Topic: What is the solution ? (Read 3066 times)

Do you have any proof of this?  I just cant see most doing this that are able to.  The industrial size who have big market share I just don't see block withholding.

I think industrial mining is a two edge sword.  One side they have a huge amount of power.  The good side is it allows us to get in on their buying of hardware on some companies and its cheaper for everyone.

It most certainly is not.  Satoshi himself realized that mining would become an industrial-scaled operation.

Pool owners realized they could combine many miners together and have a better chance of solving blocks, which in turn meant more profit for the miners.  Some of those owners charged fees for the privilege of mining on the pool.  Others did not, but found other ways to obtain coin such as donations and merge mining.

Just like the guys who initially wrote the pool software and gathered together people combining their hashing power towards solving blocks, the ASIC manufacturers take that a step further.  They produce the chips, put together the hardware and mine with it, and/or sell it, and/or provide cloud mining services.  Why would the guy who invented the shovel not be allowed to use it to dig for gold as well as sell the shovel to others?

Absolutely.  Those who perform block withholding attacks have changed the software to give themselves an unfair advantage.  They are purposefully withholding a solution, and if the OP is to be believed are somehow transferring that solution somewhere else to give themselves a larger portion of the pie than they deserve for the work that was done there.  It's like hacking your ATM card to be able to withdraw money, yet not have that withdrawal reflected in your bank's balance.  It's theft, plain and simple.

Seriously?  You really think that the thieves should get away with it because that will somehow breakdown the pools and magically spread the mining back to the masses?  Yikes.

The concept of pool is originally against Satoshi's idea of decentralization. Pool owners did it for sheer profit and u find that OK. U say ASIC miner manufacturers are mining themselves is a Capitalist feature. And when someone perform block withholding attack... u find it stealing ?

Wake up buddy. Block withholding practice is now spreading among miners like wildfire. There is a good side of it. People will lose faith on pools with time and the mining will be de-centralized again. Be dynamic. Accept the change.

Personally i will believe it when i see it.  One big reason is solving block is a very small chance.   It's not likely to solve a block (I'm assuming he does not have a warehouse of miners). 

I'm not entirely sure what you're implying here.  I wrote "Welcome to capitalism" in the context of a completely different discussion.  In that discussion, the original poster was complaining that it wasn't fair that hardware manufacturers were also using their own equipment to mine.

Here, the original poster has admitted to altering the mining software to not submit potential block-solving hashes at the pool on which they are found, but rather re-submitting them on another pool.

Quite frankly, I'm not sure the poster is actually able to accomplish what he's stated.  However, if he somehow has indeed figured out a way to cheat the system, then he's committing theft.  Think about what he's saying he can do:

1) Mine on pool A, with 25% of the pool's total hashing power.  Assuming no fees and straight PPS, he'd get 6.25BTC from solving the block.
2) Mine on pool B, with 75% of the pool's total hashing power.  Assuming no fees and straight PPS, he'd get 18.75BTC from solving the block.
3) He finds a share on pool A that would solve the block, but somehow transfers that to pool B.
4) He's still going to get paid by pool A if some other miner on pool A solves a block.

I don't believe point 3 is possible, but that is what he's claiming he's doing.  If he truly is, then he's performing a block withholding attack on pool A and then getting a larger payout than he deserves from pool B.

Seriously, What your doing sounds un-ethical at best. With difficulty rising so rapidly causing shrinking returns due to the huge increase in hashrate recommending bitcoin mining as an investment doesn't sound like the best advise. With your investment in mining the advice is extremely biased as well. You should close up shop and go elsewhere.

You realize that you're willfully admitting to performing block withholding attacks?  That's not a software tweak.  That's theft.

Some of the questions I see above are out of context. But I'll try my best to clear up the confusion...

1. Solar powered mining does not mean our mining firm is 100% solar powered. But sun light has a % of contribution in running not only our mining machines, but also some of our office appliances. This helps us in saving a % of power cost. This is a nice read regarding this http://blog.cex.io/solar-bitcoin-mining/. If anyone is interested, please go through it.

2. As we have stated before in other posts as well, we have not purchased mining power at any other so-called cloud mining company. We run our own mining facility and thereby able to allocate mining power to our investors as cloud. When investment gets added to an investor's portfolio, his mining power increases. There is an internal mapping for that.

3. We used to mine at multiple pools and have modified our software for a certain tweak to increase the chance of winning hashes. When we find a hash at some big pool, we dont submit it there. Rather we take it to a smaller pool where our hashing ratio is high. This improvised method has given us better return than usual and with increasing hash power its effectiveness is growing as well. That is why, we dont want to back out from the mining business. Rather finding a way to stay afloat even below 500.

Why the F*&k would you need solar panels for a cloud mining setup?  Don't you just login to a browser and click "mine"?   

Cloud mining and private datacenter mining are two totally different things.  Not sure the OP's angle here.

The only real measure of your success here would be if you can get your investment in BTC back. USD amount doesn't make any sense - you could just have bought a few Bitcoin with the investment money instead of going the mining route. If you want to measure your performance, your benchmark will need to be this, not breaking even in USD but whether your mining operation was able to beat a dumb 'invest in BTC' strategy. Did it? Will it?

Please tell me this is a joke thread. You are all just trolling each other, right? Playing bullshit bingo maybe.

Solar powered cloud mining setup. Good one =D

Close the data center. Dump all the hardware and run! 

Thank you everyone for the response. I think there is a confusion here that I am the investment manager. Sorry, I'm not. I am from technical background and I'm supervising all things Bitcoin for the investment firm. As Bitcoin is a less known investment product for most investment managers, I'm also trying to help him out with my knowledge and predictions.

To clarify another point, our calculation was not so simple to take 500 as breakpoint and invest at 600. We are mining at our own facility and it took some time to develop and grow. We started investing into Bitcoin way before Bitcoin rached 500 for the first time. But, at a properly managed firm, you can not get clearance for huge investment overnight. It requires to show the stats and graphs to the management for approval.

Bitcoin has given back a lot to us and hence we have no problem to wait till March for 500. That is already under coverage. Thanks to everyone who has asked for patience. We are also exploring other ways to efficiently utilize our mining facility.

The problem with dumping is there is no physical hardware.  Since they bought in the "cloud" i have a feeling they can sell GHZ but people are more interested in hardware in most cases.

Personally with low priced electricity and space I still think asic days will continue on for me.

Close the data center. Dump all the hardware and run!

Bitcoin will reach 500 even this year, so be patient.

If someone can answer your question with precisely,
I will own that person for me  

If you believe that Bitcoin will rise, than invest it !
Life has a chance and many option
So make your choice..

Believe it or not this does surprise me.  I have a long background with the IRS  and a degree in accounting. You would be surprised how bad some investment managers are. More often then not they are acting as a salesman for a few funds/stocks/bonds etc. then they are actually doing real work for a client.

Not to say the op is guilty of this.  He may have used 500 as break even and invested when coins were 600.

Just so we're clear, you're an investment manager. You invested your client's money into Bitcoin mining and you don't have a calculation for the price of Bitcoin that would mean a break-even price for you? And you come to the forums to ask for investment advice now?

No one can say price in future, there are educated guesses but nothing is for sure in the world of bitcoin.

What site did you buy cloud mining?

Well I will bite on this question.  

1) How much are you on the hook for % wise  ie  does your cloud section = more or less then 20% of your holdings
2) Yes    But my thoughts are not the reality we live in and many times I do not match this reality with those thoughts.
3) There are options to keep your cloud running, but a lot depends on how much you have in hashpower and your exact power costs. Along with how much you have in other areas of investment.

You sure have terrible grammar for an investment manager. Therefore I don't believe anything in your post.

I think that you need to be a bit more patient, not freak out and wait. I think that the best will surely happen to you don't worry.

You should divest everything and invest in a bitcoin dice site.

I am from an investment management firm. We invested a part of client's money into Bitcoin Mining. As most of u already know that investment firms deal with large chunk of money, we had to go for cloud mining to cope up with the huge inflow. There was no big problem as we run our own solar powered cloud mining setup. Things were fine as long as Bitcoin was floating above 500 USD. But, in the last quarter (July-September), bitcoin price slump against USD has affected our operating profit. In this quarter we had to payback customers from the earning of previous quarter as we were expecting a price rise in this quarter (October-December). 500 USD is ok for us and anything beyond only makes profit. But, we are a bit worried, as price is not showing much of an upward movement. So, I have 3 Qs to the community...

1. Do you think we should liquidate the current investment in cloud mining and go for other investment opportunities ?

2. Do you think price will cross 500 USD by March 31, 2015 ?

3. If point 2 is NO, is there any other option to keep our cloud mining operation up and running ?