poolin

Proof-of-Work and Yield Farming: Binance and Poolin Launch Tokens Backed by Bitcoin Hashrate

14/01/2021 by Idelto Editor

There’s a new type of token gaining popularity in the crypto space with the launch of coins that are backed by a specific amount of proof-of-work (PoW) hashrate. On January 6, 2021, Binance launched a new project called the bitcoin standard hashrate token (BTCST), a coin that represents 0.1 terahash (TH/s). Furthermore, the mining operation Poolin has also revealed a hashrate token called pBTC35A and each token represents 1 TH/s hashrate with pre-determined SHA256 processing power.

Tokens Backed by Proof-of-Work

The Bitcoin (BTC) network has seen the protocol’s hashrate increase significantly during the last few weeks, despite the network mining difficulty being so high. There have also been substantial numbers of mining rigs added to the network in recent months and exchanges like Binance and Huobi have joined the mining fray.

With bitcoin mining showing significant upside potential, a couple of crypto industry heavyweights have introduced tokens backed by PoW hashrate. Last week, Binance unveiled a new project called the bitcoin standard hashrate token (BTCST), a coin that’s claimed to be backed by 0.1 terahash (TH/s).

“BTCST sets off to solve the problem of limited exit options by bringing exchange-grade liquidity to Bitcoin mining, and in secondary trading,” Binance announced last Wednesday. “BTCST will perform as a leveraged Bitcoin token free from liquidation risk. BTCST will create an efficient market for Bitcoin’s mining power in ways similar to how Grayscale Bitcoin Trust creates institutional liquidity for Bitcoin.”

The crypto trading exchange added:

BTCST is collateralized by 0.1 TH/s of real-world Bitcoin mining power, which is historically proven to be positively correlated to the performance of the digital gold, and hence the value of BTCST climbs along with the current skyrocketing Bitcoin market.

Poolin Launches the Mars Project, Binance PoW Token Audited

However, Binance is not the only business looking to offer a PoW mining token as the mining operation Poolin has also introduced the Mars Project. On January 11, 2021, Poolin tweeted “Join the first Ethereum-based standardized hashrate protocol, earn wBTC and LP reward. Infinite possibility when PoW mining steps into [an] Ethereum smart contract,” the mining pool further said. Currently, Poolin is the fifth largest bitcoin pool capturing around 9.4% or 14 exahash per second (EH/s) today.

The Poolin minted ERC-20 token is called pBTC35A and the company says each coin is backed by the firm’s PoW hashrate. “The protocol consists of pBTC35A tokens and [the] MARS token,” Poolin’s announcement explains. “Each pBTC35A token represents 1TH/s hashrate with a pre-determined power ratio, mining rigs would be in Poolin Superhashrate’s custody during life cycle. While net profit on wBTC would be distributed per block.”

Poolin says the first batch will be “50,000 pBTC35A (approximately 50PH/s) tokens for Bitcoin (output with wBTC) mining in this protocol and locks up more than 50PH/s machines physically.” Poolin notes that people can obtain the tokens using the inhouse shop ((Basic KYC needed) or via the token’s Uniswap contract. The company further detailed that Ethereum and other PoW mineable coins will be also created, but Poolin doesn’t have a confirmed schedule.

According to Binance Launchpool, the PoW token (BTCST), the organization recently launched has also passed an audit from the blockchain security company Certik, and scored a “98 out of 100 in a security audit.” Users will be able to stake BNB, BUSD, and BTC in separate pools in order to farm BTCST tokens, Binance Launchpool also said.

“Compared to conventional cloud mining, BTCST portrays the decentralized spirit of blockchain, with all mining rewards distribution done by smart contracts that are onchain with full transparency,” Alex Zhao, the cofounder, and CTO of BTCST said last week.

What do you think about the new tokens backed by PoW hashrate? Let us know what you think about this subject in the comments section below.

Despite Bitcoin’s Price Highs, Onchain Data Shows BTC Miners Are Not Spending More Than Usual

25/12/2020 by Idelto Editor

The cryptocurrency economy has been higher in value than ever before as bitcoin has touched an all-time price high at $24,298 per unit. Regardless of the all-time price highs, the world’s bitcoin miners are not spending more bitcoin than usual according to onchain statistics. Bitcoin miner outflow has been higher during the bull run but also lower than the 2019 top.

Speculators assume that when the price of bitcoin (BTC) rises, bitcoin mining operations will sell more coins. However, while BTC has touched a new all-time high (ATH), miners are not selling more bitcoin than usual according to data from onchain charting sites like Cryptoquant and Glassnode. On December 22, the onchain researchers from Glassnode explained how miners are not spending more than usual during the ATH.

“Despite the recent rally, Bitcoin miners are not spending more BTC than usual,” Glassnode said on Tuesday. “The Miner Outflow Multiple, which shows when BTC miner outflow is high with respect to its historical average, is far from previous tops and even below the 2019 local top.”

Since the halving and the bull run that followed a few months later, bitcoin miners have been profiting a great deal. Before the halving, it was estimated that miners need BTC prices to be around $12,500 to break even at revenues obtained before the halving.

The overall hashrate is very high at 139 exahash per second (EH/s) as 14 mining operations are point hashrate at the BTC chain. With prices above the $23k handle, bitcoin miners and even older generation mining rigs like the S9 are seeing significant profits.

At the time of publication, 18,579,969 BTC are in circulation today and so far that’s 88.48% of the 21 million supply cap. BTC’s inflation per annum has dropped considerably to 1.78% after holding a rate of above 3.6% before May’s halving.

On average $20,961,900 worth (at today’s exchange rates) of BTC is issued by miners every day at 144 blocks per day. Yesterday 147 BTC blocks were found and 2,037 blocks were found during the last 2 weeks at 6 blocks per hour.

While the BTC coinbase rewards have a two-week average of $146,046 per block the average aggregate number of fees per block is 0.81 BTC or $18,837. Glassnode’s onchain stats show that entities are holding onto coins longer, according to the “realized hodl ratio” during the last seven days.

In addition to data from Glassnode, miner outflow stats from Cryptoquant indicates that bitcoin miner selling has not increased a great deal with BTC prices so high. Cryptoquant tracks data from major BTC mining pools like Antpool, Poolin, Btc.com, F2pool, Viabtc, Slush, Dpool, Bytepool, and others alongside the smaller unknown mining pools as well.

What do you think about miners holding onto their newly minted bitcoins? Let us know what you think about this subject in the comments section below.

The post Despite Bitcoin’s Price Highs, Onchain Data Shows BTC Miners Are Not Spending More Than Usual appeared first on Bitcoin News.

Video: Coordinating Bitcoin Upgrades With Poolin’s Alejandro De La Torre

24/11/2020 by Idelto Editor

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The guest for this episode of Bitcoin In Asia is Alejandro De La Torre, vice president at Poolin. De La Torre and Poolin have launched taprootactivation.com to improve on the communication and transparency of the Taproot activation process. Bitcoin Magazine’s Aaron van Wirdum covered the initiative here, and in this Interview, De La Torre and host John Riggins explored additional context around it.

De La Torre has been in the Bitcoin data and mining space since 2014 when he founded SendChat, later acquired by wallet and data service Blocktrail, where he led business development until the company was acquired by Bitmain. Inside of Bitmain, De La Torre co-founded BTC.com and led its European office during the SegWit upgrade process. Now, back with former BTC.com colleagues at Poolin, De La Torre leads its global business development initiatives.

Poolin operates out of Beijing and is currently the second-largest pool in terms of Bitcoin hash power. Their services have expanded over the past year to include facilitating additional financial services products for their miner customers, and they have partnered with BlockFi and Three Arrows Capital, among others, for those expanded services.

In addition to discussing taprootactivation.com, De La Torre talked about lessons learned during the SegWit and blocksize debates, Bitcoin upgrade activations and the changing competitive landscape in the Bitcoin mining pool business.

The post Video: Coordinating Bitcoin Upgrades With Poolin’s Alejandro De La Torre appeared first on Bitcoin Magazine.

Poolin Launches Initiative To Activate Taproot, Encouraging Other Mining Pools To Join

16/11/2020 by Idelto Editor

Top 2 Bitcoin mining pool Poolin wants Taproot, and hopes other pools do too.

Poolin, the Chinese mining pool that currently controls around 13 percent of all hash power on the Bitcoin network, is preparing for Taproot, the proposed protocol upgrade for which the code is included in the upcoming Bitcoin Core 0.21.0 release. Bitcoin’s second-largest mining pool (only topped by F2Pool, which controls around 17 percent of hash power) today launched a webpage to help inform mining pools on Taproot, and lets them indicate how they would prefer the backwards compatible upgrade to be activated.

“We’re excited to see Taproot get close to deployment, and as one of the biggest mining pools on the Bitcoin network we want to be constructive in the soft fork activation process that will help make Taproot a reality,” Poolin VP Alejandro De La Torre told Bitcoin Magazine.

Taproot

Taproot, as implemented in Bitcoin Core, is actually a combination of three upgrades rolled into one.

First, it would introduce the Schnorr signature algorithm, which is considered by many cryptographers to be the best in the field. Besides a strong level of correctness, no malleability and relatively fast verifiability, Schnorr signatures allow for math to be performed with them. Among other things, this allows for a new type of smart contracts on Bitcoin.

Smart contract flexibility would be further expanded through a trick called MAST, which allows for coins to be spent in various ways, without ever needing to reveal the options that ultimately aren’t chosen. Moreover, if all parties to a smart contract agree on the outcome of the contract, Taproot lets them cooperate to make the settlement-transaction indistinguishable from regular transactions, benefiting user privacy.

Third, Taproot will include an updated version of Bitcoin’s programming language, called Tapscript.

Poolin, founded by former Bitmain (and more specifically, BTC.com) employees, was the first Bitcoin mining pool to publicly indicate support for the Taproot upgrade by including a custom string of data in all of the blocks they mine.

“Taproot will unlock a new range of possibilities for Bitcoin, improving privacy and expanding smart contract possibilities,” De La Torre said. “We think the Taproot upgrade will benefit Bitcoin and, therefore, also benefit Bitcoin miners.”

Taproot Activation

The Taproot code will be included in the upcoming Bitcoin Core release, currently the (de facto) reference implementation for the Bitcoin protocol. However, this release will not include activation logic just yet; this is expected to be included in an upcoming Bitcoin Core release. As a backwards-compatible soft fork upgrade, Taproot activation is presumed to happen smoothly if a (large) majority of miners enforce the upgrade. Previous soft forks were activated through BIP 9, which triggered enforcement of the new protocol rules when 95 percent of all hash power on the network signaled support for the upgrade.

Largely due to the long, painful and messy activation process for Bitcoin’s last consensus protocol upgrade — SegWit, in 2017 — Bitcoin developers have been discussing whether BIP 9 is still the best way to activate soft forks. Some now prefer BIP 8, which (if so configured) would not just enforce the new rules when a (large) majority of miners signal supports for the upgrade, but would also activate the upgrade at a specific future date or block height, known as a user activated soft fork (UASF).

Some smaller changes to the upgrade mechanism are also being discussed. Some argue that the hash power threshold could be lower than 95 percent, for example, and there is also debate on the preferred duration before the upgrade should be enforced automatically (if at all). Specific proposals also include a combination of these ideas, which could perhaps even involve a special Bitcoin Core software fork to get the job done (like the BIP 148 client which — according to many — nudged miners to activate SegWit in 2017).

Poolin CEO Kevin Pan told Bitcoin Magazine that his team prefers Taproot to be activated through BIP 9 — though not outright rejecting BIP 8 with forced activation.

“Unlike during the SegWit activation process, there is no heated debate around Taproot, and BIP 9 has also been used successfully before SegWit,” he said. “We therefore prefer the old school way, BIP 9. But the community could still have a user activated soft fork.”

Pan does prefer the activation to happen through Bitcoin Core, and believes that the 95 percent threshold is “fine.” If BIP 8 with forced activation is chosen instead, he thinks one year is a good amount of time before the new rules are enforced. But whichever solution is chosen, the Poolin CEO believes Bitcoin Core developers will make the right choice: “I think the devs are doing great.”

Taproot Activation Website

To encourage other mining pools (as well independent miners) to help activate Taproot as well, Poolin today launched taprootactivation.com, a webpage dedicated to Taproot activation. Besides information for miners about the proposed Taproot upgrade and the activation mechanisms and parameters under consideration, the open-source website also lets miners indicate their preference.

“We want to avoid the issues we saw around SegWit activation, I don’t think anyone wants to relive that,” De La Torre explained. “I think miners play a crucial role in soft fork activation, in this case for Taproot. A website like this could help inform a better process. We are a large mining pool, with much hash power, so we’ve decided to take that initiative upon ourselves.”

Although Poolin has a preference for the BIP 9 activation process, the webpage is not intended to advocate this activation mechanism in particular. Nor would the preference that miners indicate on the website be in any way binding, of course: developers choose which activation logic they implement in their code, and Bitcoin users decide if they want to run that code.

“Still, we hope that an overview of miners’ preferences could help inform the discussion around Taproot activation,” said De La Torre.

Bitcoin Magazine recently sent out an email to all mining pools that controlled at least 1 percent of hash power on the Bitcoin network, inquiring about Taproot and activation preferences. At the time of publication of this article, the only other mining pool that responded was Slush Pool, whose cofounder Jan Čapek said will support Taproot, and doesn’t expect it to be as heated a topic as SegWit. Čapek indicated a preference for BIP 8 as the activation mechanism with a 90 percent hash power activation threshold and forced activation after one year.

Over the next days and weeks, De La Torre will also be reaching out to Bitcoin mining pools to poll where they stand on Taproot and the different activation mechanisms, and will update the website accordingly.

Full disclosure: the author of this article offered some minimal support editing the text on taprootactivation.com.

The post Poolin Launches Initiative To Activate Taproot, Encouraging Other Mining Pools To Join appeared first on Bitcoin Magazine.

Hash Watch: Bitcoin Cash Services Reveal Contingency Plans for Upcoming Fork

05/11/2020 by Idelto Editor

The Bitcoin Cash blockchain is set to upgrade on Sunday, November 15 and it’s still expected that the network will bifurcate. So far, a number of crypto services have revealed contingency plans for the fork, and today’s data shows that 754 out of 1,000 bitcoin cash blocks were mined with the BCHN software.

In 11 days, the Bitcoin Cash upgrade is coming and the latest feature that will be added to the network is the ASERT Difficulty Adjustment Algorithm (DAA). However, the community is also preparing for a contentious fork, as one of the seven BCH full node projects has introduced the Infrastructure Funding Proposal (IFP) into the codebase. The IFP has been extremely controversial, as it has created a great divide between those who support it and those who do not. In September, news.Bitcoin.com reported on how most BCH market participants including businesses, executives, miners, and developers from six full node projects decided to bid Bitcoin ABC farewell.

As far as coin votes, hashpower, and futures markets are concerned, Bitcoin ABC is not faring well in comparison to BCHN. Block statistics from the web portal Coin Dance shows that 75.4% or 754 blocks out of 1,000 were mined using the BCHN software. 11 blocks out of the last 1,000 BCH blocks have signaled for ABC, which accounts for 1.09% of the thousand blocks mined. There is roughly 2 exahash per second (EH/s) of SHA256 hashrate pointed at the Bitcoin Cash network on Wednesday, November 4.

Bitcoin ABC futures show that the market is trading for much less than BCHN futures on Wednesday afternoon. Poloniex ABC futures paired tether (USDT) indicates the token is swapping for $20 per unit. ABC futures on Coinflex are priced similarly at $20.50 per ABC token. The ABC futures on Coinex are even lower, as the ABC token is swapping for $16.34 at the time of publication. If the prices end up being roughly the same after November 15, 2020, then the ABC airdrop will have a very small market valuation amid the totem pole of top coin market cap positions.

Since our last report, a few infrastructure providers have announced contingency plans for the upcoming fork. For instance, the mining operation Poolin has revealed its plans for the BCH fork scheduled on the 15th.

“The Bitcoin Cash (BCH) network is expected to undergo a hardfork on the 15th of November, 2020,” Poolin detailed. “There are currently two competing fork proposals, Bitcoin Cash ABC (ABC) and Bitcoin Cash Node (BCHN). As per the latest data from Coin Dance, 76.3% of BCH blocks have signaled support for BCHN over the last 7 days, compared to 1.0% for ABC. In the event of a successful fork, users holding BCH prior to the fork will receive the new assets.”

The mining pool also said the operation will switch all of the BCH hashrate to BTC one day before the hardfork, it also plans to suspend BCH payments on November 15, and “a separate announcement about switching the BTC hashrate back to BCH will be published once the hard fork has completed and the network is stable.” At press time, Poolin only captures a touch over 1% of the BCH network hashrate, according to Coin Dance data.

On October 30, the firm Bitgo detailed that it was preparing for the upcoming fork on November 15 as well. “Bitgo is currently running BCHN nodes and expects that it will be the dominant chain post-fork,” the company tweeted. “We will pause all BCH services at 00:00 a.m. UTC Nov. 15 in preparation for the fork. We will monitor the network and restore service as soon as the dominant chain is confirmed. Our primary goal is to ensure the safety of client coins. We will post more details about Bitgo’s approach to this upcoming potential fork in a blog post next week,” the company added.

During the evening crypto trading sessions (ET), the San Francisco exchange Coinbase revealed its plans for the upcoming fork. “Bitcoin Cash (BCH) is expected to undergo a hard fork on November 15th, 2020,” Coinbase tweeted. “Prior to the fork, Coinbase will run BCHN nodes and expects that it will be the dominant chain post fork. Once the fork begins, BCH sends/receives to and from coinbase.com and Coinbase Pro will pause, and will be re-enabled once we’ve determined the upgrade is stable.”

Coinbase added:

Once the fork is complete, please be aware that we will NOT support BCH ABC forked coin sends/receives on coinbase.com or Coinbase Pro.

The hardware wallet firm, Satoshilabs (manufacturers of the Trezor wallet), revealed its contingency plans on November 4, 2020. According to the blog post, Satoshilabs has decided to run Bitcoin ABC and conceding to understand that there “may be service interruptions.”

“Depending on user consensus following the fork, this will either remain unchanged or switch to supporting only the forked chain, named Bitcoin Cash Node,” Satoshilabs’ post explains.

“Following the fork, Satoshilabs will monitor whether the forked chain has sufficient support to justify supporting it. If the community chooses Bitcoin Cash Node, Satoshilabs will drop support for Bitcoin Cash ABC and connect to the new network,” the company added. Bitcoin Cash proponents and Trezor owners on social media and forums were not pleased with Satoshilabs’ decision to operate the minority node.

Furthermore, the hardware wallet company Ledger Wallet gave information on how the firm will handle the upcoming upgrade in mid-November. “Ledger will suspend their BCH services from the 12th of November at 07:00 UTC for security reasons,” the hardware wallet company wrote. “We’ll be keeping an eye on the developments after the fork to see which chain will remain viable both technically and economically.”

Seven days ago, the exchange, Okex, informed customers about the trading platform’s BCH fork contingency plans. “The Bitcoin Cash (BCH) network is expected to undergo a hard fork,” the blog post notes. “There are currently two competing fork proposals, Bitcoin Cash ABC (BCH ABC) and Bitcoin Cash Node (BCHN). In the event of a successful fork, Okex users holding BCH prior to the fork will receive the two new assets, BCH ABC and BCHN.”

The trading platform Binance detailed its BCH fork arrangements on November 3, 2020, and said that this is “a contentious hard fork that may result in an additional token.” Interestingly, the exchange is listing a leverage tokens market called “BCHUP” and “BCHDOWN” and Binance plans to delist the market on November 9, 2020. Moreover, two days ago the exchange Huobi also announced the trading platform’s contingency plans.

“This upgrade is expected to fork Bitcoin Cash out of two chains, BCHA (Bitcoin Cash ABC) and BCHN (Bitcoin Cash Node),” Huobi’s blog post details. “Since there is no fair naming standard for the BCH fork in the current community, Huobi Global respects the opinions and consensus of the community and users and will set a transition period for the fork. After the community has formed a consensus on BCH naming, we will end the transition period and rename BCHA or BCHN.”

With just over a week left until the upgrade and possibility of a minority fork, BCH supporters are preparing for the outcome. The best thing users can do is patiently wait, but also make sure they have control over their bitcoin cash private keys. BCH enthusiasts who store funds on an exchange should make sure the trading platform has updated customers on how it will proceed with the fork. If a BCH user is unhappy with the direction of any third-party software provider or trading platform, they should move their BCH to another location before the fork.

What do you think about the upcoming Bitcoin Cash upgrade and the possibility of a chain split? Let us know what you think about this subject in the comments section below.

The post Hash Watch: Bitcoin Cash Services Reveal Contingency Plans for Upcoming Fork appeared first on Bitcoin News.