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Bitcoin Mining Pool BTC Guild Compelled to Sell Due to Uncertain Bitcoin Regulation and Mining Centralization

Bitcoin Mining Pool BTC Guild Forced to Sell Due to Uncertain Bitcoin Regulation and Mining Centralization

BTC Guild won’t be shutting down. Not too long after the NYDFS had published it Bitlicense proposal guidelines, Michael, the possessor of BTC Guild, had stated that he would shut the pool down if the regulations went into effect spil proposed. On Ten/31/14, he announced that he would be shutting down BTC Guild. While at very first the shutdown came spil no verrassing, the community response to it wasgoed. Within a few hours of the announcement, Michael switched the statement to reflect that BTC Guild wasgoed being sold instead of just being .

One of the main drivers of this proposed closure wasgoed the myriad of different state proposals for regulating Bitcoin and Cryptocurrencies. Also the risk of being hacked has bot enhancing while the capability to recover from it has greatly bot diminished. Pool centralization causes the failure of one pool to be more disastrous than it otherwise would be. Pool centralization has left only a duo large pools causing more variance ter the pool payouts for those who are much smaller.

BTC Guild’s Main Reasons for Wanting Closure

1) Risk/cost of a successful attack against the pool. Spil pooled mining te general is shrinking due to large manufacturers creating private farms, the potential revenue for the pool has gone down spil expected. While the pool is still very profitable, the amount of time it would take to recover from an attack has enlargened due to the overall share of the network shrinking.

BTC Guild has, to date, never bot successfully hacked. However, I have seen a rise ter attack attempts, and things like Heartbleed/Shellshock which display that efforts are being waterput into compromising common Linux services if possible. Neither of those attacks had any affect on BTC Guild, but they were both reminders that under BTC Guild’s own code, there are many services which could be a doorway into the pool’s servers if a vulnerability wasgoed discovered.

One successful attack could cost close to a year of pool revenue, maybe more depending on what happens ter the mining landscape overheen that period of time. If something else happened ter that time (subsequent attack or regulation forcing closure), it would mean continuing to operate the pool beyond this point has cost mij more money than it might potentially make te the surplus of its lifetime.

Two) US government/regulators are already taking stances against specific business types te Bitcoin, applying requirements which would be unlikely for BTC Guild to operate under if they attempt to extend regulation into pooled mining, either directly or indirectly due to unclear definitions. Nobody will mine on a pool which requires them to provide personally identifiable information when they can switch a single line ter their configuration to point elsewhere.

Additionally, state regulators are embarking to make noise about Bitcoin. Fresh York is the very first to publicly waterput anything forward, but there are 49 other states which can waterput their own spin on things. Due to the capability for states to establish a nexus for businesses dealing with their state’s residents, it is a scary landscape to proceed operating te.

I have no intention of leaving the US myself, and given the latest history of the US when it comes to online businesses, I wouldn’t feel safe simply moving the business legal entity to another country while continuing to live te the US myself.

Spil usual, Michael concisely outlines his stance and reasons for his announcement. Much like when he thought out his shutdown project if the BitLicense went through spil proposed. What happened next however wasgoed unexpected.

BTC Guild Likely Being Sold

BTC Guild Shutting Down Likely Being Sold

Earlier today, a news postbode wasgoed made identifying that BTC Guild would be shutting down on January 31, 2015. This postbode is still available ter its entirety on the Bitcointalk forum (https://bitcointalk.org/index.php?topic=49417.msg9395478#msg9395478).

Just hours after making this postbode, numerous parties have voiced strong rente te purchasing BTC Guild and keeping it running. Spil a result, the previously announced timeline for closure of operations has bot cancelled, and the webpagina will likely proceed without interruption.

Many different individual companies and people have stepped up, suggesting to purchase the Bitcoin mining pool. One company head commented on the ongoing sale to CCN on the condition of anonymity due to negotiations:

It would not be te the best rente of Bitcoin mining for BTC Guild to close. Mining is getting too centralized and being taken away from the miners who support it.

Michael is not without standards for the sale of the pool however. He said:

I’m glad that there has bot a lotsbestemming of rente shown te acquiring BTC Guild, I am just hoping that it completes up te reliable forearms and can proceed to run under the same standards (or better) than I waterput myself up to overheen the years.

BTC Guild wasgoed created ter May of 2011 and has bot at the forefront of the mining community everzwijn since its inception. BTC Guild wasgoed also the very first pool to waterput into place a 51% mitigation project back te April of 2013. The project wasgoed done to prevent centralization of mining. Unlike ghash who stated they would work to attempt and prevent going overheen 51% and did nothing, BTC Guild used their policy to make sure it would not toebijten. Many miners have vastly overlooked the problem of pool centralization by mining at ghash and Discus Fish. Centralization of a decentralized network is an kwestie wij spil miners should all be aware. The fewer pools there are, the more centralization will occur. Miners should be aware and be careful to spread the hash rate around to avoid this. If the risk of a hack is enough to cause a pool like BTC Guild to close or be sold, can you picture the consequences of a hack to a larger pool? The disruption and loss of faith ter Bitcoin could be catastrophic.

BTC Guild will most likely proceed with a fresh holder which is a good thing. More miners need to leave Discus Fish and ghash and spread their hash rate to other pools like BTC Guild, Eligius and others to protect the network and confidence ter Bitcoin spil a entire. Michael foresees the final negotiations for the sale of the pool being set by early next week. He is also open to having a palm te the operations, something he stated when a fellow miner voiced regret overheen losing him:

Eventually, yes. Part of negotiations (regardless of who finishes up buying the pool) will almost certainly revolve around how much time I remain involved with the pool. Depending on the final terms, it is possible you proceed to see mij around for years to come ter some capacity.

It is good to see the closure of BTC Guild averted, but it should not have come to this. The crazy patchwork of regulations going up not just te the US but also ter other countries spil well compounds on the growing mining centralization to create real problems. Bitcoin needs us all to be vigilant te doing our part to protect its longevity. Do wij indeed want Bitcoin mining to become so centralized that a crooked company could take control? Miners are the backbone of the Bitcoin blockhain along with utter knots. Wij need to protect it not let it drift away.

Bitcoin also needs its miners, proponents and community to not be so passive about regulations no matter where you live. If thesis regulations can drive a high profile Bitcoin company out of business or to be sold imagine how many other companies never get commenced or gasped off before they can grow. That is chilling.

CCN will bring the results of the BTC Guild sale once it happens.

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