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115 sats \ 3 replies \ @DiedOnTitan 18 Jun \ on: The Lifecycle Of Bitcoin Miners, Evaluating Risk On Miner Purchases bitcoin
Thanks for the write up.
The 90% Bitmain de facto monopoly represents the most centralized aspect of the entire Bitcoin ecosystem. It is very concerning. Whatever Bitmain's rep is with regard to hardware, Bitmain does not have an ethical reputation. They have market share dominance, and they also mine, which is a dangerous situation. The ASICBoost scandal revealed that they boosted their own miners for their mining pool and sold crippled miners to everyone else. They used heavy handed attempts to block SegWit, which would level the playing field. They announced a patch the day after Segwit was released. Coincidence? Nope.
Who knows what nefarious plans they are up to now. The financial incentives are huge to design miners that give their mining pool an edge.
There is an urgent requirement to diversify away from BitMain and I hope @KaboomracksAlex that you think about the broader ecosystem and try to wean your company off of 90% Bitmain sales.
It's easy to point a finger at Bitmain as the bad guy, and historically they have been, but the reality here is that the problem isn't them as a company, but the geographic centralization of chip/computer production.
The alternatives to Bitmain are Micro BT and Canaan, which do not produce as competitive hardware, and are still located in China. Until someone starts producing miners outside of China, there's not any viable alternative.
There are different manufacturers attempting to do things, but until they actually ship miners in masse that are competitive with Bitmain miners, there's not really a path forward.
A lot of Bitcoiner's look at mining from a idealistic perspective, and unfortunately ideals don't have the power to change things at this moment, when if you make decisions based on ideology, you get wrecked economically.
If Kaboomracks stopped selling Bitmain equipment, or tried to push other manufacturers that the majority of the market doesn't want, we likely would not be able to survive as a company.
I personally want to see Bitcoin succeed and think things like hardware centralization is a problem that isn't talked about enough, which is why I talk about it. But I also want to be accurate and programatic about the solutions.
We are constantly talking with different manufacturers who are trying to compete with Bitmain, but until they bring a good product to market, it's just vaporware.
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I appreciate the perspective. You are in the trenches on this subject and have skin in the game. Keep us posted on how this plays out. If Bitcoin becomes global base money, there definitely needs to be a lot more competition in this area. Its shocking where we are on the mining side currently.
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Yeah it's really unfortunate where we're at, and how there is a general lack of concern around it.
A lot of things are going to become clearer this next cycle as more money gets involved.
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