A bitcoin miner in every hand

[alh]

It really is a genius idea, problem is who would actually integrate these chips into their products? Whats the benefit of a fridge maker to add this chip? "Hey buy our fridge it has a bitcoin miner integrated that will save you $1 a month off your electric bill" ....I think not lol.

Now if 21e6 does some deal where half the bitcoin profits go to the company thats a different story....now fridge company has a "free" 1PH farm and 21e6 does also.

Either way I doubt this would fly with consumers...if people find out companies are making a profit off their  electricity there would be an uproar, even at 3 bucks a month.

I don't know about refrigerators, but a device like a Tivo or an Xbox routinely undergo a "teardown" sometime after introduction. Somebody will buy it and crack it open and detail all the chips and such. I wonder what will happen when they try and explain their list of chips and one of them is 21e6? It won't remain a secret in my opinion for long inside a Tivo or Xbox.

Of course maybe Tivo will include an "economy" setting that turns off the Bitcoin mining application.... 

[Biodom]

In my opinion, the only way smartphone bitcoin mining chip will have any chance is if it will be activated (working) only during phone charging.
Many people charge the phone overnight, so at least 1/3 (8/24) of the day X potential number of devices=still a large number.
say, 20w=100GH for 14-16 nm chip
X1mil phonesX8/24 (charging time)=33PH
x10 mil=330PH
etc

With phones numbering in billions, it would be relatively easy to get to these numbers.
A deal with a single major carrier and manufacturer would be enough (they have Qualcomm on board already)

[sidehack]

It really is a genius idea, problem is who would actually integrate these chips into their products? Whats the benefit of a fridge maker to add this chip? "Hey buy our fridge it has a bitcoin miner integrated that will save you $1 a month off your electric bill" ....I think not lol.

Now if 21e6 does some deal where half the bitcoin profits go to the company thats a different story....now fridge company has a "free" 1PH farm and 21e6 does also.

Either way I doubt this would fly with consumers...if people find out companies are making a profit off their  electricity there would be an uproar, even at 3 bucks a month.

I don't know about refrigerators, but a device like a Tivo or an Xbox routinely undergo a "teardown" sometime after introduction. Somebody will buy it and crack it open and detail all the chips and such. I wonder what will happen when they try and explain their list of chips and one of them is 21e6? It won't remain a secret in my opinion for long inside a Tivo or Xbox.

Of course maybe Tivo will include an "economy" setting that turns off the Bitcoin mining application.... 

Unless they integrate hash cores into the processors already built into the things.

Several people will make issue, but how many of the Wal-Mart electronics consumers actually care to do market research on the crap they buy? How many folks will just buy what's cheap and meets their needs (wants, more likely) without caring about the underlying technology or why they're being exploited? Probably "almost everyone", even if it's almost nobody represented on these forums.

[OgNasty]

It really is a genius idea, problem is who would actually integrate these chips into their products? Whats the benefit of a fridge maker to add this chip? "Hey buy our fridge it has a bitcoin miner integrated that will save you $1 a month off your electric bill" ....I think not lol.

Now if 21e6 does some deal where half the bitcoin profits go to the company thats a different story....now fridge company has a "free" 1PH farm and 21e6 does also.

Either way I doubt this would fly with consumers...if people find out companies are making a profit off their  electricity there would be an uproar, even at 3 bucks a month.

I don't know about refrigerators, but a device like a Tivo or an Xbox routinely undergo a "teardown" sometime after introduction. Somebody will buy it and crack it open and detail all the chips and such. I wonder what will happen when they try and explain their list of chips and one of them is 21e6? It won't remain a secret in my opinion for long inside a Tivo or Xbox.

Of course maybe Tivo will include an "economy" setting that turns off the Bitcoin mining application.... 

Unless they integrate hash cores into the processors already built into the things.

Several people will make issue, but how many of the Wal-Mart electronics consumers actually care to do market research on the crap they buy? How many folks will just buy what's cheap and meets their needs (wants, more likely) without caring about the underlying technology or why they're being exploited? Probably "almost everyone", even if it's almost nobody represented on these forums.

People still buy incandescent lighting for an example of how little the average person cares to think about electricity costs when considering their purchases. 

[alh]

Unless they integrate hash cores into the processors already built into the things.

Several people will make issue, but how many of the Wal-Mart electronics consumers actually care to do market research on the crap they buy? How many folks will just buy what's cheap and meets their needs (wants, more likely) without caring about the underlying technology or why they're being exploited? Probably "almost everyone", even if it's almost nobody represented on these forums.

Interesting idea. While I wouldn't be surprised to see an Xbox specific ASIC which could have hash cores added, what about the Tivo? I would expect by now that virtually everything inside a Tivo is now a commodity item, no? What would a Tivo have that requires an ASIC? I would think that a Tivo is all about the software, and it's integration with an upstream host for schedules and stuff. Is there really any obvious place to "hide" Bitcoin hashing cores within a Tivo?

I also then wonder what it would cost 21e6 to get Tivo to integrate their "Bitcoin mining technology"? Tivo would have zero incentive otherwise I would think. This feels a bit like the hardware equivalent of the crapware/bloatware that gets included on every new Dell/HP/Acer computer you buy these days.

[aurel57]

I think this would work on space heaters. Need to pack at least three S1 boards in a unit with a wifi. Give the space heater to people free and make it so they have to sign up to unlock the unit and get paid a monthly credit back the more they use it. If you had 3 boards in it then you could have a low, med or high heat by running 1,2 or 3 of the boards.

Then what about a whole home heating system made out of asics?

[RoadStress]

Then what about a whole home heating system made out of asics?

Too complicated for a result that isn't that impressive.

Edit:



Taken from http://imgur.com/a/q9cbL

[sidehack]

Zero OpEx because it's all shifted to the consumer, who is seeing at best a fraction of the revenue and footing all of the cost. Count me out, pretty much forever, on any mining device I can't configure the pool for and any mining device which I can't turn off.

[Bicknellski]

Zero OpEx because it's all shifted to the consumer, who is seeing at best a fraction of the revenue and footing all of the cost. Count me out, pretty much forever, on any mining device I can't configure the pool for and any mining device which I can't turn off.

Versus receiving... zero now?

[notlist3d]

Then what about a whole home heating system made out of asics?

Too complicated for a result that isn't that impressive.

Edit:



Taken from http://imgur.com/a/q9cbL

I'm suprised they picked a usb charging plug.  I really want to see some ROI math on their equipment.

I'm not expecting ROI on any of those but I could be wrong.

[RoadStress]

I'm suprised they picked a usb charging plug.  I really want to see some ROI math on their equipment.

I'm not expecting ROI on any of those but I could be wrong.

It's the best device after a router. The cell phone thing will be done in Phase 3 so no need to worry about that for now.

Why are you expecting ROI? This is not about ROI. It's about decentralization. Unless I get it wrong. It would cost 35$ extra to get the device? If yes then it's not worth it. But the extra 8$ for a router will be worth it. If that's their expense and nothing for the consumer then it's damn good!

[dogie]

I'm suprised they picked a usb charging plug.  I really want to see some ROI math on their equipment.

I'm not expecting ROI on any of those but I could be wrong.

It's the best device after a router. The cell phone thing will be done in Phase 3 so no need to worry about that for now.

Why are you expecting ROI? This is not about ROI. It's about decentralization. Unless I get it wrong. It would cost 35$ extra to get the device? If yes then it's not worth it. But the extra 8$ for a router will be worth it. If that's their expense and nothing for the consumer then it's damn good!

If your chips are not revolutionary performers, how does this lead to decentralisation? Those chips spread across 100,000s of devices in the best case still have to compete against the rest of the network running concentrated data centres of the same chips which were deployed for less and have lower electricity costs. Those centralised data centres are going to be able to run harder, longer and more numerously to those devices. And think about it, if you manage to get this into 100,000 products with a 50GH chip, even that is just 5PH. 5. Bitfury has been building ~20PH facilities from scratch for years. So in the best case these decentralised devices (assuming 100% up time) can compete with 1/4 of a single Bitfury facility, or 1.5% of current network capacity.

While its a noble effort, I'm not sure its a shrewd business decision. That said, maybe they have totally different numbers which paint a different story.


Edit:

But the extra 8$ for a router will be worth it. If that's their expense and nothing for the consumer then it's damn good!

The consumer still has to pay for the electricity to mine, and only gets a portion of the revenue in return. IIRC it was suggested 25% to the consumer, 75% to them and locked at the chip level. So, mining would be 4x more difficult to operate at 'break even'. That would lead to non critical devices (USB chargers etc) simply being unplugged when not being used.

[sidehack]

For any smart consumer, it would lead to devices not specifically designed to turn electricity into heat for some productive purpose being turned off, or the hashing functions disabled when additional heat is not something you specifically want. Decentralization is great, but a million people spending out of pocket monthly to help "maintain the network" while funneling the resources generated by their efforts into the coffers of a multimillion-dollar corporation is silly. Asking someone else to pay the electric bill on your money-printing press (that prints less money than it costs to run, if not now then within a year or so) and then generously offering to pay you one fourth of the money you printed for them really can't be painted as a good deal to anyone except them and the electric company. I just don't see the numbers in it, especially if the block rewards are hardware-locked to the chip maker. Sure it gets visibility for bitcoin, but all your PR is centered around tricking people into giving you more money - which, to be honest, is actually pretty standard.

[dogie]

... but all your PR is centered around tricking people into giving you more money - which, to be honest, is actually pretty standard.

Aaaand we're back at square 1 . I don't think we'll ever achieve decentralisation, its fundamentally incompatible with economics unless someone is philanthropically burning $10Ms for the benefit of others.

[sidehack]

Or not burning $10M for the benefit of himself - just, not spending it at all. Decentralization is easy, but it depends on wealthy entities not buying up the entire market. Which is fundamentally incompatible with human greed. It doesn't require anyone to be particularly generous, just for rich people to not be particularly greedy - very likely negating the attitude which made them rich in the first place.

Someone actually prioritizing decentralization over maximized profits could do pretty much the same thing 21e6 is working toward without claiming all the block rewards, and being honest about educating consumers about the true costs of the things they're buying. Same argument behind selling mining hardware fresh off the line instead of self-mining during the prime months and reselling it when it's running breakeven. It's all a matter of what you think is important - support the network, or raid the network. You can't do both.

[Biodom]

My take is this:
There seems to be two models:
1. KnC, Bitfury, Bitmain (later one, probably, although they still sell for now), Spondoolies (later one as well)-deploy large centers, don't sell miners to anyone anymore, either keep bitcoin or sell it into the market, suppressing price.
2. 21 co. You are the product (similar to facebook, google, etc).  Charging iphone 6 costs $0.5/year. Even if this doubles or even quadruples, most people would not care if they get some gimmick like a ringtone. If fact, most people already using their phone for something they did not intend, unless they go in deeper in the settings and turn off various data collecting and ads presenting options. In fact, phone typically lasts 1.5-2 times longer with these battery-draining programs switched off. Nobody really complains about it, other than battery drain.
21co can sell the chip to many manufacturers, further diversifying the network.


As long as 21 co sticks with bitcoin and not make it a blockchain on 21coin, and, hopefully, makes an option for a pool choice, i would be fine with this scenario much more than I would be with scenario #1.
Unfortunately, if there is no massively produced retail miner (Spond dropped out, etc.), I see no other choices, except for a few dedicated enthusiasts, which is also great, but won't work on a massive scale.

[RoadStress]

If your chips are not revolutionary performers, how does this lead to decentralisation? Those chips spread across 100,000s of devices in the best case still have to compete against the rest of the network running concentrated data centres of the same chips which were deployed for less and have lower electricity costs. Those centralised data centres are going to be able to run harder, longer and more numerously to those devices. And think about it, if you manage to get this into 100,000 products with a 50GH chip, even that is just 5PH. 5. Bitfury has been building ~20PH facilities from scratch for years. So in the best case these decentralised devices (assuming 100% up time) can compete with 1/4 of a single Bitfury facility, or 1.5% of current network capacity.

While its a noble effort, I'm not sure its a shrewd business decision. That said, maybe they have totally different numbers which paint a different story.

If the chips are not revolutionary performers then this will not happen. End of story.

But let's not focus on that. If I know that revolutionary performers will come sooner or later I think we can move on from this subject and discuss how will we manage the fact that 21 inc will suck all the newly created coins.

Edit:

But the extra 8$ for a router will be worth it. If that's their expense and nothing for the consumer then it's damn good!

The consumer still has to pay for the electricity to mine, and only gets a portion of the revenue in return. IIRC it was suggested 25% to the consumer, 75% to them and locked at the chip level. So, mining would be 4x more difficult to operate at 'break even'. That would lead to non critical devices (USB chargers etc) simply being unplugged when not being used.

Not this topic again. A 10W increase in power consumption (which I find it huge for small devices) means ~1$/month. NOBODY cares about that. This is a pointless subject.

My take is this:
There seems to be two models:
...

If they can get routers that will consume a maximum of 10W per household for bitcoin mining then it's over for number 1.

[sidehack]

Unless they make open pool choices, they become number 1. If they don't make open pool choices, they then have to convince everyone to spend that extra $8 initial and $1 per month in exchange for almost exactly nothing in return.

[dogie]

Unless they make open pool choices, they become number 1. If they don't make open pool choices, they then have to convince everyone to spend that extra $8 initial and $1 per month in exchange for almost exactly nothing in return.

$1 a month might not sound like much, but put another way, who would "subscribe to the bitcoin network" for $12 a year? That doesn't sound like something that can be sold en-mass.

[jtoomim]

The cell phone mining idea is total nonsense. If they had a 10 GH/s mining chip that ran at 0.25 J/GH, that would be 2.5 watts, enough to drain an iPhone 6 battery (11 Wh) by itself in 4.25 hours. During this time, it would make about 0.00002 BTC, worth about $0.005. In order to not be ludicrous, the mining chips will need to be restricted to devices that are normally plugged in and connected to the internet, like wifi routers.

In their slides they suggest using a "/dev/bitcoin" as a micropayments method. If they sold 1 million of these devices, and each owner made one micropayment per hour (i.e. visited one webpage), that would be 278 transactions per second, or enough to fill up 40 MiB blocks. Given that the current block limit is 1 MiB, I'd say there's an obstacle in their way. Using satoshis as auth tokens would make this even worse.

A 10 GH/s miner currently generates around 00010300 satoshis per day. If a person was using their "/dev/bitcoin" once a day, and if 21 Inc received 0% of their mining revenue, they would be able to make one transaction per day. At that transaction rate, the 0.1 mBTC transaction fee would end up costing 97% of their total daily revenue. Even if you received your money once a day but only spent it once a month, you would still end up spending a high proportion in transaction fees. Since your transaction would have a large number of inputs, it will end up being several kiB in size, and will have a correspondingly large required fee. Using micropayment channels helps this problem, but if you use that, then you're no longer getting freshly mined satoshis, and you might as well not be mining at all. If you use a system like Eligius, where the pool's debt to you is paid through the coinbase transaction once every few days (or maybe weeks?), it might sorta work a little.

Embedding a miner in every device would increase centralization, since there's no way those devices would be useful without mining into 21's specially configured pool. Moreover, this pool would need a large datacenter backing it in order to get acceptably low variance.