After waiting for over three weeks for a compensation strategy, victims of the Zaif cryptocurrency exchange hacking can now sigh with relief as the owner of the Japanese exchange has put forward a plan. Tech Bureau, which owns the Zaif cryptocurrency exchange, has announced that it will sell its entire stake to Fisco Digital Asset … Continued
This week the Zcash Foundation and researchers from the University of Luxembourg have released a study that finds the presence of ASIC and FPGA miners may be controlling around 30 percent of the overall Equihash mining hashrate. The study speaks volumes to cryptocurrency developers and communities who have attempted to produce proof-of-work mechanisms that were meant to provide ASIC resistance.
As of May 2018, Roughly 30% of the Equihash Mining Algorithm is Likely Mined by ASICs
Over the past few weeks, there’s been a lot of discussion on the subject of application-specific integrated circuits (ASICs). The conversations have revolved around digital currency networks that have been threatened and even maliciously attacked to the point that coins are allowed to be double spent. Cryptocurrency proponents that hoped their favorite cryptocurrency consensus algorithm would defend the network are finding out they were sorely mistaken. Cryptocurrencies like Bitcoin Gold, Monacoin, and Verge have seen significant attacks on their networks and millions have been stolen or double spent by malicious actors.
In the case of Bitcoin Gold (BTG), the cryptocurrency that hoped to be a ‘better bitcoin,’ used the Equihash algorithm modeled after the Zcash network. On May 23 someone took over more than 51 percent of the BTG hashrate and was able to double spend over $18Mn USD worth of BTG. A few weeks later the Zcash Foundation and the University of Luxembourg had decided to research how prevalent ASIC and FPGA miners are within the Zcash network and all cryptocurrencies that use the Equihash algorithm.
Most of the mining power (95%) is concentrated in pools so any large hidden ASIC/FPGA operation should be present in one or several of the pools. Moreover, four pools concentrate 87.5% of the total mining power.
The Zcash Foundation Has Dedicated R&D Efforts Towards ASIC Resistance
The Zcash Foundation explains in there official ASIC resistance stance that they have been developing “ASIC resistance as an option while simultaneously researching ASIC resistance.” Essentially, Alex Biryukov and Daniel Feher detail that ASIC miners are present within the network hashrate of coins that utilize the Equihash algorithm, and have presented their estimates specifically for the Zcash Foundation.
However, the research team concludes that the study needs further research, and detecting ASIC miners is not so easy and data can be manipulated.
“It is important to note that our current methods can be ‘fooled’ by careful ASIC miner and the methods are also not fine-grained enough to detect ASIC miner testing of few % of the total hash-rate — This is a work for further research,” the University of Luxembourg team concludes.
What do you think about the study that says roughly 30 percent of the Zcash hashrate is processed by ASICs? Let us know your thoughts on this subject in the comment section below.
Images via Shutterstock, Bitmain, and the University of Luxembourg research paper.
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Another government-approved Japanese cryptocurrency exchange has launched a program to borrow cryptocurrencies from its members. The exchange seeks to borrow 1 BTC or more. Initially, only BTC will be borrowed, but the exchange plans to add other cryptocurrencies including BCH, XRP, ETH, and LTC.
Bitbank is one of the 16 fully-licensed cryptocurrency exchanges in Japan. Announcing a new service on Friday for customers to rent out their cryptocurrencies, the company explains:
‘Virtual Currency Lending’ is a service that allows customers to enter virtual currency lending transactions with Bitbank and receive up to 5% virtual currency per year…When we reach the expiration date of one year, we will reimburse by adding the specified usage fee to the virtual currency lent by customers in the month of offering.
Members with an account at Bitbank can start using this service, the exchange detailed, adding that only BTC can be rented out currently, “but we will also sequentially support other virtual currencies” such as “ripple, litecoin, ether, monacoin, bitcoin cash etc.”
“In principle, the virtual currency lent by the customer is locked until the predetermined loan period has elapsed,” therefore it cannot be sold or transferred “unless the loan term expires or we return it,” Bitbank described.
The loan period is 12 months. Before the loan period begins, Bitbank will hold a “recruitment month” for customers to apply for the program. For example, “If the recruitment month is January 2018, the period of use fee will be from February 1st to January 31st, 2019,” the exchange clarified.
“The usage fee is calculated by the quantity of the target virtual currency in which the transfer was made within the period for each recruitment month,” Bitbank elaborated. The minimum amount the company will borrow is 1 BTC and the maximum is 25 BTC. Bitbank will pay 3 percent to borrow any amount less than 5 BTC, 4 percent for an amount of 5 BTC but less than 10 BTC, and 5 percent for an amount 10 BTC or more.
If customers cancel the loan contracts mid-way, a five percent fee, which includes applicable taxes, will be levied.
Competing with GMO
Another fully-licensed Japanese crypto exchange, GMO Coin, operated by GMO Internet, launched a similar service in April. Initially, only BTC was supported but the company extended its offerings to BCH, ETH, LTC, and XRP earlier this month.
GMO’s loan terms are 90 days for BTC and 150 days for other coins, which are shorter than Bitbank’s terms. In addition, GMO seeks to borrow a larger amount of coins, from 10 BTC to 100 BTC, paying a fee of 5 percent for all loans.
What do you think of Bitbank’s offerings? Let us know in the comments section below.
Images courtesy of Shutterstock, GMO Internet, and Bitbank.
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Between May 13th and 15th, Monacoin, a cryptocurrency developed in Japan, appears to have suffered from a network attack that caused roughly $90,000 in damages. The attack appears to have been a selfish mining attack, where one miner successfully mines a block on the blockchain but does not broadcast the new block to other miners. … Continued