Bitmain and the ASICBoost allegations

[Lauda]

This video definitely needs to be watched by anyone interested/concerned with this subject: https://www.youtube.com/watch?v=t6jJDD2Aj8k
If the current profit margins are 1% and you covertly save 20% energy by using this patented exploit, you are looking at 19-20 times more profit than the competition. The lower the current profit margin, the higher your advantage is (percentage wise).

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[BitcoinPanther]

As I watched the video this is what captures my attention

They claim they've only used them on the testnet but not the mainnet, 'for the good of the network.' However, if they didn't use it and won't use it, then they shouldn't mind if we disable it in a counter-optimisation.

It is logical that Bitmain should not resist if Bitcoin developer counter or lay asicboost useless since they claim that they don't have any intention on using it on the main net.  But, with the argument over this, it seems they are lying about it.   I now doubt that they are in for the good of the network, rather they want to monopolize the mining industry thus with the patent of the so called chip under their company.  Worst, as said this will derail development because issues are keep on occurring one after another.

[cellard]

This video definitely needs to be watched by anyone interested/concerned with this subject: https://www.youtube.com/watch?v=t6jJDD2Aj8k
If the current profit margins are 1% and you covertly save 20% energy by using this patented exploit, you are looking at 19-20 times more profit than the competition. The lower the current profit margin, the higher your advantage is (percentage wise).

What can we possibly do tho? It looks like Jihan Wu has checkmated the whole PoW game. If anyone noticed this earlier, it would have been easier to change. Now as far as I know, it would take segwit to invalidate this advantage, which means, we'll never get the 95% needed since it goes against Jihan's interest.

This puts us in a compromised situation where UASF seem to be the only way out, which means network split unless we can get everyone on board...

[FiendCoin]

This video definitely needs to be watched by anyone interested/concerned with this subject: https://www.youtube.com/watch?v=t6jJDD2Aj8k
If the current profit margins are 1% and you covertly save 20% energy by using this patented exploit, you are looking at 19-20 times more profit than the competition. The lower the current profit margin, the higher your advantage is (percentage wise).

I watched it earlier. It should be eye-opening for people who don't know. Lets see how long before the shills come to defend Emperor Wu.

[Yakamoto]

This video definitely needs to be watched by anyone interested/concerned with this subject: https://www.youtube.com/watch?v=t6jJDD2Aj8k
If the current profit margins are 1% and you covertly save 20% energy by using this patented exploit, you are looking at 19-20 times more profit than the competition. The lower the current profit margin, the higher your advantage is (percentage wise).

This is something I honestly didn't want to think of as being possible, but I guess someone managed to do it and now it's a fact of life we now have to deal with. That's an absolutely insane advantage that is being provided to a ""very select few"" individuals and I can now see why Jihan's name is a lot more common than I would expect any miner to be.

It's nuts thinking that this allows for nearly a 20% undercut on the competition, or, like you said, a 20x increase in profit.

[Kakmakr]

Asic's acctually killed the entrepreneurial spirit of Bitcoin mining for me and industrialized it. The proprietary patented technology has lead to strong monopolies and mining giants. These giants have misused their advantageous position in many ways to be the top dog. < Shipping delays, Selling outdated technology and now exploiting ASICBoost >

What is holding back other technological countries to compete head to head with these giants? Silicon Valley?

[HCP]

What is holding back other technological countries to compete head to head with these giants? Silicon Valley?

From a technological standpoint... nothing is preventing other countries from competing...

Economically however, have you seen the costs involved in manufacturing in "First World" countries? There is a reason the majority of items you'll find in a lot of stores are all marked "Made in China" (or some other SE Asian country)...

And then there is the enormous costs involved with the production and supply of electricity... If other countries had similar manufacturing and electrical supply costs to China, you can be damn sure that there would be massive mining operations in those countries as well...

[Kakmakr]

Asic's acctually killed the entrepreneurial spirit of Bitcoin mining for me and industrialized it.

Yes, and that was being built in from the start, if you read Satoshi's early messages.  Bitcoin mining in a P2P network was only to bootstrap the system (with "useful idiots" I would say), but afterwards the idea was that one would go to a centralized mining farm network backbone, with users only having light clients connecting directly to miner nodes, not even downloading the block chain.  That, at least, was bitcoin's initial vision.  

This is why it is ridiculous to be shocked by a 20% gain in efficiency using a smarter calculation, and not be shocked by the introduction of ASICS.

No matter what the initial goal was, it made way for a proprietary technology that had patented "secrets" that could be used to have a competitive edge over their competitors. The debate on "If this was done" is irrelevant, because the mere existence of this and the difficulty to prove it's use was above the skill and knowledge level of the people that used this technology and these are the people who already has to compete with China with their cheap electricity.

If this happened in Western countries, we would have seen anti-trust lawsuits being instituted against these companies and I know China has anti-monopoly laws, but we will not see any of these laws being applied in this scenario.  

[Amph]

how is saving 20% energy equal to have 20x more revenue, doesn't make sense to me, also wasn't asicboost just 20% more hashrate and not about efficiency?

now you have that you need 5-6 asic to generate the same income as before, while consuming 5 times more, if you consume 1/5 less, you are only generating 20%+ more

doing an easy math you have that right now all the asic(nethash) consume 1% of what they earn per day(18,7k in consumption against almost 2M in earning), 20% of 1% is 1/5 of 18.7K, which is only equal on saving 3,3 bitcoin...

edit missed a zero

[Lauda]

how is saving 20% energy equal to have 20x more revenue,

Watch the video before responding. It's simple math really.

also wasn't asicboost just 20% more hashrate and not about efficiency?

No.
You spend 990 000$ in electricity and make 1 000 000$ which is a 1% profit margin. If you have 20% more energy efficiency, that means that you spend 990 000 - 20% = ~$800k for energy for the same amount of revenue. Which in result means 19-20x higher profit.

[cellard]

This video definitely needs to be watched by anyone interested/concerned with this subject: https://www.youtube.com/watch?v=t6jJDD2Aj8k
If the current profit margins are 1% and you covertly save 20% energy by using this patented exploit, you are looking at 19-20 times more profit than the competition. The lower the current profit margin, the higher your advantage is (percentage wise).

What can we possibly do tho? It looks like Jihan Wu has checkmated the whole PoW game. If anyone noticed this earlier, it would have been easier to change. Now as far as I know, it would take segwit to invalidate this advantage, which means, we'll never get the 95% needed since it goes against Jihan's interest.

This puts us in a compromised situation where UASF seem to be the only way out, which means network split unless we can get everyone on board...

Everyone seems to be ignoring this. I'll ask it again: How do you pretend to stop ASICBOOST without UASF?

There will never bee an agreement to enable segwit with 95% miner approval. Which leads us to UASF. And UASF, leads us to a big problem, because we can see a potential network split, crashing the price. Is this crisis worth it to shake Jihan off?

Anything is better than BUcoin in my book, so maybe it's a penitence we need to pass. But we need to be sure to have everyone supporting Core's chain.

[Lauda]

Everyone seems to be ignoring this. I'll ask it again: How do you pretend to stop ASICBOOST without UASF?

SegWit doesn't stop ASICBOOST. What SegWit does is that it prevents you from covertly using it. Therefore, if you attempt to use it after SegWit has been activated we will know for sure. I'm sure that there will be BIPs to prevent any usage of it.

There will never bee an agreement to enable segwit with 95% miner approval. Which leads us to UASF. And UASF, leads us to a big problem, because we can see a potential network split, crashing the price. Is this crisis worth it to shake Jihan off?

Doing nothing and letting BU propaganda attack the network would also lead to a potential network split. A UASF can, but does not have to lead to a split. In any case, development wise, the original Bitcoin chain with it's reference implementation being Bitcoin Core would prevail very quickly. Just compare the development ATM (BU is still based on Core 0.12.x).
FYI, it looks like Vertcoin will be a testbed for UASF as some 'attackers' have joined in to deliberately block Segwit from activating: https://vertcoin.org/wp/mandatory-upgrade-uasf-for-segwit-starting-on-31st-may-2017-000000-gmt/