High Performance Computing Systems

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Dec 3, 2013 (3 years and 8 months ago)

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High Performance Computing
Systems


Bitcoins
Doug Shook
2
What is it?


Is it a currency? A commodity? Both?


No physical representation of the currency


How to verify transactions?

Peer-to-peer: no financial institutions

Eliminate double spending

Reduce the number of reversible transactions


Satoshi Nakamoto, “Bitcoin: A Peer-to-Peer
Electronic Cash System”
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Bitcoins
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Bitcoins


Problem: How to prevent double spending?

Traditional solution: introduce a central authority


Bitcoin's solution: Proof-of-work
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Proof-of-work


A timestamp server publishes blocks

Blocks consist of transactions


In order for a block to be added, its hash must
satisfy the difficulty conditions

i.e. The hash must begin with a certain number of
0's
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Network Operation


New transactions are broadcast to every node


Each node adds transactions to a block


Each node attempts to find a proof of work for the
block


When a block is found, it is broadcast to all other
nodes


Nodes verify the block and begin computing the next


This process is known as mining
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Incentives


Each block has a reward associated with it

Currently 25BTC / block

Decreases by half every 210,000 blocks

Max number of Bitcoins: 21,000,000 (~2140)

Current number of Bitcoins: ~11,000,000


Also: Transaction fees

These will ultimately be the only reward
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Conversion Rate
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Conversion Rate
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Conversion Rate


Highest: $266 (April 10th)


Current: $96

Most individually owned BTC as of 3/20/2013: 111111

$29.5 million at highest price

$10.6 million currently
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Difficulty


Bitcoin was designed to have a constrained supply

Try to keep block rate at 6 / hour


Every 2016 blocks, the target is recomputed

If the actual time is greater than 6 / hour, difficulty
decreases by the percent difference

Otherwise it increases


Computing the hash is not a fixed size problem –
more like a lottery

Current probability / hash: 2e-17
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Generating Hashes


In its infancy, CPUs were plenty powerful enough

Target was high, difficulty low

Not much interest


Interest grew, as did the difficulty

Technology needed to keep up


GPUs were exploited next, now no longer enough


Currently

Pools

FPGAs

ASICs
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Mining Tools


Metric: Mhash/s

Also of interest: Mhash / J


CPUs

Core i7: 33.3 Mhash/s

Cell: 21 Mhash/s


GPUs

ATI Radeon 7990: 1200 Mhash/s ($899)
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Mining Tools


FPGAs

Most fall between 100-1000 Mhash/s

Butterflylabs Mini Rig: 25,200 Mhash/s ($15k)


ASIC

Most > 25,000 Mhash/s

BitForce Mini Rig: 1,500,000 Mhash/s

Built in Nexus 7 control panel

Not yet released, no price available
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Mining Pools


Distributed Systems (like BOINC)

Members get a share of the reward if their pool
finds a block


Methods of distribution:

Flat payout

Score based

Work divided into shares
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Mining Pools



Source: blockchain.info
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Security


Sept 2011: 25k coins stolen from Mt. Gox

Worth ~$400k at the time

Shortly afterwards their DB was compromised

100k BTC sold for cheap, tanking the price

400k BTC missing


August 2012: Bitcoin Savings & Trust

Digital hedge fund turned pyramid scheme

500K bitcoins lost ($5.49M)