Bitcoin Forum

i've always thought ghash was a great pool and still is.  the strangest thing about this whole situation is the contradiction between their previous interview (against 51%) and then of course their actions that followed. making me think it was simply some corruption happening deep within management. i probably dont have enough evidence {hence why its a theory} but the biggest clue is the btc price. when they passed 50% there was a large drop and then it seemed there was a very large amount of bidding and bullish movement right before they pulled a portion of their hash power out of the pool. if this was simple price manipulation it was a great move but you would think it would damage their business more than anything, which is why i think it was out of the interest of a single or small handful of individuals with ulterior motives and of course going against what the public wanted them to do (keeping the network decentralized). in the end i applaud ghash because it could possibly give the dev team a reality check while its still early in the game. keeps them on their feet.  thoughts?

I tend to think that yes, this was a price manipulation.  If so it's a great time to get in.

-bm

Just how "deep in management" you think 2 or 3 people go?  I doubt this is a Fortune 100 company. 

maybe ghash is buying while there is the 51% issue and prices are low then scale back hash rate after
its possible

"Insider trading" in bitcoin is a bit of a oxymoron...

pay back the 1 Million NXT you stole from the NXT community.

https://nxtforum.org/nxtventures/nxtautodac-all-of-bluemeanie%27s-automated-profit-making-blockchain-companies/60/

These are just wild rumors. You should remember that GHash had immediately issued a press release stating that they have no intention to launch a 51% attack, when the news first surfaced.

People buying coins when the price drops seems normal to me; doesn't mean its a conspiracy.

Though it could be.

Looks like we have a new whipping boy. Complete with a mysterious secret plan.   ::)

ghash really does not have any way to manage their hashrate over the short term.

If they had 48% one day and 51% the next their actual hashrate could have potentially gone down but had slightly better luck compared to the rest of the network. To say that their actions caused them to get 51% would really not be accurate.

They could do what BTC Guild did. No?

26% of the hash rate is unknown and 32% is Ghash.IO. Their hash rate dropped the exact percentage that unknown increased. I'm sure happy that one evil actor doesn't have control of most of the mining power. I feel much better now.

https://blockchain.info/pools

Your link does not exactly let you look at historical data.

The increase in "unknown" miners could be simply large operations moving to solo mining: even if they only find a block every few days.

I agree it is unlikely Ghash.io actually sold any hash-power.

I'm glad you put that last sentence in.

They have said, "Successful and innovative companies cannot be expected to limit their growth or competitiveness as a direct result of their success".

That sounds like a resounding "fuck you, we're winning, deal with it" to me.

Is the move away from GHash.io to unknown (solo) really surprising, is it a big deal?

The thing is, there is no incentive for miners to move away from GHash.io and it is a systemic problem. But if GHash.io didn't play fair and starting being evil, I bet they would instantly lose much of their hashrate, since most of it is external (i.e. not cloud mining)

Oh, this is just a coincidence.

Carry on and sleep well knowing our benevolent masters at Ghash.io have taken 20% of their hashing power off the racks and are letting them collect dust. Because we all know how trustworthy and rational they are. Right?

Simply concentrating the hash-power is evil:
How A Mining Monopoly Can Attack Bitcoin (http://hackingdistributed.com/2014/06/16/how-a-mining-monopoly-can-attack-bitcoin/)

Really? Control of the mining power is no big deal, eh. What exactly would the consequences be of a hard fork to Bitcoin? How much faith would be lost in Bitcoin and its dev team? Would it maintain its top spot in crypto money land? GHash has already used its hashing power to attack a gambling site that accepted 0-confirm transactions. LukeJr, that piece of Jesus freak crap, has already used the Eligius pool to attack CoiledCoin. This problem needs to be solved once and for all so that no pool operator has the power to do anything to Bitcoin.

GH has repeatedly double spent to steal from gambling sites, they deserve to be shutdown.  I don't believe their excuses that its random employees using their addresses to steal.

For sure it could be price manipulation, but I think that anytime a company actively does something against teh Bitcoin community, it could be argued that it is price manipulation, IMO.

Price manipulation? I doubt it. BTC's value went down, IMO, because this is a serious problem that is being ignored. Now folks are losing faith, including Peter Todd :( (And I don't mean faith in BTC's valuation, I mean faith in the project itself).

It would be nice to "rest easy" knowing that this was price manipulation and not indicative of Bitcoin's health. But I don't believe that's the case.

I can see a parallel between Too Big To Fail (Goldman Sachs, JPMorgan etc) and the problem of pool centralization.

But let's be honest: GHash.io is as unlikely to kill BTC as Goldman Sachs is unlikely to kill money in the US. Doesn't mean they can't manipulate things if they wanted to, but it doesn't mean they can get totally away with it either.

Isn't it quite likely that big miners have intentionally pulled their capacity away from GHash and are now appearing as 'unknown'?

I know that if I had mining resources in a pool that was close to 51%, I would think about moving them to protect the network (as long as I didn't lose too much by doing so).

wont be surprising that most of unknown are ghash

Bitfury pulled a large portion of their mining capacity. They said they were going to redirect to other pools, however they likely started to solo-mine.

1.) Who the fuck is Peter Todd?

2.) New folks tend to buy CEX.IO shares or mine directly at Ghash because that's the biggest.

Human stupidity...

I absolutely agree with the OP. I was thinking of posting the same thing myself.

Ghash reaches 51%, price of bitcoin crashes.
Ghash suddenly drops to around 30%.
Price of bitcoin goes back up.
Now Ghash is getting closer to 51% again.
Watch btc price crash again.

Someone is manipulating the btc price to keep it in the 500s.

btc should be around $1000 by now with all the good acceptance it's had lately: Apple, Google, Yahoo, Expedia, etc., etc.... Even the Feds have given it recognition as something they can auction off.

Welcome to free market ;)

+100

One thing that I don't understand is how people buying Cex.io shares effects Ghash's total hashing power.

The way I'm thinking of it is that this is hashing power that's already 'working' as it were and people are just buying the rights to mining that's already being done anyway. Is this not correct?

I guess when they get more revenue, they buy more hardware.

That would make sense. But the hashing power that they do not sell I am sure they use to hash for themselves. They wouldn't turn it off until someone buys it.

Yeah, that's a good point.

By buying shares on Cex.io you're indirectly contributing to their hashrate in a delayed fashion.

I also find it strange that one of the bitcoin developers announced selling a huge stash of their bitcoins over this whole 51% fear.  I can understand why one would do that, but why announce it?  Sounds like a joined effort to spread FUD..

They would keep their unsold GH/s running as long as they produce more revenue then electric costs.

This is an excellent point!!

He said he consulted a lawyer and was advised to announce it to prevent any possible liabilities. I'm buying that, it sounds reasonable to me.

Heh, I could see a lawyer saying something like that. But in reality there's no way you could be held liable for something like that. It's like being required to say I'm going to be selling half my gold because I work at a goldsmith's shop.

either way, I can't think of anything that rips away confidence in Bitcoin more than its own developers starting to split.    the good news is, next estimated difficulty change is 20%, and theres no way most of that is coming from Ghash.  we need large difficulty changes now to diversify the network.. so keep it comin'

Understand two things:

First: He is raising awareness of a very big problem with Bitcoin. The problem has always been there and we've always known it. LukeJr killed an altcoin (CoiledCoin) using a mining attack just because he could do it so we know it works. I appreciate a warning coming from a respected developer because it carries more weight and people will listen.

Second: As difficulty rises your ability to make money drops. Difficulty will keep increasing. Can it go down? Yes, but take a look at this chart to see how likely that is: https://docs.google.com/spreadsheet/lv?key=0AiFMBvXvL2dtdEZkR2J4eU5rS3B4ei1iUmJxSWNlQ0E

As difficulty increases and the reward drops small time miners will need to go to a pool that has the lowest fees to make a profit over their mining costs. This will allow anyone to take over the network that is willing to charge nothing. You might say, a government wouldn't need to run a pool for free when they could just buy the equipment and destroy the network. Yes, but why would they buy the equipment when they can just use your equipment for a lower cost? Difficulty changes, as you say, will not diversify the network. They will have the reverse effect and concentrate the network toward anyone willing to run a pool and charge nothing.

It didn't really react the last times. Ghash also never approached 50% of the hash rate, but 50% of block rewards over a timeframe of 24 hours, which is a huge difference. Ghash's share of hashing power never significantly exceeded 40%.

This would only hold to be true if the new miners being brought online are not going to ghash, or are going to ghash at a lower rate then their current network share.