Who Created Bitcoin

Kent Weaver 05/07/2021

Brief History of Seven Satoshi Nakamoto

Another lawsuit related to Satoshi Nakamoto began in the United States in November. The missing bitcoin inventor was hiding behind that name. The dead programmer’s sister wants her brother to be considered Satoshi Nakamoto, and has sued another claimant. Given that the inventor of the cryptocurrency is entitled to 1 million bitcoins, now the equivalent of $66 billion, “that’s a score many are willing to start a risky game for.” Other contenders for inventor laurels included a German fraudster, an anonymous writer, one of the pioneers of smart contracts, and even Ilon Musk, to whom the invention was attributed by an enthusiastic intern.

Satoshi number one. David Kleiman.
In November, the civil trial of Ira Klayman v. Craig Wright began in Miami. The defendant, Australian software engineer and one of the pioneers of the cryptocurrency movement, Craig Wright, has been claiming since 2016 that he is Satoshi Nakamoto. He has already spent a serious amount of money on the courts, including declaring as his intellectual property the white paper (a detailed plan for the design and development) of bitcoin in the UK. The plaintiff, the sister of the deceased David Kleiman, is seeking through the courts to establish the fact that Wright was not acting alone, but with her brother.

Clayman and Wright created W&K Info Defense Research LLC to mine bitcoin and manage intellectual property, including the cryptocurrency’s source code, her representatives wrote. At the first meeting, Ira Klayman showed excerpts of Internet correspondence that allegedly confirmed that her brother alone had mined the bulk of the bitcoins. She accused Wright of theft by deception and counterfeiting. Wright, on the other hand, objects that he is Satoshi Nakamoto alone, and that David was merely a friend and confidant. Wright’s attorneys are resting on the fact that their confidant has had an autism spectrum disorder since childhood and no contract could have been made with him. “He wore a ninja uniform in the yard when he was 13, and all the kids called him a freak,” the defendant’s side claims. The main issue, though, remains unresolved for everyone involved in the case. You have to have a secret key to get 1 million bitcoins. There is no other way. The only one hundred percent proof, which Wright hasn’t been able to do since 2016, is to transfer at least a thousand bitcoins from wallets that were reliably owned by Nakamoto. The bitcoin creator is known to have dropped out of sight in 2011 and has never contacted anyone since.

Satoshi No. 2. Craig Wright.
In 2016, software engineer Craig Wright, featured in the previous story, claimed to be Satoshi Nakamoto, although the general consensus among crypto activists was that several programmers worked under that name. Since then, Wright has not been able to take any bitcoin from Satoshi’s wallets. Wright claimed his copyright on the white paper and bitcoin source code to the U.S. Patent and Trademark Office in 2019. This does not mean that he is recognized as the creator of the cryptocurrency or the owner of the exclusive copyrights to its code. An unlimited number of people can assert their rights under U.S. law. In response, the Cryptocurrency Open Patent Alliance (COPA) has filed a lawsuit against Wright, demanding to recognize that he had nothing to do with the creation of the main bitcoin document. These proceedings are still pending. In January 2021, Craig Wright accused bitcoin.org and its anonymous owner under the pseudonym Cobra of violating his copyright in the white paper. The High Court in London handed down a default judgment on June 28 because the defendant, one of the opinion leaders in the cryptocurrency industry, did not defend himself by remaining anonymous.

Satoshi No. 3. Dorian Nakamoto.
This was the first high-profile attempt to expose the bitcoin founder. Newsweek in March 2014 published a piece about Dorian Nakamoto, whom it named the creator of the cryptocurrency. The publication made a lot of noise. Dorian Nakamoto was actually similar: Japanese last name, Asian appearance, which the Japanese last name suggests, libertarian views (like most crypto-geeks), computer engineer.

But these all turned out to be mere coincidences. In an interview, he seemed to say: “I’ve given up on bitcoins,” but later claimed he misunderstood the question. Nakamoto admitted to the Associated Press that he had nothing to do with bitcoin.

Satoshi Number 4: Ilon Musk
In November 2017, on Technoblogger Medium, former SpaceX intern Sahil Gupta made a “throw-in” that Satoshi was probably Elon, as he is very good at both economics and cryptography, knows programming languages very well and is by nature an encyclopedist. Gupta suggested that during the 2008 financial crisis Musk got the idea to solve the problem of trust in banks by creating money that banks don’t need.

Musk, of course, denied the enthusiastic intern’s assumptions, and even admitted that he lost the only bitcoin a friend gave him a few years ago.

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oICmNPgkhYl2 03/22/2021

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What’s better to mine in 2022

Kent Weaver 03/07/2021

Mining is the process of mining new cryptocurrency tokens. It provides cryptocurrencies with the advantage of decentralization – the absence of a control center (a government, a bank, or a separate group of people).Also, mining is one of the ways to make money from cryptocurrencies. In this review from ProstoCoin, you can find out what is the best way to mine tokens and which coins will bring the biggest profits in the next year.

Coins can be mined using:

video card;
processor;
ASIC equipment;
FPGA.
Graphics cards (GPU)
A GPU is a chip on a video card that performs cyclic computational operations to process graphic elements. Although GPUs don’t have the same hash rate as ASIC devices, they are more flexible to use. Firms such as AMD and Nvidia originally developed GPUs to improve graphics quality. However, they are now quite popular among those who want to mine cryptocurrency.

Not so long ago, it became unprofitable to mine top coins via graphics chips due to the increased complexity of the network and expensive electricity. For this reason, it is better to mine liquid and promising altcoins, which do not need large capacities, with the help of video cards.

video card mining

The good thing is that GPUs give you the ability to mine almost any token, albeit with varying efficiency. Also, the miner can quickly respond to changing market trends, quickly switching between mining of different coins. Cryptocurrencies that are based on Equihash, it is better to mine through Nvidia GPUs, as video cards of this manufacturer have an increased amount of RAM. For mining you can buy a video card Nvidia GeForce RTX 2080 Ti, which costs 86,590 rubles.

The advantages of GPU-mining:

The ability to mine almost any token;
fast switching to mining other more profitable cryptocurrencies.
Disadvantages:

Not the highest hash rate.
CPU
CPU is a central processing unit of a personal computer or laptop. Most are developed by Intel and AMD. When Bitcoin was first created, it was possible to generate 100 coins per day using a regular CPU. In 2022 it is not realistic to mine BTC with CPUs due to the widespread use of more efficient ASIC devices. It is better to prefer other cryptocurrencies such as Monero. When mining these koins, you can activate the Smart Mining feature. It automatically starts mining tokens if the CPU resources are idle. For mining, you can buy an Intel Core i5-7600K for 31,000 rubles.

Advantages of CPU mining:

small amount of capital required to start mining, compared to GPU;
the ability to use the Smart Mining function (only when mining Monero) to optimize mining.
Disadvantages:

Low profitability.
ASIC
ASIC is a kind of integrated circuits. Essentially, it is a chip designed to execute a hashing algorithm as quickly as possible. ASIC equipment performs computing operations for mining 100,000 times faster than the most powerful CPU. Such devices are designed for specific hashing algorithms. Consequently, a miner needs to buy a separate ASIC to mine different hashes.

mining on asics

There are several manufacturers producing such equipment. The most popular are Bitmain and Canaan. ASIC devices are not cheap. Equipment with an increased hash rate will cost 210,000 rubles.

The ability to execute trillions of hashes every second has several drawbacks. Due to the fact that ASIS equipment intensively performs computational operations, it produces a lot of heat energy. Consequently, if a miner plans to use such devices, he needs to take care of creating a cooling system. This requires the use of fans, and they create a lot of noise. In addition, due to the increased hash rate, ASIC devices consume a lot of power. For this reason, most of the miners who use such equipment live in states with cheap electricity.

ASIC-mining advantages:

Efficient mining of any cryptocurrency, including bitcoins;
high profitability.
Disadvantages:

high cost of equipment;
high power consumption.
FPGA
FPGA is a microchip which can be programmed to perform any calculations. Such equipment mines tokens several times more efficiently than video cards, while consuming the same amount of electricity. It is necessary to program the board from scratch, only in this case it will mine a certain cryptocurrency. The programming code must be written in Verilog or VHDL. The cost of FPGA-equipment starts from 250 000 rubles.

The advantages of FPGA-mining:

The ability to use any algorithms;
High level of energy efficiency.
Disadvantages:

high cost of equipment;
Difficult board setup.
What does the choice of equipment depend on?
Deciding on what is more profitable to mine and what device is better to buy for cryptocurrency mining, take into account the following factors:

Power. Characterizes the number of hash functions that the equipment performs per second. This parameter determines how many coins the device generates. The more power, the more tokens the miner will receive.
Encryption algorithm. Different tokens work on different encryption algorithms. The type of equipment you use determines what kind of coins you can generate. For example, you can mine any kind of token through a GPU. However, tokens for which there are ASIC devices are unprofitable to mine with video cards. In this case, ASIC equipment can only mine tokens intended for it.
Electricity consumption. When mining cryptocurrency, the equipment consumes a lot of electrical energy. Depending on the power consumption of the equipment, 10-100% of the profit is spent on the electricity fee. For example, with a graphics chip, a miner will spend 10-20% of income on the electricity bill. As for ASIC equipment, it becomes less energy efficient over time.
Cost of equipment. How much is spent to start mining depends on when it will pay off and whether it will pay off at all. The cost of the mining equipment starts with 10 thousand rubles (simple GPUs) and may reach 350-700 thousand rubles (modern ASIC devices).
Payback period. This is the period, after which the money invested in mining will be fully returned to the miner. It is unrealistic to determine the exact payback period. This is due to the fact that this parameter depends on the cryptocurrency exchange rate, the complexity of computing operations. A miner can only predict the current payback period if he takes into account the cost of purchasing the equipment and the cost of electricity.
A person who plans to engage in mining needs to carefully work out a scheme of earning, make a detailed calculation of investments, compare the investment with the approximate profit. There are general rules that can be followed to maximize the efficiency of token generation:

Monitor the market. Analyze news summaries about cryptocurrencies. The value of coins is largely dependent on the information background.
Consider several options. Make a list of tokens that are profitable for mining, so that if the market situation changes, you can quickly switch from one coin to another.
Optimize your costs. Try to choose equipment with an optimal cost to power ratio.
What is the best way to mine?
You should select the equipment for mining, taking into account the peculiarities of the cryptocurrency you plan to mine.

Cloud mining: profitable or not?

Kent Weaver 02/10/2021

Bitcoin and altcoin mining attracts a lot of attention. After all, cryptocurrency exchanges are influenced by a lot of uncertain, rapidly changing factors and market psychology. Because of this, conducting a fundamental analysis and forecasting revenues in the secondary market of cryptocurrencies is quite a challenge. But with mining everything looks easier. ProstoCoin explains whether this is true.

How profitable cloud mining is
By comparison, some of the determinants of mining efficiency – such as processing power (production volume), electricity charges, and network fees – are public information from which a relatively objective quantitative analysis can be made. Given that miners’ earnings are closely tied to the value of the cryptocurrency, the return on investment becomes more predictable and stable than when buying cryptocurrency on the secondary market.

Many private and institutional investors from non-mining industries want to get involved in cryptocurrency mining. When bitcoin was not yet so popular, it was easy for a miner to mine bitcoins at home and make a good profit.

But now is not the “good old days” when the processors of ordinary computers can mine large amounts of bitcoins. The entry threshold into mining has gone up a lot: negotiating electricity supplies at discounted prices, choosing a location for a data center, choosing mining rigs and pools, calculating the seasonal volatility of electricity charges, keeping track of changes in cryptocurrency legislation, and much more.

As mining grows in popularity, so does its complexity. This makes it impossible to mine bitcoins from home with an ordinary computer. Home mining is only profitable if you have extremely cheap electricity and a cold climate to mine in for many months.

While the quantification of bitcoin mining is more objective than that of stock trading, the high entry threshold can deter many investors. That’s why cloud mining has emerged. It is a subspecies of mining that allows investors and crypto-enthusiasts to mine bitcoin, avoiding the complexities of mining bitcoins themselves.

The concept of cloud mining emerged to reduce the high costs of mining and to shield investors from the technical challenges of self-mining. The idea quickly attracted a large number of miners who could not afford expensive equipment.

For comparison, the cost of a single modern miner starts at $2,000. For stable bitcoin mining, you will need several of these machines. You also need to provide noise isolation and heat dissipation (otherwise your neighbors will ask you to give up this investment). The cost of a cloud contract can start at $10. This is a huge difference, which is what attracts investors to mine bitcoins using companies that specialize in this – cloud mining providers.

How to Calculate Profit
Providers commit to buying, maintaining, and upgrading equipment. They also provide a special platform for investing, withdrawal of earned bitcoins, mining statistics, and a special yield calculator. For example, on the website of one of the most popular providers ECOS you can compare the yield of cloud mining with buying bitcoin on the exchange.

ECOS calculator

Cloud mining allows you to noticeably reduce the impact of cryptocurrency market volatility while keeping your earnings stable. You get income on a daily basis. This approach is especially convenient for long-term investors, whose goal is not to make money from quick speculations, but to keep and multiply their capital for many years.

The main disadvantage of cloud mining is finding a reliable provider. There are a large number of scammers on the market. Sometimes it is hard to distinguish a bona fide company from a scam. Therefore, before you enter the world of cloud mining, carefully check the provider you want to work with.

One of the most popular and reliable providers is the company ECOS. Their data center is located in the Free Economic Zone of Armenia. The company is free from income taxes, VAT, import and export customs duties as well as property and real estate taxes. It allows the company to save not only clients’ money, but also its own.

Conclusion
Cloud mining is probably the best way to invest in bitcoins that is currently available. It is more profitable than self-mining and less risky than trading cryptocurrency on an exchange. If you believe in bitcoin growth and want to have a stable income for a long time, invest in ECOS cloud mining and earn daily!

The most expensive pizza in history

Kent Weaver 01/11/2021

Almost every member of the cryptocurrency community is familiar with the story of how in 2010 a US resident purchased a couple of pizzas for 10,000 BTC. Now that story makes us smile, and the man who then ordered pizzas for Bitcoin is called the greatest fool of the twenty-first century. If that customer had been more patient and didn’t spend the available coins, he would be a multimillionaire now. Together with ProstoCoin, let’s remember the day of this purchase – which is now known as Bitcoin Pizza Day – and consider what impact it had on the cryptocurrency industry.

At the time, the price of a pizza was approximately $20. Consequently, $40 was paid for 2 pizzas. In late spring 2010, 10,000 Bitcoins were worth $40 to $50, so the deal could be called fair.

On May 22 Laszlo reported that he bought 2 pizzas for digital coins and posted a picture. This date became a landmark for the cryptocurrency community – the man purchased a real commodity for the first time for the coins. Prior to that, bitcoins were only used in trading transactions.

Bitcoin pizza

In mid-summer 2010, the price of Bitcoin skyrocketed. In early August, 10,000 coins were worth $600. At that time, Laszlo’s offer on his website to buy food for BTC became relevant again. However, he said he was no longer planning such expenditures. At the end of fall 2010, 10,000 Bitcoins were already worth $2.6 thousand.

During the next nine years BTC only grew in price – so, the price of one coin reached $20,000. Due to this fact, those who possessed large amount of bitcoins later became millionaires. The deal to order 2 pizzas for 10,000 BTC became known as one of the most famous follies of the modern world.

In 2013, Laszlo, whose real name was Laszlo Heniec, gave an interview to The New York Times magazine. It was revealed that after the famous deal, cryptocurrency stopped being interesting to him for a while. Laszlo said that at the beginning of 2013, he sold all of his digital coins for $1 each, earning $4,000. He used the proceeds to buy several PCs and video cards. Laszlo did not plan to mine the coins, as one might think. The purchase of office equipment was due to Laszlo’s line of work – he works in the IT sphere.

When reporters asked him about the Bitcoin pizza deal, Laszlo said that his goal was to become the first person to buy physical products with coins. He said that he hadn’t believed in a successful future for BTC before, so it was easy for him to spend the coins.

Laszlo gave a comprehensive answer to the question about his motivation. He said that it was food he wanted, not a gift certificate for it. Laszlo’s logic is that if food can be purchased with Bitcoins, it means that one can live on them.

The journalist asked if Laszlo had any regrets about the money he spent in 2010, as the value of those 2 pizzas had already risen to $80,000,000. To this, Laszlo smiled and said that he preferred not to think about the purchase made in such a context.

In February 2018, news of Laszlo again appeared in the media. The enthusiast conducted a repeat experiment using the Lightning Network. The man purchased 2 pizzas for 0.00649 Bitcoin. He needed help from a friend in London for the new experiment, because it was impossible to complete the transaction without an intermediary. The deal turned out to be successful and Laszlo purchased his pizza. However, this experiment did not have such an impact on the cryptocurrency industry as the first purchase of food for Bitcoins. According to the crypto-enthusiast himself, the new experiment was staged as a tribute to Bitcoin Pizza Day.

How is Bitcoin Pizza Day celebrated in the world?
In honor of the first purchase for digital coins, the cryptocurrency community eats pizza and thanks Laszlo for his great contribution to shaping the industry. The date for Bitcoin Pizza Day is May 22. Various firms organize pizza parties for their employees on this day. There are companies that hold larger events. These include Blockchain Hub Kyiv, which for several years now invites everyone to celebrate pizza day on the banks of the Dnieper River.

Pizza Day is also known as Bitcoin Christmas. The tradition of giving each other gifts for Christmas has also passed into this holiday. For example, pizzerias from different countries reduce prices on their dishes, and cryptocurrency exchanges organize drawings for prizes for community members.

What is gas in Etherium

Kent Weaver 01/02/2021

The Etherium network, unlike Bitcoin and many other cryptocurrencies, operates not only the main cryptocurrency, but also Gas. It is Gas that allows users not only to make transactions, but also to run smart contracts, deploy DApps, and store information on the blockchain. In this article, we’ll take an in-depth look at what Gas is in Etherium, talk about what it’s used for, and how to optimize its costs.

Gas in Etherium

We’re all used to the fact that you have to pay a fee to miners for their services to verify transactions and support the network in order to make transactions in the blockchain. And the Ethereum network is no exception. However, in Bitcoin and many other cryptocurrency networks, the commission process is quite simple. The user only needs to choose the optimal amount of commission and wait for the transaction. Pay more – the transaction will go faster, less – you’ll have to wait a bit.

With Etherium, it’s more complicated. The commission for transactions in the Etherium network is calculated in gas and paid in ETH. That is, the more energy-consuming the transaction, the more gas it will take, and the higher the commission will be.

Essentially, Gas is the unit of calculation on the Ethereum network that is used to calculate fees for a transaction or action on the blockchain. Ethereum Gas is also often referred to as the fuel of the network. Using the analogy of regular fuel, the easiest way to explain what gas is in Ethereum is.

Imagine that you are going to go somewhere by car and you need a certain amount of gasoline to do so. You go to a gas station, fill up your tank with the right amount of fuel, and pay for it. If you draw a parallel to this situation with Ethereum, the trip you’re about to take is a transaction, the gasoline is Gas, and the gas stations are miners.

Why does Ethereum need Gas?
The Ethereum network combines more functions than the usual cryptocurrency. ETH can be used to send cryptocurrency transfers between users, but the main purpose of Ethereum is to create and execute support for smart contracts. The concept of using gas allows Ethereum to share the computational cost of EVMs and the real value of ETH.

The second reason is to incentivize miners. Many dApps are deployed on Ethereum smartcontracts, which integrate a variety of fields: games, insurance, finance, real estate, and more. Naturally, such a network requires special protection, and in the case of blockchain networks, the security of the network is directly proportional to its hash rate, i.e. the number of miners.

In order to encourage miners and offer them attractive earning conditions, a gas system was introduced. With its help, miners can receive a commission commensurate with their resource costs, because the more complex the transaction, the more gas it will take to perform it.

Ethereum Gas appears for any transaction that requires a fee. Specifically, gas is needed to:

make a transfer of ETH to another wallet;
to create a smart contract on the Ethereum blockchain;
execute a smart contract on the Etherium blockchain.
Each of these operations requires a different amount of gas to perform. For example, a cryptocurrency transfer would require 21,000 gas. The cost of creating and executing a smart contract depends on its complexity and how many EVM commands will need to be executed.

How much does gas cost
There is no fixed price for the cost of gas. The sender sets two key parameters for each transaction:

Gas Limit – the maximum gas limit that can be charged for a transaction.
Gas Price – the price of gas selected by the initiator of the transaction.
Gas Limit is primarily a function for developers. It allows you to warn users against huge expenses as a result of an error, a huge or infinite contract cycle. For example, if a transaction requires only 21k gas, and the user has set a limit of 50k, the unspent difference will be returned to his wallet. At the same time, if a lower limit than required was set, the gas will be wasted and the operation will be rejected.

With the Gas Price parameter, users of the cryptocurrency network can control the speed of their transactions. After all, the principle of price priority also applies in the Etherium network: the transactions with the highest value are the first to be included in the block.

The cost of gas is measured in the minimum part of the Etherium – wei. However, in most wallets this parameter is specified in Gwei. 1 Gwei equals 1 million wei. So, for example, if Gas Limit is set to 50,000 and the sender specified a price of 20 Gwei for one unit of gas, the transaction will cost him 0.001 ETH.

The average cost of Etherium gas is usually 50-60 Gwei. But this parameter can change depending on the load on the network. For example, the surge in interest in DeFi in 2020 caused the cost of gas to jump from 11.7 Gwei to 538 Gwei.