“Within 24h of launch a majority of miners are already on strike” Consequences? | Hacker News Reader

“Within 24h of launch a majority of miners are already on strike” Consequences?

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105 points1qazxsw23edc35 comments

https://www.coindesk.com/filecoin-miners-go-on-strike-one-da... Coindesk post.

This is hard for me to follow, but this is what I was able to gather: Filecoin developers have set expensive hardware requirements to be a Filecoin miner, as well as expensive staking requirements. The mining is also highly centralized with insiders. Third party miners are disappointed because they can't mine despite costly investments.

Is this summary correct?

My take on possible consequences: no one likes excessive centralization in a crypto commodity. This hurts the adoption and value of Filecoin. Filecoin miners and investors may also dump Filecoin holdings.

Centralization of Filecoin is an issue, but not the point of these tweets. The tweets focus on rekt Filecoin miners, they have spent more than $200M on hardware, but seems impossible to get back that with FIL mining, and since most miners are from China, no west media report this thing yet.

My question is, why did the miners not anticipate this- aren't the rules more or less agreed to in advance? Or were the rules changed out from under them?

Or is this something nobody anticipated would be an issue?

Most miners thought they bought 10TB storage, they will mine $FIL with that 10TB, but according to the rules, they can only start from like 1TB, most of the storage they bought are useless for mining.

Like in the tweets, many miners don't understand this, nobody tell them the risks in the community, not even the Protocol Labs.

I think mining equipments are over sold, maybe 10 times, due to the lack of enough warnings.

It’s highly unlikely that they would get their money back if they lived in the west either. Most victims of crypto currency fraud are not made whole.

Genuinely not sure why people keep falling for this though.

Regardless of the actual reason why they cant use the 200M hardware, isnt int kinda funny that they even assumed that they could make money from the full capacity at day 1. Who the heck would be the customer of cloud storage hardware worth 200M at day 1. Clearly demand grows over time, that cant be skipped. Reward "miners" for whatever they provide even if no one uses it - sound unsustainable.

Rewarding miners for reserved but unused capacity is an explicit feature of Filecoin that I guess is intended to build up capacity in advance of customer need. These miners just did what Protocol Labs told them to do.

> These miners just did what Protocol Labs told them to do.

Without a contract? I'm not talking about smart contracts, I'm talking about real world, legally-binding contract.

If they just went and bought $200M USD of hardware basing on marketing... I guess that's the problem, right there.

Reserves sure, but at the start you dont know how much is needed so to just assume reward for whatever show up is comically naive. It could take months for real demand actually using a significant portion of the storage. Pay everyone else anyway is literally trowing money away.

Just imagine if one of the large cloud storage player would have set this up and simply offered all their reserves which they could do as there is no way anyone would use it. If they would get paid for that It would be very lucrative.

Well, they can always sell their hardware as it's generic server equipment right? They can also sell their FIL holdings.

Brand new hard drives drop a lot in value once used. Buying 256 gigs of RAM (specially ECC memory) and 2080 TI is not exactly cheap either.

Oh, I forgot a super important bit. Using a 2080 TI/consumer grade GPU for cloud purposes is against Nvidia terms.

To avoid being sued you need a Tesla GPU, the cheapest one is $7,374

Datacenter license only counts if you're leasing out the hardware directly. It's fine to use consumer grade but you can't subdivide it or sell it to customers (for ML as an example)

Bit of a grey area: https://www.datacenterdynamics.com/en/news/nvidia-updates-ge...

Quoting: “To clarify this, we recently added a provision to our GeForce-specific EULA to discourage potential misuse of our GeForce and Titan products in demanding, large-scale enterprise environments.”

According to this article, they want to discourage but I would expect legal retaliation if FileCoin proves to be profitable. There is one area where AWS never launched: gaming servers and I suspect this could be the reason.

Its almost always specialized cause crypto mining software for proof of work extensively uses GPU to increase hashes per second rate.

This is filecoin. Afaik it's storage-based, not compute-based.

I looked at the requirements earlier and was blown away. Their official recommendation is three servers with some very expensive hardware. Three Epyc processors, one machine with 128GB of RAM (and a lot more swap space), and one with 2x GPUs. And all that to "seal" like one TB an hour. But it's OK, because this is totally not a proof of work system.

https://filecoin.io/vintage/mining-hardware-config-testnet-v...

How often (on average?) do you need to seal each TB you have?

For example if it's four months and you can do a terabyte per hour then that's about 3 petabytes and the cost of the sealing servers is a small fraction of the cost of the storage server. Is it much less?

But also the tweet says something about one terabyte per day?

You only seal (the expensive operation) when you add power.

Once you stop sealing you don't need to seal again for ~1 year (depending on your sector lifetime).

Keeping storage power is a cheap computation in comparison.

Assuming one is starting off by sealing pledged sectors, they would also need to re-seal any such sector upon upgrading to store actual content pursuant to some deal they have accepted.

I'm assuming there is probably not enough real storage demand yet, so large miners will end up pledging sectors a fair chunk of the time, in order to increase their power, at least while they have spare disk space remaining.

Glad I dodged this bullet. Last year I dedicated my Intel Nuc i3, 8 gb Ram with a 500gb hard drive but the amount of files/contracts was so low that eventually I shut it down.

I'm very surprised about the 128 gigs of ram requirement, guess this network isn't that decentralized as promised. Anyway, from the beginning it easy to see that competing against something like AWS S3 would be super super hard if not impossible.

With a low token price, electricity costs, hardware costs and your ISP asking about your absurd bandwidth use, I would be shocked if anyone can actually make a profit on this.

What did you expect in terms of revenue offering 500 GB to the network?

I was just testing the waters, the idea seems futurist and reasonable. The price of token wasn't set back then and the company decided to inject some capital with a fixed return over a period of 2 year I believe, don't remember the amount but I know it was very generous.

Hardware requirements...

https://docs.filecoin.io/mine/hardware-requirements/#specifi...

This note hasn’t aged well...

> Filecoin allows to launch a small cloud storage business for a few thousand dollars directly from home, where it would cost millions in infrastructure and logistics to get off the ground in the current data hosting model.

Why is this called a "strike"? When the issue seems to be miners unwillingness to buy Filecoin in order to join the network. Simply seems to be an issue of the price, risk/reward ratio of buying a "ticket to mine".

Putting the cluster in cluster.

"Filecoin is very complex and requires high-end hardware, including min 128GB mem."

Why is Filecoin so complex? If they require coins to be staked in order to offer storage to the network anyways.

But how come this issue didn't come up in the calibration/testnet?

Yeah, if these numbers are correct I'm not sure why Protocol Labs didn't run the numbers ahead of time and predict this situation. Or maybe they did and they just don't care. Crypto miners have become spoiled by ROI measured in months, so when something comes along that looks like a real business the miners cry foul.

Found a very relevant thread here: https://twitter.com/NicoDeva_/status/1317689811046522880

We got an infinite loop here

I'm looking forward on James Mickens commenting this.

I'll say it louder for the people in the back. Decentralization is inefficient. Chinese miners won't be allowed.

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