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Author Topic: The LTC Dark Pool: Boon or Burden?  (Read 1724 times)
tacotime
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December 08, 2011, 04:59:24 PM
 #1

The dark pool or pools have been operational since roughly 10 days after the release of Litecoin.  Historically, almost all the LTC mined by the dark pool appears to be immediately released to the market at BTC-e for sale.

The dark pool provides a major advantage to LTC, which is that is is extremely difficult to attack (unless the dark pool chooses to).

On the flip side, there is the inherent problem of, aside from an unlikely 51% attack, these two scenarios:
- The dark pool is being mined by computers infected with trojans (botnet).  The release of virus definitions for these trojans would result in the rapid collapse of the hash rate by 80%, requiring weeks to lower the difficulty.  This is a likely scenario, as the hash rate here does not vary with the price of LTC (as you might expect for someone who has to worry about the costs of electricity).
- The dark pool decides to contract the supply by not bringing any LTC to the market for a long time, hence manipulating the market.  The possibility remains that the dark pool is attempting to assemble as large a mining network as possible before heavily constricting the supply, resulting in only a tiny amount of new coins being mined per day by others.  The result would be massive deflation.

The strange thing is that so far, the dark pool appears to have decided to sell as much as their LTC as possible.  With 80-90% of the mining capacity, the dark pool can act as a "central bank" for LTC; so why are they inflating it so intensely?

See the present dark pool size here: http://pool-x.eu/net

And historic network hash rates here: http://www.litecoinpool.org/charts

Code:
XMR: 44GBHzv6ZyQdJkjqZje6KLZ3xSyN1hBSFAnLP6EAqJtCRVzMzZmeXTC2AHKDS9aEDTRKmo6a6o9r9j86pYfhCWDkKjbtcns
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December 08, 2011, 05:12:32 PM
 #2

See the present dark pool size here: http://pool-x.eu/net

Unknown doesn't mean 'dark pool', it means everything except the numbers reported by the known pools. For all we know PooL-X really has 50% of the network hash rate but is massively cheating its users.
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December 08, 2011, 05:14:51 PM
 #3

Please take a look here. https://bitcointalk.org/index.php?topic=53796.20

If I helped, feel free to donate to:
BTC: 1DimPUBPnmZuWu5XrMa3xVnFgMz1iGBNdr
LTC: LLqQuvRZd4uZyenER2mE8d3ns1N1qBWQjD
tacotime
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December 08, 2011, 05:32:58 PM
 #4

See the present dark pool size here: http://pool-x.eu/net

Unknown doesn't mean 'dark pool', it means everything except the numbers reported by the known pools. For all we know PooL-X really has 50% of the network hash rate but is massively cheating it's users.

Yep, see above post.  The miner themselves gave that message alongside the validation of the wallet where most of this LTC is going to.  The hashing power seems to be centralized into one or a few dark pools.

Quote
$ litecoind verifymessage LSQAz3zmxfKAEPZJd9693Udrg19gEidHs8 "G0n+/4N/SwNJfsjVNrVvkVuGbwiR+X/Wwzm8IZk9WBuoZfriG7iWqnMdOALUDx4NEXfiTkeDsy5dk/OI3JUBQ9s=" "Yes, it's really me"
true

edit:
Code:
artforz: Lh4SgE576JGDAftCbjHSXNkGThFGjxtXxn LSQAz3zmxfKAEPZJd9693Udrg19gEidHs8 LN3MtQw5SBjpw3rCxpfoN2byozsZH4hps9 all belong to one darkpool (the smaller one)
artforz: theres a bigger one, pretty easy to tell its blocks by the random-looking nonce values, most of its generations ends up in LRD5YJcp5mQj8LHM1Q2LrzrBgpyuUR789V

Code:
XMR: 44GBHzv6ZyQdJkjqZje6KLZ3xSyN1hBSFAnLP6EAqJtCRVzMzZmeXTC2AHKDS9aEDTRKmo6a6o9r9j86pYfhCWDkKjbtcns
tacotime
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January 08, 2012, 05:42:29 PM
 #5

It appears that some of these pools/solo miners are either gone or have collapsed


Code:
XMR: 44GBHzv6ZyQdJkjqZje6KLZ3xSyN1hBSFAnLP6EAqJtCRVzMzZmeXTC2AHKDS9aEDTRKmo6a6o9r9j86pYfhCWDkKjbtcns
gmaxwell
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January 08, 2012, 06:38:15 PM
 #6

See the present dark pool size here: http://pool-x.eu/net

So— because I'm in the 'unknown' I'm the "dark pool"?

Awesome.
tacotime
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January 08, 2012, 06:46:21 PM
 #7

Well, technically, for lack of a better term to describe the composition of other (which you can determine generally using the block chain).  Using the term dark pool is also confusing because it already has a definition in algorithmic trading.  The composition of other, though, is either pools that are private or solo miners, so I'm not sure what term we should use to refer to it.

Code:
XMR: 44GBHzv6ZyQdJkjqZje6KLZ3xSyN1hBSFAnLP6EAqJtCRVzMzZmeXTC2AHKDS9aEDTRKmo6a6o9r9j86pYfhCWDkKjbtcns
k9quaint
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January 08, 2012, 07:29:50 PM
 #8

See the present dark pool size here: http://pool-x.eu/net

So— because I'm in the 'unknown' I'm the "dark pool"?

Awesome.


You are no longer "unknown" because you just identified yourself!
That means I am now the "dark pool". MWAAHAHAAHHAHAH!
wait...

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January 09, 2012, 02:06:43 AM
 #9

no i'm spartacus!

Tym's Get Rich Slow scheme: plse send .00001 to
btc: 1DKRaNUnMQkeby6Dk1d8e6fRczSrTEhd8p ltc: LV4Udu7x9aLs28MoMCzsvVGKJbSmrHESnt
thank you.
NASDAQEnema
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January 09, 2012, 07:51:06 PM
 #10

The dark pool or pools have been operational since roughly 10 days after the release of Litecoin.  Historically, almost all the LTC mined by the dark pool appears to be immediately released to the market at BTC-e for sale.

The dark pool provides a major advantage to LTC, which is that is is extremely difficult to attack (unless the dark pool chooses to).

On the flip side, there is the inherent problem of, aside from an unlikely 51% attack, these two scenarios:
- The dark pool is being mined by computers infected with trojans (botnet).  The release of virus definitions for these trojans would result in the rapid collapse of the hash rate by 80%, requiring weeks to lower the difficulty.  This is a likely scenario, as the hash rate here does not vary with the price of LTC (as you might expect for someone who has to worry about the costs of electricity).
- The dark pool decides to contract the supply by not bringing any LTC to the market for a long time, hence manipulating the market.  The possibility remains that the dark pool is attempting to assemble as large a mining network as possible before heavily constricting the supply, resulting in only a tiny amount of new coins being mined per day by others.  The result would be massive deflation.

The strange thing is that so far, the dark pool appears to have decided to sell as much as their LTC as possible.  With 80-90% of the mining capacity, the dark pool can act as a "central bank" for LTC; so why are they inflating it so intensely?

See the present dark pool size here: http://pool-x.eu/net

And historic network hash rates here: http://www.litecoinpool.org/charts

Isn't the point of a central bank to inflate for profit and deflate for panic leading to profit in the inflation stage?

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