New 22 Petahash Mining Pool Signaling Bitcoin Unlimited

New 22 Petahash Mining Pool Signaling Bitcoin Unlimited

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A new mining facility and pool going by the name of ‘CANOE’ has joined the Bitcoin mining race this week, already claiming 0.7% of the total hashrate with 22 Petahashes worth of mining power.

Also read: Network Alternative Bitcoin Unlimited Closing In On ‘Opponent’ Segwit Proposal 

New Pool Signaling Bitcoin Unlimited

News of CANOE’s launch came recently when Chinese Twitter account cnLedger revealed that the pool was attracting much attention in China for signaling the Bitcoin Unlimited (BU) software client. BU is a favorite with many Chinese bitcoin miners. All of New 22 Petahash Mining Pool Signaling Bitcoin Unlimitedthe 22 Petahashes are owned by the pool itself, according to cnLedger.

Bitcoin miners signal their support of their preferred bitcoin client by ‘relaying’ the version number when they mine new blocks. If 75 percent of all blocks being relayed over a two week period are signaling for BU, the software ‘locks in’ and activates.

While the share of the overall network hashrate is not a guarantee of the percentage of blocks being relayed, knowing which pools prefer BU is a common way to form an estimation. CANOE’s addition adds to the roughly 20 percent of total hashpower that prefers the BU client.

New 22 Petahash Mining Pool Signaling Bitcoin Unlimited

The person in charge of the CANOE pool is Ang Li, a bitcoin entrepreneur since 2013 who became a miner in 2015. Li started to build a large-scale mine the following year in Sichuan, which has recently been called the capital of bitcoin mining.

Apart from CANOE, a pool called BTC.top is another newcomer that has been publicly supporting BU. BTC.top was launched in December 2016, and now has about 7% of the network’s hashrate. Other pools that have publicly supported BU’s scaling plans include ViaBTC, the Bitcoin.com pool, India’s GBMiners, and a sizable portion of SlushPool.

Why Support BU?

Li told Chinese news website 8btc that Bitcoin’s network congestion is the reason why bitcoin’s block size needs to be increased. While Bitcoin’s users and transactions have been expanding, the network can still only handle between 3 and 7 transactions per second. Li described:

Now the reward for a new block is (only) 12.5 BTC, but the fees are almost 1 BTC. Many people are paying more fees in order to make sure their transaction will be confirmed soon.

A scaling solution called the Lightning Network is being developed by at least five different development teams. Some believe it to be an alternative to the BU client, while others including the BU development team, have pledged support for the Lightning community. New 22 Petahash Mining Pool Signaling Bitcoin UnlimitedThe network’s solution calls for high-valued transactions to be processed on the Bitcoin blockchain while 0.042 BTC or smaller transactions are meant to take place across their network instead. Entrepreneurs who open a Lightning ‘Payment Channel’ for the network will be able to collect fees from users directly using the Lightning Network.

Keeping transactions ‘on-chain’ will require higher fees under this arrangement. “BS [Blockstream] supports Core dev team’s path which will lead to the Lightning Network”, Li said. “They’re thinking of the interest of their own company and team, but they did not consider the interest of the majority of miners. Meanwhile, their solution cannot solve the long-term problem of network congestion. It is also against the original vision of Bitcoin,” he argued.

Helping Guide the Mining Community

Li also believes that as new miners and big money flow into the network, most miners cannot fathom the potential outcomes of the various scaling plans like BU and Lightning. The lack of technical knowledge has, in his opinion, contributed their indifferent attitude towards scaling. “We are much more deeply involved in the mining business”, Li shared. “Therefore we want to guide miners to work toward the best of their interest. This is also the reason to found the pool”. He also explained that:

To support scaling (on-chain) is to defend the interests of the miners. Mining is the foundation of the whole bitcoin network and business. So defending the interests of miners means defending the bitcoin network too.

The incentives that Satoshi Nakamoto designed in the Bitcoin whitepaper are not enough to sustain mining for long, Li feels, adding that as the block reward halves every four years, miners income will continue to decline. According to him, keeping the block size where it New 22 Petahash Mining Pool Signaling Bitcoin Unlimitedis now will not provide enough incentive and therefore has to be reconsidered. Li also believes that only a larger mining transaction fee will maintain the balance. “By increasing block size, and transaction numbers, the fees will gradually replace the block reward, providing enough incentive for the miners to defend the bitcoin hashrate. This is the fundamental way to achieve healthy development of the whole ecosystem.”

Nonetheless, he believes that other scaling plans should not be ruled out. “We support increasing the capacity, it does not simply mean that BU’s plan is the best one. But increasing the capacity is essential,” he noted.

His future plan for the pool is to deploy another facility for mining in Xinjiang, named “Dian Jin Blockchain,” or Electric Gold Blockchain. The new project will have a capacity of 130,000kw with the intent to become the largest bitcoin mine in the world.

Updated: a previous version of this article stated that Bitmain would take part in the funding of the above mentioned new project. In an email to Bitcoin.com Bitmain clarifies: “Bitmain only built the farm and sold it. Bitmain is funding neither that mining farm nor that mining pool.”

What do you think of CANOE? Let us know in the comments section below.


Images courtesy of Shutterstock, Bitcoin Unlimited, and Blockchain.info


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  • Ricky Bickerton

    Yawn…….. Another Pro BU article, that says miners support what makes them the most money, yawn.

    Not saying segwit is, but BU is not the answer to scaling.

    The only reason BU is popular is too ensure segwit is not activated, because miners want to earn as much as possible.

    • Tony

      Miners want to earn as much as possible? Well no shit sir, bitcoin is working as intended.

      • They invest a lot in electricity and equipment, mining is very costly and I think is normal they think about what they impact the profit of doing it.

    • Jean-Claude Morin

      That’s the whole concept of the “game theory”. Bitcoin is based on that everyone try to make the best decision for themselves and it work. If miner think bigger block are better they will increase it, If they feel the block are too big and fees are too low they will stock increase it.

    • richardamullens

      Bitcoin Unlimited is popular because it is a way out of the current impasse that has caused congestion in the network and increasing fees. You can see the horrendous queues by searching for “Johoe’s mempool statistics”. Many people have been waiting 4 days for their transactions to confirm and I presume that transactions with “insufficient” fees just fail. It does not make sense to make Bitcoin an unreliable method of making monetary transactions but this is what Blockstream has been doing by their connivance with paid core developers who have deliberately dragged their feet in increasing the block size.

      • Patrick Miller

        SegWit is a block size increase

  • Steffen Søborg

    Why is it so difficult for miners to signal segwit?

    • richardamullens

      Miners won’t signal for segwit because it would just cement the stranglehold Bitcoin Core and Blockstream have over the mining ecosystem. The blocksize problem needs to be fixed once and for all and taken out of the hands of Blockstream/Core who are operating in their interests and not that of Bitcoin.

    • Ricky Bickerton

      Because they are making more from high transaction fees, which are why miners use BU, just to stop segwit activating, and also a lot of change is not good, when it’s human nature to change things for your own benefit. What is annoying is the arguments either side, people acting like there are only 2 choices and both of them are poor solutions as temporary at best, and arguments for BU are just BS, claiming increased block size will increase BTC users, it won’t it will only increase micropayments which will quickly fill up blocks and put us back at square 1. If the solution does not allow 20k+ transactions a second, it’s not the scaling solution everyone is looking for. More research needs to be done on payment channels.

      • Patrick Miller

        Fixing tx malleability, allowing script versioning, Schnorr signature aggregation, and thus confidential tx is more important in my book

    • Patrick Miller

      It’s not. They could technically do both, but BU is more political than real solution oriented. I’m surprised they don’t support Segwit

  • > If 75 percent of all blocks being relayed over a two week period are signaling for BU, the software ‘locks in’ and activates.

    No, 75% is just an idea that has been discussed. Nothing locks in and activates.

    • Patrick Miller

      Could author please clarify this ?

  • Patrick Miller

    Good to see Bitcoin miners in China gaining more understanding, education, and communication through community. Over time, they will realize we need both. I support Segwit but I understand why they currently believe that BU.

    Biggest problem I see, is that codebases have diverged too much