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Specialized mining hardware is an environmental disaster but it does make 51% attacks more difficult. With POW on general purpose CPUs, anyone can rent cloud p

by andy81 4y ago

Specialized mining hardware is an environmental disaster but it does make 51% attacks more difficult. With POW on general purpose CPUs, anyone can rent cloud processing to mine for short bursts in a way that's just not possible for attacks on bitcoin.

cowtools 4y ago
That is a good point, but consider the following: 1. If a cryptocurrency is dominated by specialized miners, then you have a centralization effect as the majority hash-rate can be more controlled by monopolies that can take advantage of their economies of scale. Because mining is mostly done by companies at scale, it is easier for governments to impose regulations on miners and control the type of transactions that are allowed to be verified. 2. Vendors accepting cryptocurrency can always choose their own level of risk by deciding how many blocks to wait before accepting a transaction. This allows them to "wait out" temporary attacks. I would say that the permanent miner takeover as described #1 is an order of magnitude more threatening than the temporary attacks as you've described. But it is still quite an issue. Specialized hardware will depreciate if it is tied to a cryptocurrency that has been attacked. So miners are incentivized not to attack, lest they devalue the resell value of their hardware. Note that this advantage doesn't really apply to GPU-mined cryptocurrencies.
- javert 4y ago
  There is no such thing as a "miner takeover" because miners don't vote. Unlike with proof of stake. The only powers they have are to censor transactions, conduct denial of service and (if they have over 50%) conduct a double spend attack. What you are describing in #1 is a government takeover of miners. Definitely a nit pick, but what are we here for if not for that?
- hmlongco 4y ago
  "Vendors accepting cryptocurrency can always choose their own level of risk by deciding how many blocks to wait before accepting a transaction. This allows them to "wait out" temporary attacks." And introduces even more inefficiencies into the entire system as now we have to spend that time waiting for transactions to clear
nuclx 4y ago
Botnets are playing a big role in CPU-based mining as well.
latchkey 4y ago
Worse, it incentives botnets.
- cowtools 4y ago
  RandomX has some mechanisms to discourage cryptojacking botnets: https://github.com/tevador/RandomX#does-randomx-facilitate-botnetsmalware-mining-or-web-mining https://github.com/tevador/RandomX#does-randomx-facilitate-b...
  - latchkey 4y ago
    I read that as it incentives botnets made up of more powerful hardware.
once_inc 4y ago
How is specialized mining hardware an environmental disaster? In what way is the bitcoin mining industry more harmful to the environment than a steel smelter, an aluminum factory, or wash dryers? How is it an environmental disaster if most of the hash rate is from green energy and it is also actively suppressing methane release? I've noticed a trend on HN where people say mining is bad for the environment, but can often poorly articulate the details. This, in my opinion, means they are just rehashing the same disinformation in articles that all point to the same sources (cambridge or digiconomist). Quotes like "Bitcoin mining uses more energy than [country X]", "That green energy could be used for other things", and "It provides no intrinsic value" have all be waylaid years ago, but keep getting brought back up.
- awoimbee 4y ago
  - fossil fuels are used for Bitcoin mining - Bitcoin mining needs a stable source of energy to run 24/7, something you won't get from eg a single wind mill - building and maintaining renewable energy sources still has an environmental impact, the energy would be better used by something else than Bitcoin - making chips and PCBs is an environmental disaster, the fact we are making so much useless ASICs is horrible Some industries are more polluting than others, but we should be doing everything in our power to reduce the pollution. Bitcoin (POW) is intentionally wasteful.
  - once_inc 4y ago
    I don't argue that Bitcoin mining uses fossil fuels. In fact, I'd still be a Bitcoin proponent if its Proof of Work uses solely fossil fuels, because the benefits of having separation between money and state is a solution for many of the problems we face today. I'd also like to point out that: 1. Most of the energy generated today is lost because it is unused. This is called "rejected energy". Having the option to not let so much energy get rejected is an efficiency gain for us, and should be prioritised before we shut down manufacturing and services because of energy use/emissions. 2. Mining is done at the knife's edge of margin cost. Lots of miners buy energy from suppliers at severely discounted prices (due to lack of demand) and scale up and down depending on the supply of energy. The days that you need to keep your miner online and hashing for 24/7 have passed us by years ago. These days, even an S9 miner can still be profitable if you have near-free electricity at your disposal. 3. Bitcoin mining enables the construction of renewable power plants in locations that are currently unaffordable to build.

by andy81 4y ago

cowtools 4y ago

That is a good point, but consider the following: 1. If a cryptocurrency is dominated by specialized miners, then you have a centralization effect as the majority hash-rate can be more controlled by monopolies that can take advantage of their economies of scale. Because mining is mostly done by companies at scale, it is easier for governments to impose regulations on miners and control the type of transactions that are allowed to be verified. 2. Vendors accepting cryptocurrency can always choose their own level of risk by deciding how many blocks to wait before accepting a transaction. This allows them to "wait out" temporary attacks. I would say that the permanent miner takeover as described #1 is an order of magnitude more threatening than the temporary attacks as you've described. But it is still quite an issue. Specialized hardware will depreciate if it is tied to a cryptocurrency that has been attacked. So miners are incentivized not to attack, lest they devalue the resell value of their hardware. Note that this advantage doesn't really apply to GPU-mined cryptocurrencies.

javert 4y ago
There is no such thing as a "miner takeover" because miners don't vote. Unlike with proof of stake. The only powers they have are to censor transactions, conduct denial of service and (if they have over 50%) conduct a double spend attack. What you are describing in #1 is a government takeover of miners. Definitely a nit pick, but what are we here for if not for that?
hmlongco 4y ago
"Vendors accepting cryptocurrency can always choose their own level of risk by deciding how many blocks to wait before accepting a transaction. This allows them to "wait out" temporary attacks." And introduces even more inefficiencies into the entire system as now we have to spend that time waiting for transactions to clear

nuclx 4y ago

Botnets are playing a big role in CPU-based mining as well.

latchkey 4y ago

Worse, it incentives botnets.

cowtools 4y ago
RandomX has some mechanisms to discourage cryptojacking botnets: https://github.com/tevador/RandomX#does-randomx-facilitate-botnetsmalware-mining-or-web-mining https://github.com/tevador/RandomX#does-randomx-facilitate-b...
- latchkey 4y ago
  I read that as it incentives botnets made up of more powerful hardware.

once_inc 4y ago

How is specialized mining hardware an environmental disaster? In what way is the bitcoin mining industry more harmful to the environment than a steel smelter, an aluminum factory, or wash dryers? How is it an environmental disaster if most of the hash rate is from green energy and it is also actively suppressing methane release? I've noticed a trend on HN where people say mining is bad for the environment, but can often poorly articulate the details. This, in my opinion, means they are just rehashing the same disinformation in articles that all point to the same sources (cambridge or digiconomist). Quotes like "Bitcoin mining uses more energy than [country X]", "That green energy could be used for other things", and "It provides no intrinsic value" have all be waylaid years ago, but keep getting brought back up.

awoimbee 4y ago
- fossil fuels are used for Bitcoin mining - Bitcoin mining needs a stable source of energy to run 24/7, something you won't get from eg a single wind mill - building and maintaining renewable energy sources still has an environmental impact, the energy would be better used by something else than Bitcoin - making chips and PCBs is an environmental disaster, the fact we are making so much useless ASICs is horrible Some industries are more polluting than others, but we should be doing everything in our power to reduce the pollution. Bitcoin (POW) is intentionally wasteful.
- once_inc 4y ago
  I don't argue that Bitcoin mining uses fossil fuels. In fact, I'd still be a Bitcoin proponent if its Proof of Work uses solely fossil fuels, because the benefits of having separation between money and state is a solution for many of the problems we face today. I'd also like to point out that: 1. Most of the energy generated today is lost because it is unused. This is called "rejected energy". Having the option to not let so much energy get rejected is an efficiency gain for us, and should be prioritised before we shut down manufacturing and services because of energy use/emissions. 2. Mining is done at the knife's edge of margin cost. Lots of miners buy energy from suppliers at severely discounted prices (due to lack of demand) and scale up and down depending on the supply of energy. The days that you need to keep your miner online and hashing for 24/7 have passed us by years ago. These days, even an S9 miner can still be profitable if you have near-free electricity at your disposal. 3. Bitcoin mining enables the construction of renewable power plants in locations that are currently unaffordable to build.