The blockchain technology works on the system of a distributed ledger. Banks use ledgers to keep track of transactions. They serve as intermediaries as they can reverse transactions. This was what Satoshi Nakamoto wanted to solve as he introduced a distributed ledger system which works on trustlessness and removes all intermediaries thus allowing transacting intermediaries to connect to transact directly. Through the blockchain technology, transactions are irreversible.
Bitcoin Mining and Proof of Work
One of the best ways to earn bitcoin is through mining. Mining talks about the use of hardware to perform a series of calculation – proof of work. The proof of work on the blockchain or bitcoin technology is to prevent double-spending and keep the network or transactions from takeover. In the proof of work system, legitimate transactions will be able to perform calculations to generate proof easily. In order for a block to be accepted by the network participants, miners must complete a proof of work which covers all data in the block. When bitcoin began, miners can simply users their CPU to mine since the calculations needed are not too complex or hard. But as time went on when the system became known, CPUs are no more suitable as works to be done became harder and more complex requiring hardware with speed and more power. This was what brought powerful Application Specific Integrated Circuits (ASICs) into play. They are used solely for mining.
ASIC Bitcoin Mining History and Complexities
When the ASICs first came, there were many manufacturers producing them. But as time goes on, more speed is needed with hardware that consumes lesser power and space, many of the manufacturers which produced at first could not because of the cost of producing ASICs had shot high. This left only a few manufacturers in the market with few ASICs and greater demand. These manufacturers only sell to the highest bidder, therefore, the cost of ASICs today are high. Manufacturers also mine bitcoin today, since they have the necessary tool to do so, therefore they control much of the mining pool. Now the manufacturers can be seen as the new wave of intermediaries which Satoshi Nakamoto seek to eliminate with the blockchain technology. The manufacturers largely determine who earn as they control most of the mining pool and who gets to have the mining hardware.
Before a transaction can be confirmed successful and miner earns, the ASIC miner has to do series of complex calculations in very limited time. Because of this, bitcoin miners requires a lot of speed to work successfully. This is what led to the relatively bigger size and power requirements of ASIC miners. But over the years manufacturers develop updates of ASIC miners to have a faster speed and consume lesser power, this also led to high cost of the hardware.
Today’s mining equipment manufacturers have business models that centralize access to mining equipment. The equipment produced by these manufacturers is used in their own mines to extract significant value out of cryptocurrencies before it is released to the public. By the time the public gets access, the ROI of this mining equipment has significantly dropped. We alleviate these issues through our co-operative model that disperses the power throughout the community.
Node haven comes into play to decentralize the distribution of mining equipment while incentivizing the manufacturers.
The major challenge of manufacturers is the high cost of production of ASIC miners. Node Haven will use Product Development Vehicle (PDV) to help lift the burden. Node haven will use the funds gathered from the token sale to develop and produce a 7nm ASIC bitcoin miner (which is very fast and consume lower power). Thus the bitcoin miners can be reserved and redeemed through the Node haven token.
The current manufacturers of ASIC bitcoin miners are Profit Seeking Companies (PSC) which sell ASIC miners to the highest bidder. Product Development Vehicle (PDV), as against PSC, utilized by Node Haven will allow miners to be reserved and redeemed by the token. The managers are rewarded with tokens which will later be redeemed for products they are producing. This will significantly reduce the cost of purchasing an ASIC miner. Since the manufacturers will also be part of the consumers in the PDV systems, they will have the mind of the consumer thus putting power back into the hands of the consumers.
Node Haven token holders will have the singular opportunity to reserve bitcoin miners. After a week of the production of the miners, the miners will be redeemed with the tokens which are held by the token holders. The miners will then be shipped to them subsequently.
ASC 7nm Miners Vs other ASIC miners
The ASIC 7nm miners which will be produced by Node Haven will be faster and consume lower power and lesser areas than other ASIC miners. Take a look at some of the Specs below:
For further information on Node Haven, you can read:
Thanks for reading. I am @ayobami99 (bountyhive username: Ayobami). You can also reach me on bitcointalk: https://bitcointalk.org/index.php?action=profile;u=1848386;sa=summary
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