News from botcoin brothers
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Berlin, Germany - Release Date: 11 JUN 2015
Next Steps towards our ~500 PetaHash Launch Preparation
Skipped a Heartbeat? Decentralized Business Philosophy, Wealth Creation for All, and Massive Scaling: Think ExaHash(es)
By the way, we won an Innovation Award
Presenting to Volkswagen Execs: Autonomous Driving could (will?) boost Blockchain Transactions
you expressed an interest in our company and products, and subscribed to frequent updates. It is time again to inform you about our next steps towards the launch, when you will have an opportunity to act. In this Newsletter #3 I also want to give you more insight into our business philosphy, since we are obviously introducing some very bold upgrades to the Blockchain infrastructure, and intend to provide solutions for everyone to participate in the wealth creation which both Bitcoin and the Blockchain offer - not just for the 1%. We also won an Innovation Award recently, which we are certainly proud of, and are looking ahead towards the future, boosting transaction volumes in the Blockchain from currently 1 (one) to 1 million per second - for which we are working hard to build the infrastructure.
Hope you find this informative and of interest to you!
Bitcoin Brothers, Berlin (Pre-Launch; we will release the ‘real’ company name at launch time)
Next Steps towards our ~500 PetaHash Launch Preparation
You did, of course, notice we did not launch our massive services in Q1 this year, as we had originally planned (and so boldly announced on the huge display on Times Square in Manhattan, New York City). Market conditions played too much into our hands, and everything we had forecast (disappearance of hardware vendors, the flat-lining hashrate, emergence of the Blockchain as the true value of Bitcoin, awareness of the scaling issue of the Blockchain for massive growth, and the trending of wealth distribution in Bitcoin starting to mimic the fiat world) happened even faster than we had expected. These are several reasons making it very tempting to hold back on the launch - since we are planning a fairly massive impact, it readies the market for corrective and innovative measures.
Nevertheless, we are taking the next steps forward. You, the recipients of our newsletters, demonstrated a very strong demand for participation in Bitcoin mining (and for being a part of the Blockchain), by signing up in our sales-lead database with your capacity interest. While we initially mostly filled the “Sales” page on our website with this interactive option for you to participate, adding to the main message of “no pre-sales at all” (to clearly distinct ourselves for a variety of less-trustworthy enterprises), we were admittedly very surprised of the feedback volume. Within 1 week after our November press release, we had registered interest in this database of double the existing hashrate (700 PH). Since then, this interest has consistently grown, and currently stands at 2 ExaHash (2,000 PH).
We are closing the Sales Lead database on July 31st, and then start the next phase, in which you can commit to capacity, if you wish. Until then, you can still register your interest, especially if you are not ready for any commitments, yet.
Here is why: very obviously, a much larger part of the world population than the current miners have an interest in mining. The miners until now have knowingly accepted a high risk for their contribution and their effort to gain Bitcoins for the future: pre-paying for hardware with a short life-cycle, risks of deliveries and specifications, risk in high “fiat” costs of running the hardware and paying for heavy power demand, cooling, data center space (or housing cost), and facing the changing / decreasing value of Bitcoin against these expenses. For the vast majority of all those interested in the potential of Bitcoin and the Blockchain, these risks were much too high - thus the high registration rate in our database. The proportion of this demand did surprise us, too.
We put an emphasis on scalability - a crucial factor in the Blockchain’s future - and surely want (and will) meet this demand. After all, we claim to be the only company on the globe with the ability to deliver this scalability well into the ExaHashes, while at the same time driving down the cost for mining (i.e. transaction processing) dramatically.
While we initially planned to launch with only a few of our machines to match the current hashrate of 350 PH, we are likely upping this a little to around 500 PH in the first step, and then quickly ramp up to meet the actual demand. To determine “actual” demand a little better, and ensure we have an “orderly” way to share mining capacity (i.e. as in not having a stampede when we turn the switch on) between all who want it (our German roots show here a little, don’t they), we need to validate your entries in the database. Every entry currently summing up to the 2 EH has been pre-validated (entries like “Joe Shmoe at 123 Main Street” - which were very few - have been removed).
After August 1st, you will have an opportunity to make a binding commitment to mining capacity - in return, we will guarantee this allocation of capacity at launch, along with a capped upper price range. At this point we want to stress again: no money is changing hands (at all!) until you get what you pay for - it will only be a “tit-for-tat” exchange, in which you remain in full control of your mining capacity at all times. We will give you a heads-up with the details prior. Binding commitments help us to plan accurately.
For obvious reasons, and as much as we want to be as transparent as possible in honor of the entire open Blockchain concept, during the pre-launch phase we have to be also a little protective of our business model and technology. We are aware the last 4 paragraphs likely upped your blood pressure a bit, and spark many questions. Obviously, we do not make these announcements out of thin air or without a very solid solution for each, but it would not be very smart to share them too early.
I do want to address (and repeat) the following, because it is fundamental, and important:
we believe in the Blockchain and its potential for the next 10 years and more
we believe in the core principles of the Blockchain, its decentralization, control functions and rules, participation and consent of all, and transparency
You also wonder about the pricing of mining capacity and degrees of availability in sizing. Exact launch dates and capacity pricing are competitive advantages, and thus not revealed until it gets serious, but we repeat our previous statements: after (significantly) pushing difficulty with our launch (you know as much as we do what an additional ~500 PH will do to the difficulty) you will be able to mine 1 Bitcoin for under $100 - and we say this with the current expenses in mind of an estimated $300-$600 cost per Bitcoin at present difficulty. Capacity will be offered in increments starting as low as 1 GigaHash, so literally everyone can participate in Bitcoin mining and in the Blockchain. There are no realistic limits on the upper end.
Skipped a Heartbeat?
Decentralized Business Philosophy, Wealth Creation for All, and Massive Scaling: Think ExaHash(es)
Recently, you - like most of the Bitcoin / Blockchain / Banking / IoT / (insert all other technologies the Blockchain could be useful for) - communities were left to scratch your head about emerging ideas for the future of Blockchain processing power. With virtually no serious hardware maker left, and cost of Bitcoin mining exceeding their value today, the hashrate has been flat-lining below a 350 PH median for quite a while now, after it had previously exploded.
The future outlook as publicized in the cryptospace news looks bleak to most: USB adapters, lightbulbs, and battery-sucking cell phones with a single mining chip in them? Which consumer base might be willing to pay the mining bill for just 2 companies to benefit from it - and technologically, it is also a hard concept to sell for operational efficiency and cost. And this is the best coming from two extremely well funded outfits (one by investors, the others by earlier Bitcoin earnings). This is not meant as a jab towards other members of the community spreading disheartening news, just summarizing what most conclude anyway these days. In addition, there is a big concentration of hashing power in large mining pools, which are all mining only for themselves now: few gain the bulk of block rewards, the individual miner is left out for the most part.
As a result, you were left equally disappointed and scratching your heads, when articles and blog entries took advantage of the transparency of the Blockchain, and highlighted the tilted wealth distribution in Bitcoin: with very few wallets holding 99% of the wealth at 2/3rds of all Bitcoins created, this appears to trend towards the same wealth distribution as in the fiat world, which Bitcoin and the Blockchain set out to change. You wondered why just about 30 people holding those few wallets meet on exclusive private islands to discuss the future of the open-source Blockchain meant for all on this globe (and yes: you can get your own evening with Richard Branson and drinks, if you book a 1-week vacation for $250,000 on his island). Is this what the future of Bitcoin holds? Currently the operation of the Blockchain is closely tied to Bitcoin, so is this also the future for the Blockchain?
You were lately also likely to scratch your head contemplating technological aspects: how can the Blockchain possibly live up to its great expectations to power so much more than Bitcoin: boosting the transaction volume per second (tps) from currently 1 (one!) to over a million when it could run the Internet-of-Things authentication and communication for billions of devices, when it could run secure and vendor-independent Autonomous Drive authentication and communication for billions of transportation devices between vehicles-to-vehicles and vehicles-to-infrastructures? And so much more. Compare this to current transaction numbers in the financial world: Visa has 2,000 tps (4k on busy days), and the entire global financial community runs approx 50,000 tps. A 1-million-tps-volume requires much, much more than a few home miners, a few remote mining farms in politically obscure locations, and a number of USB adapters, light bulbs, and overheating cell phones.
While we are still far away from those kind of applications for the Blockchain, and those transaction volumes (once adopted), the perspective of the Blockchain actually scaling and delivering this kind of performance, and doing so at the crazy low cost originally promised for Bitcoin, has to be set up today: to instill the confidence there is a growth path, and the Blockchain will be ready for all those applications.
This is the point where we share our business philosophy with you - as a European company, embedded in sound democracies and economies, with the determination, technology, and vision to deliver the true concept of the Blockchain to all – with emphasis on ALL, because only with “win-win” business models you can build something sustainable for a long time.
Thus we offer truly decentralized solutions, which allow everyone to participate in the efficiencies of very large operations - and not just the very few who can afford to take the expensive risks - and allow everyone to control the Blockchain in a way it was designed to be run and grow.
Thus we share the cost benefits of our approach and efficiency - if we can offer you to mine Bitcoins for less than $100 each, while doing so at much higher difficulties than today, we are surely not giving anything away or running at a loss (we are a business, after all, and earn profits). But sharing these enormous benefits with all leaves you happy, too, and creates win-win situations, in which everyone can thrive and prosper. While this example is of course for the last 3rd of the creation of Bitcoins, it also sends a strong signal to all those considering the Blockchain for many other, and much bigger, uses - it can run cheaper, more secure, more reliable, and with decentralized control than anything else existing or imaginable today.
Thus we demonstrate scalability for the Blockchain - who else can start with 500 PH and quickly scale up to 1 EH and more? We can administer up to 3 EH from a single console if desired, and do much more - this gives all those, who are planning massive uses for the Blockchain, the confidence it will keep up – and also counters concerns that ever-growing Blockchain records may slow things down.
Thus we live transparency - you still have a little nagging feeling in the back of your head if there is some evil masterplan behind it? Not to worry, we mean what we say, and we will back it up. As we get closer to launch, and long before any money changes hands or other commitments are executed, we will open our doors of super-secure facilities to reputable journalists, media outlets, and various other certification options to make sure everyone is confident we are exactly what we claim to be. As in most brand-new developments in history, through the 1849 California Gold Rush, and current day inventions, there is always a criminal element trying to “make a quick buck” with undesirable deals (or outright scams). Bitcoin has sadly been hit by several of those - the more complicated technology gets, the easier it becomes for some to create a smoke screen - and so we will go out of our way to be as transparent as possible. There is no need for any secrecy at that time for an open-source solution.
Thus we enable new Encryption & Security - going further than the above, the Blockchain also represents a new security concept. The network is the security, powered by such massive, forward-hashing computing power that it cannot be compromised, and it is no longer individual devices and local solutions to compromise (for those it is only a question of when, not if, they get compromised). This allows for completely new levels of encryption, security, and privacy - with completely new applications. If the Blockchain provides this massive computing power to sustain this level of security, we enable a new digital world for the future, in which we all succeed. We can only be successful, however, if we all succeed together, and actually deliver on all those promises. “Don’t be evil” is then no longer a corporate marketing slogan of questionable value, the Blockchain forces every participant to adhere to it.