Tuesday, August 13, 2019

Blockstream announces first Bitcoin mining pool that uses BetterHash

Blockstream announced on Thursday, August 8, a new branch of business linked to bitcoin mining, with the aim of offering institutions and companies in Canada and the United States a network of data centers to manage mining operations. The Fidelity Center for Applied Technology and LinkedIn co-founder Reid Hoffman are among the first customers of this service.

According to the company's announcement, published on Twitter and on its blog, these are two products. Blockstream Mining, which allows interested companies to have an infrastructure to house equipment and have electric power quotas dedicated exclusively to mining and Blockstream Pool, a Bitcoin mining group that uses BetterHash. The new protocol is designed for individual miners to control "what Bitcoin transactions to include in their newly extracted blocks," as the statement indicates.

Today we're excited to reveal Blockstream Mining and Pool, providing enterprise-class mining equipment colocation in our US & Canada data centers, and the first-ever #BetterHashmining pool for a stronger, more decentralized #Bitcoin network. 🌎⛏️⛓️ https://t.co/sMVTTJNNep pic.twitter.com/EeQwuqyrB9
— Blockstream (@Blockstream) August 8, 2019

Blockstream argues that the momentum to create this business comes from the need to confront the "parties involved in ASIC manufacturing, hosting and grouping operations [that] were becoming a centralizing force and preventing Bitcoin from reaching its maximum potential" .

However, the use of the facilities, the remote monitoring services of the activities, the logistics for the importation of mining equipment, is currently reserved for institutions and companies, although it is not ruled out that in the future there is a diversification of the type of clients that can use this mining infrastructure.

In this regard, Blockstream CEO Samson Mow said he does not believe that Blockstream Mining presents centralization risks.

En todo caso, Blockstream Mining sirve para descentralizar el ecosistema minero de Bitcoin de muchas maneras. Estamos autoexplotando con solo una pequeña porción de nuestra energía disponible, con el resto asignado a los clientes, y tenemos planes de hacer que el servicio de alojamiento esté disponible para los mineros más pequeños que de otro modo no podrían hacerlo efectivamente.
Samsom Mow, CEO de Blockstream.

The company, focused on the development of software for Bitcoin and side chains such as Liquid, specifies that they have 300 MW of electric power available, thanks to a partnership with the Quebec hydroelectric and its facilities in Georgia, USA. UU.

The hardware available at this stage of the project represents less than 1% of the global hash rate, which runs with Bitfury, Ebang, MicroBT and other manufacturers, as indicated by the company on its website.

The first pool that uses BetterHash
Although many users in the networks criticized the launch of this Blockstream project, many agree to recognize the benefits of mining pools adopting the use of BetterHash, a protocol that was proposed by Matt Corallo in June 2018, through the Bitcoin Core mailing list.

The idea received criticism, because its development had been done, in part, unilaterally or behind closed doors.

This mining protocol proposes two new principles: the change of the getblocktemplate function, which allows the selection of the blocks and transactions that each pool wants to work, and the modification of the Stratum protocol, which currently serves to communicate the nodes and the pools in the different networks of miners.

It should be mentioned that in the past there have been criticisms for the ability of mining pools to make decisions regarding the use of mining equipment, without taking into account the interests of their customers. For example, in November 2018, Bitcoin.com decided to migrate all its processing power to the Bitcoin SV chain, after the Bitcoin Cash hardfork. The measure was widely criticized, because it revealed the power that different actors have to centralize Bitcoin mining.

At that time, bitcoiners like Jameson Lopp questioned the fact, indicating that the mining industry is not decentralized enough and that more alternatives such as BetterHash were needed, which then remained a project under development, but could contribute to the operators had more independence from the directives or owners of pools.