DASH mining in any capacity is officially dead

[Checkerama]

EDIT: Thanks for all of the responses. In order to really consolidate all that I have been trying to perceive on this post, I have created an article on medium with mathematical models and indicators to show the competition SHA-256 mining brings to x11 mining, and how this will incredibly inhibit the possibility of DASH global infrastructure worldwide. Check it out:

https://medium.com/@aquilesgomez/hi...11-algorithm-on-the-dash-network-f48533a5e6fe
https://medium.com/@aquilesgomez/hi...11-algorithm-on-the-dash-network-f48533a5e6fe
https://medium.com/@aquilesgomez/hi...11-algorithm-on-the-dash-network-f48533a5e6fe
https://medium.com/@aquilesgomez/hi...11-algorithm-on-the-dash-network-f48533a5e6fe

EDIT 2: Anyone interested in buying one of these 8x Antminer D3's is more than welcome to buy one off of me LOL. Still in the box, PM me to set up an escrow.

Let's get this straight - I'm not here to complain about my shitty investment into the Antminer D3 which I've bought 10 of already, but I want to be frank about what the hell just happened - in ONE FOUL SWOOP, Bitmain managed to flood out one of bitcoin's main competition by showing just how weak their hashing algorithms were in terms of scalability for its mining community.

We are officially in the negative when it comes to DASH profitability with a 1500 dollar Antminer D3 with an average cost per KW/h. Now that's not the part I want anyone to focus on - but look at that DASH mined per year - 2 DASH coins. Now let's look at the hashrate, which has only very recently in its lifetime reached above 1000TH/s

In comparison, bitcoin is at a hashrate in the 5.3 MILLION TH/s range and its profitability stays stable:

Note that their S9 basic has a hash rate 100 times the size of the D3 hashrate, yet still gives us reasonable returns:

From a mining investment point of view, it's obviously clear that bitcoin comes out superior in terms of profitability and sustainability as a business model. Most of the support and big push for bitcoin comes from its mining community - do you all honestly think your 5% governance structure is going to be enough to propel your DASH into mainstream limelight when the algorithm underlying it can't even support a few months supply of algorithm miners?

Part of the allure of bitcoin is that it created an industry under it - not just as a payment method, but also as a means of livelihood while supporting the underlying cryptocurrency structure and, in a way, propelling it into mainstream limelight due to its robust infrastructures around the world. What the hell did DASH miners get? A cryptocurrency whose profitability got flooded out by new technology WHILE using that same new technology? I'd like to remind everyone that we are only talking about 1500 TH/s. 1500... vs 5.3 million.. and its suddenly not viable to even mine it at all?

This is a serious issue in terms of scalability, and you're being delusional if you think no ones gonna take note off the lack of infrastructure DASH will be providing into the cryptocurrency sphere in comparison to bitcoin - we harp on bitcoin because of its shitty transaction speeds and high network fees, but we're literally killing DASH by not even accommodating to the mining community which supports its PoW infrastructure. In essence, DASH just hard-capped itself at the 1.5 PH/s line, while bitcoin will continue to improve itself around the world in terms of hashrate. You might have the software capable of bringing this to the masses, but without the hashrate and processing power to process those fancy 2MB/s blocks the devs have been promising, the DASH team just shot itself in the foot twice by introducing both cheaper network fees AND the promise that, somehow, 2MB/s blocks will be supported by its mining community. People are already dropping DASH mining like hotcakes everywhere - just look at ebay selling D3's for half of its price.

So, in conclusion, this is something that needs to be addressed immediately. The devs are just tip toeing around this issue by solving problems that don't even exist and building aritificial hype around the coin that shouldn't exist (why are 2MB/s blocks so important when you dont even have the tx volume or high tx fees to make it impactful?) meanwhile, their competition, bitcoin, is proving itself to be a competitor globally in terms of PoW infrastructure needed to support a global adoption to its base because, seriously, no amount of development work is going to transact thousands of trillions of dollars a day on a hash rate of 1.5 PH/s. Thanks for your time.

 

[UdjinM6]

Few points:
1. You can't compare sha256 vs x11 hashrates directly, it's meaningless and says nothing about how one network is more or less secure comparing to the other. What matters is a _portion_ of globally available sha256/x11 hashrate allocated towards Bitcoin/Dash.
2. Blockchains work under assumption that blocks are mined by honest _rational_ miners, meaning that if you think that it's not profitable to mine and you are not here for the long run (when you expect the value to go up and pay for your current losses) - you just turn your miner off and stop mining (or you pick a profitable (x11) coin to mine, if you can find one).

 

[Checkerama]

Few points:
1. You can't compare sha256 vs x11 hashrates directly, it's meaningless and says nothing about how one network is more or less secure comparing to the other. What matters is a _portion_ of globally available sha256/x11 hashrate allocated towards Bitcoin/Dash.
2. Blockchains work under assumption that blocks are mined by honest _rational_ miners, meaning that if you think that it's not profitable to mine and you are not here for the long run (when you expect the value to go up and pay for your current losses) - you just turn your miner off and stop mining (or you pick a profitable (x11) coin to mine, if you can find one).

I appreciate a reply especially from someone on the DASH team.

Now I think the misconception in your first point might come from thinking I am comparing algorithms... so let me be clear on this: I have not determined a network more secure based on hashrate. As a matter of fact, X11 might only need 1500 TH/s to be AS secure as the 5.3 million TH/s bitcoin is pumping out. This is not my point entirely. Instead, I am going off of the rudimentary definition of a hashrate, which is the measurement unit of the processing power of the network.

This is VERY important, because what you're essentially saying is that to any joe schmoe trying to jump into a network, what network seems more viable to support a global scale transaction process - the 1500 TH/s one, or the one with the 5.3 million TH/s? More hashrate in your network is good, but you're capping your miners at that 1500 TH/s line in terms of profitability (it does not become worthwhile to mine DASH at all after 1500 TH/s).

Meanwhile, bitcoin has found a way to not only multiply its hashrate power into the millions while retaining profitability and difficulty, but also boast a global presence in terms of bitcoin farms around the world (we've all seen em, they're beasts).

To scale, given our current hashrate in the DASH network, one should still remain reasonably profitable up to the 300,000 TH/s given the price difference between bitcoin and DASH. The DASH network magnitude is off by hundreds.

But while I have your attention, what exactly does DASH plan to do about the fact that their PoW is capped to a handful of miners right now (which have been sold only these past few months)? Do you plan to switch the DASH network onto the PoS masternodes completely? And if so, why even call it a CRYPTOcurrency? Thanks

 

[Vedran Yoweri]

what exactly does DASH plan to do about

excuse me for providing a link to a answer. looking forward to it.

 

[Checkerama]

excuse me for providing a link to a answer. looking forward to it.

Thanks for your constructive reply - but honestly the link says nothing other than bigger blocks. Bigger blocks require stronger machines... which brings me back to my original point; how exactly do they plan to incentivize miners when their profitability is hard capped at 1500 TH/s? Who is going to process their ultra-big 16MB blocks? Thats where they're not answering it.

It's nice to dream, but without the infrastructure, you can have 128MB blocks that won't be mined because people don't want to waste so much electricity on making 5k a year with 1 MB blocks, much less 128 MB blocks.

 

[Vedran Yoweri]

but honestly the link says nothing other than bigger blocks

you didn't read or don't understand. can't help you with that.

 

[UdjinM6]

... but you're capping your miners at that 1500 TH/s line in terms of profitability (it does not become worthwhile to mine DASH at all after 1500 TH/s)...

We are not capping it, it's market doing its job. Market sends everyone a signal - MINING IS NOT PROFITABLE IN SHORT TERM, DO NOT BUY NEW MINERS IF YOU DON'T WANT TO LOSE MONEY.(Sorry for upper case but market is basically screaming at this point). Yet people keep buying them. I can't stop people from buying things, I don't have that power

One would argue that diff went through the roof way too quickly and people were not ready but we have nothing to do with this either, it's miner's job to try to predict profitability in X months and decide should he take the risk or not.

So either the price of mining hardware should go down significantly or the price of Dash should go up for mining to become profitable again. And we don't control either of this. All we (as a community) can do to "help" miners (there is no such goal btw, it's more of a side-effect) is try to increase Dash adoption (and thus increase the price of it).

Also note, this situation is not unique to us. Darkcoin was mined at a loss for a very long time in early days, those who believed in the project and helped it to grow were rewarded later. And btw, I'm not saying that this story is going to repeat again - no one can guarantee this, it's up to everyone to decide where to put his money.

 

[Checkerama]

I also want to make it clear that yes, the link details a merging of masternode and miners in order to determine hashrate, but also requires someone to hold a masternode to do it.

That means the person would have to have 1000 DASH... now worth 450,000 dollars, to be able to "mine" DASH. That's not even covering the cost of their complex collaborative system that would be required to mine it. And lets not forget... the whole point of cryptocurrency is to make it DECENTRALIZED?? This sounds a hell of a lot like centralizing power to me. You're telling me you made your algorithm "ASIC resistant" just so you could have a plan that centralized power to masternode owners? No wonder people think this is a scam.

 

[Checkerama]

We are not capping it, it's market doing its job. Market sends everyone a signal - MINING IS NOT PROFITABLE IN SHORT TERM, DO NOT BUY NEW MINERS IF YOU DON'T WANT TO LOSE MONEY.

Did I just not point out that I don't care about short term profit? Its the pathetic 2 DASH a year that one 1500 dollar ASIC miner would use up. Who, in their right mind, would think "im gonna win everything back in a couple of years if I just spend thousands of dollars in electricity and equipment IF DASH blows up?" when they can just support a network that does support the decentralized mining infrastructure Satoshi's original vision had?

And its a soft cap - anyone mining further at this point is losing money to electricity. That's a cap, whether you like it or not.

 

[demo]

So either the price of mining hardware should go down significantly or the price of Dash should go up for mining to become profitable again. And we don't control either of this.

But you control the algorithm, dont you? You can change its initial values, you can change difficulty, cant you?

 

[UdjinM6]

Did I just not point out that I don't care about short term profit? Its the pathetic 2 DASH a year that one 1500 dollar ASIC miner would use up. Who, in their right mind, would think "im gonna win everything back in a couple of years if I just spend thousands of dollars in electricity and equipment IF DASH blows up?" when they can just support a network that does support the decentralized mining infrastructure Satoshi's original vision had?

And its a soft cap - anyone mining further at this point is losing money to electricity. That's a cap, whether you like it or not.

I agree that there is a "soft cap" which basically forms as a balance of mining cost and token price. I didn't say otherwise, so there is no need to prove the point to me. I disagree that we (as a dev team) has anything to do with it or that we can somehow magically "fix" it. Again, it's a market. Players are free to take all the risks or not, no one is forcing you to buy a miner. Rational/lucky players are going to save/earn some money, irrational/unlucky players are going to lose money.

Re collateralized mining: I wouldn't take this too serious for at least a couple of years - it's not even formalized yet (or at least I'm not aware of such document).

But you control the algorithm, dont you? You can change its initial values, you can change difficulty, cant you?

I don't control it, I can't force everyone to upgrade at my will even if I would introduce new diff algo. And even if I would this would change nothing - there is still X amount of hashrate and Y amount of new money issued. If you propose to adjust the supply curve to bump the reward - I don't think it's a good idea, this will most likely result in a huge price drop and a complete loss of creditability. We, as a community, can agree to adjust the block reward to smth like 40/50/10 or 30/60/10 etc. (mn/miner/governance) through a hardfork though - write a DIP specifying the change, the rationale etc. and create a proposal for masternodes to vote.

 

[demo]

I don't control it, I can't force everyone to upgrade at my will even if I would introduce new diff algo. And even if I would this would change nothing - there is still X amount of hashrate and Y amount of new money issued. If you propose to adjust the supply curve to bump the reward - I don't think it's a good idea, this will most likely result in a huge price drop and a complete loss of creditability. We, as a community, can agree to adjust the block reward to smth like 40/50/10 or 30/60/10 etc. (mn/miner/governance) through a hardfork though - write a DIP specifying the change, the rationale etc. and create a proposal for masternodes to vote.

This is in theory. In practice, the masternode owners are a bunch of stupid who are unable to judge anything, and believe EXACTLY what YOU, the core team, are saying.

i'm not gonna vote positive on some core software change from a stranger, whatever it says.

The above quote reveals the retarded way of thinking of a typical masternode owner.

 

[Checkerama]

This is in theory. In practice, the masternode owners are a bunch of stupid who are unable to judge anything, and believe EXACTLY what YOU, the core team, are saying.

Not to badmouth, like I've been doing this whole time, but I would have to agree - majority of your masternode owners don't have a business or scalability mentality when it comes to the opportunity cryptocurrency has to offer and generally vote whatever way the core developers say is the best way. Jumping into DASH early and picking up a cheap 1000 of them doesn't automatically make you a genius at judging the future of a cryptocurrency. The budget page proves just that (people vote for the most ridiculous propositions...)

 

[Ftoole]

Why should we change the reward system do to poor investments. I remember this same debate some what when btc first had the Avalon ASICS released. So many thought theyd get a lot but didn’t cause the diff went threw the roof. I mean should we also stop the 7% block reward decrease in February?

 

[Checkerama]

I agree that there is a "soft cap" which basically forms as a balance of mining cost and token price. I didn't say otherwise, so there is no need to prove the point to me. I disagree that we (as a dev team) has anything to do with it or that we can somehow magically "fix" it. Again, it's a market. Players are free to take all the risks or not, no one is forcing you to buy a miner. Rational/lucky players are going to save/earn some money, irrational/unlucky players are going to lose money.

Re collateralized mining: I wouldn't take this too serious for at least a couple of years - it's not even formalized yet (or at least I'm not aware of such document).

Thank you for clarifying the collaterized mining portion (sigh of relief) and I would have to agree - this is a market with lots of losses and lots of gains. A gamble, so to say. If you say that the dev team can't do anything about it, then I don't understand the purpose of governance in your system. A hard fork on a governance structure crypto would definitely remove the single most technology that makes DASH worth pursuing, yet it might incentivize others to jump onboard the hard fork if it promises a better and more scalable solution that your current x11 algo settings are set to.

I will run more meaningful mathematical models, however, to prove my point... because I still believe that the current hashrate soft cap proves that DASH will not hold up in creating a robust infrastructure that would hold up global transactions.

 

[Vedran Yoweri]

majority of your masternode owners don't have a business or scalability mentality

he, at least we don't go on forums complaining, reeking of butthurt and blaming others for our errors.

 

[Checkerama]

he, at least we don't go on forums complaining, reeking of butthurt and blaming others for our errors.

The only error was believing DASH had a shot at being a global crypto competitor should've known as soon as bitmain didn't accept dash for D3s. Garbage algos are garbage.

 

[UdjinM6]

...
I will run more meaningful mathematical models, however, to prove my point...

That would be great, looking forward for it!

 

[Checkerama]

Why should we change the reward system do to poor investments. I remember this same debate some what when btc first had the Avalon ASICS released. So many thought theyd get a lot but didn’t cause the diff went threw the roof. I mean should we also stop the 7% block reward decrease in February?

Not the reward system I'm concerned about, but I will make the comparison soon enough. It's more about how the system handles high TH/s that I'm concerned about - a crucial necessity to DASH scalability

 

[Vedran Yoweri]

The only error was believing DASH had a shot at being a global crypto competitor should've known as soon as bitmain didn't accept dash for D3s. Garbage algos are garbage.

the wisdom you accumulated here sets you free to conquer the world. i wish you well.

 

[demo]

he, at least we don't go on forums complaining, reeking of butthurt and blaming others for our errors.

Of course the dash community blames the masternode owners.
You are not more than 400 people, you own 4000 masternodes, and 4.000.000 dash.
The rest 3.500.000 dash owners (who are by far more than 400 people) complain to you, because YOU govern, not us!

 

[demo]

As a conclusion, I believe that a hard fork should be done, that will give voting power to more actors. The masternode owners proved themselves incompetent.

I remind to the miners my proposition back in Jan 15, 2017 . Why the miners didnt support it? The stupidity of the masternode owners must be proved mathematically. And if after the proof they keep denying to give voting power to the rest of us, then a hard fork is inhevitable.

We , the 3.500.000 dash owners, we are the Dash community. The masternode owners are either a bunch of idiots or a bunch of spies (most of them, not all), and as such we should either educate them or spit them out of Dash's body and confiscate the dash they own.

 

[Checkerama]

That would be great, looking forward for it!

Thanks for the patience - I've whipped up a quick article based on our conversation to really convey the problems I am seeing with the algorithm and how it fails to incentivize a worldwide, decentralized, mining adoption. Check it out:

https://medium.com/@aquilesgomez/hi...11-algorithm-on-the-dash-network-f48533a5e6fe

 

[Ftoole]

Thanks for the patience - I've whipped up a quick article based on our conversation to really convey the problems I am seeing with the algorithm and how it fails to incentivize a worldwide, decentralized, mining adoption. Check it out:

https://medium.com/@aquilesgomez/hi...11-algorithm-on-the-dash-network-f48533a5e6fe

You should compare btc pay out and hashrates when it’s first ASICS came out those miners lost usd then to. I remember because I bought the 200 go Avalon and the bitmain s1 at 180 gh. Sadly the first gen ASICS for any coin except script you seem to loss your money on. I also bought the grid seeds when they came out I made rob in like 6 or 9 months.

 

[Ftoole]

Oh I forgot butterfly labs the ran off with a lot of btc and never delivered. U should look at btc,s difficultly back in 2013 when comparing it to dash that’s when the ASICS hit.

 

[Ftoole]

Here an old bitcoin talk thread about mining profitability.
https://bitcointalk.org/index.php?topic=1001943.0

 

[Ftoole]

But most early miners such as my self thought of it as a hobby not as a way to live off of. Maybe it would become something and provide a return but it was a really cool project to play with. I think the next gen x11 miner will bring a decent roi. I am sorry that people didn’t understand the first gen ASICS kill difficulty all the time. I mean when the s2 came out thier were cries by the s1 crowd when s3 came out s1 and s2 cried and so on. I mean mining isn’t an instant pay off ever.

 

[Ftoole]

Oh here is on from September 2013 about losses. https://bitcointalk.org/index.php?topic=297657.0

 

[Twilight Miner]

- It is not possible to compare different algos and its hashrate. Such comparison means nothing.
- Unprofitable mining does not mean that coin have any problems with scalability. Dash network will generate new block in 2.5 minutes and no matter how many miners will join or leave the network. Just difficulty will be reajusted.
- You cannot blame in this situation anyone but yourself. You was too greedy and did not do math before you buy miners.
- Same situation happened in bitcoin network several times. For example when first asics emerged but some guys already invested in GPU farms. In that time there were no much profitable altcoins and they thought they just lost money. Many of them sold their equipment but many other smart guy bought it cheap.
- Nobody will do any reward manipulation in dash network because some group of guys bought overpriced miners. Any attempt of reward manipulation will ruin whole network.

What are the ways out?
- Easy way. Reek you butthurt on forums and cry that dash is scam.
- Hard way. Swallow your disappointment, try to learn from your mistake, mine and hold. Because of expensive mining new coins supply will be limited for the exchanges (because more miners decide to hold) and price should go higher.

 

[Checkerama]

Oh I forgot butterfly labs the ran off with a lot of btc and never delivered. U should look at btc,s difficultly back in 2013 when comparing it to dash that’s when the ASICS hit.

I'll see if I can make any correlations between those. Thanks!

But I will stick to my current argument that the algorithm currently set up is, comparably, four times less profit than btc would've made back then. That's of course, extrapolating the data that I've garnered today. I can see what youre saying though.

- It is not possible to compare different algos and its hashrate. Such comparison means nothing.
- Unprofitable mining does not mean that coin have any problems with scalability. Dash network will generate new block in 2.5 minutes and no matter how many miners will join or leave the network. Just difficulty will be reajusted.
- You cannot blame in this situation anyone but yourself. You was too greedy and did not do math before you buy miners.
- Same situation happened in bitcoin network several times. For example when first asics emerged but some guys already invested in GPU farms. In that time there were no much profitable altcoins and they thought they just lost money. Many of them sold their equipment but many other smart guy bought it cheap.
- Nobody will do any reward manipulation in dash network because some group of guys bought overpriced miners. Any attempt of reward manipulation will ruin whole network.

What are the ways out?
- Easy way. Reek you butthurt on forums and cry that dash is scam.
- Hard way. Swallow your disappointment, try to learn from your mistake, mine and hold. Because of expensive mining new coins supply will be limited for the exchanges (because more miners decide to hold) and price should go higher.

Clearly you have no idea what you're talking about - if you've ever taken a statistics class, it is possible to create a coefficient for difficulty and hashrate without depending on specific algorithms. Using that coefficient, one can determine the comparable mining profitability independent of cryptocurrency price (profitability based off of the amount of hashrate one introduces to the network). The math is done - bitcoin will win the hash rate war in the end of the day. No one will support a network that promises more centralized power due to its poor ROI on the miners that actually spend the money on the equipment which holds up YOUR network.

And you guys think I'm still complaining about immediate profits. LOL - so ignorant, truly. Even in September 2013, the people were making negative returns but still mining hundreds of bitcoins. DASH is mining 2-30 a year, max, with a few months worth of ASICs. You're a fool if you think any miner is going to decide to support this network when they could easily transition to the one that makes x4 the profit. You really don't get it, do you? If you want to compete vs Bitcoin, DASH would have to be worth, today, 32,000 dollars each. Good luck with that without the hashrate.

My concerns have to do with the scalability and necessity of DASH's network infrastructure which none of you are investing in except for the masternode owners who aren't even contributing to the PoW that is necessary to process the transactions (who do you think is processing your fancy 2MB blocks? LOL) But please keep living in your ideology cloud and let me know when you all want to be adults and come up with some concrete scalability solutions instead of crying about people criticizing your shit algorithm.

Again - DASH, great idea, waste of a technology on this community. Blindly following devs. Then you wonder why returns on DASH are so poor in comparison.