Bitcoin mining company BitFury’s CEO Valery Vavilov has been clear on the company’s stance in the Bitcoin block size debate. When we contacted him for his thoughts on the debate, Valery sent a full statement detailing where BitFury stood on the issue and why. While going over this statement with BitFury, they gave us access to the news of their new 16nm chip announcement. The timing of this release follows its climb to the second largest hash rate provider in the world. Furthermore, BitFury is aggressively building out its 100 MW data center in Georgia.
Also Read: Exclusive Interview With Jihan Wu of Bitmain on S7, Block Size Debate and More
Valery’s well thought out statement on the block size debate touches on several points, like the fact that the block size needs to be increased, but also tested done in a way that does not damage Bitcoin. Valery and BitFury — like Jihan and Bitmain — take the blockchain, and it’s security, very seriously. Here are Valery’s thoughts:
“There is a spirited discussion currently happening about increasing the block size. We believe that in order for Bitcoin ecosystem to prosper, the maximum block size must be increased. It is a common understanding among Bitcoin developers that the current limit of one megabyte hinders scalability of Bitcoin Blockchain and prevents its wide adoption as the technology of the future.
“We have thoroughly studied all block size increase proposals and find that Jeff Garzik’s BIP 100 proposal is the most reasonable and considerate one. We think that the block size debate must be resolved by a consensus and the voting mechanism introduced in BIP 100 is a good way to achieve such a consensus. The forecasts of growth of the Bitcoin network made in other proposals don’t provide enough predictive power, so in such case the cost of a mistake is extremely high. The power to make such future-defining decisions must belong to the community, not handed over to some mathematical function.
“Ultimately, it is up to all network participants to decide what number of full nodes is sufficient to preserve decentralization, not up to potential hardware growth trends. We believe that BIP 100 is the best solution in this regard. As the Bitcoin community has pointed out, BIP 100 may be susceptible to a 21% attack. We propose an enhancement of BIP 100 that resolves this problem. We propose a mathematical formalism for the voting process in BIP 100 that can be used to algorithmically determine the best block size limit that would be considered appropriate by all voting miners. To determine the optimal block size limit, we introduce a non-negative dissatisfaction function based on a vote and a target limit and minimize its value summed over all votes. The block size limit found this way would satisfy miners provided the dissatisfaction function is chosen appropriately.
Because of our role and responsibility for the integrity of the Bitcoin network, we can’t support a momentary jump to 8 MB blocks. We believe a substantial part of full nodes right now would not be able to support blocks of this size simply because of hardware limitations. Similarly, we do not support proposals to fork client software as we believe this move may have potential negative consequences for the entire Bitcoin ecosystem.
“We acknowledge that block size regulation is only one of the steps in Bitcoin’s evolution, other improvements must be made to the protocol in order to improve Bitcoin’s scalability. We think that introduction of enterprise-grade super-nodes running on specialized software and hardware might be a solution to the scalability issues. These nodes would be maintained by miners and other parties and serve as a key component of Bitcoin’s stable growth in the future. Please see our full research here.”
The linked research includes this well though out analysis, as well as ideas for solutions. The security of Bitcoin and its blockchain always tops Valery’s list of priorities; the current block size issue and its treatment by the community have caused havoc and uncertainty with Bitcoin at a time when it should be capitalizing on a struggling global economy.
BitFury 16nm Bitcoin ASIC Taped Out
Valery also announced that BitFury has finished the design and taped out its 16nm chip. Valery discussed the upcoming chip with us at the North American Bitcoin Conference in Miami this past winter. Since then, BitFury acquired Allied Control to help build custom cooling technology that is environmentally friendly and will allow the company to push its ASICs even further. Valery has also been actively implementing renewable energy to power BitFury’s data centers, as well as researching for even better energy sources.
The specifications on the new ASIC are excellent. From BitFury’s press release:
“Executing its chip with expectations to operate as low as 0.06 joules per gigahash (unit of energy per unit of compute), BitFury is the first Bitcoin transaction processor ready to support the increased computing power required for the upcoming “Exahash Era” – the time when the Bitcoin network computing power exceeds 1,000 petahashes (quintillion hash operations) per second, as each 16nm chip will deliver up to four times the amount of compute power at a given energy level of BitFury’s currently deployed 28nm ASIC. This level of energy efficiency is enabled by BitFury’s full-custom design methodology, which should result in the highest transistor density of any leading-edge processor.
“By radically increasing its ASIC energy efficiency, BitFury reinforces its commitment to ensure a zero carbon footprint and high efficiency of its operations. BitFury already uses only renewable energy sources to power its data centers and continuously seeks new ways to reduce energy use per unit of compute. An important step forward in this effort is BitFury’s deployment of its proprietary immersion cooling technology (enabled by the acquisition of Allied Control) in its upcoming Tbilisi, Georgia, data center, which supports expansion of up to 100 megawatts. This same technology will then be deployed in other BitFury data centers, likely to be located in North America. In addition, at the recent Blockchain Summit on Necker Island, BitFury disclosed development of a potentially highly disruptive approach to wind power generation.”
“All told, BitFury is leading the development of environmentally-responsible infrastructure for the next chapter of the Internet based on the Bitcoin protocol and Blockchain technology,” — Valery Vavilov, BitFury CEO.
BitFury’s 16nm chips will be used for the company’s data centers, and it is fully committed to building out the 100 MW (MegaWatt) data center. We will be talking more with Valery and BitFury about this in the near future.
Valery’s views on the block size debate highlight the need for proper testing and consensus to make sure solutions are implemented done safely and efficiently. Valery also gave details of possible solutions, such as changes to the BIP100 proposal to make it able fend off a 21% attack.
Not many of the miners or mining pools support XT. This mass rejection may have come as a surprise to many in the industry, but the miners are much more cautious on this issue, as a mistake could cause massive increases in orphan blocks or make mining more inefficient, despite the industry’s hard work in producing more efficient ASICs. The measured and testing approach to make sure these things are worked out ahead of time is something that will make the network stronger and more secure.
While there are many sides in the block size debate, the good thing that has come from it is the dialogue and possible solutions to solve the issue of network scalability. Workshops are upcoming on the issue as well, with one upcoming in Montreal on Sept 12th and 13th.
BitFury is making strides forward with their ASICs and data center technology. It is an interesting time in the Bitcoin industry.
What are your thoughts on BitFury’s stance on the block size debate? Let us know in the comments below!
Image Source: BitFury