Topic: Math/algorithm or processing power makes more bitcoins? (Read 744 times)

OK, would he not need to re-program his ASICs in order to perform this new shortcut?
Or existing ASICs can just follow a modified version of CGminer let's say?
Excuse my ignorance by the way 

Money originally arose due to a desire to trade more efficiently, just as language originally arose due to a desire to communicate more efficiently.  Money has value just as words have meaning.  Both are emergent properties, driven by natural human desires.

Note: This does not explain why any one particular currency has value, but rather why there exists some form of money.


Don't worry.  I'd bet many people don't understand this but are afraid to confess such ignorance.

There is value in owning certain objects (goods).  A simple example would be a plumber fitting a $3 washer to fix a leak in your kitchen.  We can easily identify the $3 of value in the utility of a dry kitchen.  However, the plumber might charge $60 for this, a markup which occasionally confuses people.

As you rightly observe, there is value in certain kinds of labour, and the skill (knowledge) of the labourer plays a part in determining this value.

But the story does not end here.  There is value in all kind of things: location (shipping), customer knowledge (advertising), risk mitigation, time (investing), et cetera.  Businesses often work to unlock such efficiencies and, the extent to which they are successful is the extent to which they can profit.

To be confused by a factory owner profiting above the costs of materials, maintenance, and wages is just a more subtle version of being confused by the plumber's $57 markup.


Suppose I want to employ you to dig a ditch for me (a full day's work).  Could I pay you with 3kg of 1-day-old date and walnut cake and 20 freshly baked potatoes?


Quantum computers theoretically break certain cryptographic algorithms.  Bitcoin may have to transition to newer algorithms as older ones fall.


A form of consensus.  The 21 million cap is effectively part of the definition of Bitcoin.  The full definition of "Bitcoin" is written as a piece of software called "Bitcoin Core".  The analogy is weak, but you might consider why the English word "water" has the meaning that it has and how you might go about changing this meaning.

I think this is the ONLY response in this thread so far that has understood what the OP was even asking.

Note:  The OP is not asking to change bitcoin to use something other than SHA256.  The OP is asking if it is possible to find a more efficient way to compute SHA256.

The answer to the OP is, YES.  It is possible to be more efficient.

As a matter of fact, there are MANY efficiencies that have already been discovered and implemented by most of the mining community.  For example, SHA256 is no longer computed from the beginning on every nonce change.  It was noticed that several steps at the beginning of the hash process had the exact same result as the nonce changed.  Now, this result is only computed once (it's called a "midstate").  Then the miner modifies the nonce and continues the calculation FROM THE MIDSTATE, returning to the MIDSTATE each time he doesn't find a successful hash.  The midstate is only recomputed after all the available nonces have been attempted and something else in the block needs to change (such as the timestamp or the extranonce).

If the OP is an exceptional mathematician, then he may discover a new mathematical shortcut that nobody else has noticed yet.  This would give him an advantage until others discovered the same shortcut.

No, you don't have a chance. Even if you did find a more efficient way to complete the algorithm, what's stopping those big farms from using that new technique too?

What you mentioned about blocks has nothing to do with solving them, it has to do with block size.
The OP asked if there is another was to solve hashes.
NO THERE IS NOT.
He can however create an alt-coin that does something different.
Oh, wait, that is cliché and we are not allowed to explain to newbies how Bitcoin works and God forbid if we mention alt-coins.

Changing the way blocks are found DOES make it an alt-coin.
Or did you not get that by now?

Seriously man......

I didn't suggesting anything. In fact, simply suggesting to someone at level to create an altcoin is a smartass response, but I won't point that out. It's become a cliche and a cop-out answer among the community. More than likely, everyone who has used this cliche wouldn't have even the slightest concept of how to start an altcoin without google.

Wasn't trying to be an ass. Get your panties out of a wad.

Take a look at the "science coins" subgenre. There are approaches to use computing power for solving real world applications. Stuff like fiddling with molecules to fit them into organic receptors, medicine related. And similar.

Anyway, thank you guys for your replies

I don't even understand how regular money works... why does it have value and why does bitcoin have value?

Or how business charge more for the cost to buy something, how does it not end up in debt? When you charge more for the original cost of something. Service, work, knowledge, value. My microencomics class did not help me much, it would seem. (Macro is what I could have used too)

A person slaves away digging a ditch, and someone hands him an address so he can get paid? As opposed to handing him money, or better yet food.

I remember when PayPal was new and I could only spend it at Home Depot using a phone number, I lived on that for a bit buying peanuts and Iced Tea.

Anyway, thanks more reading I must do

Also what happens when quantum computers become common place?

What is this 21 million cap governed by?

So you are suggesting that we change Bitcoin from Sha-256 to something else?
Without any valid reason?
And what would that make it?

Stop being such a smart ass.
It is quite clear what I said.

They say "solve a math problem" when you look up Bitcoins

example or as an analogy, some says divide add 400 to 300, you could do 400 + 1, 401 + 1, 402 + 1 or 400 + 100 + 100 + 100 or 4 + 3 + four zeros... do you see what I'm asking?

Anyway, part of me is asking this because when I see warehouses filled with computers dedicated to bitcoin mining, I wonder if I even have a chance who does not have access to these number of computers and that much power...

I looked through a sample block

taken from stack overflow:



Here is an extremely simplified sketch of the problem, but it should give a pretty good idea of what the problem is.

The data:

This is the hash of the last block (shortened to 30 characters):

00000000000001adf44c7d69767585

These are the hashes of a few valid transactions waiting for inclusion (shortened).

5572eca4dd4
db7d0c0b845

And this the hash of one special transaction that you just crafted and which gives 25BTC (the current reward) to yourself:

916d849af76

Building the next block:

Now, let's use an gross approximation of what a new block might look like (the real one uses binary format). It contains the hash of the previous block and the hashes of those 3 transactions:

00000000000001adf44c7d69767585--5572eca4dd4-db7d0c0b845-916d849af76--

Now let's do mining by hand! Our goal is to complete this block with a nonce (a piece of garbage) such that the hash of the new block starts with 13 zeros (considering the previous hash, it seems that 13 zeroes is the current difficulty!).

Mining (trying to finalize this block):

Let's try with nonce=1, and compute the hash of the block (I'm using the md5 hash algorithm, but Bitcoin uses double sha256):

> echo "00000000000001adf44c7d69767585--5572eca4dd4-db7d0c0b845-916d849af76--1" | md5sum
8b9b994dcf57f8f90194d82e234b72ac

No luck, the hash does not start with a 0… Let's try with nonce=2

> echo "00000000000001adf44c7d69767585--5572eca4dd4-db7d0c0b845-916d849af76--2" | md5sum
5b7ce5bcc07a2822f227fcae7792fd90

No luck…

…

If we pursue until nonce=16, we get our first leading zero.

> echo "00000000000001adf44c7d69767585--5572eca4dd4-db7d0c0b845-916d849af76--16" | md5sum
03b80c7a34b060b33dd8fbbece79cee3

For nonce=208, we get two leading zeroes!

> echo "00000000000001adf44c7d69767585--5572eca4dd4-db7d0c0b845-916d849af76--208" | md5sum
0055e55df5758517c9bed0981b52ce4a

Continue like this… If you finally find a hash that has 13 leading zeroes… you're a winner! Other miners will now build upon your block, you've just got 25BTC.

But you'll have to be fast!

Back to step 1…

If someone manages to build a block before you do, you'll have to start again from the beginning with the new block's hash (the one of the winner).

You're talking about using a different algorithm. Bitcoin currently uses SHA256 and that is hardcoded.  You could use a different algorithm but you would have to make an altcoin.

Bitcoin uses a hashcash proof of work function. This algorithm requires a service string, nonce and a counter. Everything has to comply in order for this to work.
You can always check this page out for more information. The wiki is quite useful.
https://en.bitcoin.it/wiki/How_bitcoin_works

You can create an alt that does so. Why would it be valuable if it does not require a lot of processing power to create?  

if you are talking about others algo like pos or pob, then i can say that bitcoin is not aiming at any fork for those, we will stay with pow, until something really better will come out

I love how when someone has an idea, whether bad or not, for bitcoin they just get told to make an alt coin. Why not tell Gavin to make an altcoin for 20mb blocks and 1 minute block times? Fact is it can change, it doesn't have to work in a specific way, and it doesn't have to be an altcoin.

Bitcoin was created to work in a specific way.
You cannot change that.
However you are more than free to try something else with your own alt-coin.

I think you don't understand how bitcoin works.

This should probably be posted in Beginners and Help.   

Is there only one way to solve hashes for bitcoins or can you come up with better/more effective ways aside from the processing itself eg. number of gates/electricity... ?

I don't know if I can get across what I am asking, can you make a more efficient solution to a mining problem that doesn't require as much processing power?