13.04.2021

As Bitcoin Cash Hard Forks, Unknown Mining Pool Continues Old Chain

The old chain, Bitcoin ABC 0.19.0 mined by the unknown pool, considers the new chain invalid while the new chain, Bitcoin ABC 0.20.06 mined by mining pool BTC.com, considers the old chain invalid.

A rogue chain has developed during a planned bitcoin cash hard fork, as an unknown mining pool failed to update to the new chain’s software.

The on-going chain battle, which should be resolved by bitcoin cash’s internal rules, gives an insider look into how proof-of-work (PoW) consensus mechanisms operate.

The hard fork occurred on Friday at 16:49:28 UTC at block number 609,135. Two additional blocks broke into two different chains that have been mined for a total of 4 new blocks, according to BitMEX Research’s Fork Monitor.

But under the Nakamoto consensus mechanism employed by bitcoin cash and other proof-of-work (PoW) protocols, the chain with the longest history would be considered to be the trusted ledger, invalidating the rogue chain.

Seeing old chains continue has happened before as some miners, who run software that creates the blocks forming the chain, forget to upgrade to the new software required for hard forks before the forking date.

As BitMEX Research noted in a tweet, mining the wrong chain comes at a cost.

The opportunity cost for mining the incorrect chain could reach up to 25 BCH, or about $6,600, if the unknown pool had beat other miners in securing the two correct blocks, in addition to the electricity costs associated with mining.

Armenian IT Company Accused of Illegal Electricity Use to Mine Crypto

An IT company in Armenia has been accused of illegally accessing electricity and using it to mine cryptocurrencies.

$150,000 in power

On Sept. 21, in an announcement from the Armenian National Security Service, the organization accused an IT company of illegally mining cryptocurrencies from inside a hydropower plant.

The state agency reported that the IT company had installed cryptocurrency mining equipment inside one of the hydropower plants operating in Armenia and as a result illegally consumed 1.5 kilowatt-hours of electricity – worth more than $150,000, locally – over the course of 1.5 years.

Illegal crypto mining in China

Cointelegraph reported in September that regulators in the autonomous Chinese province of Inner Mongolia issued a notice demanding a clean-up of the province’s crypto mining enterprises.

Several departments within Inner Mongolia determined the need to rectify the mining industry within the province. The organizations named were the Development and Reform Commission, the Public Security Department, the Office of the Ministry of Industry, The Financial Office and the Big Data Bureau.

As of the end of May, China was reportedly responsible for 70% of global BTC mining. At the time, reports emerged that Chinese regulators were investigating illegal mining operations in Sichuan – a province responsible for 70% of China’s Bitcoin mining thanks to the electricity generation of the Dadu River Basin.

Arctos Inks $1M Sale and Leaseback Deal With Bitcoin Miner Blockware

Private investment firm Arctos Capital has acquired $1 million in assets from Blockware Mining LLC, but will lease them back to the company so it can continue operating as usual.

Arctos Capital, the general partner of the Arctos Capital Cryptoasset Credit Fund, is a commercial lender that provides financing for mining businesses and investors, according to a press release. Arctos will lease the lastest generation of Bitmain Antminer hardware to Blockware as well as allowing the company to continue its mining and hosting operations.

Blockware intends to use the funds to expand its operations and equipment. A leaseback transaction allows for businesses to sell an asset and lease to another company or individual in the long-term after a completed sale.

Blockware Mining, a subsidiary of Blockware Solutions, is a bitcoin mining facility located in the U.S. that offers turnkey solutions for external miners looking to profit off cryptocurrency mining operations. Their aim is to bring greater hashing power to the U.S. in order to further decentralize the Bitcoin network.

“We are excited to announce the closing of this sale and leaseback transaction, which we believe to be one of the first, if not the first, transaction of its kind in the U.S.,” said Trevor Smyth, managing partner at Arctos Capital in a statement.

“Equipment leasing structures will offer Bitcoin Mining Companies an efficient, lower risk method to free up working capital and expand their revenues,” Smyth added.

A Sale and Leaseback transaction, funded by Arctos Capital, is secured by the latest generation of Bitmain Antminer hardware and will allow Blockware Mining to continue expanding its’ mining & hosting operations.

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