Bitmain is half a year, and the probationary salary is 100% of the official salary, there is no difference. Once layoffs are made, new employees who have not passed the probationary period will be the main layoff targets. The department managed by Ketuan Zhan will face large-scale layoffs. The layoff plan is strongly opposed by Ketuan Zhan. Bitmain can only temporarily abandon the layoffs and replace it with continuous reductions. For marketing and travel expenses, a budget committee was established to strictly approve every expenditure. At the same time, employee benefits, such as reimbursement of taxi expenses, breakfast supply, snacks and drinks, etc., have also been abolished, and even the tradition of giving employees 400 yuan worth of BTC/BCH every month has been stopped.
In the face of huge cash flow pressure, trivial savings is obviously of no avail. Soon, the management again discussed the layoff plan, and it has reached the point where it has to be laid off.
In December 2018, Jihan Wu began to organize all entrepreneurial veterans and business backbones to persuade Ketuan Zhan to agree to layoffs, but Ketuan Zhan still insisted not to layoffs. The persuasion process was very unsuccessful. After many meetings and intense debates, Bitmain executives were caught in a dilemma of wasting time with Ketuan Zhan.
In this process, the shortcomings of the dual CEO system began to appear, and the relationship between the two CEOs gradually deteriorated.
On the night of December 16th, Ketuan Zhan reconvened the management meeting, and more than 30 managements who were present were asked to hand over their mobile phones. At this time, Jihan Wu was on a business trip in Hong Kong and was busy with listing related work.
In the meeting, Ketuan Zhan's core content was three items:
(1) Bitmain cannot have two CEOs, only one CEO and must be Ketuan Zhan. Ketuan Zhan said that he met an old leader during a business trip. He hadn't seen each other for many years. The old leader suggested that the company can only have one CEO, and it must be him. Ketuan Zhan feels that this is a kind of fate, an opportunity given by God.
(2) Ketuan Zhan believes that the company's cash flow problems, the biggest responsibility is the inability of the financial department. To prove his point, Ketuan Zhan announced Bitmain's financial data at the meeting. In the evening, employees in Taiwan began to post messages on social media, saying that the company's capital chain was broken and the top management was split.
(3) If Ketuan Zhan is not supported, the option will be cancelled and the equity will be voided.
Hearing about this, Jihan Wu, who lives in Hong Kong, sent a WeChat message to the management who are attending the meeting.

https://preview.redd.it/c5cxea2lqid51.jpg?width=1080&format=pjpg&auto=webp&s=3d6a0388408f6b8abe10648e5e4b7a3a5434c821
On the afternoon of December 17, 2018, Jihan Wu returned to Beijing to negotiate with Ketuan Zhan all night, and finally reached a consensus in the early morning. Bitmain co-founder Yuesheng Ge announced the results of the negotiations. Jihan Wu and Ketuan Zhan ceased to serve as CEOs, and Haichao Wang served as CEO. Jihan Wu voluntarily backed down and Ketuan Zhan served as chairman.
The "12.17 Incident" had a very bad impact on Bitmain, especially the disclosure of Bitmain's financial status, which caused vendors to start dunning. The loan that had just been negotiated with the Bank of Beijing was cancelled the next day. Jihan Wu's resignation as CEO caused an uproar in the industry, and it became a hot topic among Cryptocurrency mining, blockchain practitioners, and investor communities. The media focused their interpretation on Bitmain's series of incidents, and generally looked down upon its ongoing Hong Kong IPO, believing that the high-level changes had already signaled the failure of the IPO in advance.
On Christmas December 24, 2018, Bitmain finally began to implement the layoff plan. This long-delayed “correct decision” was achieved after a stalemate for nearly three months. The AI ​​teams in Beijing, Singapore, Taiwan, and Shanghai have laid off more than 50% of their employees. The Israeli R&D center was closed and Shenzhen New Species Technology Co., Ltd., which had been acquired for only ten months, was dissolved, and all employees were laid off. Copernicus, Bitmain's top blockchain development team, was not spared and was wiped out in this layoff. Copernicus and some of the laid-off employees joined the new company Matrixport co-founded by Jihan Wu and Yuesheng Ge, headquartered in Singapore.
3. Past events when starting a business
After the "12.17 Incident", Jihan Wu gradually faded out of Bitmain's management affairs and turned his attention to the IPO and new company. And this is one of Jihan Wu's major mistakes, he began to let Ketuan Zhan manage Bitmain alone.
In fact, as early as 2013, Jihan Wu planted hidden dangers.
Jihan Wu, an investment banker, was the earliest translator of the Bitcoin white paper. He began to get involved in the cryptocurrency mining industry in 2012. The disappearance of Kaomao and Nangua Zhang's ticket skipping led Jihan Wu to decide to develop his own chip.
In 2013, Jihan Wu established his own mining machine company. Together with Yuesheng Ge, who was only 20 years old, he found Ketuan Zhan, an integrated circuit designer of the Chinese Academy of Sciences, to create the protagonist of this article, and later the digital Cryptocurrency mining giant, Bitmain.
Jihan Wu promised Ketuan Zhan that every time a mining machine chip was successfully developed, he would give some shares to the Ketuan Zhan team. At that time, the company founded by Ketuan Zhan was on the eve of falling apart. In order to regroup the team, Ketuan Zhan promised to share half of his shares with the team members. Unfortunately, this is just a bad check. With the rapid development of Bitmain and higher and higher valuations, the expanding Ketuan Zhan almost monopolized all the shares.
Like many startups, Bitmain encountered many difficulties in its early days, and many jobs had to be done by the boss. For example, in the chip design and production process in the second half of 2013, Bitmain was caught in a dilemma of insufficient funds. Jihan Wu personally raised funds and met with TSMC’s sales to persuade TSMC to accept the production needs of a start-up company. Jihan Wu also participated in the selection of the thermodynamic parameters of the heat sink in the Antminer S1.
In 2014, Jihan Wu discovered that this company was independently operated by Ketuan Zhan, which had huge problems. Forcing Jihan Wu to continue to participate in company management.
At that time, Bitmain's mining machine chips had just achieved a certain lead in the standard design process. Jihan Wu believes that the next step must be to develop full customization technology, but Ketuan Zhan plans to invest resources in the research of mobile payment chips.
Ketuan Zhan met a mysterious person from the Party Central Security Bureau who claimed to be able to manipulate the Party Central Committee’s decision-making process for the next generation of mobile payment cryptography standards, but this direction is likely to lead to the fact that Bitmain has just gained the lead in the mining machine market. Regained.
Jihan Wu said that as a graduate of the School of Economics, with a little memory of his high school stage and the knowledge reserve of a computer technology amateur, he retrieves various materials and papers every day, learns theories related to full customization, and goes to Ketuan Zhan conducts persuasion work there.
Fortunately, in the direction of full customization technology, Ketuan Zhan finally listened to Jihan Wu's opinion. Bitmain quickly integrated the technical experts from the United States and Russia introduced by Jihan Wu, which greatly improved the design level of chips and complete machines.
In 2015, Jihan Wu suggested that Ketuan Zhan consider the direction of artificial intelligence. But Ketuan Zhan is not here, he prefers the CPU direction. After staying asleep at night, coupled with in-depth analysis by the Bitmain investment team, Ketuan Zhan finally agreed with this direction. It is a pity that after the Tianshi Chen brothers made major breakthroughs in theory and practice, Bitmain officially invested in the relevant direction, and it was still a step behind.
In the two years from 2016 to 2017, Bitmain's business performance has achieved rapid development, becoming a unique super unicorn in the blockchain industry. According to Froth & Sullivan, in 2017, Bitmain Technology Holdings was the second largest fabless chip design company in China and the tenth largest fabless chip design company in the world, and the fourth largest fabless ASIC chip design company in the world, accounting for 74.5% of global cryptocurrency market share.
However, the huge crisis has long been buried in the early days of entrepreneurship.
Ketuan Zhan's decision on major directions revealed his weakness of extremely lack of business understanding. But every mistake he made was blocked by the company's core employees. His overconfidence in his management ability led to the gradual intensification of conflicts, and the management differences between the two founders became more serious.
4.The giant gets lost
The contradiction between the two broke out on December 17, 2018. Ketuan Zhan used extreme means to force the management to compromise with him by canceling the option, so as to achieve the goal of sole control of the company. Jihan Wu returned to Beijing from Hong Kong overnight and negotiated with Ketuan Zhan all night. In the end, the two resigned as CEO. Jihan Wu retired. Ketuan Zhan has the exclusive rights of chairman in exchange for the implementation of the layoff plan.
Jihan Wu's voluntary retreat has intensified Ketuan Zhan's management to do whatever he wants.
A Bitmain employee commented on Ketuan Zhan's management skills, summed up in two letters-SM.
After becoming the sole helm of the company, Ketuan Zhan quickly "rectified" the department in charge of Jihan Wu as the chairman of the board. He guided the sales of mining machines at the dinner, and pointed out that the sales performance is not due to the sales staff. Ability is strong, but the company provides opportunities. Take two sales leaders as examples, saying that if the company hadn't given the opportunity, they would still be losers. In addition, Ketuan Zhan also instructed the sales staff on how to toast and imparted the wine table culture and experience.
After the meal, Ketuan Zhan came to the conclusion that the quality of Bitmain sales staff was too poor, and Huawei’s blood needs to be injected to drive the company’s progress. Soon, the marketing and sales director from Huawei officially took over Bitmain, opening the era of brand premium for Antminer.
In order to further understand and guide the sales work, Ketuan Zhan asked to meet the customers with the sales staff. During the negotiation process, Ketuan Zhan had a heated discussion with customers on the issue of Chinese and Western medicine, and had also forced the sales staff to be able to ship 10,000 machines due to insufficient production capacity.
Although the requirements for sales personnel are strict, Ketuan Zhan has provided a lot of convenience for "Mainland Ark". In addition to selling mining machines at a more favorable price, Bitmain's mining machines are also hosted in Ming Wang at a higher price than the market price. Mine. It is reported that both Ketuan Zhan and Ming Wang are shareholders of Ark.
The new sales strategy of Huawei's executives has also brought very obvious changes to Bitmain. The self-righteous brand premium reduces the price-performance ratio of Antminer, causing competing products to eat away at Bitmain's market share. Later, Bitmain found that the strategy was wrong and started to cut prices, and found that the mining machine market was saturated and the purchase demand of miners had decreased.
More dangerous than the sales strategy is that the technical advantages of Antminer are being chased by competing products, and even overtaken. At the same time, the two mining pools under Bitmain also lost their first and second positions. The AI ​​business, which Jihan Wu placed high hopes and Ketuan Zhan personally supervised, became a laughing stock in the industry. Not only did it fail to make a profit, it almost brought down Bitmain.
Blindly introducing senior executives from Huawei to occupy important positions completely destroys the company's internal cultural foundation. The bureaucracy within Bitmain began to corrode from high-level employees to ordinary employees. Ketuan Zhan is not aware of this. He is still keen on recruiting Huawei employees, imitating Huawei's organizational structure and strategy, letting HR do sales and R&D personnel to do HR.
The organizational structure adjustment in October 2019 was the fuse for Ketuan Zhan to completely anger Bitmain management. This time, Ketuan Zhan completely marginalized Bitmain’s veteran employees, and suddenly promoted some of the “airborne soldiers” who had just joined the company to the position of person in charge, which caused the former person in charge to report to the new employees. The two managers who were originally equal The hierarchy becomes the subordinate relationship, the operation and development of different business lines are merged into a large department, the upward reporting process becomes more cumbersome, and the relationship between employees becomes delicate.
5. Headwind
On October 29, 2019, Jihan Wu urgently held a staff meeting. Prior to this, the legal representative of Beijing Bitmain has been changed to Jihan Wu, including the parent companies Hong Kong Bitmain and Cayman Bitmain. Jihan Wu stood in the lobby of Building 25, B1, announcing that Ketuan Zhan has been relieved of all duties. Any employee in the Bitmain Group shall no longer execute Ketuan Zhan’s instructions and participate in any meetings convened by Ketuan Zhan. If there is any violation, the company will demotion and expel the company based on the severity of the circumstances. If losses are caused to the company, the company will be held accountable.
Jihan Wu's speech is very long, which can be summarized as follows:
(1) Ketuan Zhan has been relieved of all duties. Also expelled from the original Huawei company HR Zhi Wang introduced by Ketuan Zhan at the end of 2018. Zhi Wang’s reputation on Bitmain was extremely poor and was ridiculed by employees as "nine thousand years" (In ancient China, the emperor was called "ten thousand years old", and the prince was "eight thousand years old." However, in the Ming Dynasty, there was an eunuch who caused harm to the country and the people. He called himself "nine thousand years old", meaning that he was only A little lower than the emperor's level).
(2) Ketuan Zhan's ability to control the company's option incentive plan has disappeared, and it is no longer possible to cancel employees' options at will.
(3) The organizational structure adjustment plan led by Ketuan Zhan was suspended.
(4) We are optimistic about the future of AI business, but the premise is that the main business can continue to make profits in order to support the company's continued investment in AI business.
In the speech, Jihan Wu also told employees the whole story of the "12.17 Incident" and bluntly said that the company is not in good condition. If no measures are taken, Bitmain is likely to go bankrupt in three quarters and he must come back to save the company.
At this time, Ketuan Zhan, who was on a business trip in Shenzhen, finally experienced the situation of Jihan Wu in the "12.17 Incident".
After the official return, Jihan Wu began to clearly point out the company's various problems in operation and management, and went deep into each business line to understand the situation. In the mining machine sales department meeting, employees spoke enthusiastically, reflecting on the difficulties and opinions encountered in the work, the marketing and sales director from Huawei asked with a surprised look, "Why didn't these issues be reported to me before?", and soon , The director was interviewed and "voluntarily resigned."
On November 2, 2019, Jihan Wu announced a salary increase for all employees. Bitmain’s last salary increase dates back to 2018. In principle, Bitmain has two salary increases every year.
On November 7, 2019, Ketuan Zhan spoke on social media for the first time, describing his hardship in starting a business, and condemning Jihan Wu for “stabbing a knife in the back”. At the end of the article, he also set himself a KPI for 2020, that is, the mining machine market share will reach 90%, and the AI ​​business will earn 1 billion.
But Ketuan Zhan's majestic plan did not make Bitmain employees feel emotional, but ridiculed him instead. Employees exposed that he insulted employees, advocated Chinese medicine, believed in Buddhism, drank in meetings, practiced Qigong...
However, there is less than half a year before the halving of Bitcoin production, and the cryptocurrency market shows no signs of recovery, which makes Bitmain management very anxious.
On January 6, 2020, Bitmain ushered in another round of layoffs, with a layoff ratio of about 1/3. This time the layoffs have caused many employees who have just increased their salaries to feel very grieved. On the one hand, they were looking forward to Jihan Wu's return. On the other hand, the compensation for this layoff was less than 18 years.
Ketuan Zhan, who has been unable to enter the Bitmain office area, once again spoke on social media and firmly opposed to layoffs. We do not need to lay off staff and we cannot commit suicide.
During the Spring Festival, Covid-19 broke out. Mainland China has begun to extend the Spring Festival holiday and advocate working from home. Under the chain reaction caused by Covid-19, most companies have chosen to cut salaries or even lay off employees. In the first two months of 2020, China's exports fell by 17%, U.S. stocks were broken four times in a row, Bitcoin plunged 40% in 24 hours on March 12, 2020, and crude oil futures fell by 300% on April 20, 2020...
Obviously, Jihan Wu can't predict, but this layoff seems to be the right decision again. In addition, from January to April 2020, Bitmain's revenue exceeded US$400 million amid the spread of Covid-19 and the collapse of the financial market.
6. Fight to the death
When Jihan Wu tried to get the company back on track, Ketuan Zhan was not helpless. On April 28, 2020, Ketuan Zhan finally rolled back the legal representative of Beijing Bitmain to before October 28, 2019 by repeatedly submitting administrative reconsiderations, and restored his status as a legal representative.
On the morning of May 8, 2020, a piece of news about Bitmain quickly appeared on the real-time hot search rankings, and even dominated the headlines of the day. At window 52 on the second floor of the Haidian District Government Affairs Center, when Ketuan Zhan, the legal person of Beijing Bitmain Company, was receiving the business license, a group of unidentified people snatched the business license from the industrial and commercial administrative staff. A source at the scene said that the number of unidentified people in the group was about 60 people, of which Luyao Liu was directing at the scene.
This is a skillful piece of news. It first leads readers to think that Ketuan Zhan is a victim, using 60 people to grab business licenses as the focus. The masses accused Jihan Wu of lawlessness, but ignored whether the government affairs center could have 60 personnel. As for Hong Kong Bitmain to have the right to appoint a representative to obtain a business license, this is a deeper level of thinking.
The follow-up report restored the real situation at the scene. Only more than ten people were present, and both sides were equipped with security personnel. Bitmain employees also broke the news in the circle of friends, claiming that Ketuan Zhan's bodyguard had injured Bitmain's authorized person, and said in a threatening tone, "Be careful!"
However, the subsequent plot reversal did not have much effect. Jihan Wu's reputation has been greatly affected. From a bloody soldier who rescued the company in trouble to a lawless criminal, it can be said to be a world of war. do not.
Ketuan Zhan, who succeeded in the first battle, began to counterattack Bitmain continuously. On the afternoon of June 3, 2020, Ketuan Zhan led a team to pry open the back door of the Beijing Bitmain office and formally occupied the deserted Beijing headquarters.
On June 4, 2020, Ketuan Zhan called on Bitmain employees to resume work and promised to expand the company's market value to more than US$50 billion within three to five years. After that, Ketuan Zhan began to contact employees by phone, trying to acquire the options in the hands of employees at a valuation of 4 billion US dollars.
Subsequently, Ketuan Zhan recalled Huawei's executives and issued a series of personnel appointments and removals. As of June 9, 2020, Ketuan Zhan has successively eliminated CFO Luyao Liu, and Wenguang Wang, the head of the mining center. Luyao Liu is responsible for controlling Bitmain's IPO plan. He also appointed Yanwu Ma as the HR director, Gang Ren as the head of the mining center, Yonggang Sun as the head of the supply chain, Ling Gu as the financial director, and Bin Zhu as the head of the mining machine business department. Bin Zhu is the senior executive of Huawei who was interviewed and left as mentioned in the previous article. During his tenure, he reduced Antminer’s 90% market share to 50%, and received a large number of complaints from miners. Internal employees once speculated that he might be Compete against the spies sent by the company.
In addition to recalling senior executives of Huawei, Ketuan Zhan also urged employees to return to work. They can receive a bonus of 10,000 yuan when they return to work on the same day, which is only half the next day. Ketuan Zhan showed a very kind side. Every time the elevator door is opened, Ketuan Zhan's hot gaze can be met, shaking hands, taking photos, and receiving money. As there is no personnel information, Ketuan Zhan does not know whether the person receiving the money is a Bitmain employee, and these people did not resume work the next day.
The effect of gentleness was not good, Ketuan Zhan began to force employees to return to work. Seeing that there are still very few respondents, Ketuan Zhan threatened employees through SMS, phone calls, EMS, emails and other harassment, issued multiple threats such as termination of contract, suspension of payment of social insurance, suspension of wages, and even used personal information saved by employees to form a group of employees. Domicile threats, requiring employees to perform "work handover", trying to force employees to return work computers, etc.
On June 10, 2020, the media revealed that Ketuan Zhan had controlled Bitmain's Shenzhen factory and prohibited employees from delivering normal shipments to paid customers, which caused difficulties in the operation of the Bitmain mining machine department.
On June 13, 2020, Hong Kong Bitmain, the parent company of Beijing Bitmain, issued a statement accusing Ketuan Zhan of signing a "Sales Agency Agreement" with the Ark Data Technology Co., Ltd. in which it holds shares, in an attempt to embezzle Beijing Bit's assets.
On June 17, 2020, the media revealed that Ketuan Zhan started selling 14,000 T17+ series mining machines at low prices.
On June 20, 2020, Hong Kong Bitmain officially suspended the supply of chips to the Shenzhen factory.
On July 13, 2020, in the "A Letter to All My colleagues in the Shenzhen Factory" released by Bitmain in Hong Kong, more details were added on the series of Ketuan Zhan's actions in June.
The legal person Feng Zhou of the Shenzhen plant is related to Ketuan Zhan. After being relieved of Ketuan Zhan's post, Jihan Wu flew to Shenzhen to have a long talk with Feng Zhou. Jihan Wu believes that Feng Zhou is the right person to manage the factory and help the company overcome difficulties, and decides to leave Feng Zhou to continue to manage the factory.
This wrong decision staged a story of a farmer and a snake. When Ketuan Zhan began to counterattack Bitmain, Feng Zhou was also quickly instigated and began to assist Ketuan Zhan in seizing customer machines and transferring 17,000 T17 mining machines in the warehouse. Hainan Continental Ark Data Technology Co., Ltd., which is held by Ketuan Zhan, sold them at a low price.
In order to protect the interests of customers, Jihan Wu had to make a compromise and paid the payment for some goods to a bank account controlled by Ketuan Zhan in exchange for delivery. However, after the other party received a payment of 109 million, the delivery stopped. On July 8, 2020, 5600 mining machines have been overdue.
At the same time, the factory defaulted on suppliers’ accounts payable as much as 200 million yuan. Bank acceptance bills issued by the factory, exceeding 36 million yuan, will expire on July 17, and more than 34 million yuan will expire on July 23. It is understood that Ketuan Zhan, after receiving the bank's dunning call, made it clear that he would not repay the loan, which would destroy the company and the entire group's credit in financial institutions.
7、 This is not the end
So far, the power struggle between the founders of Bitmain has been more than half a year. The office building already occupied by Ketuan Zhan is still empty, and most employees choose to work from home. Some chip developers returned to the office with the acquiescence of Jihan Wu and continued to maintain research and development to reduce the impact of infighting on technological iteration and competitiveness.
This giant ship that once stood on top of the supercomputer chip is crashing into the iceberg due to the madness of the former helm. Ketuan Zhan's madness and Jihan Wu's compromise made mistakes again and again. Bitmain tried to save himself many times, but was unable to get out of the black hole.
If the time goes back to that day in 2013, would Jihan Wu and Yuesheng Ge still choose to dial Ketuan Zhan?
submitted by paulcheung1990 to Bitcoin [link] [comments]

Let's talk about Operation Dragonslayer

There's a conspiracy theory going around about Bitcoin (BTC) and Bitcoin Cash (BCH/BCC) that I think my fellow redditors should know about.
TLDR: In 17.5 hours BCH will try to usurp BTC as the "true" Bitcoin and this will cause BTC prices to tank to unrecoverable levels and will have side effects on alts as well since BTC is the main pair.
Technical TLDR: The conspiracy plan is that when Bitcoin locks their difficulty algorithm, a group of miners will switch to BCH in mass and pump BCH to huge levels. This will cause a panic sell of BTC and cause people to try and transfer BTC from their wallets to exchanges, but because all the miners have left and the difficulty is locked, the network will be clogged with slow and expensive transactions for the next 2 weeks, spelling the end of Bitcoin.
Longer Story
I'm going to assume most people here are fairly new to crypto and weren't around for all the politics and drama between /bitcoin and /btc
There's a lot to understand about the interplay between difficulty algorithm changes, miner reward incentives, the politics of the pools that take a while to go into.
These two articles might help catch you up:
Two weeks ago we saw something similar when BCH exploded and BTC went all the way down to $5500. This was because BTC had a difficulty algorithm change and BCH was approximately 3-4x more profitable to mine. Only Slush kept mining BTC so we'll see if they stay true to BTC this time around too.
Right now we're seeing BTC, ETH, and most alts fall at the exact same time BCH rises. This might be bots reading the right indicators and buying/selling.
The estimated time of the difficulty algorithm changes is on the bottom of https://fork.lol/pow/retarget
Other important items to note:
Will Thanksgiving Weekend 2017 be like Thanksgiving Weekend 2013? We'll see...
Strategies
  • Start moving your BTC and alts off of wallets and into the right exchanges just in case the networks get clogged and you want to be ready to make a move
  • Go into FIAT to avoid this drama and enter in again after this passes
  • Go into BCH
  • Put some super low limit orders on BTC in case stop orders and panic selling cause another flash crash like ETH had on GDAX
FAQ
What is the "dragon" being slain?
Some think it's Bitcoin, the biggest crypto. Other think it's a private chat group that a bunch of Core folks are in that they self-dubbed the Dragon's Den in an self-mocking fashion
Isn't this just some stupid 4chan meme?
Rational brains would agree, and chances are it really is and Jihan and gang are shaking their head in disbelief that people would believe something like this.
But $4B of volume on BCH is undeniable, and not something that a bunch of "trolls" can just conjure up.
submitted by darkally to CryptoCurrency [link] [comments]

Cryptocurrency Investing

Cryptocurrency Investing
This article is provided for informational purposes only. Your decision to invest in cryptocurrency cannot be made on the basis of this text.
At the time when cryptocurrencies gather pace and many new altcoins appear, it seems hard to decide which one to choose for the investment. There are some notions that can help to make a decision.
https://preview.redd.it/49vonh8kv1y31.jpg?width=1024&format=pjpg&auto=webp&s=b6b1ec1e200632fedc1e56a7af8f4d5139852ce6
What affects the value of cryptocurrency?
The price of cryptocurrency depends on different factors. First of all, the basic economic principle of demand and supply works here. High demand for limited coins will raise their prices. The more coins are mined, the harder it is to get new ones. As a result, they become more precious.
Usefulness of coins also matters. When people understand that they can solve specific cases using cryptocurrency it may be in demand. For this reason, DASH became famous in countries which suffer difficulties with official banking system.
Mass media and historical events affect the value of cryptocurrency too. If negative publicity appears or the government puts a strict regulation against the use of coins, their price goes down. It works the opposite way too. Microsoft started accepting BTC as a payment method in 2014. They set an example for many other global companies and promoted the cryptocurrency.
Rise and fall
As it has already been mentioned, notable cases influence the market. In 2013 the Bitcoin price raised to 266$ but crashed and it costed 109$ in October. It happened because of the Silk Road arrest. This anonymous trading floor sold illegal goods and commonly used BTC for getting payments.
Cryptocurrency market has capped the climax several times in 2017. The price of BTC was growing from April and in the middle of December gained its maximum reaching 20 000 dollar mark. Meantime the price of BTC was close to 11 000$ at the beginning of September 2019 but came down to 8 000$ at the end of the month.
Coin market capitalization
Cryptocurrency capitalization is an integrated cost of all issued digital coins at the market. US Dollar usually serves as a monetary indicator. This characteristic helps to understand if cryptocurrency is attractive to invest in or not.
Two main factors affect the capitalization. One of them is a coin emission (the amount of coins in turnover) and another is a coin rate. In most cases, the emission always grows because of the mining process. The more coins have been mined the harder to get some new ones. This process affects the rate too. For example, this scheme works with BTC.
There are some cryptocurrencies (such as NXT) with initial emission. Capitalization here is directly related to the rate and market activity because the total amount of coins is unchangeable.
Who risks nothing, gains nothing?
When one tries to choose cryptocurrency for the investment, attention should be paid to its capitalization. High level of capitalization tells about better market fluctuation tolerance of the currency. It is more stable but a rapid increase in the rate can not be expected. On the other hand, assets with lower capitalization show significant swings in a short period of time.
Famous quotes
“It is not a speculative investment even though it is being used as such by other people. As Bitcoin network grows the value of Bitcoin grows. As people move into Bitcoin for payments and receipts they stop using US Dollars, Euros and Chinese Yuan which in the long-term devalues these currencies.” – Eric Schmidt, Executive Chairman of Google “Bitcoin is a technological tour de force.” – Bill Gates, Co-founder of Microsoft
Interesting fact
One of the world’s most famous and successful investment in cryptocurrency was made by Norwegian student Kristoffer Koch in 2009. He got to know about bitcoins while he was writing a thesis on encryption. Kristoffer purchased 5 000 bitcoins for 150 Krones ($26.60) and forgot about them soon afterwards. “Cryptography and computer security interests me: I’m a technical guy, not an investor. So I just bought a few at that time.” – said Mr. Koch. In 2013 cryptocurrency was vividly discussed in mass media and it made the Norwegian remember about his investment. The idea of how much his coins had come to be worth struck him. 150 Krones turned into 885 000 dollars and some part of this money was used to buy a spacious apartment in a prestigious district of Oslo.
Cryptocurrency investing can be really profitable. It bring its benefits if one takes into account all moments which influence the market and stays aware of changes in this sphere.
No matter which cryptocurrency you choose to invest in, you can always exchange one coin for another using StealthEX. It is an anonymous and limitless cryptocurrency exchange with the top concern about user’s privacy.
Follow us on Medium, Twitter, Facebook, and Reddit to get StealthEX.io updates and the latest news about the crypto world. For all requests message us via [[email protected]](mailto:[email protected])
submitted by Stealthex_io to NewbieZone [link] [comments]

Cryptocurrency Investing

Cryptocurrency Investing
This article is provided for informational purposes only. Your decision to invest in cryptocurrency cannot be made on the basis of this text.
At the time when cryptocurrencies gather pace and many new altcoins appear, it seems hard to decide which one to choose for the investment. There are some notions that can help to make a decision.
https://preview.redd.it/i390wllao1y31.jpg?width=1024&format=pjpg&auto=webp&s=edf040c91bbb928dad681c9c091733475bb00139
What affects the value of cryptocurrency?
The price of cryptocurrency depends on different factors. First of all, the basic economic principle of demand and supply works here. High demand for limited coins will raise their prices. The more coins are mined, the harder it is to get new ones. As a result, they become more precious.
Usefulness of coins also matters. When people understand that they can solve specific cases using cryptocurrency it may be in demand. For this reason, DASH became famous in countries which suffer difficulties with official banking system.
Mass media and historical events affect the value of cryptocurrency too. If negative publicity appears or the government puts a strict regulation against the use of coins, their price goes down. It works the opposite way too. Microsoft started accepting BTC as a payment method in 2014. They set an example for many other global companies and promoted the cryptocurrency.
Rise and fall
As it has already been mentioned, notable cases influence the market. In 2013 the Bitcoin price raised to 266$ but crashed and it costed 109$ in October. It happened because of the Silk Road arrest. This anonymous trading floor sold illegal goods and commonly used BTC for getting payments.
Cryptocurrency market has capped the climax several times in 2017. The price of BTC was growing from April and in the middle of December gained its maximum reaching 20 000 dollar mark. Meantime the price of BTC was close to 11 000$ at the beginning of September 2019 but came down to 8 000$ at the end of the month.
Coin market capitalization
Cryptocurrency capitalization is an integrated cost of all issued digital coins at the market. US Dollar usually serves as a monetary indicator. This characteristic helps to understand if cryptocurrency is attractive to invest in or not.
Two main factors affect the capitalization. One of them is a coin emission (the amount of coins in turnover) and another is a coin rate. In most cases, the emission always grows because of the mining process. The more coins have been mined the harder to get some new ones. This process affects the rate too. For example, this scheme works with BTC.
There are some cryptocurrencies (such as NXT) with initial emission. Capitalization here is directly related to the rate and market activity because the total amount of coins is unchangeable.
Who risks nothing, gains nothing?
When one tries to choose cryptocurrency for the investment, attention should be paid to its capitalization. High level of capitalization tells about better market fluctuation tolerance of the currency. It is more stable but a rapid increase in the rate can not be expected. On the other hand, assets with lower capitalization show significant swings in a short period of time.
Famous quotes
“It is not a speculative investment even though it is being used as such by other people. As Bitcoin network grows the value of Bitcoin grows. As people move into Bitcoin for payments and receipts they stop using US Dollars, Euros and Chinese Yuan which in the long-term devalues these currencies.” – Eric Schmidt, Executive Chairman of Google
“Bitcoin is a technological tour de force.” – Bill Gates, Co-founder of Microsoft
Interesting fact
One of the world’s most famous and successful investment in cryptocurrency was made by Norwegian student Kristoffer Koch in 2009. He got to know about bitcoins while he was writing a thesis on encryption. Kristoffer purchased 5 000 bitcoins for 150 Krones ($26.60) and forgot about them soon afterwards. “Cryptography and computer security interests me: I’m a technical guy, not an investor. So I just bought a few at that time.” – said Mr. Koch. In 2013 cryptocurrency was vividly discussed in mass media and it made the Norwegian remember about his investment. The idea of how much his coins had come to be worth struck him. 150 Krones turned into 885 000 dollars and some part of this money was used to buy a spacious apartment in a prestigious district of Oslo.
Cryptocurrency investing can be really profitable. It bring its benefits if one takes into account all moments which influence the market and stays aware of changes in this sphere.
No matter which cryptocurrency you choose to invest in, you can always exchange one coin for another using StealthEX. It is an anonymous and limitless cryptocurrency exchange with the top concern about user’s privacy.
Just go to StealthEX.io and follow these easy steps:
  • Choose the pair and the amount for your exchange. For example, BTC to ETH.
  • Press the “Start exchange” button.
  • Provide the recipient address where the coins will be transferred.
  • Move your cryptocurrency for the exchange.
  • Receive your coins.
Follow us on Medium, Twitter, Facebook, and Reddit to get StealthEX.io updates and the latest news about the crypto world. For all requests message us via [email protected]
submitted by Stealthex_io to StealthEX [link] [comments]

How NOT to tell which is "the real Bitcoin"

1) Temporary price and hashpower dominance
Years ago I mused what would happen when the masses indoctrinated in Keynesian economics finally piled into Bitcoin. To hear it from the man himself in one of his rare moments of honesty,
By [inflating the money supply], the government may secretly and unobserved confiscate the wealth of the people, and not one man in a million will detect the theft.
-John Maynard Keynes
Not one man in a million. An exaggeration for effect, but the reality is probably 1% or less really understand the importance of an inflation-free, unmanipulable money supply.
Therefore, I pondered, with the propaganda arms of the world's governments working overtime to reinforce the Keynesian message that inflation is needed to keep the economy running smoothly and avoid the "ravages" of deflation, how hard would it be to get a majority of investors in Bitcoin to be for lifting the 21 million coin limit?
Pffft. Is that even a question? 90% could easily be convinced, probably 99% if the world's governments really tried. Remember this doesn't have to be done by convincing currrent investors to change their stance; much easier to bring in more new investors than have been in Bitcoin up to now, eclipsing them.
The consequences are then obvious: the majority, ney the vast majority, of the investment and therefore hashpower could end up in an Keynesian version of Bitcoin after a chain split. In fact at some point this seemed inevitable.
Is this a bad thing? No, I reasoned, because it will soon enough lose to the better money. It could take a few years, but we will always have our sound money in the original Bitcoin despite being relegated to underdog status and probably even losing the Bitcoin name for a time.
In fact, far from being a disaster, it would be a boon to those of us with the understanding and patience to wait it out: we'd get the chance to double, triple, or even tenfold our money in chain-split arbitrage trading on the backs of the clueless Keynes-indoctrinated masses.
To really drive the point home, consider that even the current crop of crypto investors are a relatively savvy bunch, yet they are granting 6 of the top 10 slots by market cap to coins that have yet to take the plunge to a decentralized model (XRP, EOS, ADA, XLM, IOTA, and NEO).
Realize that these new holders are still the top 1% in terms of general investor savvy, and you have an idea of the extent of the folly in choosing "the real Bitcoin" by market cap (and therefore by hashpower, since hashpower closely follows price).
Far be it from a sign of not being the real McCoy, temporary loss of price dominance is in fact something we should expect to happen perhaps even multiple times in the march to full global adoption.
Two investment adages reinforce the point that the market takes time to determine value and can be deranged in the "short term," which can actually be quite a while:
"The market can stay irrational for longer than you can remain solvent."
"In the short term the market is a popularity contest; in the long term it is a weighing machine."
Finally consider that the whole point of investing is to identify mass delusions and profit from them. An investment that is irrationally hated, as Bitcoin was in 2011 and 2012 - BCH in 2017 and 2018 - represents the ultimate buying opportunity. Bitcoin grew 100x in 2013, meaning about 99% of the investors were new and previously had ignored or disdained Bitcoin.
The nature of an exponentially growing asset is what they used to call on Usenet an "eternal September," wave after way of ever more clueless newbs, ever more ignorant of the history of Bitcoin and ever less educated in economics.
As crypto is currently the biggest investment fad in the world, the weighing machine assessing any "real Bitcoinness" has a big OUT OF ORDER sign on it. Any numbers displayed should be eyed with suspicion.
2) Naming conventions, ticker symbols, etc.
As mentioned above and as should really be obvious in a decentralized system, the one retaining the name Bitcoin for any short-term period can and likely several times in Bitcoin's future will come down to temporary price and popular caprice.
3) Github repo history, domain names, subreddit names, twitter handles, etc.
Should be self-explanatory. These come down to accidents of history, who is willing to pay the most for namespace, and the tribal politics of small groups. If any of these were to be seriously relied upon to determine a chain's worthiness to be the global ledger of civilization, Bitcoin could easily be subverted by bribing or otherwise compromising a website owner, domain squatter, or Github repository maintainer and/or a few committers.
4) Replay protection and emergency difficulty adjustment algorithms
As these are going to necessary for any temporary minority hashpower branch of a chain split, pointing to replay protection or EDA/DAA merely repeats the error of (1) above, the notion that short-term majority hashpower is any kind of reliable measure.
submitted by ForkiusMaximus to btc [link] [comments]

Another Bitcoin hard fork & potential civil war has been avoided - no suspensions will occur. Additional info on other forks including upcoming Bitcoin Cash fork and Bitcoin "Gold" also inside

Last month, we notified you that there was the potential for a civil war to break out as a direct result of another "OG" Bitcoin fork, named SegWit2X, particularly due to Bitcoin.org (affiliated with the Bitcoin Core development group) unusually breaking from its neutral stance and naming-and-shaming companies and organizations that supported SW2X even as an alternative, including Blockchain.info and Coinbase. The group behind the implementation of SegWit2X, which builds on the ideas of SegWit, has announced that its upcoming implementation around the middle of the month will not go on.
With this sudden change of course, we are now no longer preparing for suspending Bitcoin trading around the middle of the month. We'll also talk about two other forks that users have mentioned or will likely mention below.

Bitcoin Cash is forking - use additional caution

Unrelated to the above dispute between SegWit2X and SegWit without 2X, Bitcoin Cash developer groups are currently planning on updating their difficulty adjustment algorithm in a few days on November 13th. One of the main differences of the Cash chain is that it has a slightly different method of adjusting difficulty, where if there's a period with huge gaps between new blocks, an emergency difficulty adjustment will occur to rapidly lower difficulty ahead of the standard difficulty retargeting of every 2048 2016 blocks. This helped stabilize it in its early days in August and September, but has later proven to be rather erratic. With the new difficulty adjustment algorithm selected, difficulty retargets will occur with every block similar to other altcoins like Ethereum and Vertcoin, based on a moving average of how long the last 144 blocks took to make. In Portal terms, stable hashrate goes in, stable difficulty comes out. Rapid hashrate changes goes in, rapid difficulty changes comes out.
To implement this change, a hard fork is necessary. As seemingly all parties are in agreement with the change, and with supporters of the Cash chain like exchanges and online wallets preparing for this, we will not suspend Bitcoin Cash trading on /GlobalOffensiveTrade due to a low risk of an accidental chain split and economic impact. It's not an unwise idea to use extra caution during this time, but if you're a Cash enthusiast, you're probably already prepared. An eye will be kept on the transition just in case something does go wrong.

Bitcoin "Gold" - is banned on /GlobalOffensiveTrade

As the new dispute between SW w/o 2X and SW2X broke out, another fork of Bitcoin, called Bitcoin Gold, was beginning to be talked about. Its main idea is to shove the middle finger at ASICs (special boxes meant for mining) like Litecoin (early on, at least) and Vertcoin and similar altcoins, and to restore the viability of mining with typical graphics cards, as was commonplace during the first Bitcoin boom of 2012/2013/early 2014 and with Ethereum in early/mid 2017, with both instances causing widespread supply shortages. This was also an idea that some supporters of the Bitcoin Core developer group were tossing around a little while before the Cash fork occurred, but there were no solid plans as Gold was not a thing yet.
On paper, Gold would seem like a good fork for those that wanted to wave the middle finger at ASICs, but problems quickly became apparent with its execution. Namely, a premine operation was uncovered, where the developers of the Gold chain would be the exclusive miners of Gold until public release, and then presumably resell those coins after public release as a means to fund development, or just to make quick Benjamins. Coinbase, in its FAQ on its position on Gold, also stated that the source code was not open for public viewing for public review, thereby making it a security risk.
As a result, we will be banning Bitcoin Gold on /GlobalOffensiveTrade.

An overview of what's going on with Bitcoin and /GlobalOffensiveTrade:

  • "OG" Bitcoin trading will continue to be allowed now that SegWit2X implementation has been called off
  • Bitcoin Cash trading will continue to be allowed through an upcoming fork to alter how difficulty is determined. Use extra caution, but there are next to nil risks of significant economic impacts
    • "Bcash" is not a valid or official name, and will still result in your post or comment being removed
  • Bitcoin Gold trading is banned due to security concerns stemming from the code not being open source, as well as extensive pre-mining to the tune of 100,000 coins - your post or comment will be removed
  • Our bait-and-switch policies involving Bitcoin remains unchanged: if you do not explicitly specify which variant of Bitcoin you want, it will be assumed that you want original Bitcoin and not Bitcoin Cash (including if you say just BTC). If you want Bitcoin Cash instead of original Bitcoin, you must explicitly say so, either by stating "Bitcoin Cash", "BCC", or "BCH"
    • Bait-and-switch attempts involving sending Bitcoin Cash instead of original Bitcoin, or vice versa, are still bannable under rule 4
submitted by wickedplayer494 to GlobalOffensiveTrade [link] [comments]

TKEY mining explained. Part 1

TKEY mining explained. Part 1

https://preview.redd.it/375qshuf6fs21.png?width=1500&format=png&auto=webp&s=cf3102df8a682faf5eb9b0d20814637860a2eba0

Dear investors!
As promised, we start a series of articles about Tkeycoin mining and mining hardware. We will try to explain the process in detail and reply all the questions, if they arise. We kindly ask you not to ignore those publications and carefully read the info we provide.
To understand how mining process works in general, it is better to start with the basics. The pioneer here was the good old Bitcoin, which started to be mined back in 2009. The BTC mining technology did not really change during these 8 years - the process is still based on the Proof-Of-Work (PoW) principle and uses SHA-256 hashing algorithm.
By the way, Proof-Of-Work (PoW) existed long before the cryptocurrencies emerged, its main purpose being to create special math puzzles that required certain amount of time and resources to be solved. PoW was used to protect websites of DDOS-attacks and massive spam. In 2009 PoW was chosen by Satoshi Nakamoto for the nascent Bitcoin network, and in a few years it was already being used by millions of people for making good money.
How PoW algorithm works? The miner gets a certain math puzzle that requires spending computing power to be solved. Finding solution is a random guessing process, therefore the more computing power a miner possesses, the faster he will find the solution. The first miner to come up with the solution (to get a resulting hash) receives a certain amount of BTC as a reward for solving the block. The less lucky participants get their fraction of reward, too. It’s rather simple.
PoW principle may be compared to a class work, the teacher saying that the first student to solve the puzzle will get an A. Miners are like kids competing for an A (BTC reward). The computing power spent in the process is the amount of intellectual efforts the kids make to find the decision. Finally, the kid who comes up with the solution, gets the reward. The same happens in the Bitcoin network, though the puzzle difficulty level and the reward are different.
It looks rather simple. Naturally, millions of people all over the world soon got the idea and started to mine Bitcoins. As a result, once simple process started to get more and more complicated. There was a time, when you could mine Bitcoins with CPUs, using your home or office PC. At this stage few people knew about BTC - by the end of 2009 there were just a few hundreds of miners in the world. But the situation was changing quickly, and in the next year GPU-mining started. GPUs were faster to find the solution, and they were also cheaper, featuring the better value for money. In September 2010 GPU-mining went mainstream. A lot of people became suddenly aware that mining BTC was really profitable, therefore the number of miners increased greatly.
In the same month the first BTC mining pool was launched. In a matter of months the price of BTC skyrocketed from $1 to $20. Naturally, the difficulty of mining increased too - by November 2010 it reached 1 000 000 (compared with 10 000 in the end of 2009). In 2013 the price of BTC passed the $1000 mark. The first ASICs (customized mining hardware) emerged, meaning revolutionary changes for the market. (We will talk about them in the next part of ‘TKEY mining explained’).
These days BTC mining is by far less available and profitable than it used to be. Solo mining hardly makes any sense now. If back in 2010 you could mine BTC with an normal home PC, now you need a powerful GPU-rig or the support of a mining pool to get some considerable profit. It is caused by such factors as the increased network difficulty, block reward reduction and fast mining hardware evolution. Originally, the reward for a block solved was 50BTC, now it’s just 12,5 BTC. The network difficulty increased from 10 000 in 2009 to 6 379 265 451 411 at the moment. And most of you are well-aware of the price of up-to-date mining hardware.
Why we are talking about all this? Why we dwell in detail on the Bitcoin mining? And who is Satoshi Nakamoto?
Actually, it all this makes sense if we consider the Bitcoin situation with the Tkeycoin network current state. Mining Tkeycoin, as well as it was at the early stages of BTC history, will be really available to many, and you will be able to mine TKEY using your smartphone or a rather outdated home or office PC. You do not need to invest into costly mining hardware to get your share of TKEYs. We declared that TKEY mining will be accessible for almost everyone, and we meant it.
As you know from experience, the progress is unstoppable, therefore TKEY mining difficulty will inevitably grow with time, too. But, according to our experts, you won’t have to worry about it over the next 3 years or so.
For TKEY mining we use the updated and modified version of the PoW algorithm called mPoW. The basic principle is the same: the miners have a puzzle to solve, and get the reward when they succeed. But it’s important to know, that our protocol is free from many typical problems that plague the classical PoW. For instance,
Due to modular realization, selfish mining is made impossible; Due to the network specific architecture, 51% Attack and Double Spending are made impossible; mPoW-based mining is much less power-consuming; The network is immune to quantum attacks.
Currently, the BTC-mining is not so decentralized as it was meant to be initially. Over 65% of Bitcoin hash power is now distributed between 5 major pools. Theoretically, they can make 51% attack on the network any time soon.
On the contrary, the Tkeycoin network is completely decentralized. No monopolies will interfere with your solo mining at home, using an ordinary PC.
That is all for today. Later we will talk about SHA256 hashing algorithm, review the current ASIC market situation, suggest the best hardware for TKEY-mining and talk about mining profitability calculators.
Don’t miss the next part of ‘TKEY mining explained’!
See you soon!
Your Tkeycoin Team
submitted by tkeycoin to Tkeycoin_Official [link] [comments]

TKEY mining explained. Part 1

TKEY mining explained. Part 1

https://preview.redd.it/61gzhcjq78r21.png?width=1500&format=png&auto=webp&s=cf0406038eb054583475e500f63950362b975358

Dear investors!

As promised, we start a series of articles about Tkeycoin mining and mining hardware. We will try to explain the process in detail and reply all the questions, if they arise. We kindly ask you not to ignore those publications and carefully read the info we provide.

To understand how mining process works in general, it is better to start with the basics. The pioneer here was the good old Bitcoin, which started to be mined back in 2009. The BTC mining technology did not really change during these 8 years - the process is still based on the Proof-Of-Work (PoW) principle and uses SHA-256 hashing algorithm.

By the way, Proof-Of-Work (PoW) existed long before the cryptocurrencies emerged, its main purpose being to create special math puzzles that required certain amount of time and resources to be solved. PoW was used to protect websites of DDOS-attacks and massive spam. In 2009 PoW was chosen by Satoshi Nakamoto for the nascent Bitcoin network, and in a few years it was already being used by millions of people for making good money.

How PoW algorithm works? The miner gets a certain math puzzle that requires spending computing power to be solved. Finding solution is a random guessing process, therefore the more computing power a miner possesses, the faster he will find the solution. The first miner to come up with the solution (to get a resulting hash) receives a certain amount of BTC as a reward for solving the block. The less lucky participants get their fraction of reward, too. It’s rather simple.

PoW principle may be compared to a class work, the teacher saying that the first student to solve the puzzle will get an A. Miners are like kids competing for an A (BTC reward). The computing power spent in the process is the amount of intellectual efforts the kids make to find the decision. Finally, the kid who comes up with the solution, gets the reward. The same happens in the Bitcoin network, though the puzzle difficulty level and the reward are different.

It looks rather simple. Naturally, millions of people all over the world soon got the idea and started to mine Bitcoins. As a result, once simple process started to get more and more complicated. There was a time, when you could mine Bitcoins with CPUs, using your home or office PC. At this stage few people knew about BTC - by the end of 2009 there were just a few hundreds of miners in the world. But the situation was changing quickly, and in the next year GPU-mining started. GPUs were faster to find the solution, and they were also cheaper, featuring the better value for money. In September 2010 GPU-mining went mainstream. A lot of people became suddenly aware that mining BTC was really profitable, therefore the number of miners increased greatly.

In the same month the first BTC mining pool was launched. In a matter of months the price of BTC skyrocketed from $1 to $20. Naturally, the difficulty of mining increased too - by November 2010 it reached 1 000 000 (compared with 10 000 in the end of 2009). In 2013 the price of BTC passed the $1000 mark. The first ASICs (customized mining hardware) emerged, meaning revolutionary changes for the market. (We will talk about them in the next part of ‘TKEY mining explained’).

These days BTC mining is by far less available and profitable than it used to be. Solo mining hardly makes any sense now. If back in 2010 you could mine BTC with an normal home PC, now you need a powerful GPU-rig or the support of a mining pool to get some considerable profit. It is caused by such factors as the increased network difficulty, block reward reduction and fast mining hardware evolution. Originally, the reward for a block solved was 50BTC, now it’s just 12,5 BTC. The network difficulty increased from 10 000 in 2009 to 6 379 265 451 411 at the moment. And most of you are well-aware of the price of up-to-date mining hardware.

Why we are talking about all this? Why we dwell in detail on the Bitcoin mining? And who is Satoshi Nakamoto?

Actually, it all this makes sense if we consider the Bitcoin situation with the Tkeycoin network current state. Mining Tkeycoin, as well as it was at the early stages of BTC history, will be really available to many, and you will be able to mine TKEY using your smartphone or a rather outdated home or office PC. You do not need to invest into costly mining hardware to get your share of TKEYs. We declared that TKEY mining will be accessible for almost everyone, and we meant it.

As you know from experience, the progress is unstoppable, therefore TKEY mining difficulty will inevitably grow with time, too. But, according to our experts, you won’t have to worry about it over the next 3 years or so.

For TKEY mining we use the updated and modified version of the PoW algorithm called mPoW. The basic principle is the same: the miners have a puzzle to solve, and get the reward when they succeed. But it’s important to know, that our protocol is free from many typical problems that plague the classical PoW. For instance,

Due to modular realization, selfish mining is made impossible; Due to the network specific architecture, 51% Attack and Double Spending are made impossible; mPoW-based mining is much less power-consuming; The network is immune to quantum attacks.

Currently, the BTC-mining is not so decentralized as it was meant to be initially. Over 65% of Bitcoin hash power is now distributed between 5 major pools. Theoretically, they can make 51% attack on the network any time soon.

On the contrary, the Tkeycoin network is completely decentralized. No monopolies will interfere with your solo mining at home, using an ordinary PC.

That is all for today. Later we will talk about SHA256 hashing algorithm, review the current ASIC market situation, suggest the best hardware for TKEY-mining and talk about mining profitability calculators.
Don’t miss the next part of ‘TKEY mining explained’!

See you soon!
Your Tkeycoin Team
submitted by tkeycoin to u/tkeycoin [link] [comments]

Why Am I making less that before-Market Trends Explained!!

Hi folks recently I had been following reditt and it's pretty funny to see people jumping into crypto currency mining without understanding the basics and how markets in general work.I would like to answer some of these questions here
Q1.Why is Nicehash payment soo low compaired to couple of months back.Even after bit coins has recoverd in value since
A- 4 Reasons
1.Sudden Influx of new miners into nicehash and into the mining game in general due to the bull run (up market) in crypto currencies that we say in the past couple of months .On the day A Video on NH by Youtuber austin Evans was relseased we recorded a sudden increase in the global hashing power,which was never seen before .AFTER EVERY SUDDEN RISE THERE IS A SUDDEN FALL.-economics 101
2.Remeber NH doesn't mine a single coin it mines algorithim that can be shared by multiple coins and you are generally paid based on several factors like Btc/$ rates,current rates of other mined currencies like ZCASH (equihash),ETH (daggerhashimoto),etc and most importantly the SUPPLY (no.of gpus pointed at HN) Vs. DEMAND (No.Of buyers buying the hashing power coming out of the gpus).Since more people discoverying about the eazy 1 click "Sell hashing power" feature on NH and have no idea about the complicated "buying hashing power" section leads to more SUPPLY less DEMAND = LOW PAYOUTS
3.On NH You are only decrypting a gpu supported algorithm which is shared by many coins,all of these coins also known as alt coins are pegged against Bitcoins which is inturn by most people pegged against the dollar.So the change in the value of any one of these factors ie.Hashing PoweAlt coin demand and difficulty/Bitcoins value/Dollar fiat currency value can change your daily payout.
4.zcash,eth and other gpu mined coins still didnot fully recover to the value it had a couple of monts ago its recovering very slowly
4.Low Demand from buyer of hashing power due to uncertanity in the mining world due to Changes been made into the bitcoin system on August 1
August 1 Uncertanity = Scared Market = Low demand =Bear Run (down market).Read more only about that
Note- Nicehash payouts has increased around 30% as bitcoin rates to dollar rate had also shown a similar up trend,since you are paid in mBtc or bitcoins in general never compare your NH Bitcoin payments with fiat currency ($€£¥,etc) because that $10 that you hold in btc now can be $30 in the future if bitcoin rates rises in the future.Happened in the past with my friends who sold a lot of mined bit coins in 2013 for mere dollars ,the value of those bit coins are now in millions.Then again if Btc crashes your held $10 in bitcoins can fall to mere 0.
Since sometimes history repeats holding mined or bought btc for some time is more profitable than selling now.The price of btc will standardise one day if more and more people start adopting btc payments and there will be marginal profits to be made then by trading or mining coins (eg .modern fiat currency trading or gold trading).Again it's just a speculation based on historical analysis.
Q2.When will my GPU's become FREE
A1.NOW,ie.if you scored your cards before gpu prices skyrocketed if you sell them now the money you made till now by mining will be free+extra premium for the cards.Mosr cards come with 3yrs warrenty so that helps with the sale
Your GPU ROI is paid the day you make 40% of what you paid for your gpu by mining ,the other 60% of the ROI can comes from selling your cards.These days even used cards are sold for 110% the price of the Box price as new cards are sold for 150-200% the original price.
Price of mining/gaming grade GPU is at all time high now even though Gtx 1070/1080 and Amd RX cards are nearing the 2nd half of there life cycle .We see new faster and cheaper cards every 2 years or so.so the price of your mining cards will keep going down from now on as new surplus stock of these cards will be out in August-September and New mining cards are coming out around September aswell.Better invest in new cards to stay ahead in the mining game.
Q3.They why dont You sell your cards You are Mining right?
A1.Im under the assumption that Bitcoins will one day touch $5000 mark one day.so what ever I'm mining now if compared to the my investment and the current market I will be making my ROI in 1year plus or maybe never as difficulty of mining increases every now and then but I think bitcoin is a very functional form to currency it can add a lot of value to our society (FUN FACT-Do you know private bank can print free money,Google it up) bit coins patches all the problems with out current centralised money system making us slave for the govt.Bitcoins is the future of money
So if i follow this single idea of bit coins getting to $5000 one day my $100 is btc today will be around $280 approx. Or could be $50 .
YOU CAN NEVER ACCURATELY SPECULATE IN AN OPEN MARKET.So Stop fantasizing about getting rich quick by mining if you can do it then so the guy living next door.Have trust on crypto coins use them to buy stuff that helps making the whole currency valuable and your coins as well.
Q4.Mining Via NH vs Mining Altcoin directly vs Mining bit coins vs trading coins.
A1.Mining Via NH-Hassle free,Paid in btc,auto switching,optimised and stable than all.Saves a lot of time=More hashing time=more earning. You do pay a small % as frees but that's negligible compared to the time it saves.
Mining Directly - Hasselous,manual setup,non noob friendly,you get to keep all the profits plus you are mining an alt coin directly so if your cards are good at one or two coins then more profit here plus you are look the market and mine anything that high today Or would increase in a couple of days and sell later for a huge profit.Smart human auto switching makes you more money than NH. It's more fun but takes more time.
Mining Bitcoins-No You can't,too difficult to mine btc with gpu the Chinese got a lot of the bitcoin mining mega farms.
Trading coins-Always profitable bought bit coins last month,sold yesterday making a sweet $3000 profit in 3 weeks.Buy now and sell later will always make you some profit since bit coins are finite in number like gold,you can't create new bit coins out of thin air.so if bitcoin catches and more people know about it it's value can go though the roof.
Q4.Any better way to mine? ASIC vs Bitman miners vs Gpu rigs
A4. Now folkes asic miners (bitman miners) eta can mine better than any gpu in the market they are specifically built for mining a certain algorithm(coin) ie.No auto switching .So if the coin falls in value you are left with the most advance and expensive door stopper in the world.No one would touch the hardware and it's value could be zero in a day.Usually these miners loose all it's value in 1 yr or 2 as difficulty increases
Not so with GPUs.Say I have 2 gtx1070 and a gtx 970 bought for say $1300 (same price as a asic miner) mining 24/7 and I earn some bit coins (surely a bit less than mining on an asic) but again next year say all my cards become unprofitable by mining then I'm still the owner of with a super advance and a very expensive gaming rig on which I can do multiple display and also multiple instance of gaming. I can sell the 1070 and 970 to a gamer with 2yr warranty on those cards and I can make the reminder as gaming never falls out of favour.Remeber these cards can still decrypt other stuff like Wi-Fi passwords and physical stimulation and calculations in minutes,that's how hard mining has got and difficulty will increase overtime.
Q.Any suggestions ?
A.I can share my plans
Gameplan 1=Buy Newer cards quick in September ,Enjoy higher mining payouts,others will follow,mining hardware increases in price,then market crashes for sometime,you made your money,sell your cards for 100-150% the original value.Live happy every and after
Gameplan2-Buy bit coins today,wait till the prices reaches another all time high ,happens every year,Sell and don't forget to live happy every and after,
A happy man is some one with no money to worry about. -My Father said to me the day I started mining.
submitted by Miningforbeer to NiceHash [link] [comments]

Flux: Revisiting Near Blocks for Proof-of-Work Blockchains

Cryptology ePrint Archive: Report 2018/415
Date: 2018-05-29
Author(s): Alexei Zamyatin∗, Nicholas Stifter, Philipp Schindler, Edgar Weippl, William J. Knottenbelt∗

Link to Paper


Abstract
The term near or weak blocks describes Bitcoin blocks whose PoW does not meet the required target difficulty to be considered valid under the regular consensus rules of the protocol. Near blocks are generally associated with protocol improvement proposals striving towards shorter transaction confirmation times. Existing proposals assume miners will act rationally based solely on intrinsic incentives arising from the adoption of these changes, such as earlier detection of blockchain forks.
In this paper we present Flux, a protocol extension for proof-of-work blockchains that leverages on near blocks, a new block reward distribution mechanism, and an improved branch selection policy to incentivize honest participation of miners. Our protocol reduces mining variance, improves the responsiveness of the underlying blockchain in terms of transaction processing, and can be deployed without conflicting modifications to the underlying base protocol as a velvet fork. We perform an initial analysis of selfish mining which suggests Flux not only provides security guarantees similar to pure Nakamoto consensus, but potentially renders selfish mining strategies less profitable.

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Bitcoin basics: What is the difficulty target and how does it adjust itself? Is Bitcoin Dead Best Bitcoin Client Big Difficulty Moves for Bitcoin Droht Bitcoin durch die Miner ein Absturz? - Difficulty ...

Posted on September 17, 2013 by thomashartman1 The bitcoin mining network hit one petahash this weekend. If you use thegenesisblock mining dashboard to project the future bitcoin difficulty, as many prospective miners do, you get a monthly 80% difficulty increase filled in by default, based on the last several months … Bitcoin 2013. Posted on June 3, 2013 by thomashartman1. I’m putting together some thoughts about the may Bitcoin conference. Stay tuned. Share this: Twitter; Facebook; Like this: Like Loading... Related. About thomashartman1 I am a crypto currency enthusiast, trader, and software developer. Contact: thomas AT standardcrypto DOT com. View all posts by thomashartman1 → This entry was posted ... Also described in BIP34 are rules for rejecting certain blocks; based on those rules, Bitcoin Core 0.7.0 and later versions began to reject version 2 blocks without the block height in coinbase at block height 224,412 (March 2013) and began to reject new version 1 blocks three weeks later at block height 227,930. Bitcoin difficulty saw one of the largest resets recently and this was a result of a 50% plunge in price.However, the statement is not as simple as it seems as the drop in price contributed to a lot of miners operating at a loss, causing them to shut off mining rigs. This would eventually lead to a decrease in hash rate, leading to the difficulty adjusting accordingly. That being said, one fundamental indicator is flashing an incredibly bullish sign for Bitcoin. The cryptocurrency’s difficulty ribbons just entered the “buy zone” for the first time since March. This indicates that the recent bout of consolidation may be nothing more than a precursor to an extension of its mid-term uptrend seen throughout Q2 and Q3 of 2020/

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Bitcoin basics: What is the difficulty target and how does it adjust itself?

To read more with regards to bitcoin paper wallet, check out internet site below: http://www.cryptocoinwalletcards.com/ Tags: asic bitcoin miner, asic bitcoi... Bitcoin Mining Difficulty: An Overview - Duration: 4:37. AMBCrypto Recommended for you. 4:37. Why there will never be more than 21 million bitcoin. - Duration: 8:18. Keifer Kif 751 views. 8:18 ... The creation of a bitcoin takes only 10 minutes that's helped with a formula and the count for the bitcoins cannot exceed Twenty one million cash. This is also the utmost count that has been ... Big Difficulty Moves for Bitcoin Trade Genius Stock Market News. Loading... Unsubscribe from Trade Genius Stock Market News? Cancel Unsubscribe. Working... Subscribe Subscribed Unsubscribe 26.3K ... Genesis Mining was founded in 2013 Butterfly labs, bitcoin block, block erupter, difficulty, asic miner, Bitcoin, how much will bitcoin difficulty increase, bitcoin mining, what is bitcoin ...

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