Venezuela national bitcoin mining pool

[wheelz1200]

https://news.bitcoin.com/venezuela-passes-law-legalizing-crypto-mining-forces-miners-to-join-national-mining-pool/

Is anyone from Venezuela actually planning on jumping on this "national pool".  This might become the most corrupt pool going.  Interesting they are setting up a national pool and wondering if anyone from venzuela is really going to jump on.

[philipma1957]

https://news.bitcoin.com/venezuela-passes-law-legalizing-crypto-mining-forces-miners-to-join-national-mining-pool/

Is anyone from Venezuela actually planning on jumping on this "national pool".  This might become the most corrupt pool going.  Interesting they are setting up a national pool and wondering if anyone from venzuela is really going to jump on.

The real question is how many other countries may do the same law.

[wheelz1200]

Thats what I was thinking phil.  For one they can control the flow of information which is the real goal of the gov.  If they know end to end from mining to exchange they can keeps wraps on who is doing what within their Sovereign walls.

[mikeywith]

Is anyone from Venezuela actually planning on jumping on this "national pool".

This doesn't seem like a matter of choice, does it?

the article you referenced says:

The authorities will supervise both the creation and importation of mining equipment. Similarly, mining farms for bitcoin and other cryptocurrencies will be able to operate with the support of the State, but only if they are inspected by Sunacrip.

Small mining farms and home miners might get away with this, but if you own a med-sized mining farm then hiding that from the government is going to be a difficult job and involves a ton of risk, so my guess is that all large miners in Venezuela will end up joining that pool.

This might become the most corrupt pool going.

Given the size of the hash power coming in form Venezuela, and if there is going to be any "corruption" it wouldn't matter to bitcoin as a whole, plus, I think the reason for doing this is to tax those miners, miners in countries like the U.S do report their taxes, the government knows that and they don't have to track everybody's shares/hashrate, the government of Venezuela apparently doesn't trust the miners to honestly report their income, and this isn't a matter of something they can fix in a day or two, not even a decade thanks to the long-lasting corruption, so if you can't convince people to report their earnings, simply force them to mine on a single pool.

[wheelz1200]

You make some good points going forward.  But I would imagine there is a decent amount of gear already within the country, will they jump on?  And I think most governments are looking to get in on the action and have been missing out for the most part.  I can only imagine customer service for pool issues will be dam near impossible getting answers to  

And I agree its not going to affect bitcoin just dam imagine they hit a block, you think share value will be true  

[mikeywith]

Of course, this isn't something you can lie about, there isn't much a pool can do to cheat, the bitcoin ecosystem was designed in such a way that that nobody trusts anybody else, a pool owned by a government is no different to a pool that is owned by anybody else as far as mining is concerned.

[Artemis3]

This is the usual State oppression here. We don't have any freedoms, whatever the leader orders, we have to obey, period.

First, you are supposed to get a license to even mine, to begin with. So yeah. If you bring any asic miner to the country, you are also supposed to have a license for that, in addition to the importer's license. BTW: This bureaucracy isn't exactly efficient... (corruption).

Assuming you somehow managed to fulfill those "legal" requisites now you are forced to use their pool (it doesn't exist, yet). Internet in Venezuela is garbage, no IXP, very few international links = Orphan galore.

What software pool are they going to use? Knowing them, they might do some little google search and end up modding ckpool (because certain someone is too busy blaming others to actually release stuff). Also don't expect them to publish back any modification even if the license says so, good luck suing them, the judges are appointed by them.

Of course all they want is collect a large pool fee, who cares if blocks are lost, or the pool goes down with the frequent power outages.

The security forces will be more than happy to extort and blackmail miners (again). Your only way is having the right contact in the circle of power, if you have a large mining operation, you better be real friends with someone in power, or else...

Its not like you have a choice. Some will have to lie (learn use obfuscation and hide their tracks; ie. NOT use clear text json or do clear text dns queries) while others will have to declare it all, and even then may still be extorted, i has happened before. If you have the right contacts, you could probably even avoid using this "obligatory" pool...

Do you get a glimpse on how things are in this country? Think medieval "justice", and you'll get close.

By the way the people in power are also sanctioned by the Trump administration. If you publicly engage with them expect your relations with the US and their allies to be cut and your assets frozen or seized. So think twice before getting allured by the "free electricity". I think Iran or elsewhere is better at this point, at least their nuclear power plants can keep going without the blackouts unless bombed.

Oh and there is no mentioning of altcoins. Maybe its now illegal to mine those...

Oh before i forget, this wasn't really a "law", more like a regulation from an institution that technically shouldn't even exist because the legislative branch has been suspended defacto since 2015. This is a country that decrees things by executive powers, rest is a facade.

There is this saying inside the ruling party: "Whatever Maduro says" (is done, period).

[NotFuzzyWarm]

What software pool are they going to use? Knowing them, they might do some little google search and end up modding ckpool (because certain someone is too busy blaming others to actually release stuff).

If that was a shot at Kano you missed: -ck kicked him from the Github several years ago remember? Since for the past few years -ck now only fixes code if he is forced to or someone pays him to do it, why should Kano release his fixes for free? As long as the code is not distributed there is no requirement for code to be published plus, he is still one of the primary authors listed in the Github docs.

Plus, there is other mining pool software out there besides ckpool. I highly doubt that the major pools use ckpool or forks of it.

Back on-topic, my guess is that their main goal is to have cradle-to-grave tracking of BTC being earned through the government pool.

[philipma1957]

Which would be a good way to attack btc in general.

kind of reminds me of New York City yellow taxi cab medallions at their peak they were over 1 million a piece

then the city allowed uber and cut the yellow cab guys really deep.

seems to me this is a real threat to mining.

[mikeywith]

I don't see it as such, simply put, the government has easier and more efficient ways to do that, I am not talking about free countries where people are actually protected by the constitution, many countries like Venezuela and my country can make laws which override any existing constitution, if that doesn't work, they can easily modify the constitution to fit their goals.

Venezuela just like any other country, they don't want to miss the train, if the whole world was 100% centralized and we didn't have these geopolitical issues bitcoin would have been dead a long time ago, just imagine all major countries agree to ban bitcoin for good with 10 years or lifetime for those who buy/sell/mine bitcoin, but luckily even the large banks aren't really working together.

It is too late for any government to hurt bitcoin, we now are in times where governments can only benefit from BTC, or simply watch it grow, Venezuela's government wants a piece of the cake, without controlling miners it gets hard for them to track miner's earnings, my guess is that they just want miners to PAY them.

[philipma1957]

The whole world co operated quite a bit with covid-19

when you compare covid to the spanish flu to covid

20 to 50 million dead in a world with 1.4 billion world pop spanish flu
1 to 2 million dead in a world with 8.4 billion world pop covid

when you factor in the pop it means that the spanish flu was 60 to 300 times as deadly as covid.

yet we had world wide shut downs for covid 19.

I have a link somewhere that shows how much pollution from car exhaust was reduced.

So the world can actually cooperate. Will the world cooperate as well to license miners and pools.

maybe they will. I think covid proves they can when they want to. I am pretty sure the idea 💡 in venezula

could be enacted in many other countries

Mining is very hard now as I type so a new restriction would make it harder.

[mikeywith]

20 to 50 million dead in a world with 1.4 billion world pop spanish flu
1 to 2 million dead in a world with 8.4 billion world pop covid

The Spanish flu came in April 1918 during WW1 which lasted for 4 years and ended a few months after the Spanish flu, the whole world by then was exhausted and nations have been milked dry post-war, another major factor is technology, there was no internet, and only a few people had phone lines, heck they didn't even have TVs back then, so it was pretty hard for them to co-operate, this makes the whole comparison a bit inaccurate.

What happened during the Covid-19 this year was not even close to cooperation, many countries went against China, the Czech Republic "stole" face masks that were sent to Italy, another cargo of medical aids to Tunis was pirated by God know what country, the lock-down isn't co-operation, it's every country trying to protect itself, co-operation means if the U.S finds a vaccine they should share it with Russia and vice-versa, none of that shit is happening, every country just want to make the most of this pandemic, co-operation is close to zero IMO.

When it comes to the economy it's even worse, good luck getting China and the U.S to agree on the same monetary policies, it's not going to happen, by the way, read "the bitcoin standard" book by Saifedean, it covers all of these details and it explains why killing bitcoin now is not possible.

[stompix]

Venezuela's government has only two targets money and control. They want money but they can't get it from their traditional supporters, so they are trying to milk the one that deal with this new "technology" in secret, ostracizing them in front of the public for taking advantage of the people's resources and not contributing to the glory of the state. Been through this before the '90, I know how this bs propaganda works, and Artemis3, who is a citizen there painted the same picture, they allow you to be some kind of free entrepreneur because you bring in foreign currency which the state desperately needs to prop their own currency, but at the same time, they fleece you like there is no tomorrow and keep you on a very tight leash.

And the incompetence, in this case, is so clear you can see it from Pluto, they have hastily organized a control structure, immediately assigned directors, councils, a lot of people got a sweet well-paid seat, they are even putting laws in place, you're supposed to only mine at a national pool....which doesn't exist. And this only after an inspection by Sunacrip, and you have to obtain first a licence for mining, oh, and a licence for importing mining equipment, and you will be finally paid, paid, and this is another interesting thing. Paid, what? As bitcoin is not a legal payment solution in Venezuela, the government will probably not pay you bitcoins, but you'll either receive Petro or Bolivars.

[wheelz1200]

I don't see it as such, simply put, the government has easier and more efficient ways to do that, I am not talking about free countries where people are actually protected by the constitution, many countries like Venezuela and my country can make laws which override any existing constitution, if that doesn't work, they can easily modify the constitution to fit their goals.

Venezuela just like any other country, they don't want to miss the train, if the whole world was 100% centralized and we didn't have these geopolitical issues bitcoin would have been dead a long time ago, just imagine all major countries agree to ban bitcoin for good with 10 years or lifetime for those who buy/sell/mine bitcoin, but luckily even the large banks aren't really working together.

It is too late for any government to hurt bitcoin, we now are in times where governments can only benefit from BTC, or simply watch it grow, Venezuela's government wants a piece of the cake, without controlling miners it gets hard for them to track miner's earnings, my guess is that they just want miners to PAY them.

Another angle I was looking at with this is, if they are willing to run a pool what would happen to a country with access to infinite amount of fiat and control of their nations power supply they could dominate mining and forever make it unprofitable for anything less than a large farm operation.  First step is pool next step sovereign mining facilities?

[mikeywith]

That is a good point, but this is just too late for any country to do now IMO, even if they were able to obtain a large portion of the current 140EH we have now (which is nearly impossible for a single entity to do) will they have a spare 10MW or whatever large amount of electricity needed for that? Maybe, but unlikely, and then again, because mining is nothing but a business, I am pretty sure that individual large scale miners who have understood the game by mining for years will be able to beat a corrupt government pretty easily, another thing to consider is that Venezuela doesn't have access to an infinite supply of U.S dollars, Euros or any other semi-stable fiat currency, so it isn't just about a simple "print" command that can get them the money they need to buy millions of mining gears and make huge mining farms.

With that being said, that will still be a possibility, the fact of the matter is, any country might attempt that, I would worry more if a country with endless $ like the U.S does that.

[philipma1957]

If the USA did that then China would do it and BTC price would sky rocket like a mofo.

BTW most people don't realize how small BTC value is: 18,500,000 coins at 10,500 is around 200 billion.  This is basically nothing.  USA yearly budget is

4.1 trillion for 2018. about 779 billion in the hole
4.4 trillion for 2019. around 985 billion in the hole

over 5 trillion for this year

the chart from wiki

[stompix]

That is a good point, but this is just too late for any country to do now IMO, even if they were able to obtain a large portion of the current 140EH we have now (which is nearly impossible for a single entity to do) will they have a spare 10MW or whatever large amount of electricity needed for that?

If it's a dry season with no rain they will not have enough electricity for basic stuff and we will see again rolling blackouts for entire provinces, no, they don't have the power to spare, and even if they have they will find a way to make even electricity less efficient even if they would need to go against the laws of physics. Corruption on top of everything from brain drain to bureaucracy would make anything run by that government impossible to compete with other miners, only insane subsidies would make the things viable but they can't afford that.
But at the same time, I'm not denying the fact that maybe the authorities will try to seize some gear from "unlawful" miners and try to run them on their own, emphasis on try.

Venezuela doesn't have access to an infinite supply of U.S dollars, Euros or any other semi-stable fiat currency, so it isn't just about a simple "print" command that can get them the money they need to buy millions of mining gears and make huge mining farms.

This is why I believe or rather I assume they are trying to fleece the miners one way or the other. I don't know how the rewards will be distributed but as I said before I have a feeling the government will take the gains in coins and the miners will be paid in either fiat or petro, so the whole scheme will be used to get some kind of valuable currency in the coffers to fight inflation.

Another angle I was looking at with this is, if they are willing to run a pool what would happen to a country with access to infinite amount of fiat and control of their nations power supply they could dominate mining and forever make it unprofitable for anything less than a large farm operation. 

An infinite amount of fiat usually has a near-zero value 

[wheelz1200]

While they don't have an infinite amount of a stable currency correct, they have a silly amount of oil which in turn can can be turned into stable fiat.  Either way take venezuela out of the equation and insert any other sovereign nation with a good fiat posture and power accessible, it could certainly put a wrinkle in the system.  Remember countries don't operate as a business they engage in plenty of loss leading projects with the end goal not being monetary but something else.