Gold collapsing. Bitcoin UP.

[79b79aa8d5047da6d3XX]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

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[cypherdoc]

the device makers will have the incentive to form their own mining pools to collect BTC which i am sure they'll do.  this will further decentralize mining.

or it may concentrate it. we shall find out.

i don't see how taking today's mining pools and adding dozens of phone maker, router maker, and other device making mining pools with their millions of users can result in centralization.

It isn't clear those parties will create their own mining pools. They may outsource. But we don't know at this point, everyone is guessing, including whether this who concept gets any traction at all.

if they're going to essentially give the devices away for free, yes, those users will have to mine back at the company pool to pay the device off.

also, i don't think these companies would have invested in 21 w/o some larger plans:

“We think 21’s technology has the potential to span across a wide variety of industries and look forward to working with Balaji and the team.”
— Nagraj Kashyap, Senior Vice President, Qualcomm Ventures
“Bitcoin could be the internet’s next great protocol. With the blockchain’s distributed ledger and micro-transaction capabilities, it has the potential to become an enabling technology that expands well beyond digital payments. We’re delighted to be an investor in 21 and to work closely with Balaji and Ben.”
— Padmasree Warrior, Chief Technology & Strategy Officer, Cisco

[smooth]

the device makers will have the incentive to form their own mining pools to collect BTC which i am sure they'll do.  this will further decentralize mining.

or it may concentrate it. we shall find out.

i don't see how taking today's mining pools and adding dozens of phone maker, router maker, and other device making mining pools with their millions of users can result in centralization.

It isn't clear those parties will create their own mining pools. They may outsource. But we don't know at this point, everyone is guessing, including whether this who concept gets any traction at all.

if they're going to essentially give the devices away for free, yes, those users will have to mine back at the company pool to pay the device off.

I mean the manufacturers may outsource to new or existing large pools (which will then pay the Bitcoins or fiat to the manufacturer), instead of each creating their own. Its fairly normal for companies to leave that sort of thing to a specialist and not try to do it themselves. I'd guess some will, some won't.

[Adrian-x]

I find the 21 Dot Co. plans to be interesting and potentially pretty exciting. Speak-of efficiency though, I can't help but wonder if this could be achieved more effectively with a different algo like Blake256 which, to my understanding, is vastly more efficient than SHA256.  

Obviously that would require using an altcoin instead of bitcoin, and I know this tends to be a very bitcoin-only thread, so don't run me out of town on a rail as a heretic for asking.  

Efficiency isn't important, it's only important to individuals relative to your competition. Efficiency determines the total hash rate. The amount of energy consumed in PoW is determined by the price of bitcoin. We are in a price zone determined by the physical limitations of available energy space etc. Once we have halved we enter a new zone.

21 are positioning themselves to take advantage of a price spike like the run-up to $1200 when mining with a shitty GPU was more profitable than at any time prior, even more profitable after the more efficient ASICs for a short time. The price dip now has made bitcoin more efficient, not the advancement in tech. That's just given an opportunity to the innovators.

[cypherdoc]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

true, this won't be for everyone.

but i think these companies could be building their own virtuous cycles on top of Bitcoin which could cause the next bull run in price.  if so, how would that affect the developing country person's decision making?  pay full price for an ordinary water heater, or almost free for one with a Bitcoin miner built in?

[Adrian-x]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

true, this won't be for everyone.

but i think these companies could be building their own virtuous cycles on top of Bitcoin which could cause the next bull run in price.  if so, how would that affect the developing country person's decision making?  pay full price for an ordinary water heater, or almost free for one with a Bitcoin miner built in?

Having thought through the business opportunity, you would give free installation, and subsidize their electricity, if you really wanted to disrupt and make bitcoin boom, you would pick places where there is big government subsidizing of electricity. (Thinking Argentina or Venezuela,) and in effect you would export the subsidized electricity and sell some bitcoin into that market to pay for the electricity, it's a win win or all. :-)

[79b79aa8d5047da6d3XX]

all of which may or may not contribute to the centralization of the network, which was the original point.

[cypherdoc]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

true, this won't be for everyone.

but i think these companies could be building their own virtuous cycles on top of Bitcoin which could cause the next bull run in price.  if so, how would that affect the developing country person's decision making?  pay full price for an ordinary water heater, or almost free for one with a Bitcoin miner built in?

Having though through the business opportunity, you would give free installation, and subsidize their electricity, if you really wanted to disrupt and make bitcoin boom, you would pick places where there is big government subsidizing of electricity. (Thinking Argentina or Venezuela,) and in effect you would export the subsidized electricity and sell some bitcoin into that market to pay for the electricity, it's a win win or all. :-)

you know what i'll do?

buy a few extra batteries, keep them rotating thru charges free at work, while keeping the phone constantly mining at full capacity.

[Adrian-x]

all of which may or may not contribute to the centralization of the network, which was the original point.

Hardware will decentralizes, profits may or may not. Control will depend on the education level of the market.

[TPTB_need_war]

Rpietila, my stance is one of anticipating the TPTB's strategies and chess moves and trying to outsmart them. I don't know why you perceive this as fear. I care to observe their strategies because it helps me refine optimum counter-moves and/or reinforce the existing trajectory I am currently on. I think it is quite myopic to think I (we) can optimize my (our) strategy by being oblivious to theirs. I hope you can distinguish between this stance and fear or capitulation. Otherwise, please explain to me why my stance is less than ideal?

I believe we who choose "give me liberty or give me death" can be most efficacious if we recognize that TPTB attempt to use the ignorant masses as chattel against us and plan our strategies of defiance towards victory rather than martyrdom. Perhaps you felt disappointment if I didn't see the huge synergy between gaming and anonymity and perhaps I am wrong about that, but note I have significance experience with software marketing and I've found that without significant need in the mind of the user then significant ramp (oomph) is not attained. I sympathize if this observation irks you because I know none of us want our hard work to fail. Any way, you need a coin for your game, and that it is anonymous appears to not cause harm while the coin is not yet large and if it becomes large then that will be a good problem to have. So I say carry on. I wasn't blowing catastrophic holes in your strategy. I agree very much with the distribution strategy we discussed.

The 21 Inc paradigm doesn't seem to be very efficacious if it is actually employing the concept of energy efficiency advantage, because for those people who can afford centralized always available electric water heating (versus for example those here in the Philippines such as my house which uses a 3000+W heating element at the shower head which is only on one a few minutes per day, thus only a few $s per month insignificant to me) will find that a $50 per month decrease in their monthly expense is rather insignificant to their economic spending habits. They are not likely to be able to spend all these as micropayments and will rather likely dump this for fiat any way. Thus nearly no network effects and no really radically significant change in attitudes towards energy efficiency for the world. Afaics in this mode this is an incremental boost and not a game changer.

The threat of significance from the 21 Inc paradigm is to get Bitcoin into the hands of people for which a few $ per month is a significant enough event and who can't today afford to be always online. My social network idea is based in large part around this same observation. Interesting they are attacking a similar market that I targeted. Clearly they recognize the challenge for them is to make sure this developing world demographic doesn't go astray into free market solutions.

Afaics I can estimate from my general experience level, it appears the most significant inroads would be made with Bitcoin mining in smartphones, because everyone in the developing world wants one and wants to be connected online always. But this will not make mining more efficient (no requirement for excess heat in smartphones) and so it needs to be some sort of ruse.

The more I think about this, they have some serious challenges to overcome on the economics. The main one is that they've got to top-down drive (against competing opportunity costs for all involved) economies-of-scale into this ecosystem to make it attractive to users because smartphones are not yet inexpensive enough to finance with hidden incremental increases in electricity costs, i.e. signup offerings for micropayments which are worthwhile to the user and/or sign arrangements with connectivity that are able to fool users that spending more $ per day in electricity than they would have paid for the connectivity in cash.

Luckily for us the banksters are trying to shoehorn something into the free market that probably has less entropy than the network efforts that can be obtained with a free market offering of decentralized micropayments to these same users along with synergy of the same micropayments to the mover and shaker Westerners who drive initial network effects which won't be available in this more centralized, top-down attempt.

But this is a wake up call that we need to stop being complacent and release our solutions pronto.

[Adrian-x]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

true, this won't be for everyone.

but i think these companies could be building their own virtuous cycles on top of Bitcoin which could cause the next bull run in price.  if so, how would that affect the developing country person's decision making?  pay full price for an ordinary water heater, or almost free for one with a Bitcoin miner built in?

Having though through the business opportunity, you would give free installation, and subsidize their electricity, if you really wanted to disrupt and make bitcoin boom, you would pick places where there is big government subsidizing of electricity. (Thinking Argentina or Venezuela,) and in effect you would export the subsidized electricity and sell some bitcoin into that market to pay for the electricity, it's a win win or all. :-)

you know what i'll do?

buy a few extra batteries, keep them rotating thru charges free at work, while keeping the phone constantly mining at full capacity.

I'll raise you,  and out bid your phone and get into the home business of making yogurt or drying paint or making candles with the extra heat.

[TPTB_need_war]

I am not surprised to hear about the bold part, but question whether or not this is legal on an employer's part. Employers can (and should) censor employee communication regarding their specific industry (customers, competitors, etc). But they can not censor employee's speech in general. Obviously there are gray areas on where you draw the line and my understanding is from a legal sense the line fairly well defined to a specific & narrow set of firms that an employer interacts with or competes with. Having an investor with an unrelated investment does not qualify.

A bitcoin company does not work with or compete with an altcoin company, they are in separate areas. I would not be happy with an employer who censored me here, and think I would have legal standing to push back on that.

I'm not going to name the specific companies involved due to the risk of retaliation against the employees involved, but it might be worth asking the CEOs of established, respected Bitcoin companies about their policies regarding the right of their employees to express their own personal views in public.

That isn't a phenomenon unique to Bitcoin companies.

I smell a mountain from anthill propaganda attempt.

Data?

"Photos or it didn't happen"

[stereotype]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

true, this won't be for everyone.

but i think these companies could be building their own virtuous cycles on top of Bitcoin which could cause the next bull run in price.  if so, how would that affect the developing country person's decision making?  pay full price for an ordinary water heater, or almost free for one with a Bitcoin miner built in?

Having though through the business opportunity, you would give free installation, and subsidize their electricity, if you really wanted to disrupt and make bitcoin boom, you would pick places where there is big government subsidizing of electricity. (Thinking Argentina or Venezuela,) and in effect you would export the subsidized electricity and sell some bitcoin into that market to pay for the electricity, it's a win win or all. :-)

you know what i'll do?

buy a few extra batteries, keep them rotating thru charges free at work, while keeping the phone constantly mining at full capacity.

I'll raise you,  and out bid your phone and get into the home business of making yogurt or drying paint or making candles with the extra heat.

And i will be using a spare Kw or so, via the combustion engine, on my way to work/at work/travelling etc.

[TPTB_need_war]

His question was not asking about energy efficiency, but rather what is the holistic point of it all. And he is correct that the energy efficiency is scam. The real goal is enslavement of the developing world by loaning a smartphone in exchange for unnoticed electricity usage.

His question was exactly efficiency. I answered both with respect to energy efficiency (much better than the best ASICs as currently deployed, given effectively free electricity) and overall efficiency (likely also, since the chips will likely be very cheap). If I recall correctly I also said I didn't think it was a particularly good idea, regardless of efficiency.

He didn't ask about Larry Summers, etc. That's fair game for you be interested in talking about, but not what he asked.

Is it possible for a toaster/phone + mining chip to be as/more efficient than the best ASIC's on the market, and if it is not, how can this be a cost-efficient way to mine?

Cropping what he wrote doesn't help you. It is clear to me he was asking what the overall economic point is, and he introduced energy efficiency as one of the aspects that doesn't give him a holistic understanding. If you then argue that efficiency is improved in irrelevant and insignificant markets, you create holistic myopia instead of understanding.

Larry Summers participation is irrelevant to whether there is a usage case for the excess heat which makes a significant economic argument. I can't think of such a usage case.

[cypherdoc]

that's ok.  there are hundreds if not thousands of businesses that could eventually participate.

fine, but if the proverbial "developing country" person is shopping for a water heater, she is just shopping for a water heater. not for the best combo heater/miner that heats water just right and contributes to the decentralization of the bitcoin network.

but yes, just speculating anyway. special thanks to smooth, your recent posts have been very stimulating.

true, this won't be for everyone.

but i think these companies could be building their own virtuous cycles on top of Bitcoin which could cause the next bull run in price.  if so, how would that affect the developing country person's decision making?  pay full price for an ordinary water heater, or almost free for one with a Bitcoin miner built in?

Having though through the business opportunity, you would give free installation, and subsidize their electricity, if you really wanted to disrupt and make bitcoin boom, you would pick places where there is big government subsidizing of electricity. (Thinking Argentina or Venezuela,) and in effect you would export the subsidized electricity and sell some bitcoin into that market to pay for the electricity, it's a win win or all. :-)

you know what i'll do?

buy a few extra batteries, keep them rotating thru charges free at work, while keeping the phone constantly mining at full capacity.

I'll raise you,  and out bid your phone and get into the home business of making yogurt or drying paint or making candles with the extra heat.

we joke but you know what?  this is one of the most important things that caught my eye back in Jan 2011 and why i got into Bitcoin back then:  the sheer, raw, unadulterated ingenuity of miners.  those videos of guys with equipment scattered all over their garages or basements, cords everywhere, fans blowing loud as hell, nuts, bolts, screwdrivers lying in wait.  these guys will do anything to make money.  that's what convinced me of what a true grassroots movement this is.  no gvt is going to have the willpower or manpower to go and kick in all these guys doors.  it just can't be done.  and yes, while mining has become more industrialized and more professional, these same guys are still the ones pointing their custom asics at the pools.  they are still independent.

[TPTB_need_war]

I'll raise you,  and out bid your phone and get into the home business of making yogurt or drying paint or making candles with the extra heat.

And i will be using a spare Kw or so, via the combustion engine, on my way to work/at work/travelling etc.

Buy an established pizza restaurant and keep your oven filled with waste heat from mining. Problem is that the cost of that heat is a small portion of the operating cost and hassles of the business.

Stirling engines are very inefficient (compared to combustion engines) otherwise transportation might be a viable market. Adding unfocused heat to a combustion engine lowers the efficiency.

This is why smooth's efficiency arguments are irrelevant.

The Knowledge Age is not about physical constraints. It is about mental ones. Our ROI is coming from our mental efforts not incremental tangible efficiencies. I wouldn't waste an hour of my life on saving $10 a month. My opportunity cost is too great.

[Adrian-x]

His question was not asking about energy efficiency, but rather what is the holistic point of it all. And he is correct that the energy efficiency is scam. The real goal is enslavement of the developing world by loaning a smartphone in exchange for unnoticed electricity usage.

His question was exactly efficiency. I answered both with respect to energy efficiency (much better than the best ASICs as currently deployed, given effectively free electricity) and overall efficiency (likely also, since the chips will likely be very cheap). If I recall correctly I also said I didn't think it was a particularly good idea, regardless of efficiency.

He didn't ask about Larry Summers, etc. That's fair game for you be interested in talking about, but not what he asked.

Is it possible for a toaster/phone + mining chip to be as/more efficient than the best ASIC's on the market, and if it is not, how can this be a cost-efficient way to mine?

Cropping what he wrote doesn't help you. It is clear to me he was asking what the overall economic point is, and he introduced energy efficiency as one of the aspects that doesn't give him a holistic understanding. If you then argue that efficiency is improved in irrelevant and insignificant markets, you create holistic myopia instead of understanding.

Larry Summers participation is irrelevant to whether there is a usage case for the excess heat which makes a significant economic argument. I can't think of one.

That's why we have the halving, the efficiency comes as a byproduct of the protocol. There are no industry's that can not feel a disruption when production costs stay the same and output is halved.

The only miners that will be competitive are the distributed ones with distributed costs.

[TPTB_need_war]

His question was not asking about energy efficiency, but rather what is the holistic point of it all. And he is correct that the energy efficiency is scam. The real goal is enslavement of the developing world by loaning a smartphone in exchange for unnoticed electricity usage.

His question was exactly efficiency. I answered both with respect to energy efficiency (much better than the best ASICs as currently deployed, given effectively free electricity) and overall efficiency (likely also, since the chips will likely be very cheap). If I recall correctly I also said I didn't think it was a particularly good idea, regardless of efficiency.

He didn't ask about Larry Summers, etc. That's fair game for you be interested in talking about, but not what he asked.

Is it possible for a toaster/phone + mining chip to be as/more efficient than the best ASIC's on the market, and if it is not, how can this be a cost-efficient way to mine?

Cropping what he wrote doesn't help you. It is clear to me he was asking what the overall economic point is, and he introduced energy efficiency as one of the aspects that doesn't give him a holistic understanding. If you then argue that efficiency is improved in irrelevant and insignificant markets, you create holistic myopia instead of understanding.

Larry Summers participation is irrelevant to whether there is a usage case for the excess heat which makes a significant economic argument. I can't think of one.

That's why we have the halving, the efficiency comes as a byproduct of the protocol. There are no industry's that can not feel a disruption when production costs stay the same and output is halved.

The only ones that will be competitive are the distributed ones with distributed costs.

In that case the price of Bitcoin would plummet, because the efficiency is not registered with the miner and thus they are not a HODLer and rather a seller. And you remove all that existing hardware from the market cap.

Rather I think you will find there just isn't much interest because there is no significant efficiency gains for the miners (100% of 1% = 1%) and they have opportunity costs on their time, hassle, etc.

This is trying top-down shoehorn something that doesn't fit into a market.

[TPTB_need_war]

The network does. Difficulty goes up. Security goes up.

Security goes down! These nodes are all serving the designated pool.

We don't know that yet. They haven't disclosed how the mining is actually going to work. I'd guess you are right about it being a pool, but whether that is an increase or decrease in security overall is a matter of interpretation (including, relative to what?)

It is difficult to argue for benefits. It is reasonable to argue that Bitcoin is already so centralized it doesn't matter. Any case, I think the entire concept fails on the economics. Mass movements are not created from offers of incremental improvements. Humans have too many opportunity costs on their attention.

The most vulnerable market is the developing markets where people there lack enough capital for the basic things they want.

[Adrian-x]

His question was not asking about energy efficiency, but rather what is the holistic point of it all. And he is correct that the energy efficiency is scam. The real goal is enslavement of the developing world by loaning a smartphone in exchange for unnoticed electricity usage.

His question was exactly efficiency. I answered both with respect to energy efficiency (much better than the best ASICs as currently deployed, given effectively free electricity) and overall efficiency (likely also, since the chips will likely be very cheap). If I recall correctly I also said I didn't think it was a particularly good idea, regardless of efficiency.

He didn't ask about Larry Summers, etc. That's fair game for you be interested in talking about, but not what he asked.

Is it possible for a toaster/phone + mining chip to be as/more efficient than the best ASIC's on the market, and if it is not, how can this be a cost-efficient way to mine?

Cropping what he wrote doesn't help you. It is clear to me he was asking what the overall economic point is, and he introduced energy efficiency as one of the aspects that doesn't give him a holistic understanding. If you then argue that efficiency is improved in irrelevant and insignificant markets, you create holistic myopia instead of understanding.

Larry Summers participation is irrelevant to whether there is a usage case for the excess heat which makes a significant economic argument. I can't think of one.

That's why we have the halving, the efficiency comes as a byproduct of the protocol. There are no industry's that can not feel a disruption when production costs stay the same and output is halved.

The only ones that will be competitive are the distributed ones with distributed costs.

In that case the price of Bitcoin would plummet, because the efficiency is not registered with the miner and thus they are not a HODLer and rather a seller.

Rather I think you will find there just isn't much interest because there is no significant efficiency gains for the miners and they have opportunity costs on their time, hassle, etc.

This is trying top-down shoehorn something that doesn't fit into a market.

It's the price of bitcoin that driver the energy input needed to secure the value stored on the blockchain it's competition that drives efficiency, utilizing the heat just gives individual miners a relative advantage to be more profitable.

If efficiency a market driven phenomenon causes centralization, that is a reflection of progress, it is not a failure of the protocol.  it will still be disrupted every 4 years.