Decentralizing Mining - The future of BitShares Mining

[Stan]

I think this is a great idea - I read up on ProtoShares right after it went live and i just liked the whole concept of CPU mining and DAC's, but i quickly realized i was too late to the game by just a few days. I looked forward to being an early adopter, but in this case early adopters were the ones who began mining the first 24 hours.

And as other have said, it's not the botnets that will support ProtoShares in the long run, it's a dedicated user base.

It may be too late to be a big ProtoShares lottery winner but it's not too late to be a wily ProtoShares investor.
Many opportunities for ProtoShareholders are inbound like planes at a busy airport, no matter how you wind up acquiring them.

 

[ThisNinja]

I think this is a great idea - I read up on ProtoShares right after it went live and i just liked the whole concept of CPU mining and DAC's, but i quickly realized i was too late to the game by just a few days. I looked forward to being an early adopter, but in this case early adopters were the ones who began mining the first 24 hours.

And as other have said, it's not the botnets that will support ProtoShares in the long run, it's a dedicated user base.

[Pocket Sand]

The power-ball prizes would have to limited to 1% of the money supply and have a limited withdraw rate.  If you take a lump-sum payout you only get 10%, but if you payout over 24 months you can get the whole thing.

On a network like Bitcoin, it would be a $50 million dollar jackpot which would drive a lot of people to attempt to win it and thus 'hold' bitcoin and mine it.   There is obviously a chicken and the egg problem as the prizes would be small unless enough people caught on.   But with a network like BitShares, such a bounty is easily a potential. 

I agree that there is a segment of the population that demands predictability.  This segment will probably mine in pools which would eliminate most variance and is unlikely to solo-mine.   So randomness should not change things for the pool miner.

Well then I don't necessarily see the whole point in using a randomized "lottery-style" reward mechanism. Like you said, people can still join pools to the same effect as before, but so can cloud miners and botnets.

What purpose does using this lottery reward system solve in terms of evening out the mining rewards when a botnet or cloud miner still has a significant advantage in gaining just as much as they did when protoshares were released (if not more if their luck is better)?

In my opinion this mechanism will provide Bitshares with the exact opposite effect than the one you want.

Releasing these grand prizes will most likely cause frustration further in solo miners that don't pool as they'll constantly see these "powerballs" floating right towards these giant botnets, cloud miners, and over-sized pools. In this scenario I also believe people want predictability more than you think and I can easily see an incredibly oversized pool with over 50% of the hashing power popping up.

- As always, not criticizing, just voicing concerns.

[CryptoN8]

As far as the 6 months, I think that is way too much time. People will lose interest in the coin. Do you even remember 6 months ago in Bitcoin history?

I remember 6 months ago waiting for a specific company to deliver ASIC product.  I really hope the algorithm going forward fixes that.

[bytemaster]

The power-ball prizes would have to limited to 1% of the money supply and have a limited withdraw rate.  If you take a lump-sum payout you only get 10%, but if you payout over 24 months you can get the whole thing.

On a network like Bitcoin, it would be a $50 million dollar jackpot which would drive a lot of people to attempt to win it and thus 'hold' bitcoin and mine it.   There is obviously a chicken and the egg problem as the prizes would be small unless enough people caught on.   But with a network like BitShares, such a bounty is easily a potential. 

I agree that there is a segment of the population that demands predictability.  This segment will probably mine in pools which would eliminate most variance and is unlikely to solo-mine.   So randomness should not change things for the pool miner.

Technically how would the user be able to choose between a lump-sum payout and a payout over 24 months?

As far as the 6 months, I think that is way too much time. People will lose interest in the coin. Do you even remember 6 months ago in Bitcoin history?

Which would cause people to lose interest faster... selling something right after they mine it and then having the difficulty go up and thus they have nothing left... or holding something that is rising in value?  They know they have it and that it is worth something and will follow it for months so they can cash it out.

Those who want instant payout can have it at a price that rewards those who have a long-term interest in the coin.

[super3]

The power-ball prizes would have to limited to 1% of the money supply and have a limited withdraw rate.  If you take a lump-sum payout you only get 10%, but if you payout over 24 months you can get the whole thing.

On a network like Bitcoin, it would be a $50 million dollar jackpot which would drive a lot of people to attempt to win it and thus 'hold' bitcoin and mine it.   There is obviously a chicken and the egg problem as the prizes would be small unless enough people caught on.   But with a network like BitShares, such a bounty is easily a potential. 

I agree that there is a segment of the population that demands predictability.  This segment will probably mine in pools which would eliminate most variance and is unlikely to solo-mine.   So randomness should not change things for the pool miner.

Technically how would the user be able to choose between a lump-sum payout and a payout over 24 months?

As far as the 6 months, I think that is way too much time. People will lose interest in the coin. Do you even remember 6 months ago in Bitcoin history?

[bytemaster]

The power-ball prizes would have to limited to 1% of the money supply and have a limited withdraw rate.  If you take a lump-sum payout you only get 10%, but if you payout over 24 months you can get the whole thing.

On a network like Bitcoin, it would be a $50 million dollar jackpot which would drive a lot of people to attempt to win it and thus 'hold' bitcoin and mine it.   There is obviously a chicken and the egg problem as the prizes would be small unless enough people caught on.   But with a network like BitShares, such a bounty is easily a potential. 

I agree that there is a segment of the population that demands predictability.  This segment will probably mine in pools which would eliminate most variance and is unlikely to solo-mine.   So randomness should not change things for the pool miner.   

[Pocket Sand]

I would like to start by saying I am completely for the 6 month set vesting time, it would allow for all the aspects you listed earlier (and reduce the ability for cloud miners and botnets) but I have a few concerns about the other ideas you had recently mentioned:

I personally do not see the reason why Bitshare needs a random vesting period? It would allow more botnet/cloud miners to recoup their losses if they mine enough and it would make it more frustrating for regular miners. Most of the miners are smarter than the average "powerball player" and are not interested in a .000001% chance for any payout. I'd MUCH MUCH MUCH rather have less randomness than absolutely needed, all these random vesting periods and block amounts would frustrate me and ultimately cause a lot less people to mine this altogether. The powerball idea also poses problems in my mind as to if a few people win the few giant coin prizes, the bulk of the coins will ultimately end up in the hands of a few people. Bitshares are your main project so I hope you won't try too many different concepts than needed that could possibly jeopardize the integrity of the project as a whole.

[bytemaster]

I do like the idea of the lottery to decentralized, I just think it'll be very hard to figure out exactly how to tune the lottery so that cloud mining and botnets aren't attracted, but the individual user is. After all, there are people who spend insane amounts of money on the lottery just for the chance of winning, so there may still be individuals that are willing to spend money on cloud mining even if it turns out to be unprofitable.

You don't try to stop everyone, you just try to increase the number of solo miners.    Under bitcoin and even ProtoShares the number of solo miners is essentially 0.    However, if you change the economics of solo-mining perhaps an additional 5% of the hash power might be applied to solo-mining.   Chances are that this extra hash power wouldn't be sourced from prior pool miners, but could be entirely new hash power added by people who don't care about $30 per month, but like the 'hope' of winning a million dollar jackpot.

1) Make mining more expensive by extending the time from expense to reward.
2) Make mining less predictable by having random mining amounts and vesting periods
3) Make solo mining appeal to irrational individuals looking to purchase 'hope' 

If the lottery jackpot keeps growing on average then the incentive for solo-mining by those looking for 'hope' will increase over time.

[barwizi]

I doubt any public pool would work with 6 month mature time BUT release a getwork (or whatever protocol you like) miner that works with the wallet at release everyone can be his own private pool, not creating hundreds of connections since every wallet opens up 6-9

Just one wallet, as many miner as you like and off you go - i mean, do you really trust a pool to be around in 6 month? They can even run for just a few month and get away with a wallet full of unmatured block, wait up another 6, party on.

I really like the lottery idea and everything, the hashrate will be the same, either if everyone is mining solo or some pools provide it, it's maybe not as "fair" as pool mining but still, i really really like the concept.

[phoenix]

I do like the idea of the lottery to decentralize mining, I just think it'll be very hard to figure out exactly how to tune the lottery so that cloud mining and botnets aren't attracted, but the individual user is. After all, there are people who spend insane amounts of money on the lottery just for the chance of winning, so there may still be individuals that are willing to spend money on cloud mining even if it turns out to be unprofitable.

[Sy]

I doubt any public pool would work with 6 month mature time BUT release a getwork (or whatever protocol you like) miner that works with the wallet at release everyone can be his own private pool, not creating hundreds of connections since every wallet opens up 6-9

Just one wallet, as many miner as you like and off you go - i mean, do you really trust a pool to be around in 6 month? They can even run for just a few month and get away with a wallet full of unmatured block, wait up another 6, party on.

I really like the lottery idea and everything, the hashrate will be the same, either if everyone is mining solo or some pools provide it, it's maybe not as "fair" as pool mining but still, i really really like the concept.

[Lighthouse]

I honestly couldn't care about a well-behaved process that uses 25% of my CPU when IDLE with a low priority setting and 99% of users wouldn't even know how to monitor their CPU usage and wouldn't look at it unless something else was slowing their computer down.  Having an option to 'turn it off' would allow those who it really bothers to turn it off.

This may be true for you but it is not neccesarily true for everyone.  Just make it a toggle easy to find in the keyhotee client and you'll solve your problem.  There were very similar experiments where websites would utilize the CPU of their visitors computers at about 20% to mine instead of showing ads.  People did NOT like it.    And I agree with the others who think a more desirable reward especially for people with a long term perspective would be a really easy to use, distributed pool miner combined with the long vesting period.

[luckybit]

You don't have employees, you have investors. Companies can force limitations on employers because there's a discrepancy in power between them. It's obviously not the case here.

A miner is both an employee and an investor. These are not the rules of wall street.
The computer is the employee and the system administrator is the potential investor.

[digitalindustry]

Having a very random block award with background mining might suffer a limitation that people would switch over to mining a more instantly profitable coin. One idea might be to add random pauses to the default mining rewards - just even for a few hours at a time every day (and variably so). This would make it very much more expensive for VPS instances which are often on hourly rates. Changing the algorithm randomly so that server hardware initially selected becomes much less efficient (eg by adding a transient GPU element) might add another obstacle for VPS. I'd be careful about immediately making the mining rewards far less frequent as it would be less likely for the coin to gain wider acceptance.

I posted a new Alternative DAC proposal for a PowerBall, DAC which is designed to test the theory that a large mining reward with disproportional odds to reward would cause many miners to 'solo mine' rather than pool-mine.   It is an entire DAC dedicated to the idea and I suspect it would be an interesting experiment.   

http://bitsharestalk.org/index.php?topic=915.msg9251#msg9251

Actually ages ago it was thrown around the bitcointalk about what to do with fees , we were saying wouldnt it be good if some fees were added up and completely randomly given to some random address , in a block .

Of course there lots of paramaters , but that was the idea .