Bitcoin is a digital currency and the very first application of the distributed public ledger technology known spil blockchain. Digital currencies are susceptible to a weakness known spil double-spending where te which the same single digital token is spent more than once. Due to this threat, the transfer of tokens needs to be verified against a ledger that codifies transactions. Traditionally, the ledger is held by a centralized third-party mediator such spil a bankgebouw. Satoshi Nakamoto’s motivation behind Bitcoin wasgoed to forego fees charged by third-party mediators and neutralize their capability to switch roles transactions. Bitcoin eliminated the need for a third-party mediator by creating a trustless, decentralized ledger that is distributed to many network knots and is secured by a SHA-256 cryptographic Proof-of-Work (PoW) block-chain.
Many of the goals Satoshi set out to accomplish with Bitcoin have bot achieved. However, since Bitcoin’s inception, fresh issues have emerged. Primarily, Bitcoin could be mined by private computers (CPUs), but soon thereafter a wedloop to maximize computing (hash) power took off. The very first step-change te this technological arms-race wasgoed transitioning from mining with CPUs to movie cards (GPUs). Eventually, GPUs were supplanted by vastly more powerful Application Specific Integrated Circuits (ASICs) chips that are designed solely for mining crypto-currency. Presently, the speed at which ASIC chips can process hashes is exponentially greater than any previous technology. To waterput things te perspective, the Bitmain Antminer S9 (ASIC) hashes 13,000 times quicker than the best te class NVIDIA GTX 1080[Two] (GPU). Thesis utterly powerful ASICs bring into question Satoshi’s original vision of, “one CPU one vote”.
The engineering cost to develop single-purpose mining ASICs has led to the formation of niche manufacturers that have also began their own crypto-mining operations. Mining is especially advantageous for thesis Bitcoin ASIC manufacturers because they obtain equipment at production cost. This advantage has permitted certain ASIC manufacturers to influence a large of percentage of total hash-rate and control the distribution of mining equipment. Ironically, by determining how many miners are sold to the market and who they are sold to, thesis ASIC manufacturers are operating spil third-party intermediaries. This wij coin is the “Roman Emperor Problem”. Unnecessary to say, Satoshi could not have foreseen this development when Bitcoin wasgoed created.
Knot Toevluchthaven poses that profit-motive drives the aforementioned centralization of power and any PoW cryptocurrency that is reliant on the hardware that thesis ASIC manufacturers produce will suffer. The manufacturers’ financial backing, governance structure and profit-seeking motives drive them to drain value from the associated crypto-currencies that they voorkoop to serve.
Ter essence, the crypto-currency community is paying a debt to the ASIC manufacturers that invested into the development of the equipment they sell. The service of this debt is paid te profit-margin and control of how the ASIC equipment is distributed. Te order to circumvent the control that thesis “Roman Emperor” ASIC manufacturers have, Knot Toevluchthaven proposes a co-operative business specimen where crypto-currency mine operators collectively invest ter the development of the advanced mining equipment that they need. This specimen combats the control that centralized ASIC manufacturers exploit and facilitates the decentralization of PoW cryptocurrencies spil intended.
If you are interested ter learning more about Knot Toevluchthaven, our 7nm BTC ASIC Miner development or the “Roman Emperor Problem” visit our Webstek, Telegram, or SLACK channel.