Search Results For: linux
15 Jul
1
IBM announces its new cloud Blockchain Security Service
Today (July 15, 2016) IBM announces its new cloud Blockchain Security Service that aims at helping businesses test and run blockchain projects for private applications.
Defined as the “IBM secure blockchain cloud environment”, this project is a new integration of the IBM’s existing blockchain cloud service.
However, the company goal is to increase the security of private blockchain services running in the cloud.
Donna Dillenberger recently commented how the cloud environment – thanks to the IBM LinuxOne server – could protect valuable data on a private blockchain.
She explained to Coindesk:
“The cloud is made up of a special hardware that protects the blockchain from hacks, from people who have unethically compromised root users or system administrator credentials.”
Using this safe network, blockchain applications built through the IBM blockchain are signed and encrypted so it is impossible for a malware to install itself on this platform.
This project is currently in a limited beta version.
Cloud Blockchain Security Service
This is not the first time we read news related to IBM and blockchain services.
In fact, previously this company announced its project for an artificial intelligence called Watson to be created thanks to the blockchain. You can read the full news by clicking here.
Also, IBM is so enthusiastic about this technology that Director John Wolpert commented “We’re All in on Blockchain”, during an important Blockchain Conference held in San Francisco on February 12nd, 2016.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
8 Jun
1
OpenBazaar Test: how the Bitcoin Ebay works
The Bitcoin Marketplace: OpenBazaar Test
Recently OpenBazaar, the decentralized marketplace where you can buy items for bitcoins, launched its new 1.1.6 version.
So we decided to do a OpenBazaar test, to let you deeply understand how it works and what you can buy on this innovative market using your cryptocurrencies.
Step-by-Step OpenBazaar Test: Follow this Guide to do some Shopping
1. First of all you need to go to the OpenBazaar website and click on the Download button you can find on the right top of the page.
2. A download will start soon. If it doesn’t, you just need to select your operating system such as Linux, Windows or Mac
3. After the download is completed, click on the file (maybe you will find it in the Download file) and launch it.
4. A new window will open where you have to complete your profile with info like name, timezone, avatar and your favorite currency.
5. You can also select your favorite theme to be used as a your profile template
6. Then you will be officially into your profile where you can add other info such as your social network profiles
7. Now you can start doing some shopping.
OpenBazaar has a simple interface, user-friendly enough to experiment and pay with your bitcoins.
Among the items you can find on this marketplace there is a wide range of the company’s merchandise, so I decided to support their cause by buying their pins.
8. As you can imagine, I just had to click on the item I wanted to purchase.
9. Then you just click on the “Buy Now” (“Compra ora” because my version is in Italian).
10. A windows will appear where they ask you if you already have a wallet (if not you can open it here).
11. Now you have to insert your public wallet address, you can find on your wallet among the settings.
During this process you can also create a temporary wallet address, useful if you can’t find your public wallet address and for security reasons you don’t want to disclose your private one.
12. OpenBazaar allows purchases from all around the world, but of course you need to pay extra bitcoins for the shipment.
For a shipment to Italy you need to pay an extra of about 0.0232 BTC, so I spent almost 17 EUR for that pin.
Bitcoin Wallet
As I said, you can purchase your items on OpenBazaar by using bitcoins; and to do so of course you need a wallet.
Open your on HolyTransaction and find out more on our wallet where you can store several different cryptocurrencies including Bitcoin, Ethereum, Dogecoin, Peercoin, etc…
We call it a “Universal Wallet” for this reason.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
7 Apr
0
Red Hat to help blockchain related startups
Yesterday Red Hat announced its idea to start its OpenShift blockchain that aims at helping financial companies with their initiatives related to the disruptive distributed ledger.
Thanks to OpenShift, Red Hat users can create blockchain applications using tools provided by indipendent sellers and with the support of Red Hat’s Openshift Dedicated program.
How Openshift works
OpenShift Dedicated wants to help the startups related to blockchaintech, fintech ISVs, and traditional financial companies to begin their blockchain-based projects.
“A lot of folks in the market are looking to deploy on the big cloud providers, Amazon, Google, Microsoft. There are many companies offering cloud support”, Tapia commented.
Tapia clarified that OpenShift Dedicated is available on Amazon and will soon be available on Google and Microsoft Azure as well.
During a recent interview, director of OpenShift, Julio Tapia, explained that the company wants to use its own experience in the open source sector related to blockchain technology.
These were his words:
“We want to position ourselves with not only customers and partners, but leverage solutions developed in the entire ecosystem, taking all the innovation going on in the industry, maturing it for an enterprise market and making sure all the solutions can be launched and supported.”
Red Hat with Hyperledger
Previously, in February, Red Hat announced its partnership with the Linux Foundation’s Hyperledger project, “an open source platform to advance the blockchain digital technology for recording and verifying transactions”, according to the press release.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
6 Apr
0
Artificial intelligence connected to the blockchain thanks to IBM
IBM is working on an artificial intelligence that will use the blockchain.Thanks to the possibilities offered by the blockchain in terms of value exchange, the IBM artificial intelligence will be able to analyze tons of data in a small portion of time.
During the past months, IBM studied how to introduce the blockchain technology to its artificial computer called Watson.
And thanks to Tim Hahn this will happen for real. He explained to CoinDesk:
“What we’re doing with blockchain and devices is enabling the information those devices supply to effect the blockchain…You begin to approach the kind of things we see in movies.”
The blockchain applications will include the possibility to allow devices to perform tasks at a certain set time.
Also, the devices wil be registered on the blockchain and – thanks to smart contracts – different types of access will be created, allowing lots of functionalities and customization.
For example, thanks to the blockchain, Watson software could be updated remotely.
“You better be ready to actively update your devices throughout the lifecycle of your devices. Vulnerabilities will be discovered long after the device is released”, commented Hahn.
Unfortunately Watson is still in a development phase and we don’t have more details about this disruptive invention.
“Its early days and we’re just playing around with prototypes now”, explained Hahn.
IBM invests in the Internet of Things
It was March when IBM announced its decision to invest $3bn to build an entire office that would be dedicated to the Internet of Things (IoT), or the smart connection between devices and Internet.
In a press release IBM explained that the company predicted to earn $235bn by the end of 2016 and an increase of 22% from 2014.
The statement also predicted 6.4 billion devices that will be used worldwide within the end of 2016, an amount that will reach 20.8 billion in 2020.
Previous statement
IBM, in fact, is also working on the Hyperledger Project, an open-source blockchain led by The Linux Foundation. Presented in December, this project stars thirty companies including ABN Amro, CME Group, Red Hat and several blockchain startups.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
25 Mar
0
How the blockchain could help email security
BitMessage
Every day we send thousands of emails and such communication has become a daily routine and a MUST for any person and company.
But options to secure communications are not so common and strong. Also, the existing services are too difficult for people to use and they should use a trusted channel.
This is the reason why it has been opened the open source project called BitMessage, a service who helps to decentralize and encrypt messages and solves the problem of trusting a third party security authority.
But BitMessage doesn’t use the bitcoin blockchain, but a distributed ledger created by the BitMessage Community itself.
How it works
Thanks to BitMessage and its wallet, you will be able to create a private key and your contacts will receive a string that look like a bitcoin address.
This way you will have a long alphanumeric string among your contact lists instead of email addresses, and you need a proof-of-work to send your message, even offline.
In fact, BitMessage proposes a system where customer uses a hash of a public key that it is the same as the user’s address. “If the public key can be obtained by the underlying protocol, then it can easily be hashed to verify that it belongs to the intended recipient. The data exchanged by the user can also include a version number for forwards capability, a stream number and a checksum”, explained the whitepaper.
Here you can read the full whitepaper, in which BitMessage is described as a “peer-to-peer message authentication and delivery system” platform.
The invention
BitMessage was opened in November 2012 by Jonhatan Warren, who also created PyBitmessage, or the official instant messaging client for BitMessage.
Technical details
Its source code use Python as a language and the Qt cross-platform application framework; OpenSSL allows its cryptographic functions. BitMessage is available for Microsoft Windows, Mac OS and Linux.
Unfortunately, it is not available for mobile devices.
Download the latest version here !
Open your free digital wallet here to store your cryptocurrencies in a safe place.
21 Mar
0
Hitachi is studying the Blockchain
Some days ago the Japanese company Hitachi announced that it will open a research laboratory in the US that will study the blockchain ledger and its possible applications.
The lab will partner with Hitachi technology innovation division and it will be opened next month in Santa Clara, California.Hitachi wants to use the research laboratory to work on some projects for its customer base.
In a press release, Hitachi explained:
“By establishing the Financial Innovation Laboratory in the Silicon Valley, Hitachi will accelerate research [and] development of blockchain technology, collaborative creation with customers, and development of solutions to support business innovation in financial institutions.”
Hitachi partners with Hyperledger
This statement follows a previous company’s news related to the blockchain: in fact, in February Hitachi joined the Hyperledger Project, an advaced blockchain technology that aims at “identifying and addressing important features for a cross-industry open standard for distributed ledgers that can transform the way business transactions are conducted globally.”
The Hyperledger Project is a Linux Foundation collaborative project that stars some of the most important companies in the world, including IBM, J.P. Morgan, Fujitsu and many more.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
12 Feb
0
‘We’re All in on Blockchain’, says IBM
“We are all in on Blockchain”: these were the words of IBM Director John Wolpert during the today Blockchain Conference in San Francisco. According to Wolpert the blockchain needs a more collaborative approach, which is not always guaranteed by the blockchain developers.
So it seems that the worldwide company IBM wants to ensure itself a leading role in the market solutions related to the blockchain.
In fact, IBM is working on the Hyperledger Project, an open-source blockchain led by The Linux Foundation. Presented in December, this project stars thirty companies including ABN Amro, CME Group, Red Hat and several blockchain startups.
“It’s amazing how many smart and genius people are behind bitcoin, but they miss some logic here. You don’t need to go from trusted to trustless on everything. I think that’s an honest disagreement. The Internet is a permissioned walled garden. Anyone heard of ICAAN [Internet Corporation for Assigned Names and Numbers]? It’s permissive, but it’s permissioned”, said Wolpert.
Hyperledger Project’s goal, he continued, is to be an evolution of the first generation projects such as Bitcoin and Ethereum, that gather all the best projects that leverage on the blockchain together with all the stakeholders that will potentially use such technology. This is necessary if we want to have a widely used transactional protocol.
“It has to be immutable and modular. It can’t be this is the consensus algorithm, this is the token, all of that has to be modular. It has to be scalable. Interledger-ing is important. You have to inter-op between chains and different things”, he said.
During his speech Wolpert also emphasized IBM’s experience in consensus algorithms and distributed computing during the last 30 years.
It’s thanks to such experience that IBM was able to conduct the Hyperledger Project, that Wolpert sees as the only way to bring all the different stakeholders to the same table and make them work together to build and open-source blockchain platform that can be used in many different areas, as it is for Linux.
“We’ve been doing projects on every kind of blockchain. We’ve been doing that for a couple years and now we have a whole unit. We announced [we worked with] the Linux Foundation […] At that point, we went all in on blockchain”.About the author: Amelia Tomasicchio is a writer and a journalist of Bitcoin-related news and articles. She started writing about Bitcoin in 2014 and she graduated in Rome with an essay about movie industry related to Bitcoin.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
30 May
0
10 things you should know about Bitcoin and digital currencies
After reading these 10 things to know about the confusing world of digital currencies, you’ll feel confident joining the conversation.
1. The difference between virtual, digital, and cryptocurrencies
(TechRepublic) Virtual currencies were developed because of trust issues with financial institutions and digital transactions. Though they aren’t even considered to be “money” by everyone, virtual currencies are independent of traditional banks and could eventually pose competition for them.
First, there are three terms that are sometimes used interchangeably that we need to sort out: virtual currency, digital currency, and cryptocurrency.
Virtual currency was defined in 2012 by the European Central Bank as “a type of unregulated, digital money, which is issued and usually controlled by its developers, and used and accepted among the members of a specific virtual community.” Last year, the US Department of Treasury said that digital currency operates like traditional currency, but does not have all the same attributes — as in, it doesn’t have legal tender.
Digital currency, however, is a form of virtual currency that is electronically created and stored. Some types of digital currencies are
cryptocurrencies, but not all of them are.
cryptocurrencies, but not all of them are.
So that leads us to the more specific definition of a cryptocurrency, which is a subset of digital currencies that uses cryptography for security so that it is extremely difficult to counterfeit. A defining feature of these is the fact they are not issued by any central authority.
2. The origin of Bitcoin
Bitcoin is a cryptocurrency, a number associated with a Bitcoin address. In 2008, a programmer (or group of programmers) under the pseudonym Satoshi Nakamoto published a paper describing digital currencies. Then in 2009, it launched software that created the first Bitcoin network and cryptocurrency. Bitcoin was created to take power out of the hands of the government and central bankers, and put it back into the hands of the people.
There are currently about 12 million Bitcoins in circulation, though when it was created, the programmer said there is a finite limit of 21 million Bitcoins out there. They are currently valued at around $460 each, according to Bitcoin Charts, which tracks the activity. The value surged as high as $1000 each in December 2013.
3. The origin of Dogecoin
Dogecoin is a form of cryptocurrency that was created in December 2013. It features Doge, the Shiba Inu that has turned into a famous internet meme. It was created by Billy Markus from Portland, Oregon, who wanted
to reach a broader demographic than Bitcoin did. As of March, more than 65 billion Dogecoins have been mined, and the production schedule of this
cryptocurrency is in production faster than most.
to reach a broader demographic than Bitcoin did. As of March, more than 65 billion Dogecoins have been mined, and the production schedule of this
cryptocurrency is in production faster than most.
Earlier this year, the Dogecoin community raised funds for the Jamaican bobsled team to attend the 2014 Winter Olympics when they could not afford to go. The community also raised 67.8 million coins (about $55,000) to sponsor NASCAR driver Josh Wise, who drove the Doge-themed car in several races.
Because there’s a lot of them, Dogecoin is valued pretty low — 1,000 Dogecoins are worth $0.46.
4. Other types of digital currencies
There are other types of digital currencies, though we don’t hear much about them. The next most popular is probably Litecoin, which is accepted by some online retailers. It was inspired by Bitcoin and is nearly identical, but it was created to improve upon Bitcoin by using open source design.
There are many other types of cryptocurrencies, such as Peercoin, Ripple, Mastercoin, and Namecoin. Cryptocurrencies get some flack because they are often replicates of other versions, with no real improvements.
5. Bitcoin regulations
Who is in charge of Bitcoin? The point of the currency is that it is decentralized, but there are legalities that differ in every country. Law enforcement and tax authorities are concerned about the use of this cryptocurrency because of its anonymity and the ease of using it for money laundering and other illegal activities. Bitcoin was the prime currency on Silk Road, which was used to sell illegal goods, including drugs. It was shut down in 2013 by the FBI.
The US Security and Exchange Commission (SEC) hasn’t yet issued specific
regulations on digital currencies, but it often warns about investment schemes and fraud. The Financial Crimes Enforcement Network (FinCEN), an agency under the Department of Treasury, took initiative and published virtual currency guidelines in 2013. Many countries are still deciding how they will tax virtual currencies. The IRS is specifically concerned with virtual currencies being used for unreported income.
regulations on digital currencies, but it often warns about investment schemes and fraud. The Financial Crimes Enforcement Network (FinCEN), an agency under the Department of Treasury, took initiative and published virtual currency guidelines in 2013. Many countries are still deciding how they will tax virtual currencies. The IRS is specifically concerned with virtual currencies being used for unreported income.
6. How Ben Bernanke changed the Bitcoin game
In late 2013, the first congressional hearing on virtual currency was held to
outline the pros and cons of Bitcoin. The hearing ended up providing a
financial boost for the currency, because US officials talked about it as a
legitimate source of money, as opposed to only discussing its role in illegal
activities.
outline the pros and cons of Bitcoin. The hearing ended up providing a
financial boost for the currency, because US officials talked about it as a
legitimate source of money, as opposed to only discussing its role in illegal
activities.
Although he didn’t attend, Federal Reserve Chairman Ben Bernanke said in a letter to US senators that virtual currencies “may hold long-term promise, particularly if the innovations promote a faster, more secure, and more efficient payment system.” Bitcoin, which was valued around $13 in the beginning of 2013, jumped sharply after news of his comments broke.
7. How to get Bitcoins
There are three ways you can get Bitcoins: buy them on an exchange like HolyTransaction, accept them for products and services, and mine them. We’ll get to the latter process in the next section.
To start, download a Bitcoin wallet. There are many websites where you can download an app on your phone or computer to store Bitcoins. MultiBit is an app you can download for Windows, Mac and Linux. Bitcoin
Wallet for Android runs on your phone or tablet. To store the Bitcoins, you have three options:
Wallet for Android runs on your phone or tablet. To store the Bitcoins, you have three options:
1. Desktop wallets leave you responsible for protecting the currency and
doing your own backups.
doing your own backups.
2. Mobile wallets allow you to travel with the Bitcoins anywhere, and you
are responsible for them. Mobile apps allow you to scan a QR code or tap to
pay.
are responsible for them. Mobile apps allow you to scan a QR code or tap to
pay.
3. Web wallets are transacted through a third party service provider. If
anything happens on their side or it gets hacked, you run the risk of losing
the Bitcoins, so extra backups and secure passwords are suggested.
anything happens on their side or it gets hacked, you run the risk of losing
the Bitcoins, so extra backups and secure passwords are suggested.
Problem
is, Bitcoins can be stolen in huge quantities, just like money, and with no
centralized bank, there’s no way to recoup the losses. There are several types of Bitcoin ATMs, which exchange Bitcoins for flat currencies. Most machines are expensive and rare, ranging from $5,000 to $2,000. Skyhook,
a Portland, Oregon-based company, demoed a $1,000, machine at a conference this month. It is the first portable, open source ATM.
is, Bitcoins can be stolen in huge quantities, just like money, and with no
centralized bank, there’s no way to recoup the losses. There are several types of Bitcoin ATMs, which exchange Bitcoins for flat currencies. Most machines are expensive and rare, ranging from $5,000 to $2,000. Skyhook,
a Portland, Oregon-based company, demoed a $1,000, machine at a conference this month. It is the first portable, open source ATM.
8. How to mine for Bitcoins
It’s like mining for gold, just on the computer. You need a Bitcoin wallet and
specific software, which is free and open source. The most popular is GUIMiner, which searches for the special number combination to unlock a transaction. The more powerful your PC is, the faster you can mine. In the early days, it was easy to find Bitcoins, and some people found hundreds of thousands of dollars worth of the cryptocurrency using their computers. Now, though, more expensive hardware is required to find them. Each Bitcoin blockchain is 25 Bitcoin addresses, so it takes a lot of time to find them on your own. The exact amount of time ranges depending on the hardware power, but mining all day could drive your energy bill up and only mine a tiny fraction of a Bitcoin — it may take days to mine enough to purchase anything.
specific software, which is free and open source. The most popular is GUIMiner, which searches for the special number combination to unlock a transaction. The more powerful your PC is, the faster you can mine. In the early days, it was easy to find Bitcoins, and some people found hundreds of thousands of dollars worth of the cryptocurrency using their computers. Now, though, more expensive hardware is required to find them. Each Bitcoin blockchain is 25 Bitcoin addresses, so it takes a lot of time to find them on your own. The exact amount of time ranges depending on the hardware power, but mining all day could drive your energy bill up and only mine a tiny fraction of a Bitcoin — it may take days to mine enough to purchase anything.
To tackle that problem, there are now mining pools. Miners around the world can band together to combine the power of their computer systems and then share the profits between participants. The most popular one is Slush’s Pool, where smaller, more steady payouts are given instead of a lump sum.
9. Where you can use Bitcoin
There are many places you can use Bitcoin to purchase products or services. There’s no real rhyme or reason to the list, which includes big corporations and smaller, independent retailers including bakeries and restaurants. You can also use the currencies to buy flights, train tickets, and hotels on CheapAir; upgrades to your OK Cupid profile; products on Overstock.com; gift cards on eGifter. There’s a list on SpendBitcoins that shows all the places that accept the cryptocurrency.
10. The future of virtual currency
The value of Bitcoin has fluctuated drastically throughout the last year, and there are still 9 million of the coins out there in cyberspace. However, many
security issues remain, and that will continue to be a problem. In 2013, Mt. Gox, a Japanese exchange, handled 70% of all Bitcoin transactions, but they lost some 750,000 Bitcoins in February 2014 and filed for bankruptcy, and nothing has been proven in the case. Since it’s universal, it’s useful for international transactions, and could be helpful for transactions in developing countries.
security issues remain, and that will continue to be a problem. In 2013, Mt. Gox, a Japanese exchange, handled 70% of all Bitcoin transactions, but they lost some 750,000 Bitcoins in February 2014 and filed for bankruptcy, and nothing has been proven in the case. Since it’s universal, it’s useful for international transactions, and could be helpful for transactions in developing countries.
Some experts suggest putting a few aside if you have them and see what happens in the coming months and years, because there are sure to be regulations on the currency soon. With businesses jumping on the bandwagon and investors becoming interested in cryptocurrency, look for momentum to grow, but it will take time for the situation to stabilize as governments, the international community, and the people of the internet decide on how the next generation of currency will transition to a digital world.
Open your free digital wallet here to store your cryptocurrencies in a safe place.
27 May
0
What are Bitcoin nodes and why do we need them?
(CoinDesk) It’s well known that bitcoin is designed as a decentralized
peer-to-peer (P2P) network. However, what’s often lost in translation is
the sheer amount of machinery that is needed to maintain this global
infrastructure.
peer-to-peer (P2P) network. However, what’s often lost in translation is
the sheer amount of machinery that is needed to maintain this global
infrastructure.
For example, in order to validate and relay
transactions, bitcoin requires more than a network of miners processing
transactions, it must broadcast messages across a network using ‘nodes’.
This is the first step in the transaction process that results in a
block confirmation.
transactions, bitcoin requires more than a network of miners processing
transactions, it must broadcast messages across a network using ‘nodes’.
This is the first step in the transaction process that results in a
block confirmation.
To function to its full potential, the bitcoin
network must not only provide an avenue for transactions, but also
remain secure. By using a number of randomly selected nodes, the network
can reduce the problem of double spending – when a user attempts to spend the same digital token twice.
network must not only provide an avenue for transactions, but also
remain secure. By using a number of randomly selected nodes, the network
can reduce the problem of double spending – when a user attempts to spend the same digital token twice.
However,
bitcoin doesn’t just need nodes, it requires lots of fully functioning
nodes – nodes that have the bitcoin core client on a machine instance
with the complete block chain. The more nodes there are, the more secure
the network is.
bitcoin doesn’t just need nodes, it requires lots of fully functioning
nodes – nodes that have the bitcoin core client on a machine instance
with the complete block chain. The more nodes there are, the more secure
the network is.
This is one of the reasons there is a plan to put bitcoin nodes in space, and that the plan has important implications for bitcoin.
The problem is, the number of nodes on the network is dropping, and core developers believe it may continue to do so.
Waning support
Looking
at a 60-day chart of bitcoin nodes shows that the number has gone down
significantly. It went from 10,000 reachable nodes in early March to
below 8,000 at the beginning of May.
at a 60-day chart of bitcoin nodes shows that the number has gone down
significantly. It went from 10,000 reachable nodes in early March to
below 8,000 at the beginning of May.
 |
|
Source: Bitnodes |
What’s
interesting is that during a recent 24-hour period, the number of
reachable nodes went down from 8,200 to 7,600 and back to 8,200 again.
This suggests that a portion of users running nodes are turning off
their machines at night, meaning that this contingent of nodes are being
run on desktops or laptops.
interesting is that during a recent 24-hour period, the number of
reachable nodes went down from 8,200 to 7,600 and back to 8,200 again.
This suggests that a portion of users running nodes are turning off
their machines at night, meaning that this contingent of nodes are being
run on desktops or laptops.
 |
|
Source: Bitnodes |
Another issue is the geographic distribution of the nodes. The majority of reachable nodes are located in North America.
In Africa, where bitcoin could perhaps help people lacking access to financial resources more than anywhere else, there is a regional paucity of reachable nodes.
 |
|
A map based on Bitnodes data. Source: Coinviz |
Lack of incentive
Unlike bitcoin mining, where participants are rewarded for confirming transactions,
running a bitcoin node does not provide any incentive. The only benefit
for someone to run a node is to help protect the network, and based on
the Bitnodes data, the number of people interested in supporting the
network with a full node is waning.
running a bitcoin node does not provide any incentive. The only benefit
for someone to run a node is to help protect the network, and based on
the Bitnodes data, the number of people interested in supporting the
network with a full node is waning.
There could be a number of reasons for that.
For one thing, running a full node utilizes the resources of a machine for basically no monetary return. Plus, the collapse of Mt. Gox has likely left many people with less desire to support the digital currency.
Furthermore, the popularity of the bitcoin core client in China, where it was for a time immensely popular, has tapered off given the contentious regulatory environment there.
Centralization of mining
In
terms of supporting the bitcoin network, it used to be a lot easier for
the average user to participate. However, the advent of massive ASIC
data centres has weakened the consensual nature of mining, and by
extension providing nodes, for many people.
terms of supporting the bitcoin network, it used to be a lot easier for
the average user to participate. However, the advent of massive ASIC
data centres has weakened the consensual nature of mining, and by
extension providing nodes, for many people.
Ross McKelvie, lead engineer at bitcoin incubator Boost VC, believes that it will be larger operators with data centres like KnCMiner that will have to pick up the slack in the number of bitcoin nodes, reasoning:
“As
bitcoin grows, so does the network and the computing power behind the
scenes required to run it. The majority of bitcoiners won’t be able to
support their own nodes and will be taken over by companies like KnC.”
KnCMiner is just an example of economics and logistics in the mining industry
pushing bitcoin towards a more centralized future. McKelvie also
believes that major technology companies that take interest in bitcoin
will have to put their computing resources behind the digital currency:
pushing bitcoin towards a more centralized future. McKelvie also
believes that major technology companies that take interest in bitcoin
will have to put their computing resources behind the digital currency:
“I
wouldn’t be surprised if we see large tech companies like Google and
Amazon throwing resources at bitcoin as they adopt the currency.”
Feedback from nodes
As part of the bitcoin core developer team, Mike Hearn
sees the issue of nodes dropping from 10,000 down to under 7,000 as a
significant problem. To Hearn, the core of the issue is disinterest in
both expending computing resources and electricity toward something that
may have diminishing value.
sees the issue of nodes dropping from 10,000 down to under 7,000 as a
significant problem. To Hearn, the core of the issue is disinterest in
both expending computing resources and electricity toward something that
may have diminishing value.
On the bitcoin developer mailing list,
Hearn has proposed added functionality that would allow communications
between nodes and the developers to better understand why so many are
dropping out.
Hearn has proposed added functionality that would allow communications
between nodes and the developers to better understand why so many are
dropping out.
Hearn also wants to exclude consumer wallets installed on laptops and desktops from the network as well.
This
is because their number will continue to decline no matter what – and
they appear to only be working when users are awake during the day.
is because their number will continue to decline no matter what – and
they appear to only be working when users are awake during the day.
One of the reasons why lots of nodes are important is redundancy, according to Hearn:
“It
makes [the bitcoin network] ‘seem’ bigger, more robust and more
decentralised, because there are more people uniting to run it. So
there’s a psychological benefit.”
Moving forward
Bitcoin core developer Jeff Garzik
believes that community attention to the lack of nodes supporting the
network is what the industry needs in order to boost numbers:
believes that community attention to the lack of nodes supporting the
network is what the industry needs in order to boost numbers:
“I agree we need more full nodes. I’ve long been a proponent of such calls for more nodes.”
However,
such calls for voluntary support might not be enough motivation for
people to do so, though, so, one logical idea that has been floated is
to give nodes some sort of incentive.
such calls for voluntary support might not be enough motivation for
people to do so, though, so, one logical idea that has been floated is
to give nodes some sort of incentive.
However, that’s probably not
feasible right now: over the past six months, miners have been
averaging a daily reward of 15.98 BTC per day, according to Blockchain.
feasible right now: over the past six months, miners have been
averaging a daily reward of 15.98 BTC per day, according to Blockchain.
Recent
bitcoin prices would peg that value at around $7,040 per day for the
entire network – and the growth in transaction fees has been incredibly
flat over the past six months. As a result, miners would likely be
reluctant to concede any revenue to bitcoin nodes, which don’t require
pricey ASIC hardware to run.
bitcoin prices would peg that value at around $7,040 per day for the
entire network – and the growth in transaction fees has been incredibly
flat over the past six months. As a result, miners would likely be
reluctant to concede any revenue to bitcoin nodes, which don’t require
pricey ASIC hardware to run.
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Transaction fees on the network for past six months. Source: Blockchain |
Members
of the bitcoin community seem to be losing interest in hosting full
nodes. And it’s something to pay attention to, because over time it
might mean that the major companies in the industry may have to pick up
the slack.
of the bitcoin community seem to be losing interest in hosting full
nodes. And it’s something to pay attention to, because over time it
might mean that the major companies in the industry may have to pick up
the slack.
If larger players are taking up the role of supporting
the network as full nodes, though, it continues to lessen the amount of
decentralization the network has at an infrastructure level.
the network as full nodes, though, it continues to lessen the amount of
decentralization the network has at an infrastructure level.
This
is all down to circumstances surrounding bitcoin sentiment – the rise of
ASICs, the selloffs in China and complete collapse of Mt. Gox – plus
little in the way of incentives for someone to run a node.
is all down to circumstances surrounding bitcoin sentiment – the rise of
ASICs, the selloffs in China and complete collapse of Mt. Gox – plus
little in the way of incentives for someone to run a node.
Connections image via Shutterstock
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