Digitalcoin update attempts to ward off multipools David Parker 09/09/2013 News 6 Comments Posted 6 months ago On Saturday, an update to the Digitalcoin wallet has been released, called DigitalCoin V0.2. This is a mandatory update, which has to be downloaded by all users and pool operators in the next two weeks, because there are some important changes coming. The main feature of this update will be to ward off multipools’ so called “exploiting” of the profitability, also knows as “dumping” among most miners. This means that, pool like Multipool.us and Middlecoin.com divert all their combined hashpower to the most profitable coin, mine during a lower difficulty, and then bail out again when the difficulty increases. This may sound like what most of us might be doing anyway, we all want to mine the most profitable coin , but only when it’s actually most profitable. Now, if you are doing this as individuals, it doesn’t impact the overall network of that coin too much. Afterall, more mining power means a wider spread of the network, which also strengthens it. So, why is this an issue with multipools, you may wonder? Well, that explanation is quite simple, yet slightly different for both aforementioned pools. Let’s start off with Multipool. Digitalcoin update attempts to ward off multipools Multipool is a great pool, supporting over 10 different scrypt coins, to mine as you please. Each coin has it’s separate port on the pool, so you can choose to mine a coin you support. But there’s also another options , called the Multiport. When you connect your miner to this port, you’ll automatically mine the most profitable coin at that current time. Whenever a new coin becomes more profitable, all of the hashrate on the Multiport is directed to the next most profitable coin. This is called “hopping”, switching from one coin to another. As most of you will probably know, the Multiport on Multipool packs quite some hashpower, in excess of 750 MHash/second. As of this writing, that same Multiport is now directed to mining Digitalcoin. What this hashpower does is, it pretty much puts most other Digitalcoin pools out of work, because Multipool is solving over 90% of all generated blocks during a term of lower difficulty. Basically, it means, if you’re not on the Multiport, you’re pretty much out of luck to generate some extra Digitalcoins when the difficulty drops. Doesn’t really sound fair, does it? This also has another annoying consequence for Digitalcoin enthusiasts. All this switching between profitable coins means that Multipool miners will end up with low(er) balances of each and every coin supported by the Multiport. This fact tends to lead to ‘coin dumping’, meaning that most of the miners get their coins to an exchange and just sell at the highest buy price offered. In turn, this then leads to the coin value decreasing, because everyone wants to get rid of their coins as fast as possible. This is just one side of the damage that Multipool and Middlecoin will do to (y)our beloved coin(s). Let’s take a closer look at Middlecoin, which is definitely the worst of both evils. MIddlecoin partially employs the same strategy as Multipool does : one connection port to mine all supported coins. However, in the case of Multipool, you actually know which you’re on (if you look on the stats page), with Middlecoin, unfortunately, you really have no clue what you are mining, unless you do some research. So, if it does the same, why is Middlecoin worse than Multipool? As soon as you load the Middlecoin website, you’ll see this line of text : “This pool automatically mines the most profitable scrypt coin, automatically exchanges those coins for bitcoins, and pays out entirely in bitcoins.” Yes, you read that right , you don’t have to worry about exchanging coins, downloading and synchronizing wallets, and so on. All you need to do is point your scrypt mining program over to their server, enter your BITCOIN address as a username with any random password, and start mining. This is the dream of every lazy miner, isn’t it? It’s also the nightmare of anyone who supports one or more coins. Don’t get me wrong, we all want to get those Bitcoins, but some of us won’t do it at ANY costs, like most of the multipool miners. Middlecoin is destroying pretty much any scrypt coin sooner or later, unless the developers step in and try to prevent this from happening. If nothing changes, some coins will get exploited a few times a day, while others may nearly never get mined again because they’re stuck at a high difficulty. This is why the new Digitalcoin update is so important to anyone who supports Digitalcoin and/or the Digitalcoin community. With the change in difficulty rises and drops, the coin will remain profitable, but it will avoid the exploiting of multipools and their hashpower. This change will increase every non-multipool (small) miner’s chances of getting an equal share of the pie. We can only hope, for the sake of every altcoin out there, that more altcoin developers will follow the Digitalcoin srategy. If not, the coin you so much cherish and support, may end up in obscurity sooner rather than later. By Jdebunt – Post a Story and Get Paid – for CryptocCoinsNews.com Advertisement 6 Responses Mircea Popescu 09/09/2013 Pretty much all this “analysis” you espouse is naive nonsense. As naive solutions to misunderstood problems rarely work it’s a bit far fetched to call it “a strategy”. Go with “desperate arm flapping”, at least it’s accurate. Reply jdebunt 10/09/2013 It’s definitely a strategy, one we cannot evaluate as positive or negative yet. The full details will be visible in a few thousand blocks. Untill then it’s “desperate arm flapping” to label it as naive nonsense. Reply Reggie 04/01/2014 Some strange things are happening with DGC right now. It seems there is no way to mine it. Did the DGC software update cause this? Digitalcoinpool.org is showing zero workers and a zero hash rate. Multipool also now refuses connections on the dedicated DGC port. Reply Jon 05/01/2014 well done guys, good to know dogecoin is in good hands Reply frak 25/01/2014 Wah, wah, wah. If your coin can’t handle these kind of “attacks” against your pet coin, maybe no one should trust it, or mine it. If you can come up with a real algorithm to strengthen your coin, Fantastic – hope you open source it so all the pools can benefit. Your complaint against Multipool and Middlecoin that they are lazy miners – do you not understand the point is to earn money, not make your pet coin project work for you? If it doesn’t earn money you don’t get miners, if you don’t entice newbies or lazy miners your still will never grow and will die off. Frankly I think Multipool and Middlecoin are frakking fantastic because they make it easy to make money, make it profitable, and kill off coins that don’t pass the darwin test. Reply David Sutherland 26/01/2014 The “problems” created with open markets and free trade exist in every sector. Fortunately the benefits of open trading outweigh the problems listed. For every economic analysis the whole, not just the part, should be examined to understand the benefit and loss. What is decried here as a hurt to less popular coins likely also creates benefit for other coins. Namely, dumping alt coins by megaminers actually stabilizes the coin to it’s real market value. If mining my multipools depresses a price of an altcoin then shouldn’t it be purchased whenever large pools dump it? If it really has value then the price should rebound and a profit can be made. In the end, as usual, technology likely just speeds up market changes, or is there really an artificial manipulation when larger players act? It just seems like how the markets ought to work from my perspective. Reply Leave a Reply Cancel Reply Your email address will not be published. Name* Email* Website Comment Notify me of follow-up comments by email.