Is Decentralized Centralized?

Vitalik Buterin VS Changpeng Zhao

I always found it strange when people refer to decentralized as completely decentralized when it comes to cryptocurrency. Because, there is never truly such a thing as decentralized. It is always run by someone (some people).

Vitalik Buterin said during an interview at the Tech Crunch sessions: Blockchain 2018, that he hoped, “centralized exchanges burn in hell as much as possible”.

He continued, stating that centralized exchanges wield “stupid king-like power”,  since they have the ‘power’ to chose which cryptocurrencies “become big” after making projects pay extortionate $10 to $15 million in exchange listing fee’s.

Many people, even cryptocurrency users might not have known that. Yes, you’re favorite coin has to pay up if they are going to be listed. And Buterin’s not wrong to say this.

However, there is a lot of hypocrisy in Vitalik’s statement.  He has the resources to make his own decentralized exchange if he wanted to but has not.  And further, it is his Ethereum honestly that enabled most of the ICO scams out there and is one of the worst and most vulnerable currencies in my opinion.  His idea of decentralized is the wild-wild west of the internet full of scams and fraud.  Let’s look at a popular decentralized exchange like “Etherdelta”.  It is widely known as a scam where people have lost money.  And it’s no wonder since almost all of the decentralized exchanges I’ve seen A.) don’t work right, and B.) force you to create a wallet where they hold and control the private keys (you cannot use your own wallet at least with ones like Etherdelta).

Considering Ethereum is essentially also a centralized currency which is first and foremost controlled by Vitalik.  Some of you are probably saying ‘how’, it’s a decentralized cryptocurrency. And some of you Tech nerds already know the back end side of all cryptocurrencies, and that it’s controlled essentially by someone. Even Bitcoin is being handled and maintained by people, it might not be “Satoshi Nakamoto” but it’s got people working and controlling it.

This verbal trashing of exchange, caused Binance Founder, Changpeng ‘CZ’ Zhao to respond on Twitter.

Zhao pointed out several flaws in Buterin’s argument.

“There is no absolute decentralization. Projects with core teams still have centralization. Today, Vitalik probably has more king-like powers than anyone else in this industry, and has used it, by serving as advisors to projects, therefore helped to decide their fate, at least fate of their ICOs to a large extent.”

He went on to say that “decentralization is not safer by default” and this was clearly supported by recent hack of decentralized exchange Bancor. Which saw $12 million worth of Ether as well as EtherDelta falling victim to a phishing attack late last year.

Zhou isn’t wrong, but he’s not right either.

Buterin chose not to reply publicly instead opting to respond to a cheeky Tweet from a new French cryptocurrency exchange Blockchain.io that asked whether their “decentralized settlement feature” would send them to purgatory.

Buterin  responded in French saying:

“It’s much better than a fully centralized exchange, but it doesn’t solve the other problem, as centralized exchanges have a lot of control over the market and can choose which currencies become the most popular etc etc. In all, I think this is a very good idea and I hope that more cryptocurrency exchanges will use this semi-centralized method.”

IDEX, is pretty much one of the most popular semi-centralized crypto exchanges as they offer features from both centralized and decentralized exchanges is currently ranked #91 in terms of total trading volume for all crypto exchanges in a 24 hour time frame.  I attempted to use it when it first came out and had nothing but problems and their support chat and twitter were full of complaints about scams and lost money and balances.

Apart from IDEX, there are several other decentralized exchanges ranking within the top 100 overall trading volume for crypto exchanges. But still, majority of the volume is held dominate by centralized exchanges.

The reason why it’s dominated over decentralized exchanges, is because of the scams, and no accountability. People naturally choose whats more ‘safe’ when it comes to their money. And in this case, centralized exchanges are safer.

But both Zhou and Buterin agree, that decentralized exchanges are the best option moving foward. I disagree with both.

In March, Binance announced their intentions to launch a decentralized exchange along with a public blockchain:

“Centralized and Decentralized exchanges will co-exist in the near future, complementing each other, while also having interdependence.” — Binance

There are hybrid exchanges already like the Binance is proposing. Blockchain.io and IDEX are two good examples.  Blockchain.io is still in the process of doing it though.

Although I understand the thought process behind this, as a IT professional and investor, this decentralized exchange is a open door to insanity. Nothing, not even cryptocurrency is 100% decentralized, that’s impossible and incredibly unsafe. Cryptocurrency is already filled with a lot of fraud, scams and hacks (but still not as much as Fiat currency by the way), but having decentralized exchanges is just asking for double the trouble.

At the end of the day, we just need a better coin and a better exchange, otherwise we’ll fall into the same traps as Fiat, and reguritate the same ol’ system again.

What do you think?
Cheers,
A.Yasir

Monero lost more than 50% of its network hash rate

This is old news to many but I’ve been watching it, the hash rate on Monero was just over 1000 MH/s prior to the algorithm update as a way to combat ASIC mining by companies like Bitmain.  It plunged to as a little as 157MH/s initially but as of now (2018-08-08) 461 MH/s.

Monero-Hash-Rate-460Mhs-2018-08-09

This is significant and the move wasn’t without controversy but I think it was the right way to go.  Monero wanted to stop giant mining farms like you see for Bitcoin and Litecoin.

I think it worked, initially and clearly a lot of mining was disrupted because all the mining software had to be updated such as xmr-stak or xmrig etc.. Today if you use a pre April 2018 miner you will get “invalid results” or “share not accepted” from the pool because the algorithm has changed.  This effectively bricked Bitmain’s Monero miners but all was not lost for them as it is believed they were probably mining with them for several months if not more before releasing them publicly.  For any critics at least Monero clearly communicated almost immediately after Bitmain’s announcement that they would update the algorithm and would be sure to brick them.  And in all fairness at least Bitmain warned of this on their own sales page so it is nice to see an issue like this handled well by the main parties involved (of course those who still bought a Monero miner are out of their money).

Considering that months later the old hash rate of 1+ GH/s is now only about 460MH/s I think it is fair to say there were ASIC mining farms controlling over half of Monero!  This very well could have been Bitmain and other manufacturers themselves.  But going back to the whole mining thing, most know I am against it.  One inherent vulnerability of any mineable coin is that whoever has the most hashing power wins or controls the network allowing them to steal from others essentially.  As illustrated in my picture earlier one pool supportxmr.com has 80 MH/s, Nanopool 95MH/s, minexmr 94 MH/s so essentially 3 pools control about 60% of the hashing rate or about 20% each on average.  If you check out the list of Monero pools essentially the hash rate is concentrated among numerous pools which puts it in a similar situation as Bitcoin in a sense.

The current situation is better but nothing stops people from spending millions on GPUs and CPUs in order to dominate the network. With Monero only worth around $100 USD at the moment there is little incentive to do so unless an organization simply wanted to kill Monero.  I would imagine criminal organizations like the ones who targeted Bitcoin Gold and other coins will be ready and waiting to do the same though.

What do you think?

Cheers,
A. Yasir

Your TV A Bitcoin Miner?

Yes, China-based Bitcoin mining products maker, Canaan Creative has revealed it’s plans to marry hardware and everyday products into one Bitcoin mining relationship.

South China Morning Post reported that Canaan has launched something called “AvalonMiner Inside. A TV set which can process 2.8 trillion hashes per second. Wow. That’s hot. Literally it’s going to be really HOT.

Bitcoin mining is already utterly difficult, high energy consumption and creates a lot of heat.  I’m just not sure how you would run a 1700W miner + an AC unit pulling between 6-12 amps on the same circuit.  Even then how much power would be wasted on cooling the miner?  These sure sound cool but would be very impractical.  Also consider that if the hashing units break then you probably can’t use your AC unit and vice versa (unless of course the two can be used separately if needed).

Canaan’s not the first company to try meshing mining and consumer products. Bitcoin start up 21 Inc and Chinese appliance manufacturer Midea Group have tried in the past to create appliances like AC units with chips inside that could mine. They even made a patent for the idea.

But not everyone is excited about Canaan’s and these other companies bold ideas.  Xiao Lei, a Beijing-based Bitcoin Analyst, said “It looks more like hype. It will be more meaningful if these companies are able to embed the mining function into existing major TV brands.”

Canaan has also debuted the Avalon Miner A9, which provides a hashrate of up to 30 TH/s, with a power consumption of 1,720 watts per unit, according to Canaan’s website. The price of the new miner has not yet been disclosed on the website.

How much power do you think this will need to cool down? Bitcoin mining is essentially extremely difficult now, with almost over 80% of the hashing power coming straight from Chinese mining farms. So these products will not help the average person trying to mine. In fact, unless you had been mining it early on, these products are more so hype then anything else and giants like Canaan are trying to jump on the ‘bitcoin bandwagon’ to make some money and then swiftly leave.

Canaan took in 1.3 billion yuan (about US$205 million) in revenue in 2017, a 27-fold increase from the year earlier. Its profit in 2017 was 361 million yuan, up more than 230-fold from 2015, according to its filing to the Hong Kong stock exchange.

In 2017, Avalon miners accounted for 19.5 per cent of the world’s processing power for mining bitcoin, the filing said, citing data from consulting firm Frost & Sullivan.

So they’re doing alright. But again, Bitcoin mining is extremely difficult and this TV thing is going to need incredible amount of cooling down. It would be interesting to see how this is done, since TV’s are already hot enough.

What do you think? Would you purchase this?

Cheers,
A.Yasir

 

 

 

VMWare 6.7 A Blast From The Past

Or A Blast To Their Market?

I’ve used VMWare on and off over the years but mainly during the pre-opensource days before the days of Virtualbox, KVM, Xen, OpenVZ etc…  and have dabbled and helped maintain some VMWare clusters over the years.

Anyone familiar with VMWare or who Google’s it will see lots of dire warnings about upgrading to the next version since the upgrades often break existing servers.  This is mainly not because of the Linux Kernel but VMWare seems to have a policy of blacklisting and hardcoding what network adapters, ILOs and CPUs are supported in each release.

Indeed the majority of blogs you will find deal exclusively with warnings of what is not supported and how to get around various restrictions.

But 6.7 seems like a marked departure from the standard.  It has dropped support for the majority of CPUs previously supported even up to 6.5.

I’ve also found it be fairly buggy especially getting vSphere working nicely on 6.7 ESXi hosts.

So this brings me to the next point, VMWare has literally shrank their market share but making it so their existing customers or a lot of people who may have used VMWare literally cannot use it (at least not with the latest 6.7 version).  Since there is not a lot of hardware that supports 6.7 the logical solution for many, even existing users is to simply migrate their VMWare VMs to something opensource based on KVM whether that would be Proxmox, oVirt, OpenStack etc…

Now, I do understand VMWare wants to prevent their marketshare and they’ve likely worked out agreements with hardware manufacturers on what gets obsoleted since a lot of large corporate customers will simply just buy brand new hardware that is supported.

But to me it’s just not a green solution when the same “obsolete” hardware is more than capable of supporting large scale computing infrastructure for a long time to come.  Computing power is so affordable and up there today the problem for hardware manufacturers is that so many organizations even with old hardware don’t need to upgrade (of course save for VMWare mandatory hardware obsoletion).

Aside from all of this VMWare is a fairly good system but I feel it is starting to quickly become attractive after reviewing a lot of community feedback and talking to colleagues in the industry.  There’s a huge push to migrate to KVM based virtualization and I feel the latest VMWare 6.7 will hasten this move.

Google Chrome now marking non-SSL sites as insecure

Another Google Unnecessity?

Previously Google’s Chrome was just marking sensitive sites where you would input things like credit card details as insecure (and rightfully so) but what’s happened in July of 2018 here is a different ball game.  They are now marking any sites that are not using SSL (including mine) as being insecure- a blog site that does nothing more than provide information…

Another strange thing is that Google is claiming that there are “performance benefits” to switch to SSL.  I am not aware of any performance benefits as the SSL handshake and encryption overhead itself only decreases performance.  Now I am not saying it is always significant and noticeable but it definitely silly to claim a negative performance feature as something that increases performance.  It’s like saying “we’ve added way more stairs to your daily walk” but “this results in improved stair climbing time”.

The one thing I and many others take issue with is that Google wields enormous power and has been known to abuse it for their benefit and the benefit of other large businesses, to the detriment of small business.  Google is perhaps the most powerful on the internet overall since they control Search, Youtube and they are a non-regulated for-profit business that is essentially going to be cutting off access and traffic to non-SSL sites.

While it is good for everything to use some sort of encryption it’s important to remember that not every site on the internet has the resources to setup their own SSL certificate. I am not talking only financially (although it is not very expensive to do) but on a technical level I can imagine a lot of people and organizations will not have the ability to do so.  In addition there are other technical steps required in some hosting environments such as often requiring a separate IP which requires a DNS update or migration (which is no simple feat for the non-technical).

I’ve always kept what I’ve thought of as “public domain” sites where I am publicly sharing the information on purpose as not needing SSL.  I am neither concerned for example with this site and articles who is reading or who can see what is being read.

I think part of the motivation here may be an SEO benefit or to weed out a lot of websites and owners which will happen to be smaller and less sophisticated.  This means that the average or smaller guy or company will be at a huge disadvantage on the web in Google Chrome where their users are scared off that viewing this article here without SSL is dangerous.

I think encouraging more sites to use SSL is a good idea but I also think it is a form of penalizing and reducing the views, traffic and audience of smaller organizations and businesses.

I’d also like to point out that the average key size is very small on average from 128bit to 256bit and I believe this is well within the ability of large supercomputing facilities to crack.  SSL and TLS has suffered from security flaws in recent years and if anything I think it is time to switch to something GPG based if we are serious about security.  I believe the current SSL implementations give us a false sense of security.

There are a lot of cheap solutions to do this but it all depends on how and where you are hosted and your level of expertise.

It’s also important to keep in mind that Google may give more weight to SSL sites in the search results than before if they are implementing this in Chrome (yes I am aware that supposedly SSL sites have ranked higher for awhile but I think the algorithm will be tweaked shortly if it hasn’t already to give much less weight to non-SSL sites).

Cheers!
A.Yasir