DON'T mine to Antpool -- KYC imposed.

[mikeywith]

Getting rid of the middleman is what's all about your proposal.

Yes, and

this would require a similar implementation of the original Bitcoin nodes, where pool nodes will run on different servers owned by different people but the software is similar

I have no experience on mining

But you do understand how BTC works judging by your posts' quality, but to make a long story short of how the current PPS pool work; your miner connects to the pool using stratum protocol where a username is required, the user name is usually obtained from the pool portal but it could very well be your bitcoin address, so the pool knows that miner x whose bitcoin address is bc1... is connected to it, the pool would then send work task to the miner and set a pool difficulty based on the miner's hashrate, let's assume the share difficulty is 10k for miner x, now every share that miner x submits with a difficulty of =>10k is going to be recorded in the pool database.

By the end of the day (usually every 24 hours ) regardless of how many blocks the pool finds, the pool would use a theoretical figure of how many blocks it "was" supposed to find in the past 24 hours should their luck be 100%, and then it's a simple math which tells them how much every BTC address is going to receive for the work they did. [more below]

If there needs to be a supernode for the network to operate, it can be regulated.

There is no need for a supernode as far as mining is concerned, however, mining is location-sensitive, unlike with Bisq latency needs to be pretty low, so pool nodes need to be located across the globe for this to work effectively.

The topology is as follows:

Miner > pool node > bitcoin node
bitcoin node > pool node > miner

Since we have bitcoin nodes all over the globe it would be pretty easy to connect to them to create the block templates, so anyone running a pool node can connect to his own node or nodes near him to get a list of pending transactions/current block and etc.

The miner would need to connect to a pool node nearby if the latency to the nearest pool node is >200s the miner will need to run their own pool node if this is a simple and easy-to-install executable file with 3-4 next -- problem solved.

Now with the "accounting", using BTC scripting language I think we should be able to design a contract that owns the funds, so any BTC transferred to that contract is now owned by the contract and that includes the block rewards, and then we have to configure the contract to distribute the incoming BTC between the different miners based on the number of shares they submitted - 4% which goes to all the address that deposited funds to the smart contract.

The challenging part, however, is counting the valid shares, since we can't have a centralized database to store all the share counts from thousands of miners, we also can't count on a single pool node to tell us how many valid shares were submitted by every individual miner, to solve this, we could use sharechain which is a similar concept to P2pool.


P2pool was a perfect example of how decentralized mining is doable, it was also a great example of how a decentralized project can die when the requirements to run it is beyond the average Joe, having to run your own local node, install Python and the P2pool software was too much work to many small miners, and then it was a PPLNS pool which judging by the fact that the vast majority of miners now want PPS wasn't favoirble.

The difference here will be, no requirement to run a full node, but rather a pool node that would be lighter and easier to install, and the payout will be PPS-based with funds that are not owned by anyone. I can already see a dozen potential issues in this proposal, I don't think anything of this nature will come into extinct for the next 10-20 years, but ya, this could be a good starting point for further discussion on how a decentralized mining pool that works could be implemented.

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[BlackHatCoiner]

Since we have bitcoin nodes all over the globe it would be pretty easy to connect to them to create the block templates, so anyone running a pool node can connect to his own node or nodes near him to get a list of pending transactions/current block and etc.

Every pool owner should be running their own node and not rely on anyone. Otherwise, it is a recipe for disaster. I believe you know that.

There is no need for a supernode as far as mining is concerned, however, mining is location-sensitive, unlike with Bisq latency needs to be pretty low, so pool nodes need to be located across the globe for this to work effectively.

Bisq was an example of a DAO that works in practice. You can remove mandatory Tor from the equation, use location-based algorithms and you have improved latency significantly.

I don't know if we're envisioning the same thing. The point of this DAO would be to elect representatives which will be responsible for broadcasting the block headers to the miners. As far as I understand, by design, PPS requires miners to agree on a single block header. That can't happen if the network is completely peer-to-peer; there needs to be an entity which will broadcast the unique block header, and the rest of the miners will only have to verify it comes from that entity. Representatives will be the main operators, as pool owners are currently in centralized pools. Governance proposals can be later on made by any stakeholder.

In this way, regular miners will not need to run full nodes. It can be as simple as an upgrade to their current software.

[mikeywith]

Every pool owner should be running their own node and not rely on anyone. Otherwise, it is a recipe for disaster. I believe you know that.

Yes "pool owner" but what I was describing is "pool node" which acts something like an SPV client where it would only need to acquire certain pieces of information and doesn't need to hold the complete blockchain, if every miner needs their own node then the project will fail right out of the box.

Bisq was an example of a DAO that works in practice. You can remove mandatory Tor from the equation, use location-based algorithms and you have improved latency significantly.

An interesting idea, I know about Bisq, but I don't understand how it technically works, I will have to read about it.

I don't know if we're envisioning the same thing. The point of this DAO would be to elect representatives which will be responsible for broadcasting the block headers to the miners. As far as I understand, by design, PPS requires miners to agree on a single block header. That can't happen if the network is completely peer-to-peer; there needs to be an entity which will broadcast the unique block header, and the rest of the miners will only have to verify it comes from that entity.

PPS is just a "payment structure" it doesn't have any unique aspect in regards to how blocks are constructed or handled, also, miners don't need to have to agree on a single block header, in fact, every miner hashes unique block header due to the fact that each nonce is different, the only thing that needs to match across all miners would be the coinbase transaction, it's how centralized pools know which share is "worth paying for" and which share isn't.

Representatives will be the main operators, as pool owners are currently in centralized pools. Governance proposals can be later on made by any stakeholder.
In this way, regular miners will not need to run full nodes. It can be as simple as an upgrade to their current software.

That sounds like a good idea, the "representatives" would need to vote/decide which share is valid since any unfair player can submit shares to the pool which contain a coinbase transaction that pays to their own address and thus would receive rewards for the work which was never intended to benefit the pool.

[BlackHatCoiner]

PPS is just a "payment structure" it doesn't have any unique aspect in regards to how blocks are constructed or handled

No, but it does matter for the DAO structure. Miners need to be paid regardless of whether they mine a block or not. That means their source of income is the coins at stake.

also, miners don't need to have to agree on a single block header, in fact, every miner hashes unique block header due to the fact that each nonce is different, the only thing that needs to match across all miners would be the coinbase transaction, it's how centralized pools know which share is "worth paying for" and which share isn't.

The pool must be giving a unique block header to each individual miner as well, otherwise there will be instances of miners hashing the same things (providing the same work multiple times). Nonce is a field they change later. Is the merkle root different to each miner, or is there an extraNonce field which could be their pool ID e.g.?

That sounds like a good idea, the "representatives" would need to vote/decide which share is valid since any unfair player can submit shares to the pool which contain a coinbase transaction that pays to their own address and thus would receive rewards for the work which was never intended to benefit the pool.

That's correct. The only disadvantage of this whole business, is that there have to be colored coins issued; at least that's how voting process works in Bisq.

[mikeywith]

The pool must be giving a unique block header to each individual miner as well, otherwise there will be instances of miners hashing the same things (providing the same work multiple times). Nonce is a field they change later. Is the merkle root different to each miner, or is there an extraNonce field which could be their pool ID e.g.?

Yes, there is an extraNonce in the coinbase transaction, Stratum V2 even allows the modification of the included transactions and thus a completely different Merkle root, a pool like Cksolo would have both the pool address + the miner's address in the coinbase transaction which also means a unique Merkle root for everyone, P2pool also puts the miner's bitcoin address in the coinbase transaction for 0.5% payment (done to discourage block withholding) but also serves the purpose we are discussing, there are a dozen of other methods in place to ensure that all miners have different block candidate, so this certainly shouldn't be an issue.

That's correct. The only disadvantage of this whole business, is that there have to be colored coins issued; at least that's how voting process works in Bisq.

I think the most challenging part would be the validation of shares, the other aspects are pretty simple to deal with, it's only this part and the risks associated to it, P2pool solves this issue by using "chain of shares" which could be used in a decentralized PPS as well, of course, with some modification given that the end result or the final coinbase transaction will be different for a PPS pool as all payments should go to the same "address".