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Author Topic: JP Morgan investing into Bitcoin mining? ;>  (Read 6673 times)
BitcoinBug
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July 13, 2011, 06:41:33 AM
 #1

The investment bank worked with HPC solutions provider Maxeler Technologies to develop an application-led, HPC system based on Field-Programmable Gate Array (FPGA) technology that would allow it to run complex banking Bitcoin mining algorithms on its credit book faster.  Grin

http://www.computerworlduk.com/news/it-business/3290494/jp-morgan-supercomputer-offers-risk-analysis-in-near-real-time/
http://forum.bitcoin.org/index.php?topic=22426.0
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Sjalq
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July 13, 2011, 07:25:06 AM
 #2

JP Morgan has the money to take over the whole network.

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July 13, 2011, 07:44:56 AM
 #3

JP Morgan has the money to take over the whole network.

ou overestaimate the network. Quite some employees at JpMorgan earn enough to take over the network with their paycheck. The paycheck of ONE MONTH.
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July 13, 2011, 08:53:08 AM
 #4

The obsession most mining people have with bitcoin is really fascinating. You people tend to  overestimate the importance of bitcoin relative to the GPGPU and parallel processing as a whole. This leads to some absurd conspiracy theories like AMD research driven by bitcoin or bitcoin mining as driving force in new GPU sales. Reality is rather different. Computing resources thrown at bitcoin are very likely even less than those in SL3 unlocking. Assuming the average miner has 500MH/s at his disposal, the whole mining society would be comprised of less than 30.000 users. The amount of GPUs thrown at BTC mining is really insignificant doesn't matter how important it is to you. This is even more valid as far as FPGAs are concerned.

Unlike what you may think, there is something called "computational finance" and it has some  embarassingly parallel applications, for example Monte Carlo simulations used for financial planning. The investment JPMorgan made for hardware would bring them much more profit if used for those tasks as opposed to bitcoin mining.

Also unlike what you think, corporate customers and universities are still way bigger market as far as GPGPU/FPGA niche is concerned as compared to hobbyist and semi-hobbyist uses like bitcoin mining and SL3 unlocking.

Bottom line: the universe does not revolve around you, sorry.
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July 13, 2011, 09:50:03 AM
 #5

I don't think it revolves around bitcoin either. However bitcoin now has more processing power than the combined processing power of the top 500 super computers. If this trend continues at even a fraction of it's current rate I doubt the argument would still hold water in as little as a year's time.

If the price trend continues, something that could easily happen with the advent of proper simplified cellphone to cellphone payments, then I would argue that it follows that mining interest would again peak.

As far as JP Morgan is concerned, if something does not stop bitcoin it is the end of the road for them, finish, kaput, klaar.

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iopq
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July 13, 2011, 10:00:45 AM
 #6

The obsession most mining people have with bitcoin is really fascinating. You people tend to  overestimate the importance of bitcoin relative to the GPGPU and parallel processing as a whole. This leads to some absurd conspiracy theories like AMD research driven by bitcoin or bitcoin mining as driving force in new GPU sales. Reality is rather different. Computing resources thrown at bitcoin are very likely even less than those in SL3 unlocking. Assuming the average miner has 500MH/s at his disposal, the whole mining society would be comprised of less than 30.000 users. The amount of GPUs thrown at BTC mining is really insignificant doesn't matter how important it is to you. This is even more valid as far as FPGAs are concerned.

Unlike what you may think, there is something called "computational finance" and it has some  embarassingly parallel applications, for example Monte Carlo simulations used for financial planning. The investment JPMorgan made for hardware would bring them much more profit if used for those tasks as opposed to bitcoin mining.

Also unlike what you think, corporate customers and universities are still way bigger market as far as GPGPU/FPGA niche is concerned as compared to hobbyist and semi-hobbyist uses like bitcoin mining and SL3 unlocking.

Bottom line: the universe does not revolve around you, sorry.
why don't they pay people to run computational finance crap on their GPUs? I mean if you pay more than people mine in BTC then those terahashes would be all theirs

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July 13, 2011, 10:08:18 AM
 #7

why don't they pay people to run computational finance stuff on their GPUs? I mean if you pay more than people mine in BTC then those terahashes would be all theirs

Great idea for a business. If someone wrote the components to make this happen I'm sure there would be very lucrative applications.

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Meni Rosenfeld
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July 13, 2011, 10:09:33 AM
 #8

The obsession most mining people have with bitcoin is really fascinating. You people tend to  overestimate the importance of bitcoin relative to the GPGPU and parallel processing as a whole. This leads to some absurd conspiracy theories like AMD research driven by bitcoin or bitcoin mining as driving force in new GPU sales. Reality is rather different. Computing resources thrown at bitcoin are very likely even less than those in SL3 unlocking. Assuming the average miner has 500MH/s at his disposal, the whole mining society would be comprised of less than 30.000 users. The amount of GPUs thrown at BTC mining is really insignificant doesn't matter how important it is to you. This is even more valid as far as FPGAs are concerned.

Unlike what you may think, there is something called "computational finance" and it has some  embarassingly parallel applications, for example Monte Carlo simulations used for financial planning. The investment JPMorgan made for hardware would bring them much more profit if used for those tasks as opposed to bitcoin mining.

Also unlike what you think, corporate customers and universities are still way bigger market as far as GPGPU/FPGA niche is concerned as compared to hobbyist and semi-hobbyist uses like bitcoin mining and SL3 unlocking.

Bottom line: the universe does not revolve around you, sorry.
All valid points, but I think you're underestimating the impact of Bitcoin mining at least in some niches. E.g. Vladimir buying all 5970's in the UK (he's running a big mining contract service and I think he was serious with that comment).

why don't they pay people to run computational finance crap on their GPUs? I mean if you pay more than people mine in BTC then those terahashes would be all theirs
Because of the myriad well-known disadvantages of grid computing? (Secrecy, protection against fake work, protection against tampering, communication overhead, need for a suitable platform for distributing the work, being at the mercy of end users who may quit at any point or not be convinced at all to join in sufficient quantities...). Bitcoin mining is very unique in its suitability for monetized grid computing.

They're doing fine without your Terahashes, thank you very much (and of course, they don't need literally hashes).

why don't they pay people to run computational finance stuff on their GPUs? I mean if you pay more than people mine in BTC then those terahashes would be all theirs
Great idea for a business. If someone wrote the components to make this happen I'm sure there would be very lucrative applications.
One which I (and surely others) have had for years. But like I said, for most application there are severe limitations for this kind of deployment, which I guess is why nobody managed to pull off something successful yet.

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July 13, 2011, 10:19:17 AM
 #9

why don't they pay people to run computational finance crap on their GPUs? I mean if you pay more than people mine in BTC then those terahashes would be all theirs

Because it's not cost-effective. It would still be much more cheaper if they outsourced that to an external contractor that has a data center, high uptime and 24/7 support as compared to a swarm of semi-competent people. The overhead is much lower. There are also lots of privacy-related issues that may be resolved with a NDA with the contractor.
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July 13, 2011, 02:09:52 PM
 #10

I agree that it's pretty unlikely JPM has any interest in Bitcoin mining. Even if BC has caught their attention, they would be more likely to trade BCs than mine them IMO. That thought is scary, though, because JPM (or any similar type of firm) could easily manipulate price. Some kind of manipulation is probably already going on, at least on a small scale. Consider how easy it was to bring about the flash crash from a while back. Still, I wonder if there is some kind of financial or price-action analysis that a pool of GPUs would be good at. I have no idea - for the type of trading I understand, there's nothing better than an eyeball and a properly configured set of charts in a few different time frames.
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July 13, 2011, 02:43:07 PM
 #11

What if they mined when it wasn't being used or whatever? Surely they've heard of Bitcoin and if they already have the hardware, why not? Relative electricity costs would probably be next to nothing with such an efficient computer. It seems stupid for an investment company not to maximize their own investments. Assuming that they aren't doing it because they are too good for a nerdy currency is foolish.

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gat3way
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July 13, 2011, 03:03:05 PM
 #12

Quote
Still, I wonder if there is some kind of financial or price-action analysis that a pool of GPUs would be good at.

Monte Carlo simulations most probably as they can be parallelized very well. They are used to create probabilistic models and optimize complex portfolios.

Quote
What if they mined when it wasn't being used or whatever? Surely they've heard of Bitcoin and if they already have the hardware, why not? Relative electricity costs would probably be next to nothing with such an efficient computer. It seems stupid for an investment company not to maximize their own investments. Assuming that they aren't doing it because they are too good for a nerdy currency is foolish.

For a number of reasons this is quite the opposite to maximizing profits. It has just too much overhead associated with it.
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July 13, 2011, 03:12:38 PM
 #13

It's unlikely that larger firms like JPM will get involved at this point.  They don't just invest on hunches, per se.  They need some hard core statistical backing for any strategy they implement.  There simply isn't enough data to justify that yet.

Also, realize that for 99% of the financial world, volatility = risk.  So the recent price moves from $1 up to $30 put btc farming in the same category as penny stocks.

I use my btc farm for trading model optimizations myself.  But I use the CPUs for that.  They make me more money than bitcoin farming does (and that would be true for JPM or any other large financial institution).

BUT ... bitcoins make a steady income.  Trading models don't necessarily.  You can maximize profit.  But you can't maximize HOW OFTEN often profit will come.  Again, that entire world operates under the premise of risk = volatility.

A good gaming analogy for you younger folks might be:

 btc farming = hot/dot
 trading strategies = instant cast

Yes, the analogy has limits.

But I haven't finished my morning coffee yet.

"... and the geeks shall inherit the earth."
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July 13, 2011, 04:23:22 PM
 #14

The investment bank worked with HPC solutions provider Maxeler Technologies to develop an application-led, HPC system based on Field-Programmable Gate Array (FPGA) technology that would allow it to run complex banking Bitcoin mining algorithms on its credit book faster.  Grin

http://www.computerworlduk.com/news/it-business/3290494/jp-morgan-supercomputer-offers-risk-analysis-in-near-real-time/
http://forum.bitcoin.org/index.php?topic=22426.0

Someone needs to tell them that all the experts on this forum say that mining is barely profitable and in most cases not even worth it.  Cost of electricity, never gonna make back your investment, blah blah blah.

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July 13, 2011, 04:32:08 PM
 #15

What if they mined when it wasn't being used or whatever? Surely they've heard of Bitcoin and if they already have the hardware, why not? Relative electricity costs would probably be next to nothing with such an efficient computer. It seems stupid for an investment company not to maximize their own investments. Assuming that they aren't doing it because they are too good for a nerdy currency is foolish.

Because it's not worth it to them.

They earned 5.6 BILLION this past quarter.  The entire bitcoin market cap is under 100 million.  Yes, those numbers are big for us but they don't even bat an eye when looking at it from their view.
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July 13, 2011, 08:14:59 PM
 #16

Interesting that this thread was posted as the network hash rate went from 11 to 15 TH.

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July 13, 2011, 08:17:18 PM
 #17

That is currently being assigned to luck. We'll see if it holds... troubling if it does because 4 THashes was then just mobilized at once.

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July 13, 2011, 09:41:46 PM
 #18

That is currently being assigned to luck.

Luck is not responsible for this...

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SlaveInDebt
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July 13, 2011, 09:54:30 PM
 #19


"A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain." - Mark Twain
gat3way
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July 13, 2011, 10:12:02 PM
 #20

Gotta be JPMorgan Smiley Now all they need to do is withdraw their money....through mtgox, aheheheaha.
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