ASICMINER: Entering the Future of ASIC Mining by Inventing It

[memvola]

Fair enough, I agree. This is logical. The problem is - just look at this forum - there is an irrational, overblown fear of the "51% attack". If ASICMINER starts soloing with a huge chunk of power, or if it contributes to one pool thus making that pool close to or over 50%, all hell will break loose in the forums, then the press will pick up, and next thing you know the public will be irradiated with sensational half-truths, disinformation, and fear mongering. Therefore, it may be a prudent PR move to distribute the power, in a transparent manner, into the hands of several pool operators.

Besides the irrational fear, there is a very legitimate aspect of the concern, regardless of whether it is even plausible to think that ASICMINER is a threat. Your PR move has zero value for people who matter, especially the ones who have the responsibility to develop the system itself. It's very un-Bitcoin to have to trust any particular party, and it really doesn't matter whether it is benign. The only way to address this concern is to split hashing power into different stations and introduce some degree of social insulation between them. This may very well be easily doable. Maybe not though. You may still view it as a PR move, but I think it is much more defensible.

Of course for all we know, all chips are toast and we are arguing over nothing.

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[Deprived]

It's very un-Bitcoin to have to trust any particular party, and it really doesn't matter whether it is benign. The only way to address this concern is to split hashing power into different stations and introduce some degree of social insulation between them. This may very well be easily doable. Maybe not though. You may still view it as a PR move, but I think it is much more defensible.

Thing is, splitting it between pools still requires exactly same solo-mining.  In both cases you have to trust friedcat not to 51% attack - as there's no way to FORCE him to split it between pools.  So as there's no way to secretly double-spend, splitting between pools achieves absolutely zero in practical terms - and so shouldn't give any PR benefit.  Maybe in practice it WOULD give PR benefit - but I don't believe we should be pandering to the ignorant who don't understand simple logic just so they feel happier that somehow some need for trust has been removed (when it hasn't).

No matter what we discuss or what friedcat agrees to do, we (and everyone else) still has to trust that if the chips arrive, work and could generate 51% of network power he won't abuse it.  And IF it all works like that then he'd be cutting off his nose to spite his face by 51% attacking anyway - as if you can mine the majority of newly minted BTC last thing you'd want to do is massively devalue BTC (beyond the devaluation likely to occur anyway when ASICs come out) and risk some major change in hashing algorithm to shut your chips totally out of BTC in the future.

Plus honestly not sure why people think ASICs will work well on pools alongside GPUs/FPGAs - won't they need an entirely different granularity of work to avoid being totally inefficent?  Are people who propose splitting across multiple pools suggestng the ASICs sit idle whilst pools get adjusted to work with them?  If not (and they accept solo mining before moving to updated pools) then why the need to move if he didn't 51% before moving (and let's face it - best way to 51% attack anyway would be to do it before even announcing the ASICs were ready, which no plans/announcements/commitments to pool mine can prevent).

It's meaningless PR - far better to explain WHY it's entireless pointless than play out some pretence at the cost of efficiency.

[lagmo]

It's very un-Bitcoin to have to trust any particular party, and it really doesn't matter whether it is benign. The only way to address this concern is to split hashing power into different stations and introduce some degree of social insulation between them. This may very well be easily doable. Maybe not though. You may still view it as a PR move, but I think it is much more defensible.

Thing is, splitting it between pools still requires exactly same solo-mining.  In both cases you have to trust friedcat not to 51% attack - as there's no way to FORCE him to split it between pools.  So as there's no way to secretly double-spend, splitting between pools achieves absolutely zero in practical terms - and so shouldn't give any PR benefit.  Maybe in practice it WOULD give PR benefit - but I don't believe we should be pandering to the ignorant who don't understand simple logic just so they feel happier that somehow some need for trust has been removed (when it hasn't).

Why not just use a decentralized Pool like P2Pool?
That should at least provide some transparency.

[Jutarul]

The moral of the 51% tale is that bitcoin, as the first cryptocurrency, is fragile as long as it's young and the hashing is not technology bound. Decentralization can only be guaranteed if there are no technology leaps - and these ASICs are likely to be the second to last leap to occur. The next one will be, when a company has enough money to develop a chip which is state of the art (and I don't think BFL has that quite yet).

If you want to protect bitcoin from 51% attacks during these times, first thing to do is to (re-)introduce checkpointing again - at least temporarily.

[nathanrees19]

Asicminer is clearly one distributor of Asic-Hardware.

I disagree; it isn't clear at all. A quick read through the OP and it looks like they are selling shares for a self-mining company.

They drive away potential buyers from Asicminer.

Potential buyers for what? What/Where's the product? Where's the website advertising the product?

Especially because all the other companies arent selling anything yet too.

It is true that they aren't shipping, but BFL and Avalon both have websites that make what they intend to sell very clear. Some will have pre-ordered, while others are waiting for stock to become available so they can buy it. People know about the product and they want the product.

ASICMINER has a thread about selling shares. Any information about a potential of selling a product is buried.

On the other hand i think Asicminer should start to think about how to sell the Asics. There needs to be a website at one time at least. Now the demand should be created. Its not good to let this part of the business lay down until short before selling i think. Others could take away the needed domainnames and so on. Plus you lose time of cheap advertising because potential customers cant find any infos.

This. If ASICMINER is serious about selling a product, they need to look serious. You can't "maybe" sell a product, it has to be a clear and direct goal of the company.

I hope ASICMINER considers this to be constructive criticism; ASIC vendor competition is important.

[memvola]

It's very un-Bitcoin to have to trust any particular party, and it really doesn't matter whether it is benign. The only way to address this concern is to split hashing power into different stations and introduce some degree of social insulation between them. This may very well be easily doable. Maybe not though. You may still view it as a PR move, but I think it is much more defensible.

Thing is, splitting it between pools still requires exactly same solo-mining.  In both cases you have to trust friedcat not to 51% attack - as there's no way to FORCE him to split it between pools.  So as there's no way to secretly double-spend, splitting between pools achieves absolutely zero in practical terms - and so shouldn't give any PR benefit.

Exactly. That's why you need to both physically and socially split the mining power. I was originally talking about making and selling mining farms, I don't know how pools are relevant.

I mentioned PR because even though you may split the hardware into different & disconnected locations and let them be run by different people, there is still some concern as long as it's under the same corporate roof. However, it still mitigates most probable attacks, and is therefore more defensible from a PR standpoint. I myself would like them to be run by different interest groups entirely.

[friedcat]

Update

This is a quick update. Please expect more details soon.

1. Our wafers are already in the slicing and packaging service. Whether we could beat everyone else in early delivering, or we have to revise and redo the wafers, will be known within the next two weeks.

2. All shareholders who have ambiguous Bitcoin addresses will receive the confirmation mails within this week.

3. We will make ASICMINER re-hosted after the confirmations, as well as the platform decided. It will not be later
than our first deploying and the first payment to shareholders.

[DiabloD3]

I don't get why everyones getting so hyped up about a 51% attack.

All the 51% attack does is allow extremely limited double spending attacks (and only double spending from the point of view of non-bitcoin transactions, ie, a currency exchange or a physical inventory-based vendor). The attacker cannot forge fake transactions.

51% doesn't mean what most people think it means. If the network rate is 25TH, then the attacker must have OVER 25TH to perform the attack. With the current batch of chips that friedcat ordered, he won't have enough to even come close.

What we really need to be worried about, as a community, is why the other ASIC vendors allowed ASICMINER to become >51%. If BFL and Avalon and bASIC all ship what they said they'd ship, ASICMINER would be less than a quarter of the new network.

[memvola]

All the 51% attack does is allow extremely limited double spending attacks (and only double spending from the point of view of non-bitcoin transactions, ie, a currency exchange or a physical inventory-based vendor). The attacker cannot forge fake transactions.

It could also be used to prevent transactions, rendering the network useless.

I think it's mostly the reduced trust in PoW that's what makes devs and investors wary, not the possibility of an attack itself.

What we really need to be worried about, as a community, is why the other ASIC vendors allowed ASICMINER to become >51%

+1

[DutchBrat]

Update

This is a quick update. Please expect more details soon.

1. Our wafers are already in the slicing and packaging service. Whether we could beat everyone else in early delivering, or we have to revise and redo the wafers, will be known within the next two weeks.

2. All shareholders who have ambiguous Bitcoin addresses will receive the confirmation mails within this week.

3. We will make ASICMINER re-hosted after the confirmations, as well as the platform decided. It will not be later
than our first deploying and the first payment to shareholders.

Thanks for keeping us up to date

Good luck !!!

[MPOE-PR]

They drive away potential buyers from Asicminer. Im not sure what to think about this.

Well, asicminer is not taking preorders, because it wants to be a mining company, not a mining gear supplier. So it's split itself up into shares representing the equity. Except it's not listed anywhere, nobody can buy or sell it.

I can see why the community'd start forgetting about them at this point, as what exact sense does it make to have them figure in places like the wiki? What potential buyers? There's no way to buy anything from them even if you wanted to. They aren't selling rigs, their shares can't be sold, what buyers? Buying what?

Of course for all we know, all chips are toast and we are arguing over nothing.

Which ties into the point above. Gmaxwell is an ass, sure, but I don't see much merit in Diablo's theory that Lukedash is "a BFL shill".

Thing is, splitting it between pools still requires exactly same solo-mining.  In both cases you have to trust friedcat not to 51% attack

From what I understand, mining in a pool is different from mining solo in that the pool operator, and not the pool miner, controls the mining. So mining in a pool would be akin to going "here, community, is some hashing power, use it as you think fit," whereas mining solo would be "we reserve the right to attack the network any way we see fit, deliberately or accidentally".

The merit of going with some pools is that their ops have so far shown themselves credible. For an example: hashpower is 12TH today, slush gets 6TH, Luke gets 4TH Graet gets 2TH (I left some pools out please don't get insulted, it's just a simple example!). Tomorrow, this company adds 24TH to that pool, of which 12 to slush, 8 to Luke, 4 to Graet. It's true that all the pools grew by 200%, but because ALL grew by 200% their relative proportions are still the same, 50%, 33%, 17%.

So maybe in the end the best strategy would be to do a neutral split, mine proportionally in all the pools, equal to their current market share. Speaking of PR moves, THIS would have been the smart PR move to make. Unfortunately the aspiring mining company not only lacks the strategic competence to list itself on the right exchange, it also lacks the strategic competence to properly handle its market communications. Obviously all these are remediable flaws, provided they have more sense than BFL and start working on remedial rather than waste effort in denial.

[DutchBrat]

Well, asicminer is not taking preorders, because it wants to be a mining company, not a mining gear supplier. So it's split itself up into shares representing the equity. Except it's not listed anywhere, nobody can buy or sell it.

I can see why the community'd start forgetting about them at this point, as what exact sense does it make to have them figure in places like the wiki? What potential buyers? There's no way to buy anything from them even if you wanted to. They aren't selling rigs, their shares can't be sold, what buyers? Buying what?

Yet in their business plan they state:

I'm relatively active between 1:00AM to 3:00PM of forum time each day. Contacting me within this time interval could get quicker responses.

Business plan and Estimated Return The expected starting date of chips
manufacturing is late August to September, 2012. The chips are supposed to be
deployed and start hashing in October to November, 2012.

After the ASIC miner chips are produced and deployed, we will first directly
mine with them, then use part of the revenue to make user-friendlier mining
boards or rigs for sale.

If our chips are successfully produced, all the following businesses will
contribute to the shareholders' return:
  Self-Mining with First Batch of Chips At least 12TH/s in
total, that is equivalent to 30MH/s per share, or 300MH/s per BTC.
  Hashrate/Chip/Board Selling Net profits are
conservatively calculated as $5 per GH/s. That roughly equals to 0.5BTC per
GH/s with the current BTC/USD exchange rate. It means that each time we sell
1TH/s of hashing power in various forms, the net profit per share will be
1.25mBTC, that is, 1.25% of the initial investment.
  Self-Mining after Mass Production Unlimited hashrate in
theory because of the low margin cost. But in reality we have to consider the
cost of management (labor) and place (rent). We believe an expansion to 50TH/s
is not hard to achieve. That pushes the hashrate per share to 155MH/s, or
1.55G/s per BTC.
  Next-Generation Products The plan will be discussed among
board members and approved by shareholders, because it would require keeping
some of the revenues instead of paying them all as dividends. The return of
this stage is difficult to estimate, since in the Bitcoin world everything may
happen and happens even quicklier than imagination. But we personally believe
that much more potential profits wait there.

[nathanrees19]

1. Our wafers are already in the slicing and packaging service. Whether we could beat everyone else in early delivering, or we have to revise and redo the wafers, will be known within the next two weeks.

BTCest of luck. :3

[MPOE-PR]

Yet in their business plan they state:

After the ASIC miner chips are produced and deployed, we will first directly
mine with them, then use part of the revenue to make user-friendlier mining
boards or rigs for sale.

Yes, I am aware. Many ifs in there.

[meowmeowbrowncow]

It's funny how people on one side or another of an argument can be so completely blind to the opposing premise.


I wince when I hear statements like, 'the only logical answer ...,' without any substantive rebuttal of specific argument.

[bitfair]

Update
1. Our wafers are already in the slicing and packaging service. Whether we could beat everyone else in early delivering, or we have to revise and redo the wafers, will be known within the next two weeks.

An encouraging update! It means the chips at least passed the QC at the fab, and that slicing+packaging+testing is already under way. I'm hungry for more info, please return soon and fill in more blanks:
1) Recovered the ~5000 BTC from GLBSE yet? (I would like to just stop worrying about it...)
2) Did the fab really process 12 layers in 7 days, or was it simply information delay?? [Dec 05: "There are 12 layers left", Dec 12: "we are now in QC"]
3) What is the reason for deploying the second half of the chips later than the first? [Genuine question, I'm simply not smart enough that the reasons are obvious to me!]

I think I can say on behalf of all (at least many/most) stakeholders: Thanks, congrats, and keep up the great work!

[DiabloD3]

Update
1. Our wafers are already in the slicing and packaging service. Whether we could beat everyone else in early delivering, or we have to revise and redo the wafers, will be known within the next two weeks.

An encouraging update! It means the chips at least passed the QC at the fab, and that slicing+packaging+testing is already under way. I'm hungry for more info, please return soon and fill in more blanks:
1) Recovered the ~5000 BTC from GLBSE yet? (I would like to just stop worrying about it...)
2) Did the fab really process 12 layers in 7 days, or was it simply information delay?? [Dec 05: "There are 12 layers left", Dec 12: "we are now in QC"]
3) What is the reason for deploying the second half of the chips later than the first? [Genuine question, I'm simply not smart enough that the reasons are obvious to me!]

I think I can say on behalf of all (at least many/most) stakeholders: Thanks, congrats, and keep up the great work!

With #3, from what friedcat has said in this thread, this is what seems to be going on: the chips are now out of the fab, are being packaged and tested, and soon as thats done they will be shipped to friedcat or another company to be inserted onto boards (he hasn't said whos manning the solder gun on this yet, or if he did, I missed it). He hasn't said whos manufacturing the boards (this should be easier to do than with FPGAs, btw) or if they're done yet or not.

The packaging, shipping to next location to be board mounted and have the assembled product QCed, and then being shipped to wherever friedcat has chosen to set these up for mining, can all be done concurrently depending on how the companies handle it.

Also, from what I understand, soon as mining has produced enough money for a second and possibly third run of ASICs, thats going to happen too.

I think that somewhat answers your question.

[novusordo]

Yet in their business plan they state:

After the ASIC miner chips are produced and deployed, we will first directly
mine with them, then use part of the revenue to make user-friendlier mining
boards or rigs for sale.

Yes, I am aware. Many ifs in there.

Funny, I've re-read the quote numerous times, but I've failed to find a single instance of "if".

[kano]

Yet in their business plan they state:

After the ASIC miner chips are produced and deployed, we will first directly
mine with them, then use part of the revenue to make user-friendlier mining
boards or rigs for sale.

Yes, I am aware. Many ifs in there.

Funny, I've re-read the quote numerous times, but I've failed to find a single instance of "if".

Meh, people don't see past the obvious

[SebastianJu]

I refered to the business plan, right. It stated that asicminers business is to first mine with the hardware as long as its bringing the best income and later start to selling Asics. I guess the time when selling Asics is a better practice then simply mining wont come so fast but it will come. Question is how far this is in the future.

I think the claims to sell fast, sell to shareholders and so on shouldnt be followed. Asicminer would be stupid to sell the Asic-Cashcows for low money while they could make a fortune selfmining. It would be unfair to the rest of shareholders too that didnt get an Asic. So no, i think selling shouldnt come fast. The question is when it will come (competition and so on) and when preorders, a buying website and so on will be available. If its planned in some months, maybe because it can be seen that the competition will grow to an amount where the win for selling an Asicdevice will be higher than mining a year or whatever then it has to be thought about marketing. Making people eager to want one, prebuy, inform them about the power of the asics (at the moment the infos would be rare of course). But this would only mean more sells later. And when you can advertise for nearly no cost at your target audience its something to consider.

Of course... when the time, when mining with asics isnt so much worth than selling it comes in years only then you wouldnt need to consider. But selling asics was part of the plan from the start so it will come most probably.