It's unlikely WafflePool will launch a double spend attack on Doge anytime soon as the profits from doing so would likely not be worth the future mining profits they'd lose from the huge blow to the altcoin market news of such an attack would bring.
More importantly though, it's come to light that 23 GH/s of WafflePool's hashrate (>62%) is coming from a single whale (link
), with evidence pointing to him/her making heavy use of ASICs. Note the naming convention of several workers indicate they're gridseed setups. Also note how each worker has a huge individual hashrate between 300-1000 Mh/s in mining power, making the pool-within-pool theory unlikely, unless contending that the pool consists of 36 individual huge farms. This person or group alone controls over 30% of the hashrate of the entire Dogecoin network
Assuming that this is one of the first huge scrypt ASIC farms, this highlights several issues we're going to have to deal with soon. There's a lot of debate over how ASICs will affect dogecoin, and no one can truly say for sure what will happen. But a couple of things are becoming increasingly clear:
Scrypt-N is not the only way to deal with these problems
- As ASICs come online, the overall Scrypt hashrate of Multipools is going to jump as large profit driven mining operations upgrade
- If Dogecoin is going to stick with Scrypt we need to find a way to ensure that dedicated Dogecoin miners get access to ASICs in order to counteract this jump in multipool hashrate.
- We are going to run into increased risks of hashrate centralization as ASIC manufacturers will always have access to their state of the art hardware before consumers, (and like what happened to Bitcoin, will often use it to mine for themselves for months before releasing it to their customers)
- Bitcoin did not have to deal with Multipools that could move on to another coin if their's died when dealing with the transition to ASICs. This is a unique problem without precedent
We need to come together to brainstorm how the community can strengthen itself. The problem isn't necessarily the ASICs themselves, it's access to them. If we really aren't going to change our proof of work algo to something ASIC resistant, then we need to start thinking about the following questions:
- How can we make sure that Doge miners stay up to date with ASIC availability and pricing to give them the best shot of obtaining them?
- How can we monitor manufacturers to try and fight for as much transparency as possible?
In the hopes of helping prevent someone else from falling for the same trap, I will brief you on my experience with GAWminers (a seller of ASIC mining hardware, in case you're not already familiar)
To begin with, let me just say I've never been too serious about mining Dogecoin. I already know I missed that boat when I was too late to the bitcoin party. I just like to have enough to play around with, tip out, or more recently, play some Dogecoin poker on IRC in #dogecoin-holdem (it's not mine, I just have lots of fun there). So, over the past 8 months or so, I've sort of made it a hobby to buy some hardware to grab some more doge out of the ether. A video card here and there, a new power supply to support a couple of 7970s in one box, etc. Y'know, stuff I'll still be able to use long after cryptocoins are long forgotten or whatever.
I looked from afar as ASICs took over Bitcoin and always assumed they'd make their way over to Scrypt, and that I might dabble in one at some point just for funsies.
In early July, that moment came. I saw the GAWminers fury, and after being beeped on IRC every other minute by somebody talking about their GAWminers fury (my username and their product name is an unfortunate coincidence), I decided it was time to give it a shot. Except instead of one, it was 3. Three GAWminers fury ASICs. Just for funsies. $105 each, at the time. $315 to basically have double my previous max hashing power in less than 1/10th of the power. I figure, I've spent at least twice that much on a video card which I don't use 90% of the time, might as whale. Dogecoin's fun, and this will get me more doge.
Only, it didn't stop there. I got them set up, and a week later, I could not help myself, I went ahead and bought a Black Widow too. It was priced at $450 at the time, except I had a $10 coupon sitting there for supposedly leaving my cart unchecked-out for a while. Might as whale. This same day, the price of the fury was dropped to $60 each. Alright, no big deal, price drops happen, I'll just get a credit or a refund and put it toward another Black Widow or something. Only thing that showed up in my email inbox was "request rejected", there was no explanation or anything. I guess their policy is no, then.
Not only that, but the Black Widow shortly thereafter dropped to $350, and the fury then to $40. For those keeping count, that's a little under $300 in total price drops that happened to the stuff I bought, and that's just within a couple weeks. I can only imagine what it feels like to be one of the really early adopters of this stuff who paid over $200 for a fury, or someone who poured many thousands of dollars into it.
Fast forward to some time after GAWminers updated their site, and I got directed to the support site where it turns out I actually did get a written response to my refund request--it just never made its way to my email inbox, I didn't know this support site ever existed before. It was an apologetic offer for $50 store credit and a brief claim that whatever they're pricing it at is already lower than what they get charged by their suppliers, and if they gave every customer a refund they'd go out of business, etc. (Wouldn't one go out of business by always charging less than what it costs to buy the stuff? I'm not terribly good at economics, though I would think making it up in volume is still a net negative)
I chose to give the benefit of the doubt. These are human beings behind these companies after all, and they're just trying to stay above water in a fiercely competitive and rapidly changing world. What would I do in their shoes? I don't know.
So, given their offer of a store credit (which I have not yet seen applied to my account), and some apparent speculation from the GAW CEO that mining hardware is no longer being manufactured and may rise in price
, I chalk it up to bad luck, I've never been a particularly good gambler, and I'll just continue to have fun with the doge I'm mining, maybe bite once more if the mood feels right.
Sure enough, a few days ago, I see this OneMiner thing offering a Lightning X6, 42 MH/s for $700. Not a bad price, I thought to myself, as I had just spent $750 for about 20 MH/s from GAWminers. Might as whale. At this point, I am completely unaware that OneMiner is a GAWminers thing. I know, a quick Google search would have solved that question for me, but it didn't occur to me. I sure found out once the charge appeared on my bank card. $1400 for a pair of Lightning X6's from my friends at good ol' GAWminers. I meant to only purchase 1, but apparently somewhere along the line I double clicked the "I want one" button and had added a second one to my cart. Strike two for my attentiveness and foresight. That's fine, though, I was ready and willing to roll with that. I easily blow that much on phones or tablets that I hardly use. Might as whale. And GAWminers had in fact extended an offer for some store credit, so I figure they're decent enough people and I might take that store credit and buy a little thing later on to grab a few more gigglehashes.
Less than 24 hours later, the GAW CEO posted a $150 Black Widow sale (the thread for which is now deleted from hashtalk). One third the price I had just paid for a Black Widow a few weeks ago. Effectively, 6 of those would've roughly equalled the hashing rate I had just spent $1400 on (not counting the difference in power usage), so I feel like I just wasted $500 in a matter of hours. So much for mining hardware going up in price.
That's it for me. Even if they do give me the $50 store credit, I'm done doing business with a company that treats their customers in this way. They're afraid they'll go out of business if they credit back the hundreds of dollars in rapid price drops I've helped them subsidize? How about they're going to go out of business if they keep doing this and losing customers to it?
These games they play with people's hard-earned dollars only have one winner, and that winner's name is GAWminers. This stopped being fun, and shit got real, real quick.
I know, shit already got real when I spent over $2,000 again for hardware to mine a coin. I lost sight of my real goal, which was just to have fun and make more dogecoins and be able to play around with it more. But I also lost sleep over this. I lost money that I could have spent giving something good to the community or doing something good for myself like, say, some decent clothes instead of the same 4 shirts I wear over and over again. I consider myself fortunate that I didn't go even further and lose even more.
To be clear: this is entirely my fault. GAWminers' business model is very clear in that they do not care about customers--there are numerous threads just like mine all over the internet, most of them even worse off than me. The business model apparently works for GAW, or they'd have changed their policies to something more in line with other companies that I do business with. I take full responsibility for my lack of control and my being too trusting, and getting in too deep for my own good. I post this not to fish for sympathy, nor to shame GAWminers into refunding me or giving me more store credit. Like I said, I've decided I'm no longer doing business with that company anyway--it would take a pretty significant effort on their part to earn back my trust, and it wouldn't be worth it to them in the long run. Rather, I post this in the hopes that it keeps someone else from going down this same path.
It's the story of my life. Missed opportunities. It's already too late, I missed my chance to get filthy rich off bitcoin by not mining with my 7970 for all of 2012, there's nothing I can do now that will make up for it and I don't know why I thought pouring hundreds of dollars down the drain would.
Don't get lost in the same trap I did. Curb your appetite for the gigglehashes, and be content with the 20 or 30 doge you now receive per day with your dual core CPU. Or just be happy hanging around on IRC or reddit collecting tips and watching as people happily burn billions of doge. ASIC mining is a dangerous hobby to get into, and it's easy to lose your ass if you're not careful.
I leave you with a Kenny Rogers song: https://www.youtube.com/watch?v=Jj4nJ1YEAp4
Time to fold 'em and run.
- Doge is fun. I bought 4 or 5 video cards this year to mine more doge, because doge is fun.
- I bought a few furies for funsies.
- Price drops on the furies the same day I buy a Widow. Price drops on the Widows shortly thereafter.
- GAWminers doesn't want to go out of business, won't credit me the full amount of the price drop.
- Bought a couple of Lightning X6's on OneMiner
- Turns out OneMiner is GAWminers. My bad.
- GAWminers cuts price on Black Widow by another couple hundred dollars.
- GAWminers doesn't want to go out of business, but won't stop dropping prices immediately after stupid people like me purchase hundreds of dollars worth of hardware.
- This isn't fun anymore. Don't make the same mistakes I did.
Wow, it sure has been some time, what has happened?
- DogeCoin dropped...hardcore
- DogeCoin "Merged"
- DogeCoin Spiked
- DogeCoin is normalizing
Before we go into too much at the moment, I'll just catch you up on what's been going on with me.
MAD Doge Happenings:
- Stopped checking on DogeCoin
- Reconfigured miners, set and forgot
- Started Trading Stocks....fake stocks
To summarize, I left for awhile to get away from /dogecoin
, and away from the drop. It's neat to see that the market is rallying, but there are consequences of such things. I haven't stopped mining, I have a video that's actually really quite helpful, but that's down the road. Oh and I'm gaining some help by trading stocks and taking a class on the subject.
Enough about me....time for the meat.
- What's with the "Merge"
- DogeCoin actually merged with LTC by definition. AuxPOW is clearly defined here: LINK.
- Is this the end?
- That depends on how you define the "end" since this is the end of solo mining through DogeCoin, you can still solo-mine, but unfortunately you're penalized by fighting 10x the hashrate. This does not mean the end for the coin.
- Why did we merge?
- DogeCoin needed additional hashrate, 60GH/s is great, but with the release of 500 Mh/s mining rigs the hashrate was no longer secure.
- Seriously though, isn't this the end?
- Think about it this way, there are soon to be 1000 Gh/s that will be getting DogeCoins...some of those miners have never touched DogeCoin before, perhaps this might increase DogeCoin acceptance.
- DogeCoin Value is improved over the past few months, we've seen some serious drops and drawbacks, but for the longest time, we were undervalued.
- DogeCoin Value will improve over time due to acceptance as well as market visibility
- Proof of market acceptance is the recent push from Doge/CNY, which was the largest market during the last bubble.
- What happened to the recent price rally?
- Two things happened, when we "merged" the hashrate shot up, changing a lot of information for market players. Some not connected to DogeCoin probably saw the 10X hashrate and went for it, buying as much as they could. This could also explain some of the Doge/CNY trading at far above market value due to the restricted internet overseas.
- Why is it falling?
- It was a bubble caused by many things, one part was a bubble from a trading bot calculatory error, the second was from the higher hashrate. We're just normalizing
- What is todays real Value?
- DogeCoin is really valued at around 59 satoshi's as of today. This number changes each day, but that's the number I have set previously
What do I mean by set previously?
- I trade DogeCoins both on exchanges as well as on a spreadsheet, I'll make a neat video how to "maximize profits" through some clever trading techniques. The one I'm using is setting a price before getting too involved in the trading. These prices don't change and determine my trading for the day. I buy below that number and sell above, sometimes I'm right, sometimes I'm wrong.
Keep on shibing!
Oh and one last thing, the website and /MADDOGE
is not going to look amazing for awhile, but I'll complete it over the next few weeks.
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