Friday’s installment of our daily roundup investigates a weird mining trick that first surfaced on Bitcoin back in the day. It’s now being exploited on Ethereum. We also take a look at “Bitcoin populism” and consider the fate of crypto shills whose deleted tweets leave them no place to hide on an internet that never forgets.
Also read: Nordic Region’s Largest Bank Nordea Suspected of Money Laundering
Ethereum and the Mystery of the Empty Blocks
Something strange is afoot on the Ethereum network. The number of empty blocks being mined – i.e blocks that contain zero confirmed transactions – is on the rise. The question is, why? Coinfi has done some digging and found that one of the world’s largest mining pools, F2pool, plus another called Etherdig, are responsible for the bulk of the empty blocks being processed. It turns out that the pool is exploiting a feature known as spy mining, or SPV mining, which enables them to collect fees without confirming transactions.
The percentage of empty blocks mined by F2pool has soared.
The exploit first surfaced in Bitcoin Core in 2015, but this is believed to be the first time it’s been deployed on Ethereum, and certainly at this scale. F2pool’s behavior can be likened to a driver shuttling an empty train between subway stations while still getting paid: it might be good for them, but it’s not much use to the passengers forced to wait at the platform for the next passing train. The reason why F2pool and Etherdig seem to have been spy mining is for the same reason mining pools tend to make any collective decision – profit. Etherdig has mined more than 1,250 empty blocks in the past month, earning them 3,750 ETH (worth over $800,000) in block rewards.
The Rise of “Bitcoin Populism”
Rebecca Harding, chief executive of Coriolis Technologies, has co-authored a report titled “The Global Financial Crisis and its Unforeseen Consequences”. The document, which was published on Thursday, asserts that “Lack of political leadership in the immediate aftermath of the financial crisis globally has created a tide of populism which has led to economic nationalism and trade wars.”
Harding is quoted in Forbes as attributing Bitcoin’s rise to the same protest movement that propelled Donald Trump to power and sparked Brexit. While acknowledging that “Bitcoin is here to stay,” Harding asserts that “as traditional banks increasingly adopt the features of bitcoin and cryptocurrencies they…will become less appealing to fewer people.” Bitcoin advocates may take umbrage at such a claim, given that much of Bitcoin’s value lies in it being immune from debasement and control by central banks, making any banker-led attempt to emulate it doomed to failure.
Crypto Flip-Floppers Exposed
As the maxim goes, the internet never forgets. Ironically, an astonishing number of people seem to forget this truism, and as a consequence wind up tying themselves in knots. In an age where any web page can be archived in seconds on Wayback Machine and there are Twitter accounts dedicated to screencapping crypto influencers’ hastily deleted tweets, it’s virtually impossible to avoid scrutiny for the sins of the past.
In the past few days, this lesson has been learned by some well-known entities in the crypto space. Ripple’s attempts to airbrush history by distancing itself from the creating of XRP, the cryptocurrency it once referred to as ‘ripples’, has prompted sceptics to mine the web for old examples. It’s found a veritable treasure trove.
An archived Reuters article with a screenshot of Ripple’s wallet loaded with ‘ripples’
Larry Cermak, head analyst at the influential Diar newsletter, has also developed a fondness for calling out crypto influencers for past transgressions. In addition to detailing a pyramid scheme the founder of crypto payments card Tenx once ran, he’s pointed out the inconsistencies in Meltem Demirors’ carefully cultivated persona. Aside from Demirors scorning Ripple, which she once praised, she’s been accused of failing to disclose a stake in various projects she’s shilled.
“She is charismatic, which lets her get away with more than your average person,” tweeted Cermak. “And people forget very quickly or turn a blind eye. But in my opinion, she shouldn’t be given a free pass for being blatantly hypocritical.”
Demirors was quick to retort; “Thanks for all the new followers, Larry!”
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