Bitcoin Forum

Andreesen said that one mining pool had veto power over system changes.  I don't think that, in itself, is a big deal.  I know how to encrypt my wallet. 

On the other hand, I have no real understanding of what he's talking about.

1. Where are the "rules" about these large mining pools?  I didn't see it in Satoshi's white paper.
(please answer!)

2. Why does this matter?  Does the person who is awarded a block get to "control" it forever?

3. Instead of some commie a$$ appeal (sorry, I'm and 80s kid) to donate to smaller mining pools (which some of you were making), why can't I loan them to these "more virtuous" mining groups and get kicked back some of the discovered blocks, thus receiving a return on my investment - rather than "DONATING?"
If so, could you please such an enterprise!

4. Sorry if I sound like an arrogant buffoon that has a Bobby Knight poster on my wall, but I doubt I'm the only one who has the same misconception.  I'm buying BTC to try to make $$$ and am "tech-challenged."

The rules are everything about how bitcoin works, such as:  Difficulty is calculated to set the block generation rate to about one every ten minutes.  There are 50 bitcoins generated in each block.  The reward halves every 4 years.  And so on.


Gavin is wanting to change one of the rules, to allow multi-sig transactions.  If there is a mining pool with >50% of the hashing power, they could refuse to accept the new rule, and reject any transaction that doesn't follow the old rules.  The problem here is that the pool decides the content of the block being mined.  They decide which transactions to include and which to reject.  The miners have effectively given up any power they had on deciding the 'rules' to the pool operator.

The advantage of p2pool over the traditional pools is that each miner uses their own bitcoind to decide which transactions to include in the blocks they mine.  There's no central pool operator deciding whether to go with Gavin's rule or Luke's rule.  Each miner in the pool downloads either Gavin's bitcoind or Luke's bitcoind, hence getting their own 'vote'.


The idea of the donations in to incentivise miners to use p2pool instead on one of the traditional pools (as if saving the (up to) 10% fees that the traditional pools charge isn't enough).  Having you loan some BTC only to have to pay you back more than you loan would be a disincentive.  What's in it for me as a miner?  I end up losing BTC to you.


It's OK.  I love David Hasselhoff's early work too.

If I loan them money that is intended to steer them to a particular pool, then they have MORE resources to mine with and can receive an incremental profit greater than otherwise and still reimburse me part of the additional profit?  Why wouldn't that work?  If not, these guys didn't really think through the design all that well.

If you are not mining and just want to support a particular development over another try buying hashing power from a GBLSE or other mining company/person who is supporting what you want. Then you get a return.

What in the world does mulit-sig transactions mean?
Sam

https://bitcointalk.org/index.php?topic=61125.0

It's the big craze.

BIP 16 / 17...etc

OK, I guess I'll mine more at Deepbit.
Sam

I think that's the opposite of what most are wanting to happen, but to each their own :)

Really, I didn't get that.

If deepbit is the problem then the solution is to get rid of pooled mining altogether.  The idea that because a pool is successful that it must be evil is offensive.  I would hope that all pools have the goal of success.  In my view a pool that wish's to fail is the one that is more evil.

Seems to me that some people thrive on creating solutions in search of a problem.

Success is NOT a bad thing.
Sam

I think the "problem" is that Deepbit has the ability to veto any vote, due to their hashing power.  I could be wrong though, just what I got from Gavin's post.

And the people who use deepbit, or any other pool, are in effect voting by proxy.  That is the individuals miners choice.

As for the solution in search of a problem comment, the less tinkering with something that works, the better.  I don't think we should be messing with the foundation of the way bitcoin works.  It just feeds the seed of distrust.

We now have encrypted wallets what else do we really need to secure our transactions?  Sending a message to my smartphone will really help that much?  Smartphones can't be compromised?  Really?
Sam

I know that pools weren't supposed to be the foundation of the way Bitcoin works.  But the Bitcoin community continually badgers and belittles people who want to solo mine because it is just "stupid" to not use a pool.  I felt that heat when I first got interested in Bitcoin.  So now that pooled mining is the only way to effectively mine for Bitcoin people want to gripe about paying a fee or the success of certain pools.  Well running a pool cost's money.  Now that the community has successfully forced miners into using pools they want to whine about said pools having too much power.  I think it is time for people to take responsibility for their own actions and quit whining about the success of others.

I haven't looked into the P2Pool, maybe I should.  But when it comes to money and greed there will always be way for someone to take advantage.  There is no such thing as something for nothing or a get rich quick scheme.

I still say we shouldn't be messing with trying to fix something that ain't broke.
Sam

If you don't think we should be messing with the foundation of the way bitcoin works then why are mining at a pool which is for changing the foundation of the way bitcoin works  ???

Have I missed something?

This Gavin guy wants to change the functioning of bitcoin to add an additional signature to the Bitcoin block which will require me to reply to a query sent to my smartphone when I want to initiate a transaction.  And he is worried that Deepbit won't honor those transactions?

So it seems to me that deepbit is voting, on my behalf, for the current status quo.

Besides, like I said before, if you don't like a pool being successful then lets all start solo mining again.  I would be fine with that.
Sam

Yes, you missed that the debate isn't over weather or not to implement multi-sig transactions, but rather which protocol change is best to implement - and there are several, with support from different developers and pool operators.

And my, consistent, point is why change it at all?  The impetus to make these changes is to make it harder to hijack someones unsecured wallet.  Hasn't that problem been solved with encrypted wallets?
Sam

The impetus is to allow Bitcoin o be used by businesses and corporations, which often require TWO signatures on a check to send money. Currently you would have to assign a single person ALL the powers to spend money. That is a huge security risk for businesses. The "use a phone app to validate your sending coins" is just another bonus.
You also missed the point of P2Pool. It is exactly like a pool, in that you pool your mining power with everyone else, but it's better than a pool in that you pay no fees, you KEEP the transaction fees that pools usually keep, you get to configure your own miner however you wish and vote on whatever changes you want, you run your miner and pool software on your own computer, so don't have to worry about the pool going down for whatever reason, and being completely distributed, P2Pool can not be DDOSed. It's the best choice for capitalism, but is still not well known because it's so new and obscure. The "donations" are there to get people to bother to try it out, since part of a pool's appeal is total hashing rate: the higher the pool hash rate, the lower the variance. P2Pool had a fairly low has rate, thus high variance (there are still days when you won't find a block). Once more people join, the variance will go away, donation incentives won't be needed, and it'll be the superior option.

That can be done in software/devices without modifying the protocol/blockchain.  It is up to the user/organization to implement it if they choose.  The encrypted wallet already provides for additional security, if a user chooses to implement it.

The P2Pool is something I haven't looked into and, as I said, I probably should.  Can't comment on that one way or the other.

I have no axe to grind about any pool.  If I'm going to use a pool it will be one that charges a fee and provides good service and has a business model that provides for longevity.  Being anti-deepbit just because they are successful isn't productive.  But folks are free to choose to do so.
Sam

Yeah, um, I think you WAY overreacted with your "crusade against socialism" here, thinking this discussion had anything to do with socialism. We're (mostly) all free-market capitalists here. Leaving Deepbit is a pro-capitalist decision, and staying with Deebit is comparative to sticking with Kodak film cameras, just because you and others always have.

In this case it is.  Success = Centralization.  Centralization = Bad

There's your mistake, though it is not too late to learn and catch up. mining is profitable again in the USA, assuming you have existing hardware.

but mining is no way by far the only method to obtaining profit when it comes to bitcoins.

Maybe so.

But this thread was started for the purpose of discussing pools having too much veto power over a specific change to the way Bitcoin will work in the future.

My twofold opinion is one that people have the right to mine where they want no matter what others may think.  Or the veto power a large pool may have.  The miners choose to give said pool that power.

And two that we should be cautious of making changes to the bitcoin protocol/blockchain for the sake of increased security.  We don't know what the internet is going to look like in the future so these changes could be detrimental in that unknown future.  It seems to me that the security can be, and is, being enhanced in software (encrypted wallet) devices (smartphones/PDA's/Secure USB sticks) or services such as online bitcoin banks.

Sam

And who will the arbiter that decides what constitutes too much success/centralization?  And what methods should be employed to prevent it?  Are there any lessons in history to draw on?
Sam

>implying those two are mutually exclusive

Which two things?

1. I have no axe to grind about any pool.
2. If I'm going to use a pool it will be one that charges a fee and provides good service and has a business model that provides for longevity
3. But folks are free to choose to do so.

Sam

And trust me, pools get DDOS'd quite often. A couple of months ago a MASSIVE DDOS attack was launched that noticeably brought down the difficulty. At one time Slush's Pool, Deepbit, and several others were offline.

With p2pool this wouldn't happen, as there are no servers to DDOS (also, no fees are nice).

Just by 0.02 BTC

Yeah, that would be great, and there is a way for this already: the p2pool, but how do you "get rid" an aspect of a decentralized currency, a p2p network, that no one entity controls? That is the problem, and why there are discussions and some people shitting bricks over this new change, and why it's not just implemented and provided to everyone as a simple update directly.


Look into it, get the facts. Right now you've just written some cool movie phrases which have nothing to do with the situation. (don't really apply.). (And yeah there are get rich quick schemes, just that not everyone is ever going to find one obvisouly.)


Why do you ask that here? Please search the forums, not so long ago Gavin created an even "dumb it down" thread where he explains this exactly. The issue have been discussed EXTENSIVELY in the past months, why repeat it in this thread also?


To the point of the question:
Is the problem now that people just don't switch to p2pool even though it's already good, or is p2pool still small to provide small enough variance?
If latter is the case, I am proposing a scheme where we would set a date in the future, of "next wave" of p2pool users.
I understand that many don't want to switch to a pool that would mean risking big losses to variane, even if they wanted to help the health of the bitcoin ecosystem. But at the same time, if enough people switched at once, that would not longer be a problem.
So if we set a date, many of the miners would know this in advance, and when the date comes, they would just switch to p2pool, and in just an hour or maybe a day, could see directly, how many people there are out there that really would switch to p2pool.
Now if the variance would be low already, that would be it, people would just stay there. If it would be too high, they could switch back to their regular miners and set a new date for the next wave of switching, and they would know it would be bigger than the first one, because most people in the first wave would of course switch during the second one as well, because they obviously want this, just can't deal with the variance.

This way we could pretty exactly estimate the real amount of people out there that could switch to p2pool, and most of them would just risk a little mining time, instead of going p2pool fulltime and potentially loosing a lot more.