Decentralized bitcoin pool

Why mining pool concentration is the Achilles’ heel of Bitcoin?

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P2Pool is a decentralized Bitcoin mining pool that works by creating a peer-to-peer network of miner nodes. Decentralized payout pooling solves the problem of centralized mining pools degrading the decentralization of Bitcoin and avoids the risk of hard to detect theft by pool operators.

Miners are configured to connect to a P2Pool node that can be run locally, alongside the miner. P2Pool users must run a full Bitcoin node which serves the purpose of independently validating transactions and the Bitcoin blockchain. P2Pool also supports merged mining and several alternative blockchains. P2Pool nodes work on a chain of shares similar to Bitcoin's blockchain. Each node works on a block that includes payouts to the previous shares' owners and the node itself, which can also result in a share if it meets P2Pool's difficulty.

However, it should be noted that there are other pools such as BitPenny and Eligius which can provide this same level of decentralization. P2Pool shares form a "sharechain" with each share referencing the previous share's hash.

Each share contains a standard Bitcoin block header, some P2Pool-specific data that is used to compute the generation transaction total decentralized bitcoin pool, payout script of this share, a nonce, the previous share's hash, and the decentralized bitcoin pool target for sharesand a Merkle branch linking that generation transaction to the block header's Merkle hash.

The chain continuously regulates its target to keep generation around one share every thirty seconds, just as Bitcoin regulates it to generate one block every ten minutes. This means that finding shares becomes more difficult resulting in higher decentralized bitcoin pool the more people decentralized bitcoin pool on P2Pool, though large miners have the option to raise their difficulty, and so reduce the impact of their mining on P2Pool's minimum difficulty. Unlike Bitcoin, decentralized bitcoin pool do not know the entire chain - instead they only hold the last shares the last 3 day's worth.

In order to prevent an attacker from working on a chain in secret and then releasing it, overriding the existing chain, chains are judged by how much work they have since a point in the past. To ascertain that decentralized bitcoin pool work has been done since that point, nodes look at the Bitcoin blocks that the shares reference, establishing a provable timestamp.

If a share points to a block, decentralized bitcoin pool was definitely made after that block was made. Payouts are weighted based on decentralized bitcoin pool amount of work each share took to solve, which is proportional to the p2pool difficulty at that time.

The block reward currently A subsidy of 0. A miner with the aim to harm others could withhold the block, thereby preventing anybody from getting paid. He can NOT redirect the payout to himself. In the event that a share qualifies as a block, this generation transaction is exposed to the Bitcoin network and takes effect, transferring each node its payout.

On P2Pool stales refer to shares which can't make it into the sharechain. Because the sharechain is 20 times faster than the Bitcoin chain many stales are common and expected. However, because the payout is PPLNS only your stale rate decentralized bitcoin pool to other nodes is relevant; the absolute rate is not. There are two reported kinds of stales in P2Pool: Dead shares were too old by the time they arrived at your local P2Pool.

Very high dead rates can indicate decentralized bitcoin pool misconfiguration. Orphan shares are shares which were not extended by the rest of the P2Pool network, because some other miner's share was accepted first. Very high orphan rates decentralized bitcoin pool indicate network connectivity problems. The P2Pool console output shows your relative stale rate compared to other P2Pool miners in the 'Own efficiency' column:. When you first start P2Pool claimed efficiency will be low and the error bounds on this estimate will be large, but as it runs the numbers will converge to their correct values.

If your efficiency is unusually low, make sure your network connection isn't overloaded, that your miners support long polling and are not set decentralized bitcoin pool work for excessive amounts of time, and that your bitcoind has multiple connections. They shouldn't - It's normal for some fraction of everyone's shares to end up orphaned or dead.

Because payouts are calculated by counting how many shares you have relative to others, everyone with normal configurations is equally "hurt" by decentralized bitcoin pool. However, if you have a large proportion of stales, your payout will be hurt.

You can see how well you're doing by looking at P2Pool's "Efficiency" ex: If you have a lot of dead shares or the "Local dead on arrival" number is higher than a few percent, that means that something is wrong with your miner.

Check to make sure that it is one of the working versions in the Miners section on this page. Lower the intensity or raise the FPS of your miner. If you have a lot of orphan shares, something is wrong with P2Pool's P2P connection. Decrease decentralized bitcoin pool load on your internet connection or enable QoS Quality of Service on your router. Pay-Per-Last-N-Shares is a payout method that is completely resistant to pool hoppers.

Why am I not getting very many decentralized bitcoin pool The P2Pool difficulty is hundreds of times higher than on other pools. It can take decentralized bitcoin pool to decentralized bitcoin pool a share.

P2Pool displays an estimate of how long you have decentralized bitcoin pool wait in the console output. Why does my decentralized bitcoin pool say it has found a lot of shares but p2pool say I have only found a few?!

The real P2Pool difficulty is hundreds of times higher than on normal pools, but p2pool essentially lies to your miner and tells it to work on relatively easy shares so that it submits shares decentralized bitcoin pool few seconds instead of every few hours. P2Pool then ignores any submitted shares that don't match the real share difficulty. By doing this, P2Pool can more accurately report your local hash rate and you can see if you are having problems with decentralized bitcoin pool many stale shares quickly.

Why am I getting so many rejects? You're using an incompatible miner. See the miners section here, increase decentralized bitcoin pool FPS on the miner, decrease the intensity, upgrade your miner, or try a different miner.

What stops the pool operator or the block finder from stealing a block? A block solution is decentralized bitcoin pool worth anything because its hash matches Bitcoin's target.

Altering anything within the block will change its hash and make it decentralized bitcoin pool. If you are concerned about the pool operator stealing a block, you should try to inspect the source code of each new version.

Why does it say "Generated? P2Pool includes payouts in generation transactions, which must mature taking blocks or 20 hours before they can be spent.

The reason for this is that a block could be orphaned, which would make its payout invalid and could reverse transactions. Do I get paid transaction fees? They are split among P2Pool miners. What are these payments I'm getting that aren't generated?

These are subsidies that people who support the idea of P2Pool send to miners. Cool Subsidies sound like an awesome idea! How do I send some BTC to these awesome miners? See end of this page. Your node needs to be able to independently make decisions about what transactions to mine.

How do merged mining payments work? Merged mining is handled entirely by namecoind, so you're solo mining and payouts will go into namecoind's wallet. P2Pool uses higher difficulty shares than most centralized pools, so you'll see fewer shares reported. This is normal and doesn't reduce your payments. It's also normal to see longpoll decentralized bitcoin pool once per every ten seconds on average.

Lots of data and useful tools are available at http: P2pool works fine with decentralized bitcoin pool hardware. This lists some of the hardware confirmed to work and any special configuration required. P2Pool's protocol mirrors Bitcoin's P2P protocol in decentralized bitcoin pool ways. It uses the same framing prefix, command, length, checksum, payload and similar commands:. This project was announced on June 17, by Forrest Voight [1].

The pool began testing against mainnet in mid-July, The pool was reviewed on a Bitcoin Miner post on July 26, [2]. The software author's address for decentralized bitcoin pool can be found in the signature decentralized bitcoin pool of his forum profile.

In order to encourage people to mine to P2Pool you can donate to the recent miners in proportion using a sendmany:. You can replace "" with "accountname" if you want to pay from some specific bitcoind account, and you need to replace Note that the amount you donate will be allocated to recent miners in proportion to the amount of work they've done in the last 24 hours or so, but all the miner whose shares of the donated amount decentralized bitcoin pool less than 0.

You can change this 0. If you decide to donate you should announce it on the forums so that your donations provide the most incentive possible. Retrieved from " https: Companies Pool Operators Technical Mining. Navigation menu Personal tools Create account Log in. Views Read View source View history.

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Similarly, the main 8 pools control the same fraction of mining power in Bitcoin. Pools dictate the transaction sets in new blocks, not miners. Pools are subject to continuous DDoS attacks. If a big pool goes down, the security of the network is significantly compromised. High variance of returns, hard for users to plan economically. Decentralized mining pools for Bitcoin e.

We essentially replace the centralized pool operators by smart contracts, which is run and managed in a decentralized way on the blockchain. Although being decentralized, our pools can guarantee the same variance in payments as centralized pools.

The decentralized formation of SmartPool does not require any infrastructure to operate the pool. SmartPool may take negligible to almost zero fees to maintain the pool front-end and to develop new features.

We use Ethereum smart contracts to build a decentralized pooled mining protocol called SmartPool. Our solution implicitly replaces the centralized pool operator by network participants who run the Ethereum network. SmartPool includes several novel data structures and design choices which make its protocol secure and efficient. Specifically, we devise a new mechanism to verify and record miners' contributions to the pool without centralized operators.

SmartPool's efficient probabilistic verification drastically reduces both the number of messages and the costs to run the pool for miners. Using a novel data structure called the augmented Merkle tree, SmartPool's batched share submission and efficient payment scheme remove any incentive for submitting invalid batches. Want to learn more? His research is on cryptocurrencies, smart contract security and distributed consensus algorithms. He is a lead developer of Oyente, the first security analyzer for smart contracts, which is now open-source.

Yaron Velner is a postdoctoral researcher in the Hebrew University of Jerusalem. His research is focused on aspects of game theory incentives in blockchain protocols and formal verification of smart contracts.

He holds a Phd in computer science from Tel Aviv University. Yaron is also an experienced software developer with over 10 years of experience as a senior software engineer and a technical leader at EZchip semi-conductors recently acquired by Mellanox technologies.

At EZchip he was a member in the data structure and algorithm team, which developed novel data structures for IP routing. Victor Tran is a senior backend engineer and Linux system administrator. He has experience in developing and building infrastructure for multiple social marketing platforms and advertising networks. He is interested in building high performance multi-platform applications.

Victor co-founded and was CTO of several startups in social marketing. He built and maintained platforms which handled millions of monthly active users. One of his platform was in Alexa top 20 in the US for several months.

Vitalik is the Founder and Chief Scientist of Ethereum. He is also both the Founder and a writer for Bitcoin Magazine, a venture that marked the beginning of his career in crypto in He is interested in creating secure, efficient, and trustworthy systems and advises a number of projects in the crypto space. Prateek Saxena is a research professor in computer science at National University of Singapore.

He works on blockchains and computer security, and his research has influenced the design of browser platforms, web standards and app stores widely used today. An efficient and decentralized mining protocol for existing cryptocurrencies based on Ethereum smart contracts.

Normal centralized pools are not ideal because of: SmartPool enables an efficient way to mine blocks in a decentralized manner between miners. Everyone can propose their own transactions in a block, thus eliminating the censorship on transactions.

SmartPool requires negligible to no fees from miners. We are excited about Proof of stake as much as anyone else, but it will take roughly one more year for PoS to come. Until PoS is officially rolled out, SmartPool is still relevant and makes mining in Ethereum much more decentralized.

The adoption of Ethereum based decentralized pools for other cryptocurrencies would increase Ether volume usage as ZCash and Bitcoin miners would have to interact with the corresponding Ethereum contracts and directly benefit Ethereum miners.

Ethereum first, ZCash and Bitcoin will be supported later if funding allows. We would also provide a generic interface to allow porting to almost all cryptocurrencies.

We have considered this option, and decided against it. SmartPool is a community project, not for profit. SmartPool will be run for-and-by the community. We feel that having a separate token or currency associated with it may ultimately limit its adoption. SmartPool's goal is decentralization, and the best way to get there is to scale without creating auxiliary incentive structures around it. We will still issue tokens for each donation though. The tokens are only to recognize donors' contributions to SmartPool, thus may or may not have financial values in the future.

If you are a miner, it is pretty straightforward. You just need to install an update to your miner software which we provide to interact with the contracts. More details will be released later on. If you are not a miner but a cryptocurrency advocate, please consider donating to support the SmartPool development. SmartPool is a non-profit open source project. It is technically impossible to use P2Pool solution for Ethereum.

Moreover, our solution also performs better than P2Pool for other currencies. SmartPool leverages the security of Ethereum blockchain for its operation. Previous decentralized Bitcoin pools e. P2Pool used a separate side-chain which doesn't have as strong a backing infrastructure as Ethereum today. SmartPool's design scales ad-infinitum.

SmartPool is a versatile concept. It can support mining for more than one cryptocurrency. It is appealing both for Bitcoin which has dominated by large mining farms as well as for other cryptocurrencies like Monero and ZCash which have many more solo miners.

We already have a proof of concept for a SmartPool-based mining pool for Bitcoin. We aim to build production-ready and compatible system so everyone can use and launch their own decentralized pools.

Depending on our funding, we plan to launch and maintain SmartPool-based pools for Ethereum and other cryptocurrencies too. First beta pool for Ethereum on testnet: First working pool for Ethereum: The SmartPool project is funded by the community and run by the community.

Thus, we will do a crowdfund and ask for donations from the public. We will keep updating our funding status. Depending on how much we get, our promised deliverables vary as follows.

Less than 5, ETH: Implement SmartPool for Ethereum and release all software as open source i. In addition to what we have promised, we will launch a decentralized pool for Ethereum and maintain it until Ethereum moves to proof of stake.

More than 10, ETH: Pay to the devs please check out our team. Equipment and other expenses: GPU renting, basic infrastructure, social media promotion, etc. There is no financial benefit at the moment.

Although we issue tokens for each donation, the tokens are only to represent contributions to SmartPool. Our first priority is to promote decentralized mining and have a running pool with significant hash power. Compensating token holders will be considered, but will not be our main focus.

Transaction Censorship and Single Point of Failure Pools dictate the transaction sets in new blocks, not miners. Mining Solo is Difficult for Small Miners High variance of returns, hard for users to plan economically. Centralized Pools Take High Fees to cover for their operation costs and gain profits. Decentralize Pools by Leveraging Smart Contracts We essentially replace the centralized pool operators by smart contracts, which is run and managed in a decentralized way on the blockchain.

Mitigate Transaction Censorship Threat Miners can propose their own sets of transactions. Guarantee Low Variance Although being decentralized, our pools can guarantee the same variance in payments as centralized pools. Low Fees The decentralized formation of SmartPool does not require any infrastructure to operate the pool. How is it different from or better than normal pools? Ethereum is moving to Proof-of-stake, how does SmartPool benefit Ethereum?

What are the supported cryptocurrencies? Everyone is doing an ICO for their project. Will SmartPool have one too? How does one participate then?

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