What I think Bitcoin's MAIN problem is, and how to fix it

[jaywaka2713]

If you would like to make more people to have bitcoin, you can design a new method by using CPU only. and you can set the distribution method by sorting the whole hashing power and giving the people in different segmentation the same reward, which means, for example, to the top 5%  people they will enjoy the same reward.

I know bitcoin depends on finding the solution, but imagine the whole world is a mining pool. I am not a technical guy but I think this may solve the arms race problem in bitcoin now and involve more people.

Build a PPLNS mining system into people's wallets might be the solution to your proposition.

[notme]

i think bitcoins main problem is too many people talking about and not enough spending it.

personally I just transfer my money into BTC and buy with that for most things I would have bought online anyway. I'm going to buy them anyway might as well do it with btc. This has the double impact of helping growth the BTC economy and also my BTC balance since most of the time I have to transfer in a little bit more than I need to make sure and cover transaction costs etc. I'll take the hit on transaction costs in exchange for adding to my balance and doing my small part to help BTC grow.

That's a good approach.  In some cases, it may even save you money to do this.  I've been eying buying a 16 GB RAM chip (my motherboard only has slots for two RAM chips), and the price of a 16 GB RAM chip on bitcoinstore.com is actually $40 cheaper than on Amazon.com.

Bitcoinstore has fantastic prices if you can find what you are looking for.

[notme]

If you would like to make more people to have bitcoin, you can design a new method by using CPU only. and you can set the distribution method by sorting the whole hashing power and giving the people in different segmentation the same reward, which means, for example, to the top 5%  people they will enjoy the same reward.

I know bitcoin depends on finding the solution, but imagine the whole world is a mining pool. I am not a technical guy but I think this may solve the arms race problem in bitcoin now and involve more people.

Build a PPLNS mining system into people's wallets might be the solution to your proposition.

Right.  The mining pool infrastructure is already built out and p2pool is also available for those who want to mine on their own node.  Reenabling CPU mining in the client would be fairly simple.  The problem is that it will take you 100 watts-hours to compute the same hashes as what a ASIC miner can compute in 1/100th of a watt-hour.

[anaikh]

If you would like to make more people to have bitcoin, you can design a new method by using CPU only. and you can set the distribution method by sorting the whole hashing power and giving the people in different segmentation the same reward, which means, for example, to the top 5%  people they will enjoy the same reward.

I know bitcoin depends on finding the solution, but imagine the whole world is a mining pool. I am not a technical guy but I think this may solve the arms race problem in bitcoin now and involve more people.

Build a PPLNS mining system into people's wallets might be the solution to your proposition.

Right.  The mining pool infrastructure is already built out and p2pool is also available for those who want to mine on their own node.  Reenabling CPU mining in the client would be fairly simple.  The problem is that it will take you 100 watts-hours to compute the same hashes as what a ASIC miner can compute in 1/100th of a watt-hour.

Yes. That's why I hope there would be a algorithms that only allows CPU to compute. Nowadays, Video card is worthless in bitcoin mining.
BTW, IT seems that LTC has solved ASIC problems.

[notme]

If you would like to make more people to have bitcoin, you can design a new method by using CPU only. and you can set the distribution method by sorting the whole hashing power and giving the people in different segmentation the same reward, which means, for example, to the top 5%  people they will enjoy the same reward.

I know bitcoin depends on finding the solution, but imagine the whole world is a mining pool. I am not a technical guy but I think this may solve the arms race problem in bitcoin now and involve more people.

Build a PPLNS mining system into people's wallets might be the solution to your proposition.

Right.  The mining pool infrastructure is already built out and p2pool is also available for those who want to mine on their own node.  Reenabling CPU mining in the client would be fairly simple.  The problem is that it will take you 100 watts-hours to compute the same hashes as what a ASIC miner can compute in 1/100th of a watt-hour.

Yes. That's why I hope there would be a algorithms that only allows CPU to compute. Nowadays, Video card is worthless in bitcoin mining.
BTW, IT seems that LTC has solved ASIC problems.

LTC is a different algorithm that requires a more robust memory system.  GPUs still blow away CPUs for LTC.  ASICs can be made for LTC, although they will be slightly more complicated.

Regardless, I don't see ASICs as a problem.  Within 5 years you will be able to get a 1 TH/s USB stick that is also a hardware wallet for $5.

[anaikh]

If you would like to make more people to have bitcoin, you can design a new method by using CPU only. and you can set the distribution method by sorting the whole hashing power and giving the people in different segmentation the same reward, which means, for example, to the top 5%  people they will enjoy the same reward.

I know bitcoin depends on finding the solution, but imagine the whole world is a mining pool. I am not a technical guy but I think this may solve the arms race problem in bitcoin now and involve more people.

Build a PPLNS mining system into people's wallets might be the solution to your proposition.

Right.  The mining pool infrastructure is already built out and p2pool is also available for those who want to mine on their own node.  Reenabling CPU mining in the client would be fairly simple.  The problem is that it will take you 100 watts-hours to compute the same hashes as what a ASIC miner can compute in 1/100th of a watt-hour.

Yes. That's why I hope there would be a algorithms that only allows CPU to compute. Nowadays, Video card is worthless in bitcoin mining.
BTW, IT seems that LTC has solved ASIC problems.

LTC is a different algorithm that requires a more robust memory system.  GPUs still blow away CPUs for LTC.  ASICs can be made for LTC, although they will be slightly more complicated.

Regardless, I don't see ASICs as a problem.  Within 5 years you will be able to get a 1 TH/s USB stick that is also a hardware wallet for $5.

I don't agree. I think ASICs are a big problem. It raises the entrance level much too high. If someone wants to try BTC, they can only get it by buying with fiat money. But as LR is shutdown, Mt account is locked, it is not so easy to transfer fiat money into BTCs. What's more, ASICs are designed only for mining and are worthless in other areas. More and more powerful ASICs are joining the battle everyday, making it an arms race.

[notme]

I don't agree. I think ASICs are a big problem. It raises the entrance level much too high. If someone wants to try BTC, they can only get it by buying with fiat money. But as LR is shutdown, Mt account is locked, it is not so easy to transfer fiat money into BTCs. What's more, ASICs are designed only for mining and are worthless in other areas. More and more powerful ASICs are joining the battle everyday, making it an arms race.

I must have imagined those times I earned bitcoin for my labor.

If you don't have a skill that can be done over the internet, perhaps you could offer goods for sale.  Reliance on fiat is an assumption you are making that doesn't hold if you get a little creative.

You are right there is an arms race at the moment, but within 2 years bitcoin ASICs will catch up to the top of the line transistor sizes and after that we will have the steady 18 month doubling that is seen in CPUs and GPUs.  At this point, ASIC hardware prices will fall through the floor and mining will once again have a very low barrier to entry.  In the mean time, a small portion of people taking the risk of buying now will come out ahead.  The rest will be lucky to break even and many will take a loss.  Once the technology stabilizes, most of the risk will be gone and anybody who want to will able to earn a very small margin.

[anaikh]

I don't agree. I think ASICs are a big problem. It raises the entrance level much too high. If someone wants to try BTC, they can only get it by buying with fiat money. But as LR is shutdown, Mt account is locked, it is not so easy to transfer fiat money into BTCs. What's more, ASICs are designed only for mining and are worthless in other areas. More and more powerful ASICs are joining the battle everyday, making it an arms race.

I must have imagined those times I earned bitcoin for my labor.

If you don't have a skill that can be done over the internet, perhaps you could offer goods for sale.  Reliance on fiat is an assumption you are making that doesn't hold if you get a little creative.

You are right there is an arms race at the moment, but within 2 years bitcoin ASICs will catch up to the top of the line transistor sizes and after that we will have the steady 18 month doubling that is seen in CPUs and GPUs.  At this point, ASIC hardware prices will fall through the floor and mining will once again have a very low barrier to entry.  In the mean time, a small portion of people taking the risk of buying now will come out ahead.  The rest will be lucky to break even and many will take a loss.  Once the technology stabilizes, most of the risk will be gone and anybody who want to will able to earn a very small margin.

Well, I do not see an end of the arms race. And, I do not think ordinary people will buy ASIC machines to convert cash into BTC. It is hard for them to accept BTC, let alone buying the ASIC. Buying an ASIC is always an investment for professionals / geeks as ASIC is expensive and can only be used in mining. ASIC hardware prices may fall to the ground, but those kinds of ASIC will not be break-even. Why? In an arms race, entry level serves as cannon fodder - Only the top ones can be break-even or profitable. You can see the hash rate in BTC now. I wonder how many of ASIC owners can really get their money back.

[notme]

I don't agree. I think ASICs are a big problem. It raises the entrance level much too high. If someone wants to try BTC, they can only get it by buying with fiat money. But as LR is shutdown, Mt account is locked, it is not so easy to transfer fiat money into BTCs. What's more, ASICs are designed only for mining and are worthless in other areas. More and more powerful ASICs are joining the battle everyday, making it an arms race.

I must have imagined those times I earned bitcoin for my labor.

If you don't have a skill that can be done over the internet, perhaps you could offer goods for sale.  Reliance on fiat is an assumption you are making that doesn't hold if you get a little creative.

You are right there is an arms race at the moment, but within 2 years bitcoin ASICs will catch up to the top of the line transistor sizes and after that we will have the steady 18 month doubling that is seen in CPUs and GPUs.  At this point, ASIC hardware prices will fall through the floor and mining will once again have a very low barrier to entry.  In the mean time, a small portion of people taking the risk of buying now will come out ahead.  The rest will be lucky to break even and many will take a loss.  Once the technology stabilizes, most of the risk will be gone and anybody who want to will able to earn a very small margin.

Well, I do not see an end of the arms race.

Then you don't understand the hardware industry.

And, I do not think ordinary people will buy ASIC machines to convert cash into BTC. It is hard for them to accept BTC, let alone buying the ASIC. Buying an ASIC is always an investment for professionals / geeks as ASIC is expensive and can only be used in mining.

Ordinary people are not supposed to mine.  Mining is a professional industry. and as such requires special skills to do efficiently.  Do you refuse to use a credit card because VISA won't let you process transactions yourself?  Well with bitcoin you always have the option, but if you don't have the skills you will be wasting time and money.

ASIC hardware prices may fall to the ground, but those kinds of ASIC will not be break-even. Why? In an arms race, entry level serves as cannon fodder - Only the top ones can be break-even or profitable. You can see the hash rate in BTC now. I wonder how many of ASIC owners can really get their money back.

I agree that many current ASIC investors will lose much of their investment.  I still don't see how any of this is a problem for bitcoin since you can easily acquire bitcoins other ways besides mining.  Over half of the bitcoins have already been mined and eventually miners will only get paid transaction fees.  Pulling bitcoins out of the air isn't the endgame, it's just the only way to get the currency bootstrapped.

[anaikh]

Then you don't understand the hardware industry. ---- Glad to hear your explanation. But please remember, in the design, mining is a zero-sum game. So low-level ASICs have no way out.

Ordinary people are not supposed to mine.  Mining is a professional industry. and as such requires special skills to do efficiently.  Do you refuse to use a credit card because VISA won't let you process transactions yourself?  Well with bitcoin you always have the option, but if you don't have the skills you will be wasting time and money ---- VISA is not a mining agency. It's just a card organization. And you can not process the transactions yourself. VISA is a centralize system but Bitcoin is a peer-to-peer system. They are not the same. My point is it is hard for people to experience the whole Bitcoin process. and it will be harder for people to acquire bitcoin by fiat money as the gov will close the doors.

[jaywaka2713]

Don't get mad at ASICs. Just imagine what is was like for the CPU miners when GPUs started jumping aboard. It's just progression of technology. People who wanted Bitcoin last year had to buy a GPU. People now will have to buy an ASIC. It's no issue.

[bitzox]

it will be harder for people to acquire bitcoin by fiat money as the gov will close the doors.

Wait I dont understand this...How can the government stop me from taking cash out of my ATM and buying bitcoin from someone on the bitcointalk marketplace? or depositing money to my paypall account and buying coins directly from a miner. They can talk all they want about stopping bitcoin but at the end of the day can they stop me from sending money to a friend without saying what for? or spending cash on whatever the hell I want?

[anaikh]

it will be harder for people to acquire bitcoin by fiat money as the gov will close the doors.

Wait I dont understand this...How can the government stop me from taking cash out of my ATM and buying bitcoin from someone on the bitcointalk marketplace? or depositing money to my paypall account and buying coins directly from a miner. They can talk all they want about stopping bitcoin but at the end of the day can they stop me from sending money to a friend without saying what for? or spending cash on whatever the hell I want?

Well, I mean, "Harder", which is a comparison between different scenarios. Liberty Reserve is closed. MT.GOX account is frozen. Small online exchange places may be forced to close. This is "harder". Bitcoin's success is you can never stop a p2p network.

When you do business without a exchange center, you have to pay more effort to get a reasonable price.

IF ASIC can be used to play computer games, I think it is OK. But it can ONLY be used to mining, which creates a barrier for most people.

[bitzox]

got it, silly me forgetting what the word "harder" means

[notme]

Then you don't understand the hardware industry. ---- Glad to hear your explanation. But please remember, in the design, mining is a zero-sum game. So low-level ASICs have no way out.

Ordinary people are not supposed to mine.  Mining is a professional industry. and as such requires special skills to do efficiently.  Do you refuse to use a credit card because VISA won't let you process transactions yourself?  Well with bitcoin you always have the option, but if you don't have the skills you will be wasting time and money ---- VISA is not a mining agency. It's just a card organization. And you can not process the transactions yourself. VISA is a centralize system but Bitcoin is a peer-to-peer system. They are not the same. My point is it is hard for people to experience the whole Bitcoin process. and it will be harder for people to acquire bitcoin by fiat money as the gov will close the doors.

And my point is bitcoin isn't about mining.   Mining is just something some people do to keep bitcoin running.  But you seem to believe Bitcoin is pointless unless everybody can mine.

[jaywaka2713]

IF ASIC can be used to play computer games, I think it is OK. But it can ONLY be used to mining, which creates a barrier for most people.

This isnt much of an issue at all really. ASICs cant do anything but Bitcoin. GPUs were just what people had at the time to mine Bitcoins. Now we have ASICs. If you really look at it, once these companies are in check, ASICs will be cheaper than any GPU rig, and easy to maintain. To get 30 Gh/s before, you needed $40000 in graphics cards. Now you only need $1300.

[anaikh]

IF ASIC can be used to play computer games, I think it is OK. But it can ONLY be used to mining, which creates a barrier for most people.

This isnt much of an issue at all really. ASICs cant do anything but Bitcoin. GPUs were just what people had at the time to mine Bitcoins. Now we have ASICs. If you really look at it, once these companies are in check, ASICs will be cheaper than any GPU rig, and easy to maintain. To get 30 Gh/s before, you needed $40000 in graphics cards. Now you only need $1300.

Yes, you are right about the price. But an ASIC with 30Gh/s will soon lose its competitive advantage as mining in Bitcoin is a zero-sum game. You always have to be the best to get the block.

[anaikh]

Then you don't understand the hardware industry. ---- Glad to hear your explanation. But please remember, in the design, mining is a zero-sum game. So low-level ASICs have no way out.

Ordinary people are not supposed to mine.  Mining is a professional industry. and as such requires special skills to do efficiently.  Do you refuse to use a credit card because VISA won't let you process transactions yourself?  Well with bitcoin you always have the option, but if you don't have the skills you will be wasting time and money ---- VISA is not a mining agency. It's just a card organization. And you can not process the transactions yourself. VISA is a centralize system but Bitcoin is a peer-to-peer system. They are not the same. My point is it is hard for people to experience the whole Bitcoin process. and it will be harder for people to acquire bitcoin by fiat money as the gov will close the doors.

And my point is bitcoin isn't about mining.   Mining is just something some people do to keep bitcoin running.  But you seem to believe Bitcoin is pointless unless everybody can mine.

Of course, Bitcoin is not about mining. My point is, if more people can mine, it will be easier for them to join in the game, and the whole system will be healthy. Imagine some organizations to control the money supply in bitcoin society because they have super ASICs.

[notme]

Then you don't understand the hardware industry. ---- Glad to hear your explanation. But please remember, in the design, mining is a zero-sum game. So low-level ASICs have no way out.

Ordinary people are not supposed to mine.  Mining is a professional industry. and as such requires special skills to do efficiently.  Do you refuse to use a credit card because VISA won't let you process transactions yourself?  Well with bitcoin you always have the option, but if you don't have the skills you will be wasting time and money ---- VISA is not a mining agency. It's just a card organization. And you can not process the transactions yourself. VISA is a centralize system but Bitcoin is a peer-to-peer system. They are not the same. My point is it is hard for people to experience the whole Bitcoin process. and it will be harder for people to acquire bitcoin by fiat money as the gov will close the doors.

And my point is bitcoin isn't about mining.   Mining is just something some people do to keep bitcoin running.  But you seem to believe Bitcoin is pointless unless everybody can mine.

Of course, Bitcoin is not about mining. My point is, if more people can mine, it will be easier for them to join in the game, and the whole system will be healthy. Imagine some organizations to control the money supply in bitcoin society because they have super ASICs.

Decentralization does not mean everybody is equal.  Yes, one entity controlling most of the mining power is a threat to bitcoin.  However, the current reality of the ASIC market doesn't leave much room for that possibility.

[KSV]

@ 800 over petaflops its not just hard - its pretty damn impossible for a 51% attack.