Protection Over Profit: What Early Mining Patterns Suggest ...

Here's A to Z list of a *few* scams that happened since 2014 in India

Since today is my cake-day, I thought of posting something that got a lot of upvotes earlier on india.
Here's the full list of all the scams as listed on the site - corruptmodi.com from A-to-Z:
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My Story of BTC

This is my story of how I derped around during the last BTC bubble, made some dough, and saw my friend pile up a mountain of debt on himself, only to become a millionaire. I hope if you read it there is a moral somewhere, but I'm not so sure there is. (prices are approximate to dates, going back in my memory a bit)
OCT 2011: (BTC $4) (preface)
As an undergrad computer science major I mined a few coins in a cyber security class . It took about 2 months and I think it was around .89 BTC or something like that (Edit: OK so I probably didn't mine this much, but I had access to the computers in the graphics lab and during this time, and they were mining 24/7. We let them run for a while after the class before taking our share out). I think it was worth about $8 at the time. I thought this was really cool, but also remember at that time you couldn't do anything with it, especially where I lived. I just kind of forgot about it, got a new laptop sometime later, and eventually chucked that one with the coins on the hard drive... (it was just $8 and I had no way of spending it remember) oh well so much for those. Who knows how many coins were lost by these standards back in those days. I take in all the maths, graduate with marks, drink all the beer, laugh with friends, fun times.
May 2015: (BTC $234)
Fast forward.. I end up in Los Angeles, CA through another long set of tales. I live with aspiring actors and film makers grinding it out as waiters and bartenders. They are good mates and take me to parties on occasion where we meet all kinds of characters. I end up chatting with a guy (lets call him Bill) who's nuts about BTC. I explain to him that I know all about it, and he is ecstatic to find someone who understands what he is talking about. I haven't been paying much attention the past years, and he shows me how far its come in tech and price. I smack my forehead, knowing I tossed away 8/10ths of a coin (could have been beer money man). We become friends and talk about Bitcoin pretty regularly.
I don't buy initially, but Bill is giving it all he's got, buying left and right with anything extra dollar he can scrape up. He believes in it. I get so worried that Bill is going to loose what he put in that I just buy a bit (.1BTC) so I will be invested enough to watch it, to know if Bill is up or down. You can guess what happens at this point. Up we go. Bill makes money, I make money.
June 2016: (BTC $661)
All is well. I am happy that Bill didn't lose his money and hoping he will take and re-invest his earnings in a more diversified portfolio. I'm worried about the ~$100 I made in earnings, like do I file this? (lol younger me)
I meet with Bill for the first time in a while. I'm excited to share our gains. We both show our gains and cheers. He immediately tells me that he is looking at ways of taking out credit to buy more BTC.... WTF? I say. He quickly proceeds to tell me the banks turned him down, but he found out he can just buy BTC with credit cards... so he is filing 7 applications right now to see how many he can open to buy BTC... I think for a second. I do the rational thing. I try to talk him down, but no way. He's doing it. I don't know much about investment at this point, just math and percentages, but thats enough to make me beg him to not do it.... he doesn't listen.
By my estimates Bill purchased a total of $30K worth of BTC with combined cash and credit on hand at (my best guess) an average price of $589 per BTC. I invest what I have to spare from savings to just keep up with the train wreck I am worried about happening to Bill. I think I have .2 BTC at this point just to keep up with his insane position
August 2016: (BTC $576)
The first dip comes, and Bill is facing credit card bills with interest rates that will kick in soon (he will not be able to make the minimum payments). We discuss is troubles at this point frequently. I suggest he should liquidate and close the cards. He disagrees, and liquidates only a position large enough to pay the minimums and give him a bit of cash. Not only that but he use the cash to secure short term loans at higher interest in order to re-invest to make up the losses. I once again beg him to re-consider, but no... this is his path. I once again invest more to keep up with it, so I can keep up with Bill and his well being. I purchase a good bit more and have .5 BTC
November 2016: (BTC$758)
I move to another city and mostly forget about my interactions with Bill. He messages me a few times about the price going back up and being bullish about it once again. I do the same song and dance of trying to warn him to close his cards and positions to get out while he can. Nope he's holding strong. Nothing to be done. I assume I can't do anything to help this situation. Once the price busts above $900/BTC even I can't say anything. I've made money, he's made bank. I feel happy for him, but once again concerned. I know he is running on margin and don't want him to get sucked in, but I also don't want to weigh in on such a big investment at this point. He texts me about the gains, I mostly just give the thumbs up back, knowing I can't back down at this point, but I don't want to be around him if it fails.
Jun 2017: (BTC $3000)
I have mostly lost touch with Bill because I live in another city. I never sold my BTC though, and I never forgot about him. Around Feb. 2017 I visited LA and saw Bill. I thanked him for making me the money that I held now in BTC. I asked him what he was doing with his stake. As always he was ready for the apocalypse to happen and for his BTC to be the only currency left somehow. He was holding stone cold. I wasn't persuading at this point, hell, I was holding myself.
Dec 2017: (BTC $16000)
While I thought I would never be swept up in the chaos that is BTC... I was. The amount of BTC I hadn't sold (.3BTC) was making even me feel like a genius. I had made so much money off just forgetting about something over months at a time. I often thought about Bill, but I didn't envy, in fact I really hoped he had paid off his credit card debts and was sitting on his fat profit. I watched BTC Youtube channels and debated if we would go to $100K or if this was it. I couldn't take the pressure and sold half my position @ around $16K/BTC
2018-2019 (BTC $20K -> $3.5K) (Epiloge)
In early 2018 price went up to $20k before quickly falling back to 10K. Thankfully I sold the rest of my position on the way down at about the same point as on the way up ($16k). I bought a few back in 2019 but have never really put as much capital back in as I made. As for Bill, well I told you at the beginning. Bill is a millionaire. My best estimates based on my text with him is he cashed out @ around an average of $17k/BTC. Even after taxes, he ended up real nice. I don't know if he was in the run up in 2019 but I must assume he was.
Looking at the market today, I'm not sure this story will repeat itself... maybe it will.
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The deepest report: Bitmain's self-help history

The deepest report: Bitmain's self-help history
The original intention of this article is to let readers understand the causes and consequences of Bitmain internal fighting, but after writing it, I found that it is not so much internal fighting as it is a long history of self-help.
The story is very long. Let's adjust the timeline to the eve of December 17, 2018. That was one of Bitmain's most critical moments and the beginning of a series of subsequent stories.
1. Self-immolation In September 2018, Bitmain's financial department warned management that the company's cash flow has become very tight and operating costs must be reduced to allow the company to continue. The blockchain unicorn, which is valued at more than 15 billion U.S. dollars, is crippled in the run and struggling to break the corner.
In 2017, Bitmain made a profit of 1 billion US dollars In the first half of 2018, Bitmain made a profit of 1 billion US dollars Three rounds of financing, a total of 800 million US dollars Net assets should exceed 3 billion U.S. dollars In September 2018, Bitmain had tight cash flow and was on the verge of bankruptcy
A simple comparison, it is not difficult to see that Bitmain's ability to make money is incredible, and its ability to burn money is even more extreme.
How does Bitmain burn money? Do you pour cash into gasoline and burn it, or hire a lot of employees to stuff the banknotes one by one into the shredder? The actual situation is closer to the latter.
The following data can help readers quickly learn Bitmain's money burning skills.
At the beginning of 2018, the entire cryptocurrency market has entered a bear market, but Bitmain's monthly operating costs have been rising wildly. Operating costs have risen from 10 million US dollars at the beginning of the year to 50 million US dollars at the end of the year.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
Operating costs are just the tip of the iceberg. Excessive chip trial production can become a classic case of project management courses. Readers who pay attention to Cryptocurrency mining can easily find that Bitmain is still working hard to clear the inventory of Antminer S9 in 2019. As the co-CEO, Ketuan Zhan did not listen to the advice or even warnings of the Finance Department, insisting on the implementation of Excessive chip trial production, resulting in a large accumulation of inventory and tight capital turnover. Another CEO, Jihan Wu, once revealed that the loss of Excessive chip trial production to the company was approximately US$1.5 billion.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
The BM1393 chip incident is even more incredible. Chip expert Ketuan Zhan invested a lot of money on a failed chip, and finally failed again. From 2017 to 2018, Bitmain has failed Trial production of mining machine chips at least 4 times, including 16nm, 12nm and 10nm chips, of which 16nm Trial production failed twice, thus losing at least US$1.2 billion.
It is rumored that Bitmain still holds a billion U.S. dollars worth of cryptocurrency in a state of floating loss. In view of the rebound in the market in 2020, we will not comment temporarily, waiting for the correct answer from the cryptocurrency market. But the losses pointed out in the previous article are all irreversible.
2. Sole power
In September 2018, Bitmain's management realized the seriousness of the problem. It turned out that the company's money could be squandered. As a result, the management began to discuss self-help plans, and the most reasonable and effective way was obviously to lay off employees.
The probation period for newly hired employees at Bitmain is half a year, and the probationary salary is 100% of the official salary, there is no difference. Once layoffs are made, new employees who have not passed the probationary period will be the main layoff targets. The department managed by Ketuan Zhan will face large-scale layoffs. The layoff plan is strongly opposed by Ketuan Zhan. Bitmain can only temporarily abandon the layoffs and replace it with continuous reductions. For marketing and travel expenses, a budget committee was established to strictly approve every expenditure. At the same time, employee benefits, such as reimbursement of taxi expenses, breakfast supply, snacks and drinks, etc., have also been abolished, and even the tradition of giving employees 400 yuan worth of BTC/BCH every month has been stopped.
In the face of huge cash flow pressure, trivial savings is obviously of no avail. Soon, the management again discussed the layoff plan, and it has reached the point where it has to be laid off.
In December 2018, Jihan Wu began to organize all entrepreneurial veterans and business backbones to persuade Ketuan Zhan to agree to layoffs, but Ketuan Zhan still insisted not to layoffs. The persuasion process was very unsuccessful. After many meetings and intense debates, Bitmain executives were caught in a dilemma of wasting time with Ketuan Zhan.
In this process, the shortcomings of the dual CEO system began to appear, and the relationship between the two CEOs gradually deteriorated.
On the night of December 16th, Ketuan Zhan reconvened the management meeting, and more than 30 managements who were present were asked to hand over their mobile phones. At this time, Jihan Wu was on a business trip in Hong Kong and was busy with listing related work.
In the meeting, Ketuan Zhan's core content was three items:
(1) Bitmain cannot have two CEOs, only one CEO and must be Ketuan Zhan. Ketuan Zhan said that he met an old leader during a business trip. He hadn't seen each other for many years. The old leader suggested that the company can only have one CEO, and it must be him. Ketuan Zhan feels that this is a kind of fate, an opportunity given by God.
(2) Ketuan Zhan believes that the company's cash flow problems, the biggest responsibility is the inability of the financial department. To prove his point, Ketuan Zhan announced Bitmain's financial data at the meeting. In the evening, employees in Taiwan began to post messages on social media, saying that the company's capital chain was broken and the top management was split.
(3) If Ketuan Zhan is not supported, the option will be cancelled and the equity will be voided.
Hearing about this, Jihan Wu, who lives in Hong Kong, sent a WeChat message to the management who are attending the meeting.

https://preview.redd.it/zkj2d44tqid51.jpg?width=1080&format=pjpg&auto=webp&s=9251c1f7308e155d7911d5969e71091a5ad5e14a
On the afternoon of December 17, 2018, Jihan Wu returned to Beijing to negotiate with Ketuan Zhan all night, and finally reached a consensus in the early morning. Bitmain co-founder Yuesheng Ge announced the results of the negotiations. Jihan Wu and Ketuan Zhan ceased to serve as CEOs, and Haichao Wang served as CEO. Jihan Wu voluntarily backed down and Ketuan Zhan served as chairman.
The "12.17 Incident" had a very bad impact on Bitmain, especially the disclosure of Bitmain's financial status, which caused vendors to start dunning. The loan that had just been negotiated with the Bank of Beijing was cancelled the next day. Jihan Wu's resignation as CEO caused an uproar in the industry, and it became a hot topic among Cryptocurrency mining, blockchain practitioners, and investor communities. The media focused their interpretation on Bitmain's series of incidents, and generally looked down upon its ongoing Hong Kong IPO, believing that the high-level changes had already signaled the failure of the IPO in advance.
On Christmas December 24, 2018, Bitmain finally began to implement the layoff plan. This long-delayed “correct decision” was achieved after a stalemate for nearly three months. The AI ​​teams in Beijing, Singapore, Taiwan, and Shanghai have laid off more than 50% of their employees. The Israeli R&D center was closed and Shenzhen New Species Technology Co., Ltd., which had been acquired for only ten months, was dissolved, and all employees were laid off. Copernicus, Bitmain's top blockchain development team, was not spared and was wiped out in this layoff. Copernicus and some of the laid-off employees joined the new company Matrixport co-founded by Jihan Wu and Yuesheng Ge, headquartered in Singapore.
3. Past events when starting a business
After the "12.17 Incident", Jihan Wu gradually faded out of Bitmain's management affairs and turned his attention to the IPO and new company. And this is one of Jihan Wu's major mistakes, he began to let Ketuan Zhan manage Bitmain alone.
In fact, as early as 2013, Jihan Wu planted hidden dangers.
Jihan Wu, an investment banker, was the earliest translator of the Bitcoin white paper. He began to get involved in the cryptocurrency mining industry in 2012. The disappearance of Kaomao and Nangua Zhang's ticket skipping led Jihan Wu to decide to develop his own chip.
In 2013, Jihan Wu established his own mining machine company. Together with Yuesheng Ge, who was only 20 years old, he found Ketuan Zhan, an integrated circuit designer of the Chinese Academy of Sciences, to create the protagonist of this article, and later the digital Cryptocurrency mining giant, Bitmain.
Jihan Wu promised Ketuan Zhan that every time a mining machine chip was successfully developed, he would give some shares to the Ketuan Zhan team. At that time, the company founded by Ketuan Zhan was on the eve of falling apart. In order to regroup the team, Ketuan Zhan promised to share half of his shares with the team members. Unfortunately, this is just a bad check. With the rapid development of Bitmain and higher and higher valuations, the expanding Ketuan Zhan almost monopolized all the shares.
Like many startups, Bitmain encountered many difficulties in its early days, and many jobs had to be done by the boss. For example, in the chip design and production process in the second half of 2013, Bitmain was caught in a dilemma of insufficient funds. Jihan Wu personally raised funds and met with TSMC’s sales to persuade TSMC to accept the production needs of a start-up company. Jihan Wu also participated in the selection of the thermodynamic parameters of the heat sink in the Antminer S1.
In 2014, Jihan Wu discovered that this company was independently operated by Ketuan Zhan, which had huge problems. Forcing Jihan Wu to continue to participate in company management.
At that time, Bitmain's mining machine chips had just achieved a certain lead in the standard design process. Jihan Wu believes that the next step must be to develop full customization technology, but Ketuan Zhan plans to invest resources in the research of mobile payment chips.
Ketuan Zhan met a mysterious person from the Party Central Security Bureau who claimed to be able to manipulate the Party Central Committee’s decision-making process for the next generation of mobile payment cryptography standards, but this direction is likely to lead to the fact that Bitmain has just gained the lead in the mining machine market. Regained.
Jihan Wu said that as a graduate of the School of Economics, with a little memory of his high school stage and the knowledge reserve of a computer technology amateur, he retrieves various materials and papers every day, learns theories related to full customization, and goes to Ketuan Zhan conducts persuasion work there.
Fortunately, in the direction of full customization technology, Ketuan Zhan finally listened to Jihan Wu's opinion. Bitmain quickly integrated the technical experts from the United States and Russia introduced by Jihan Wu, which greatly improved the design level of chips and complete machines.
In 2015, Jihan Wu suggested that Ketuan Zhan consider the direction of artificial intelligence. But Ketuan Zhan is not here, he prefers the CPU direction. After staying asleep at night, coupled with in-depth analysis by the Bitmain investment team, Ketuan Zhan finally agreed with this direction. It is a pity that after the Tianshi Chen brothers made major breakthroughs in theory and practice, Bitmain officially invested in the relevant direction, and it was still a step behind.
In the two years from 2016 to 2017, Bitmain's business performance has achieved rapid development, becoming a unique super unicorn in the blockchain industry. According to Froth & Sullivan, in 2017, Bitmain Technology Holdings was the second largest fabless chip design company in China and the tenth largest fabless chip design company in the world, and the fourth largest fabless ASIC chip design company in the world, accounting for 74.5% of global cryptocurrency market share.
However, the huge crisis has long been buried in the early days of entrepreneurship.
Ketuan Zhan's decision on major directions revealed his weakness of extremely lack of business understanding. But every mistake he made was blocked by the company's core employees. His overconfidence in his management ability led to the gradual intensification of conflicts, and the management differences between the two founders became more serious.
4.The giant gets lost
The contradiction between the two broke out on December 17, 2018. Ketuan Zhan used extreme means to force the management to compromise with him by canceling the option, so as to achieve the goal of sole control of the company. Jihan Wu returned to Beijing from Hong Kong overnight and negotiated with Ketuan Zhan all night. In the end, the two resigned as CEO. Jihan Wu retired. Ketuan Zhan has the exclusive rights of chairman in exchange for the implementation of the layoff plan.
Jihan Wu's voluntary retreat has intensified Ketuan Zhan's management to do whatever he wants.
A Bitmain employee commented on Ketuan Zhan's management skills, summed up in two letters-SM.
After becoming the sole helm of the company, Ketuan Zhan quickly "rectified" the department in charge of Jihan Wu as the chairman of the board. He guided the sales of mining machines at the dinner, and pointed out that the sales performance is not due to the sales staff. Ability is strong, but the company provides opportunities. Take two sales leaders as examples, saying that if the company hadn't given the opportunity, they would still be losers. In addition, Ketuan Zhan also instructed the sales staff on how to toast and imparted the wine table culture and experience.
After the meal, Ketuan Zhan came to the conclusion that the quality of Bitmain sales staff was too poor, and Huawei’s blood needs to be injected to drive the company’s progress. Soon, the marketing and sales director from Huawei officially took over Bitmain, opening the era of brand premium for Antminer.
In order to further understand and guide the sales work, Ketuan Zhan asked to meet the customers with the sales staff. During the negotiation process, Ketuan Zhan had a heated discussion with customers on the issue of Chinese and Western medicine, and had also forced the sales staff to be able to ship 10,000 machines due to insufficient production capacity.
Although the requirements for sales personnel are strict, Ketuan Zhan has provided a lot of convenience for "Mainland Ark". In addition to selling mining machines at a more favorable price, Bitmain's mining machines are also hosted in Ming Wang at a higher price than the market price. Mine. It is reported that both Ketuan Zhan and Ming Wang are shareholders of Ark.
The new sales strategy of Huawei's executives has also brought very obvious changes to Bitmain. The self-righteous brand premium reduces the price-performance ratio of Antminer, causing competing products to eat away at Bitmain's market share. Later, Bitmain found that the strategy was wrong and started to cut prices, and found that the mining machine market was saturated and the purchase demand of miners had decreased.
More dangerous than the sales strategy is that the technical advantages of Antminer are being chased by competing products, and even overtaken. At the same time, the two mining pools under Bitmain also lost their first and second positions. The AI ​​business, which Jihan Wu placed high hopes and Ketuan Zhan personally supervised, became a laughing stock in the industry. Not only did it fail to make a profit, it almost brought down Bitmain.
Blindly introducing senior executives from Huawei to occupy important positions completely destroys the company's internal cultural foundation. The bureaucracy within Bitmain began to corrode from high-level employees to ordinary employees. Ketuan Zhan is not aware of this. He is still keen on recruiting Huawei employees, imitating Huawei's organizational structure and strategy, letting HR do sales and R&D personnel to do HR.
The organizational structure adjustment in October 2019 was the fuse for Ketuan Zhan to completely anger Bitmain management. This time, Ketuan Zhan completely marginalized Bitmain’s veteran employees, and suddenly promoted some of the “airborne soldiers” who had just joined the company to the position of person in charge, which caused the former person in charge to report to the new employees. The two managers who were originally equal The hierarchy becomes the subordinate relationship, the operation and development of different business lines are merged into a large department, the upward reporting process becomes more cumbersome, and the relationship between employees becomes delicate.
5. Headwind
On October 29, 2019, Jihan Wu urgently held a staff meeting. Prior to this, the legal representative of Beijing Bitmain has been changed to Jihan Wu, including the parent companies Hong Kong Bitmain and Cayman Bitmain. Jihan Wu stood in the lobby of Building 25, B1, announcing that Ketuan Zhan has been relieved of all duties. Any employee in the Bitmain Group shall no longer execute Ketuan Zhan’s instructions and participate in any meetings convened by Ketuan Zhan. If there is any violation, the company will demotion and expel the company based on the severity of the circumstances. If losses are caused to the company, the company will be held accountable.
Jihan Wu's speech is very long, which can be summarized as follows:
(1) Ketuan Zhan has been relieved of all duties. Also expelled from the original Huawei company HR Zhi Wang introduced by Ketuan Zhan at the end of 2018. Zhi Wang’s reputation on Bitmain was extremely poor and was ridiculed by employees as "nine thousand years" (In ancient China, the emperor was called "ten thousand years old", and the prince was "eight thousand years old." However, in the Ming Dynasty, there was an eunuch who caused harm to the country and the people. He called himself "nine thousand years old", meaning that he was only A little lower than the emperor's level).
(2) Ketuan Zhan's ability to control the company's option incentive plan has disappeared, and it is no longer possible to cancel employees' options at will.
(3) The organizational structure adjustment plan led by Ketuan Zhan was suspended.
(4) We are optimistic about the future of AI business, but the premise is that the main business can continue to make profits in order to support the company's continued investment in AI business.
In the speech, Jihan Wu also told employees the whole story of the "12.17 Incident" and bluntly said that the company is not in good condition. If no measures are taken, Bitmain is likely to go bankrupt in three quarters and he must come back to save the company.
At this time, Ketuan Zhan, who was on a business trip in Shenzhen, finally experienced the situation of Jihan Wu in the "12.17 Incident".
After the official return, Jihan Wu began to clearly point out the company's various problems in operation and management, and went deep into each business line to understand the situation. In the mining machine sales department meeting, employees spoke enthusiastically, reflecting on the difficulties and opinions encountered in the work, the marketing and sales director from Huawei asked with a surprised look, "Why didn't these issues be reported to me before?", and soon , The director was interviewed and "voluntarily resigned."
On November 2, 2019, Jihan Wu announced a salary increase for all employees. Bitmain’s last salary increase dates back to 2018. In principle, Bitmain has two salary increases every year.
On November 7, 2019, Ketuan Zhan spoke on social media for the first time, describing his hardship in starting a business, and condemning Jihan Wu for “stabbing a knife in the back”. At the end of the article, he also set himself a KPI for 2020, that is, the mining machine market share will reach 90%, and the AI ​​business will earn 1 billion.
But Ketuan Zhan's majestic plan did not make Bitmain employees feel emotional, but ridiculed him instead. Employees exposed that he insulted employees, advocated Chinese medicine, believed in Buddhism, drank in meetings, practiced Qigong...
However, there is less than half a year before the halving of Bitcoin production, and the cryptocurrency market shows no signs of recovery, which makes Bitmain management very anxious.
On January 6, 2020, Bitmain ushered in another round of layoffs, with a layoff ratio of about 1/3. This time the layoffs have caused many employees who have just increased their salaries to feel very grieved. On the one hand, they were looking forward to Jihan Wu's return. On the other hand, the compensation for this layoff was less than 18 years.
Ketuan Zhan, who has been unable to enter the Bitmain office area, once again spoke on social media and firmly opposed to layoffs. We do not need to lay off staff and we cannot commit suicide.
During the Spring Festival, Covid-19 broke out. Mainland China has begun to extend the Spring Festival holiday and advocate working from home. Under the chain reaction caused by Covid-19, most companies have chosen to cut salaries or even lay off employees. In the first two months of 2020, China's exports fell by 17%, U.S. stocks were broken four times in a row, Bitcoin plunged 40% in 24 hours on March 12, 2020, and crude oil futures fell by 300% on April 20, 2020...
Obviously, Jihan Wu can't predict, but this layoff seems to be the right decision again. In addition, from January to April 2020, Bitmain's revenue exceeded US$400 million amid the spread of Covid-19 and the collapse of the financial market.
6. Fight to the death
When Jihan Wu tried to get the company back on track, Ketuan Zhan was not helpless. On April 28, 2020, Ketuan Zhan finally rolled back the legal representative of Beijing Bitmain to before October 28, 2019 by repeatedly submitting administrative reconsiderations, and restored his status as a legal representative.
On the morning of May 8, 2020, a piece of news about Bitmain quickly appeared on the real-time hot search rankings, and even dominated the headlines of the day. At window 52 on the second floor of the Haidian District Government Affairs Center, when Ketuan Zhan, the legal person of Beijing Bitmain Company, was receiving the business license, a group of unidentified people snatched the business license from the industrial and commercial administrative staff. A source at the scene said that the number of unidentified people in the group was about 60 people, of which Luyao Liu was directing at the scene.
This is a skillful piece of news. It first leads readers to think that Ketuan Zhan is a victim, using 60 people to grab business licenses as the focus. The masses accused Jihan Wu of lawlessness, but ignored whether the government affairs center could have 60 personnel. As for Hong Kong Bitmain to have the right to appoint a representative to obtain a business license, this is a deeper level of thinking.
The follow-up report restored the real situation at the scene. Only more than ten people were present, and both sides were equipped with security personnel. Bitmain employees also broke the news in the circle of friends, claiming that Ketuan Zhan's bodyguard had injured Bitmain's authorized person, and said in a threatening tone, "Be careful!"
However, the subsequent plot reversal did not have much effect. Jihan Wu's reputation has been greatly affected. From a bloody soldier who rescued the company in trouble to a lawless criminal, it can be said to be a world of war. do not.
Ketuan Zhan, who succeeded in the first battle, began to counterattack Bitmain continuously. On the afternoon of June 3, 2020, Ketuan Zhan led a team to pry open the back door of the Beijing Bitmain office and formally occupied the deserted Beijing headquarters.
On June 4, 2020, Ketuan Zhan called on Bitmain employees to resume work and promised to expand the company's market value to more than US$50 billion within three to five years. After that, Ketuan Zhan began to contact employees by phone, trying to acquire the options in the hands of employees at a valuation of 4 billion US dollars.
Subsequently, Ketuan Zhan recalled Huawei's executives and issued a series of personnel appointments and removals. As of June 9, 2020, Ketuan Zhan has successively eliminated CFO Luyao Liu, and Wenguang Wang, the head of the mining center. Luyao Liu is responsible for controlling Bitmain's IPO plan. He also appointed Yanwu Ma as the HR director, Gang Ren as the head of the mining center, Yonggang Sun as the head of the supply chain, Ling Gu as the financial director, and Bin Zhu as the head of the mining machine business department. Bin Zhu is the senior executive of Huawei who was interviewed and left as mentioned in the previous article. During his tenure, he reduced Antminer’s 90% market share to 50%, and received a large number of complaints from miners. Internal employees once speculated that he might be Compete against the spies sent by the company.
In addition to recalling senior executives of Huawei, Ketuan Zhan also urged employees to return to work. They can receive a bonus of 10,000 yuan when they return to work on the same day, which is only half the next day. Ketuan Zhan showed a very kind side. Every time the elevator door is opened, Ketuan Zhan's hot gaze can be met, shaking hands, taking photos, and receiving money. As there is no personnel information, Ketuan Zhan does not know whether the person receiving the money is a Bitmain employee, and these people did not resume work the next day.
The effect of gentleness was not good, Ketuan Zhan began to force employees to return to work. Seeing that there are still very few respondents, Ketuan Zhan threatened employees through SMS, phone calls, EMS, emails and other harassment, issued multiple threats such as termination of contract, suspension of payment of social insurance, suspension of wages, and even used personal information saved by employees to form a group of employees. Domicile threats, requiring employees to perform "work handover", trying to force employees to return work computers, etc.
On June 10, 2020, the media revealed that Ketuan Zhan had controlled Bitmain's Shenzhen factory and prohibited employees from delivering normal shipments to paid customers, which caused difficulties in the operation of the Bitmain mining machine department.
On June 13, 2020, Hong Kong Bitmain, the parent company of Beijing Bitmain, issued a statement accusing Ketuan Zhan of signing a "Sales Agency Agreement" with the Ark Data Technology Co., Ltd. in which it holds shares, in an attempt to embezzle Beijing Bit's assets.
On June 17, 2020, the media revealed that Ketuan Zhan started selling 14,000 T17+ series mining machines at low prices.
On June 20, 2020, Hong Kong Bitmain officially suspended the supply of chips to the Shenzhen factory.
On July 13, 2020, in the "A Letter to All My colleagues in the Shenzhen Factory" released by Bitmain in Hong Kong, more details were added on the series of Ketuan Zhan's actions in June.
The legal person Feng Zhou of the Shenzhen plant is related to Ketuan Zhan. After being relieved of Ketuan Zhan's post, Jihan Wu flew to Shenzhen to have a long talk with Feng Zhou. Jihan Wu believes that Feng Zhou is the right person to manage the factory and help the company overcome difficulties, and decides to leave Feng Zhou to continue to manage the factory.
This wrong decision staged a story of a farmer and a snake. When Ketuan Zhan began to counterattack Bitmain, Feng Zhou was also quickly instigated and began to assist Ketuan Zhan in seizing customer machines and transferring 17,000 T17 mining machines in the warehouse. Hainan Continental Ark Data Technology Co., Ltd., which is held by Ketuan Zhan, sold them at a low price.
In order to protect the interests of customers, Jihan Wu had to make a compromise and paid the payment for some goods to a bank account controlled by Ketuan Zhan in exchange for delivery. However, after the other party received a payment of 109 million, the delivery stopped. On July 8, 2020, 5600 mining machines have been overdue.
At the same time, the factory defaulted on suppliers’ accounts payable as much as 200 million yuan. Bank acceptance bills issued by the factory, exceeding 36 million yuan, will expire on July 17, and more than 34 million yuan will expire on July 23. It is understood that Ketuan Zhan, after receiving the bank's dunning call, made it clear that he would not repay the loan, which would destroy the company and the entire group's credit in financial institutions.
7、 This is not the end
So far, the power struggle between the founders of Bitmain has been more than half a year. The office building already occupied by Ketuan Zhan is still empty, and most employees choose to work from home. Some chip developers returned to the office with the acquiescence of Jihan Wu and continued to maintain research and development to reduce the impact of infighting on technological iteration and competitiveness.
This giant ship that once stood on top of the supercomputer chip is crashing into the iceberg due to the madness of the former helm. Ketuan Zhan's madness and Jihan Wu's compromise made mistakes again and again. Bitmain tried to save himself many times, but was unable to get out of the black hole.
If the time goes back to that day in 2013, would Jihan Wu and Yuesheng Ge still choose to dial Ketuan Zhan?
submitted by paulcheung1990 to Bitcoincash [link] [comments]

This is for you. Get ready.

First of all I want to say a proper hello to you. Hello! :) I've been a member of this community not for a long time, but I've been in the crypto world since 2015. I'm not from US (since 90% of reddit is US) but I'll try my best to explain my thoughts in english in this post. Trust me, you won't regret reading it.
I started studying the crypto world for my own since it's a passion, a hobby. Why? Because the whole concept of crypto fits my ideals, ideas and thoughts when it's about the world.
But I will be talking about the Bitcoin, since it's the most important part here. We'll exclude any other alt-coin because makes no sense to talk about them here and is a way broader topic.

The main statement : Bitcoin is the 8th wonder of the world. Is the chance of every single one of us, to have a free life. I want to explain why, because I'm too enthusiastic and all of my friends do not share the same ideas and have no clue about the crypto world, and you are my friends now :).
Money. When it was first created, it got completely centralized. GOVs and institutions were controlling the money. Imagine a country with 1000 people and 1000 whatever-currency. Every one would have 1 currency (let's call it banana-coin). So every person would have 1 banana coin. The GOV is controlling all the banana-coins. If something bad happens, they product more banana coins. What happens when more banana coins are produced? Inflation, thats right. So in order to buy 1 bread, you need now 2 banana-coins instead of 1. This everyone can understand, right? But what if the GOV prints even more? Right, 10 banana-coins for a bread. But we have only one country. Let's add 2 more countries. The country with 10 banana-coins/bread is doing worse than the other 2 where they can still buy 1 bread with 1 banana coin. Then the 2 countries can "destroy" the first country only with the power of money. (I'm trying to keep this as simple as possible)
Now imagine this with USD/EUROS, in a CoronaVirus world with the GOVs. Yup, everything is falling apart, everything is in chaos. The systems are controlled by greedy people.
The conceptual idea of money, is to be UNCONTROLLABLE. Before the invention of money, the goods used as currencies were much better in term of freedom than the money created after. Then money was created, real gold coins, then data in systems, then recessions every time on a period of time, as example 2008 because THE MONEY WASN'T USED AS IT SHOULD BE. FINITE AND FREE.
Then Bitcoin appeared. BOOM! Finite, free and sustained only by its users. It's a wonder. I'm sorry I can't explain this as I have everything in my mind, but I'm trying... The bitcoin creator is not known, but he gave us something he knew we would need. It's like someone came from future to give us this in order to evolve as a society. He knew that the currency in a modern world cannot be used forever if its not gonna change to something that NOBODY CAN CONTROL it. Very few people really understands the quality of this, the chance that we have.
If 21 mil btc were mined, no more producing, the price lets say was at 100k. And the corona virus hits, WE DONT NEED TO PRODUCE MORE. The value will just go up, the bitcoin would help us. We don't need to MAKE more. The whole concept behind the Bitcoin is that HE WOULD WORK for us, we dont need to do anything else just to USE IT. Behind the scenes, it is the 8th wonder of the world. I'm so sad I can't explain exactly how I can in english because I know you would understand me.. I think I need better friends IRL lol
Money = inflation, the GOV is controlling it, they produce it legally (if we produce it we go to jail), ITS NOT FREEDOM. People are not understanding this. You work 20 years of your life for 2.000$ a month and then boom everything crushes because of some greed people and you are ruined.
Bitcoin = if we use it, we are saved. The price can go only up. Even in a Corona Virus situation, when businesses are closing, the bitcoin price would go up and it would sustain us on the timeframe we need. There is no need to do anything else JUST TO USE IT. Globally.
It will be slowly implemented into the word more and more by different companies, BECAUSE WE DICTATE IT. The use of this, will make big financial companies TO USE IT FOR THE SAKE OF THEIR PROFITS. This is our chance.
The price of it will hit big numbers. Maybe not now, maybe not tomorrow or after a month. But at one point, it will get extremely big. It can't hit 100$ anymore at it was. But it's at almost 10k. Remember the 2017? Most of you were like "Ohh If I would have invested then" etc etc. No. You have the chance to invest now. Even if its higher then before. Since it will go only up, there is ALWAYS THE BEST TIME TO INVEST. NOW is the "then" for what's coming next in the phrase "Ohh if I would have invested then".

Thank you if you read the whole thing, I just wanted to share with you my enthusiasm. This is the wonder WE NEED.
submitted by 2poor2die to Bitcoin [link] [comments]

Why UMI Will Not Fall Victim to Inflation: Dispelling Myths of “Deadly Issue”

Why UMI Will Not Fall Victim to Inflation: Dispelling Myths of “Deadly Issue”
https://preview.redd.it/lr1w0ukh2ik51.jpg?width=1024&format=pjpg&auto=webp&s=b413e6e6b2e94d2e9522571040151826b7874e77
With UMI staking, anyone anywhere in the world can generate new coins at the rate of up to 40 % a month, or up to 5,669 % a year, with no risk of falling victim to fraudsters. It means new opportunities for humanity which never existed before. However, many people who are used to miserable interests on bank deposits and financial pyramids that last a few months at most cannot understand what makes this possible. How can you safely earn up to 40 % a month with no risk of losing it all?
Sceptics cannot wrap their minds around this which makes them suspect there’s a catch to it. Therefore, it should come as no surprise that you can find various myths about UMI's “deadly issue” on forums and social networks. The most popular among them say that you simply cannot ensure long-term operation with this kind of “super-high income” and no one has any idea what will happen to this cryptocurrency in 10 or more years. Here's a forecast from sceptics, briefly: “deposits” with this percentage are simply impossible, it will inevitably cause hyperinflation, UMI cryptocurrency will devalue, and will share the fate of currencies in some of the less fortunate countries, such as Zimbabwe or Venezuela.
To counter these allegations, we've prepared a detailed article with arguments dispelling all these myths, nullifying all “forecasts” and putting the lid on this issue. Here we go!
What's the value behind the forecasts?
First of all, 10 or more years is too much of a long term, and forecasting so far in advance is simply impossible. Don't take us wrong here: it's not just about cryptocurrencies; it's about anything in the world. There was a time when people thought pagers, faxes, and landline phones had cheerful prospects, but look at what happened to them. They have been replaced by smartphones and the Internet accessible to all which no one believed was possible in the first place. New technologies emerge out of the blue and transform the world beyond recognition. The old — something everyone is used to — is replaced with something new and more
convenient. Something better.
10 years ago people believed in developing bank technologies, but then, all of a sudden, Bitcoin was created and transformed people's understanding of financial payments. It turned out anyone in the world can make payments with no intermediaries and generate new digital money. It's true that Bitcoin is not perfect, but millions use it all over the world. This number is also growing fast with each passing day.
Do you remember forecasts made for Bitcoin when it first appeared? Both ordinary people and respected world-class experts predicted it would soon die. No one believed it could last for even 10 years.

https://preview.redd.it/q1kzcxfw2ik51.png?width=800&format=png&auto=webp&s=17a12d73b9046a357cf6ecd77253472215c8bb24
Typical article predicting the end of Bitcoin from respected mass media. Source.

Here're some graphic examples from the leading world-class mass media:
“That's the End of Bitcoin.” Forbes, 2011, BTC price — $15.
“Bitcoin is headed to the ash heap.” USA Today, 2015, BTC price — $208.
“R.I.P., Bitcoin. It’s time to move on.” The Washington Post, 2016, BTC price — $382.
“Stay away from bitcoin and ethereum — they are complete garbage.” This is garbage." MarketWatch, 2017, BTC price — $2,345.
“Is Bitcoin Going To Zero?” Forbes, 2018, BTC price — $3,432.
In 2020, the BTC price is almost $12,000. The respected mass media have “declared Bitcoin dead” over 400 times (!!!) referring to its lack of backing, high issue rate, super-high price growth, and the like — just like the skeptics “declaring UMI dead” right now. However, despite all the discouraging forecasts, Bitcoin continues to successfully grow and rapidly gain in popularity.

https://preview.redd.it/6z60xwd13ik51.png?width=791&format=png&auto=webp&s=25a6799fe551c6e7f91aa016907e95ce032d7e5e
Over 12 years, Bitcoin has been declared dead 381 times, but it only grows stronger with each passing year. Source.

All of the above is proof that you shouldn't put blind trust in various forecasts, even coming from respected sources. Forecasts are mere opinions and arguments, but no one can know for
sure what will happen in 10, 100, or 1,000 years. No expert can know that. Similarly, no one knows what will happen to UMI many years from now.
UMI can solve any issues on the fly
We cannot know the future, but we did all we could to make our coin last forever. Most existing cryptocurrencies have a very important problem — they cannot support high-quality growth and rapidly become obsolete.
To explain this, we'd like to quote our Whitepaper:
"Despite the apparition of new technology solutions, the Bitcoin blockchain still holds only about 2,000 transactions, and it takes about 10 minutes to create a block. In 11 years, developers still did not manage to come to an agreement and implement a solution that would allow scaling the system and upgrade performance.
Most other cryptocurrencies face a similar problem. They are launched and keep operating in an almost initial state even after numerous innovative solutions become available. For example, the Ethereum network has been attempting to switch to the PoS algorithm for over two years now, but due to code complexity, security threats, and issues of reaching consensus, this causes great inconvenience."
https://preview.redd.it/ezxzrpx43ik51.png?width=800&format=png&auto=webp&s=207f8a27a59fac760fc541dae6abd30d148296f5
Screenshot of a page in the UMI Whitepaper. Have you read it? It answers a lot of questions. Link.

Bitcoin itself is technically obsolete. This is besides the fact that it has a load of other problems. For instance, BTC is supposed to completely stop coin mining in 2140, meaning miners will lose motivation to support the network. What happens then? The hope is that the main source of income for miners will be transfer fees, but will they want to maintain powerful equipment for a reward in the form of small fees? If fees are big, will people want to pay those? Will they find a different solution? Will users just leave the Bitcoin ecosystem and join more high-tech cryptocurrencies like UMI?
When we designed UMI, we accounted for all these issues and launched a promising project with a conveniently scalable ecosystem. Even if UMI faces some challenges in the future, we will make amendments as the network grows. We will act as appropriate judging from the project's current status. They will be based on the situation and the current state of the project.
It's true that upgrade decisions have been and are being made by all leading crypto projects, including Bitcoin and Ethereum, but UMI supports really safe and rapid innovation. The network can be easily modified and scaled with cutting edge technology solutions. While other cryptocurrencies simply become obsolete, we can handle all kinds of challenges on the fly. The UMI network will grow and improve to be always up to date, keep up with the times, and prevent problems in 10, 100, or 1,000 years.
At this point, the UMI network is in excellent shape, and the smart contract offers you relevant and actionable staking opportunities. We've thought out every detail, and the brisk growth of our community proves it best of all.
There is no "deadly inflation"
And, lastly, let's bring an issue with supposedly too-high emission to a close. UMI is typically accused of paying a too high reward for staking — as much as 40% a month, or 5,669% a year — which no one and nothing else in this world can pay. Eventually, it might end up with inflation as it happened in Zimbabwe and Venezuela, etc.,
Let us look at real facts. Those who consider a 40% monthly growth impossible should look at bitcoin again as the most outstanding example which has proven that nothing is impossible. Imagine how many times your deposit would have grown if 10 years ago you had bought bitcoins or inexpensive mining equipment producing a reward of 50 BTC several times a day.
Please consider the following:
In March 2010, BitcoinMarket.com started operating as the first bitcoin exchange, and 1 BTC cost a lot less than a cent — $0.003.
At the time of writing this article, the price for 1BTC was about $12,000.
It means those who bought bitcoins 10 years ago have increased their "deposit" by nearly 400,000,000% (!!!). Four hundred million percent in ten years! This is a real fact.
Those who bought bitcoins when the price was a few cents or dollars also achieved the perfect result by increasing their "deposit" by thousand or million times.
Well, now the percentage in UMI staking doesn't seem so crazy, does it? The only difference
is that BTC "deposit" grows in line with the BTC price while UMI deposit growth is ensured the growth of the number of UMI coins, which in turn doesn't prevent the price from surging. In fact, both cases demonstrate a multiple growth of the "deposit".
All of the above is proof that the reason for inflation in Zimbabwe, Venezuela, etc is a bad economy, not a high emission. In late March. roughly speaking, in one day, the FED (U.S. Federal Reserve System) released 2.2 trillion dollars to support the economy during the coronavirus pandemic. Similar financial injections are regular in the USA, the country which is the most advanced world's economy.
These facts indicate that UMI has no "deadly issue" at all and, unlike the USA, it doesn't "print" anything.
Here is bare statistics form the UMI blockchain:
The UMI cryptocurrency was launched on June 1. Since the launch, it's been 3 months.
18,000,000 UMI coins were initially issued.
In total, there are now about 18,800,000 UMI coins.
In other words, in three months, the total number of UMI coins increased by only 4.4%. Does it look like "deadly inflation"?

https://preview.redd.it/gsdjbwp83ik51.png?width=800&format=png&auto=webp&s=8d4591a24b3ddc63f8501f1b7fe7a4c02b7da89c
In 3 months, the number of UMI coins has shown a few percent increase. Source.

Let's move on:
We'd like to reiterate that the total number of UMI coins is almost 18,800,000.
There are about 14,500,000 coins on the genesis address today.
Almost 4,000,000 coins are involved in staking.
Thus, only 300,000 UMI (!)are freely circulated on the market. The remaining 18,500,000 coins are either used in staking or have not yet been released to the market.
https://preview.redd.it/f7b28jid3ik51.png?width=800&format=png&auto=webp&s=5ff8338121ebfe398cfb498a0cfcc00446ea6225
The number of coins stored on the genesis address at the time of writing the article. Source.

In real fact, UMI has no super-high emission. This fact has been proven. For a three-month period, which is a quarter of a year, the number of UMI has hardly changed and equals about 1.5% of the total number of coins on the market.
The truth is that UMI economy depends on a lot of factors. For example, burning 50,000 coins to create a structure. However, from a more general point of view, the UMI economic model itself is designed to encourage people to "save" rather than sell UMI coins. This is a crucial point that allows us to make progress, even with a high emission.
Moreover, it will take a billion-dollar staking structure that will be able to provide the highest possible emission on the UMI network a lot of years to appear. While it doesn't happen, all these forecasts can be regarded as irrelevant for today. Keep in mind that a 40% monthly profit will be available to the most successful structures and only after many years of development. To have your coins increased by 40% per month, your structure must have over 50 (!) times more coins than the number of coins initially generated by the network. And since this structure will do everything possible for the benefit of the UMI cryptocurrency, even 40% per month will not pose a risk to UMI's sustainable development.
Conclusions are as follows:
UMI offers no kind of "killing sky-high returns". Please don't take this myth seriously. UMI is growing. The current smart contract offers reasonable and up-to-date opportunities for UMI staking and poses no problem. If, however, a problem arises — we have all the tools to find an immediate solution. All these negative forecasts are not worth a brass farthing. They always have been and always will be. At all times and in all places. But they are highly unlikely to come true. Bitcoin outsmarted the most reputable and shrewd financial analysts. Why don't UMI, which is a lot more advanced than bitcoin, try to do the same?
UMI is a decentralized, strong, and high-tech network. It can exist the way it is now forever. But as it grows, it will improve to be always up to date, keep up with the times and prevent any problems. We are contributing to a great thing — we're creating a free economic system that will profitable for the entire human family. This is an opportunity to overcome social inequality and make regular people financially independent. So let's make every effort to make things go well. Ignore all evil-wishers and their predictions. Just join other users and go towards your dream. Then we will certainly succeed in it all.
Sincerely yours, UMI team
submitted by UMITop to u/UMITop [link] [comments]

The deepest report: Bitmain's self-help history

The deepest report: Bitmain's self-help history
The original intention of this article is to let readers understand the causes and consequences of Bitmain internal fighting, but after writing it, I found that it is not so much internal fighting as it is a long history of self-help.
The story is very long. Let's adjust the timeline to the eve of December 17, 2018. That was one of Bitmain's most critical moments and the beginning of a series of subsequent stories.
1. Self-immolation In September 2018, Bitmain's financial department warned management that the company's cash flow has become very tight and operating costs must be reduced to allow the company to continue. The blockchain unicorn, which is valued at more than 15 billion U.S. dollars, is crippled in the run and struggling to break the corner.
In 2017, Bitmain made a profit of 1 billion US dollars In the first half of 2018, Bitmain made a profit of 1 billion US dollars Three rounds of financing, a total of 800 million US dollars Net assets should exceed 3 billion U.S. dollars In September 2018, Bitmain had tight cash flow and was on the verge of bankruptcy
A simple comparison, it is not difficult to see that Bitmain's ability to make money is incredible, and its ability to burn money is even more extreme.
How does Bitmain burn money? Do you pour cash into gasoline and burn it, or hire a lot of employees to stuff the banknotes one by one into the shredder? The actual situation is closer to the latter.
The following data can help readers quickly learn Bitmain's money burning skills.
At the beginning of 2018, the entire cryptocurrency market has entered a bear market, but Bitmain's monthly operating costs have been rising wildly. Operating costs have risen from 10 million US dollars at the beginning of the year to 50 million US dollars at the end of the year.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
Operating costs are just the tip of the iceberg. Excessive chip trial production can become a classic case of project management courses. Readers who pay attention to Cryptocurrency mining can easily find that Bitmain is still working hard to clear the inventory of Antminer S9 in 2019. As the co-CEO, Ketuan Zhan did not listen to the advice or even warnings of the Finance Department, insisting on the implementation of Excessive chip trial production, resulting in a large accumulation of inventory and tight capital turnover. Another CEO, Jihan Wu, once revealed that the loss of Excessive chip trial production to the company was approximately US$1.5 billion.
Large-scale expansion of the R&D team is one of the main reasons. The HR who once worked at Bitmain revealed that the company once hired more than 50 employees a day and nearly 500 employees a month. Even so, it was criticized for its slow recruitment speed. The cash consumption in this area is approximately $250 million.
The BM1393 chip incident is even more incredible. Chip expert Ketuan Zhan invested a lot of money on a failed chip, and finally failed again. From 2017 to 2018, Bitmain has failed Trial production of mining machine chips at least 4 times, including 16nm, 12nm and 10nm chips, of which 16nm Trial production failed twice, thus losing at least US$1.2 billion.
It is rumored that Bitmain still holds a billion U.S. dollars worth of cryptocurrency in a state of floating loss. In view of the rebound in the market in 2020, we will not comment temporarily, waiting for the correct answer from the cryptocurrency market. But the losses pointed out in the previous article are all irreversible.
2. Sole power
In September 2018, Bitmain's management realized the seriousness of the problem. It turned out that the company's money could be squandered. As a result, the management began to discuss self-help plans, and the most reasonable and effective way was obviously to lay off employees.
The probation period for newly hired employees at Bitmain is half a year, and the probationary salary is 100% of the official salary, there is no difference. Once layoffs are made, new employees who have not passed the probationary period will be the main layoff targets. The department managed by Ketuan Zhan will face large-scale layoffs. The layoff plan is strongly opposed by Ketuan Zhan. Bitmain can only temporarily abandon the layoffs and replace it with continuous reductions. For marketing and travel expenses, a budget committee was established to strictly approve every expenditure. At the same time, employee benefits, such as reimbursement of taxi expenses, breakfast supply, snacks and drinks, etc., have also been abolished, and even the tradition of giving employees 400 yuan worth of BTC/BCH every month has been stopped.
In the face of huge cash flow pressure, trivial savings is obviously of no avail. Soon, the management again discussed the layoff plan, and it has reached the point where it has to be laid off.
In December 2018, Jihan Wu began to organize all entrepreneurial veterans and business backbones to persuade Ketuan Zhan to agree to layoffs, but Ketuan Zhan still insisted not to layoffs. The persuasion process was very unsuccessful. After many meetings and intense debates, Bitmain executives were caught in a dilemma of wasting time with Ketuan Zhan.
In this process, the shortcomings of the dual CEO system began to appear, and the relationship between the two CEOs gradually deteriorated.
On the night of December 16th, Ketuan Zhan reconvened the management meeting, and more than 30 managements who were present were asked to hand over their mobile phones. At this time, Jihan Wu was on a business trip in Hong Kong and was busy with listing related work.
In the meeting, Ketuan Zhan's core content was three items:
(1) Bitmain cannot have two CEOs, only one CEO and must be Ketuan Zhan. Ketuan Zhan said that he met an old leader during a business trip. He hadn't seen each other for many years. The old leader suggested that the company can only have one CEO, and it must be him. Ketuan Zhan feels that this is a kind of fate, an opportunity given by God.
(2) Ketuan Zhan believes that the company's cash flow problems, the biggest responsibility is the inability of the financial department. To prove his point, Ketuan Zhan announced Bitmain's financial data at the meeting. In the evening, employees in Taiwan began to post messages on social media, saying that the company's capital chain was broken and the top management was split.
(3) If Ketuan Zhan is not supported, the option will be cancelled and the equity will be voided.
Hearing about this, Jihan Wu, who lives in Hong Kong, sent a WeChat message to the management who are attending the meeting.

https://preview.redd.it/c5cxea2lqid51.jpg?width=1080&format=pjpg&auto=webp&s=3d6a0388408f6b8abe10648e5e4b7a3a5434c821
On the afternoon of December 17, 2018, Jihan Wu returned to Beijing to negotiate with Ketuan Zhan all night, and finally reached a consensus in the early morning. Bitmain co-founder Yuesheng Ge announced the results of the negotiations. Jihan Wu and Ketuan Zhan ceased to serve as CEOs, and Haichao Wang served as CEO. Jihan Wu voluntarily backed down and Ketuan Zhan served as chairman.
The "12.17 Incident" had a very bad impact on Bitmain, especially the disclosure of Bitmain's financial status, which caused vendors to start dunning. The loan that had just been negotiated with the Bank of Beijing was cancelled the next day. Jihan Wu's resignation as CEO caused an uproar in the industry, and it became a hot topic among Cryptocurrency mining, blockchain practitioners, and investor communities. The media focused their interpretation on Bitmain's series of incidents, and generally looked down upon its ongoing Hong Kong IPO, believing that the high-level changes had already signaled the failure of the IPO in advance.
On Christmas December 24, 2018, Bitmain finally began to implement the layoff plan. This long-delayed “correct decision” was achieved after a stalemate for nearly three months. The AI ​​teams in Beijing, Singapore, Taiwan, and Shanghai have laid off more than 50% of their employees. The Israeli R&D center was closed and Shenzhen New Species Technology Co., Ltd., which had been acquired for only ten months, was dissolved, and all employees were laid off. Copernicus, Bitmain's top blockchain development team, was not spared and was wiped out in this layoff. Copernicus and some of the laid-off employees joined the new company Matrixport co-founded by Jihan Wu and Yuesheng Ge, headquartered in Singapore.
3. Past events when starting a business
After the "12.17 Incident", Jihan Wu gradually faded out of Bitmain's management affairs and turned his attention to the IPO and new company. And this is one of Jihan Wu's major mistakes, he began to let Ketuan Zhan manage Bitmain alone.
In fact, as early as 2013, Jihan Wu planted hidden dangers.
Jihan Wu, an investment banker, was the earliest translator of the Bitcoin white paper. He began to get involved in the cryptocurrency mining industry in 2012. The disappearance of Kaomao and Nangua Zhang's ticket skipping led Jihan Wu to decide to develop his own chip.
In 2013, Jihan Wu established his own mining machine company. Together with Yuesheng Ge, who was only 20 years old, he found Ketuan Zhan, an integrated circuit designer of the Chinese Academy of Sciences, to create the protagonist of this article, and later the digital Cryptocurrency mining giant, Bitmain.
Jihan Wu promised Ketuan Zhan that every time a mining machine chip was successfully developed, he would give some shares to the Ketuan Zhan team. At that time, the company founded by Ketuan Zhan was on the eve of falling apart. In order to regroup the team, Ketuan Zhan promised to share half of his shares with the team members. Unfortunately, this is just a bad check. With the rapid development of Bitmain and higher and higher valuations, the expanding Ketuan Zhan almost monopolized all the shares.
Like many startups, Bitmain encountered many difficulties in its early days, and many jobs had to be done by the boss. For example, in the chip design and production process in the second half of 2013, Bitmain was caught in a dilemma of insufficient funds. Jihan Wu personally raised funds and met with TSMC’s sales to persuade TSMC to accept the production needs of a start-up company. Jihan Wu also participated in the selection of the thermodynamic parameters of the heat sink in the Antminer S1.
In 2014, Jihan Wu discovered that this company was independently operated by Ketuan Zhan, which had huge problems. Forcing Jihan Wu to continue to participate in company management.
At that time, Bitmain's mining machine chips had just achieved a certain lead in the standard design process. Jihan Wu believes that the next step must be to develop full customization technology, but Ketuan Zhan plans to invest resources in the research of mobile payment chips.
Ketuan Zhan met a mysterious person from the Party Central Security Bureau who claimed to be able to manipulate the Party Central Committee’s decision-making process for the next generation of mobile payment cryptography standards, but this direction is likely to lead to the fact that Bitmain has just gained the lead in the mining machine market. Regained.
Jihan Wu said that as a graduate of the School of Economics, with a little memory of his high school stage and the knowledge reserve of a computer technology amateur, he retrieves various materials and papers every day, learns theories related to full customization, and goes to Ketuan Zhan conducts persuasion work there.
Fortunately, in the direction of full customization technology, Ketuan Zhan finally listened to Jihan Wu's opinion. Bitmain quickly integrated the technical experts from the United States and Russia introduced by Jihan Wu, which greatly improved the design level of chips and complete machines.
In 2015, Jihan Wu suggested that Ketuan Zhan consider the direction of artificial intelligence. But Ketuan Zhan is not here, he prefers the CPU direction. After staying asleep at night, coupled with in-depth analysis by the Bitmain investment team, Ketuan Zhan finally agreed with this direction. It is a pity that after the Tianshi Chen brothers made major breakthroughs in theory and practice, Bitmain officially invested in the relevant direction, and it was still a step behind.
In the two years from 2016 to 2017, Bitmain's business performance has achieved rapid development, becoming a unique super unicorn in the blockchain industry. According to Froth & Sullivan, in 2017, Bitmain Technology Holdings was the second largest fabless chip design company in China and the tenth largest fabless chip design company in the world, and the fourth largest fabless ASIC chip design company in the world, accounting for 74.5% of global cryptocurrency market share.
However, the huge crisis has long been buried in the early days of entrepreneurship.
Ketuan Zhan's decision on major directions revealed his weakness of extremely lack of business understanding. But every mistake he made was blocked by the company's core employees. His overconfidence in his management ability led to the gradual intensification of conflicts, and the management differences between the two founders became more serious.
4.The giant gets lost
The contradiction between the two broke out on December 17, 2018. Ketuan Zhan used extreme means to force the management to compromise with him by canceling the option, so as to achieve the goal of sole control of the company. Jihan Wu returned to Beijing from Hong Kong overnight and negotiated with Ketuan Zhan all night. In the end, the two resigned as CEO. Jihan Wu retired. Ketuan Zhan has the exclusive rights of chairman in exchange for the implementation of the layoff plan.
Jihan Wu's voluntary retreat has intensified Ketuan Zhan's management to do whatever he wants.
A Bitmain employee commented on Ketuan Zhan's management skills, summed up in two letters-SM.
After becoming the sole helm of the company, Ketuan Zhan quickly "rectified" the department in charge of Jihan Wu as the chairman of the board. He guided the sales of mining machines at the dinner, and pointed out that the sales performance is not due to the sales staff. Ability is strong, but the company provides opportunities. Take two sales leaders as examples, saying that if the company hadn't given the opportunity, they would still be losers. In addition, Ketuan Zhan also instructed the sales staff on how to toast and imparted the wine table culture and experience.
After the meal, Ketuan Zhan came to the conclusion that the quality of Bitmain sales staff was too poor, and Huawei’s blood needs to be injected to drive the company’s progress. Soon, the marketing and sales director from Huawei officially took over Bitmain, opening the era of brand premium for Antminer.
In order to further understand and guide the sales work, Ketuan Zhan asked to meet the customers with the sales staff. During the negotiation process, Ketuan Zhan had a heated discussion with customers on the issue of Chinese and Western medicine, and had also forced the sales staff to be able to ship 10,000 machines due to insufficient production capacity.
Although the requirements for sales personnel are strict, Ketuan Zhan has provided a lot of convenience for "Mainland Ark". In addition to selling mining machines at a more favorable price, Bitmain's mining machines are also hosted in Ming Wang at a higher price than the market price. Mine. It is reported that both Ketuan Zhan and Ming Wang are shareholders of Ark.
The new sales strategy of Huawei's executives has also brought very obvious changes to Bitmain. The self-righteous brand premium reduces the price-performance ratio of Antminer, causing competing products to eat away at Bitmain's market share. Later, Bitmain found that the strategy was wrong and started to cut prices, and found that the mining machine market was saturated and the purchase demand of miners had decreased.
More dangerous than the sales strategy is that the technical advantages of Antminer are being chased by competing products, and even overtaken. At the same time, the two mining pools under Bitmain also lost their first and second positions. The AI ​​business, which Jihan Wu placed high hopes and Ketuan Zhan personally supervised, became a laughing stock in the industry. Not only did it fail to make a profit, it almost brought down Bitmain.
Blindly introducing senior executives from Huawei to occupy important positions completely destroys the company's internal cultural foundation. The bureaucracy within Bitmain began to corrode from high-level employees to ordinary employees. Ketuan Zhan is not aware of this. He is still keen on recruiting Huawei employees, imitating Huawei's organizational structure and strategy, letting HR do sales and R&D personnel to do HR.
The organizational structure adjustment in October 2019 was the fuse for Ketuan Zhan to completely anger Bitmain management. This time, Ketuan Zhan completely marginalized Bitmain’s veteran employees, and suddenly promoted some of the “airborne soldiers” who had just joined the company to the position of person in charge, which caused the former person in charge to report to the new employees. The two managers who were originally equal The hierarchy becomes the subordinate relationship, the operation and development of different business lines are merged into a large department, the upward reporting process becomes more cumbersome, and the relationship between employees becomes delicate.
5. Headwind
On October 29, 2019, Jihan Wu urgently held a staff meeting. Prior to this, the legal representative of Beijing Bitmain has been changed to Jihan Wu, including the parent companies Hong Kong Bitmain and Cayman Bitmain. Jihan Wu stood in the lobby of Building 25, B1, announcing that Ketuan Zhan has been relieved of all duties. Any employee in the Bitmain Group shall no longer execute Ketuan Zhan’s instructions and participate in any meetings convened by Ketuan Zhan. If there is any violation, the company will demotion and expel the company based on the severity of the circumstances. If losses are caused to the company, the company will be held accountable.
Jihan Wu's speech is very long, which can be summarized as follows:
(1) Ketuan Zhan has been relieved of all duties. Also expelled from the original Huawei company HR Zhi Wang introduced by Ketuan Zhan at the end of 2018. Zhi Wang’s reputation on Bitmain was extremely poor and was ridiculed by employees as "nine thousand years" (In ancient China, the emperor was called "ten thousand years old", and the prince was "eight thousand years old." However, in the Ming Dynasty, there was an eunuch who caused harm to the country and the people. He called himself "nine thousand years old", meaning that he was only A little lower than the emperor's level).
(2) Ketuan Zhan's ability to control the company's option incentive plan has disappeared, and it is no longer possible to cancel employees' options at will.
(3) The organizational structure adjustment plan led by Ketuan Zhan was suspended.
(4) We are optimistic about the future of AI business, but the premise is that the main business can continue to make profits in order to support the company's continued investment in AI business.
In the speech, Jihan Wu also told employees the whole story of the "12.17 Incident" and bluntly said that the company is not in good condition. If no measures are taken, Bitmain is likely to go bankrupt in three quarters and he must come back to save the company.
At this time, Ketuan Zhan, who was on a business trip in Shenzhen, finally experienced the situation of Jihan Wu in the "12.17 Incident".
After the official return, Jihan Wu began to clearly point out the company's various problems in operation and management, and went deep into each business line to understand the situation. In the mining machine sales department meeting, employees spoke enthusiastically, reflecting on the difficulties and opinions encountered in the work, the marketing and sales director from Huawei asked with a surprised look, "Why didn't these issues be reported to me before?", and soon , The director was interviewed and "voluntarily resigned."
On November 2, 2019, Jihan Wu announced a salary increase for all employees. Bitmain’s last salary increase dates back to 2018. In principle, Bitmain has two salary increases every year.
On November 7, 2019, Ketuan Zhan spoke on social media for the first time, describing his hardship in starting a business, and condemning Jihan Wu for “stabbing a knife in the back”. At the end of the article, he also set himself a KPI for 2020, that is, the mining machine market share will reach 90%, and the AI ​​business will earn 1 billion.
But Ketuan Zhan's majestic plan did not make Bitmain employees feel emotional, but ridiculed him instead. Employees exposed that he insulted employees, advocated Chinese medicine, believed in Buddhism, drank in meetings, practiced Qigong...
However, there is less than half a year before the halving of Bitcoin production, and the cryptocurrency market shows no signs of recovery, which makes Bitmain management very anxious.
On January 6, 2020, Bitmain ushered in another round of layoffs, with a layoff ratio of about 1/3. This time the layoffs have caused many employees who have just increased their salaries to feel very grieved. On the one hand, they were looking forward to Jihan Wu's return. On the other hand, the compensation for this layoff was less than 18 years.
Ketuan Zhan, who has been unable to enter the Bitmain office area, once again spoke on social media and firmly opposed to layoffs. We do not need to lay off staff and we cannot commit suicide.
During the Spring Festival, Covid-19 broke out. Mainland China has begun to extend the Spring Festival holiday and advocate working from home. Under the chain reaction caused by Covid-19, most companies have chosen to cut salaries or even lay off employees. In the first two months of 2020, China's exports fell by 17%, U.S. stocks were broken four times in a row, Bitcoin plunged 40% in 24 hours on March 12, 2020, and crude oil futures fell by 300% on April 20, 2020...
Obviously, Jihan Wu can't predict, but this layoff seems to be the right decision again. In addition, from January to April 2020, Bitmain's revenue exceeded US$400 million amid the spread of Covid-19 and the collapse of the financial market.
6. Fight to the death
When Jihan Wu tried to get the company back on track, Ketuan Zhan was not helpless. On April 28, 2020, Ketuan Zhan finally rolled back the legal representative of Beijing Bitmain to before October 28, 2019 by repeatedly submitting administrative reconsiderations, and restored his status as a legal representative.
On the morning of May 8, 2020, a piece of news about Bitmain quickly appeared on the real-time hot search rankings, and even dominated the headlines of the day. At window 52 on the second floor of the Haidian District Government Affairs Center, when Ketuan Zhan, the legal person of Beijing Bitmain Company, was receiving the business license, a group of unidentified people snatched the business license from the industrial and commercial administrative staff. A source at the scene said that the number of unidentified people in the group was about 60 people, of which Luyao Liu was directing at the scene.
This is a skillful piece of news. It first leads readers to think that Ketuan Zhan is a victim, using 60 people to grab business licenses as the focus. The masses accused Jihan Wu of lawlessness, but ignored whether the government affairs center could have 60 personnel. As for Hong Kong Bitmain to have the right to appoint a representative to obtain a business license, this is a deeper level of thinking.
The follow-up report restored the real situation at the scene. Only more than ten people were present, and both sides were equipped with security personnel. Bitmain employees also broke the news in the circle of friends, claiming that Ketuan Zhan's bodyguard had injured Bitmain's authorized person, and said in a threatening tone, "Be careful!"
However, the subsequent plot reversal did not have much effect. Jihan Wu's reputation has been greatly affected. From a bloody soldier who rescued the company in trouble to a lawless criminal, it can be said to be a world of war. do not.
Ketuan Zhan, who succeeded in the first battle, began to counterattack Bitmain continuously. On the afternoon of June 3, 2020, Ketuan Zhan led a team to pry open the back door of the Beijing Bitmain office and formally occupied the deserted Beijing headquarters.
On June 4, 2020, Ketuan Zhan called on Bitmain employees to resume work and promised to expand the company's market value to more than US$50 billion within three to five years. After that, Ketuan Zhan began to contact employees by phone, trying to acquire the options in the hands of employees at a valuation of 4 billion US dollars.
Subsequently, Ketuan Zhan recalled Huawei's executives and issued a series of personnel appointments and removals. As of June 9, 2020, Ketuan Zhan has successively eliminated CFO Luyao Liu, and Wenguang Wang, the head of the mining center. Luyao Liu is responsible for controlling Bitmain's IPO plan. He also appointed Yanwu Ma as the HR director, Gang Ren as the head of the mining center, Yonggang Sun as the head of the supply chain, Ling Gu as the financial director, and Bin Zhu as the head of the mining machine business department. Bin Zhu is the senior executive of Huawei who was interviewed and left as mentioned in the previous article. During his tenure, he reduced Antminer’s 90% market share to 50%, and received a large number of complaints from miners. Internal employees once speculated that he might be Compete against the spies sent by the company.
In addition to recalling senior executives of Huawei, Ketuan Zhan also urged employees to return to work. They can receive a bonus of 10,000 yuan when they return to work on the same day, which is only half the next day. Ketuan Zhan showed a very kind side. Every time the elevator door is opened, Ketuan Zhan's hot gaze can be met, shaking hands, taking photos, and receiving money. As there is no personnel information, Ketuan Zhan does not know whether the person receiving the money is a Bitmain employee, and these people did not resume work the next day.
The effect of gentleness was not good, Ketuan Zhan began to force employees to return to work. Seeing that there are still very few respondents, Ketuan Zhan threatened employees through SMS, phone calls, EMS, emails and other harassment, issued multiple threats such as termination of contract, suspension of payment of social insurance, suspension of wages, and even used personal information saved by employees to form a group of employees. Domicile threats, requiring employees to perform "work handover", trying to force employees to return work computers, etc.
On June 10, 2020, the media revealed that Ketuan Zhan had controlled Bitmain's Shenzhen factory and prohibited employees from delivering normal shipments to paid customers, which caused difficulties in the operation of the Bitmain mining machine department.
On June 13, 2020, Hong Kong Bitmain, the parent company of Beijing Bitmain, issued a statement accusing Ketuan Zhan of signing a "Sales Agency Agreement" with the Ark Data Technology Co., Ltd. in which it holds shares, in an attempt to embezzle Beijing Bit's assets.
On June 17, 2020, the media revealed that Ketuan Zhan started selling 14,000 T17+ series mining machines at low prices.
On June 20, 2020, Hong Kong Bitmain officially suspended the supply of chips to the Shenzhen factory.
On July 13, 2020, in the "A Letter to All My colleagues in the Shenzhen Factory" released by Bitmain in Hong Kong, more details were added on the series of Ketuan Zhan's actions in June.
The legal person Feng Zhou of the Shenzhen plant is related to Ketuan Zhan. After being relieved of Ketuan Zhan's post, Jihan Wu flew to Shenzhen to have a long talk with Feng Zhou. Jihan Wu believes that Feng Zhou is the right person to manage the factory and help the company overcome difficulties, and decides to leave Feng Zhou to continue to manage the factory.
This wrong decision staged a story of a farmer and a snake. When Ketuan Zhan began to counterattack Bitmain, Feng Zhou was also quickly instigated and began to assist Ketuan Zhan in seizing customer machines and transferring 17,000 T17 mining machines in the warehouse. Hainan Continental Ark Data Technology Co., Ltd., which is held by Ketuan Zhan, sold them at a low price.
In order to protect the interests of customers, Jihan Wu had to make a compromise and paid the payment for some goods to a bank account controlled by Ketuan Zhan in exchange for delivery. However, after the other party received a payment of 109 million, the delivery stopped. On July 8, 2020, 5600 mining machines have been overdue.
At the same time, the factory defaulted on suppliers’ accounts payable as much as 200 million yuan. Bank acceptance bills issued by the factory, exceeding 36 million yuan, will expire on July 17, and more than 34 million yuan will expire on July 23. It is understood that Ketuan Zhan, after receiving the bank's dunning call, made it clear that he would not repay the loan, which would destroy the company and the entire group's credit in financial institutions.
7、 This is not the end
So far, the power struggle between the founders of Bitmain has been more than half a year. The office building already occupied by Ketuan Zhan is still empty, and most employees choose to work from home. Some chip developers returned to the office with the acquiescence of Jihan Wu and continued to maintain research and development to reduce the impact of infighting on technological iteration and competitiveness.
This giant ship that once stood on top of the supercomputer chip is crashing into the iceberg due to the madness of the former helm. Ketuan Zhan's madness and Jihan Wu's compromise made mistakes again and again. Bitmain tried to save himself many times, but was unable to get out of the black hole.
If the time goes back to that day in 2013, would Jihan Wu and Yuesheng Ge still choose to dial Ketuan Zhan?
submitted by paulcheung1990 to Bitcoin [link] [comments]

My wife (32F) is threatening to leave me if I (30M) don't get what she considers help for my depression. This isn't the first time she has threatened to leave me.

This is going to be a long post.
I met my wife online 8 years ago. We lived across the country from each other and kept a long distance relationship going well, and go the opportunity to see each other every few months for weeks at a time. We would fall asleep on Skype together every night, text each other throughout the day, and phone each other when we had time to talk or wanted to play games together. In 2013 after a year and a half of dating I asked her to marry me and she said yes.
I was overjoyed! I had spent my highschool years as the guy that everyone avoided because my mother had been sending me to therapy for over 10 years for issues that may have been real at the time of my childhood, but regressed as I grew into adulthood. I would routinely take a cocktail of 8 different medications in the morning and before bed, and my friends are the time would better describe me as a zombie over a functional human being. I had issues holding conversation, would regularly space out, could not perform sexually, and could not get good grades in college. After I got married to my wife, we got an apartment together, and I stopped my medication cold turkey of my own volition.
I was a new man, I no longer any of my previous issues and I felt free and full of life. I never resented my mother because she only had my best interests in mind, and was not doing sending me to therapy and keeping me medicated for her own peace of mind. My parents gave me a great life growing up and gave me everything I ever wanted, being from an upper class household, they bought me a brand new car for college, anything I wanted growing up, and would support me financially on almost anything I wanted within reason. My college was fully paid for and I went to one of the best private schools in the area while growing up. I had been to every continent in the world, visited tons of grand architecture and theme parks, and seen so many wonderful things, and I was looking forward to sharing that life with my new wife.
My wife did not have the upbringing I did. She was the second oldest of 6 children. Growing up, she did not get any luxury. From having to work a summer job to buy her own school supplies and clothes, to dealing with an elder brother that sexually assaulted her every month while her parents slept, to a junkie father that would work odd jobs only to get money to get high, and a mother that worked 3 jobs to keep a roof over her children's head, her child hood was not easy. Her parents got divorced when she was 17, after being together for 23 years. Her father never gave her any love despite her efforts, she would regularly make love notes and lunches for him growing up, only to find them crumpled up and thrown in the trash and never responded to. Her elder brother would force her to give him oral at least a few times a month from the age of 15-16 while everyone in the house was asleep. Her father left and had no contact with her since she was 19, only showing back up in her life for our wedding, just to disappear again. He hasn't spoken to her in 4 years now.
Before we got married, I flew out to meet her, and we packed up everything she owned and put it in her car. We drove 2900 miles across the US to move her into our house with my parents, and after we got married, my parents paid for us to get an apartment near their house. We were so happy! After we moved in together after getting married, we both were young, only 23 and 25. We worked fast food and don't have a lot of money, surviving on only a hundred dollars of food a month. But, because we were together, everything was ok.
Or so I thought. My wife has constantly struggled with insecurity since we got married. We made sure when we got married that we would keep our finances separate. She was a bad money manager and didn't want to "ruin me" like she had ruined herself. She would break down sometimes for no reason begging me not to leave her, and I have never done anything to make it seem like I was. My parents decided that since I had gotten married and was doing OK, they were going to give me part of my inheritance up front. I took this money to pay off all our debt, I paid off half her student loans, and I would take care of any issues that came up for her that she couldn't handle without complaint. She crashed her car, I helped her buy a new one, she couldn't pay a bill, no problem, I've got her covered. Anything she felt she couldn't handle, I was always right there to support her.
Near the end of our first year together, my wife for some reason had reached the end of her rope. If we didn't move out of the big city where she didn't have any friends or know how to get anywhere, she was going to leave me. It wasn't me, but she said was devastatingly homesick, and said she couldn't live here any longer. She had made a real home away from her parents at her college town, and her best friend of 6 years lived there, who had supported her through thick and thin. Despite my aversion to this at first, I could tell that moving back home where her best friend lived and what was familiar to her was important. After 2 weeks of talking about it, I agreed to move with her back to what she considered home. My parents were planning to move around this time as well, as they no longer had any children and we're looking to downsize their home. So, for her, I left my hometown of 25 years, and all my friends that I grew up with.
My parents gave me money for us to buy our first house, and another 30 thousand on top. My wife and I found a nice 3 bedroom, 2 bathroom single family home, and bought it outright with cash. Because there was money left over, we used that for moving costs, and I began searching for a job I knew I would enjoy, while living off the interest on my savings. We were working on having a child and I knew that a kid was going to be expensive, so I was trying to make sure we had the money to support our child, and I could still make my wife happy.
In 2015, 2 years after we moved into our house, my wife said she was going to leave me again. Despite her only ever needing to pay her bills (she had gotten herself into more credit card debt), despite her crashing another car and me paying a $5,000 down payment to buy her another new one (she had to get a loan out), despite me spending time with her every night and never going anywhere without her, taking her on trips and little date nights to make her happy, she was threatening to leave again. A month after her telling me this, my father passed away from early onset Alzheimer's. I was having a rough few months.
We were having trouble conceiving and she was having severe body confidence issues. She was convinced that before I left her for someone else, she was going to have to leave me. Since we had gotten married, she had gained over 100 pounds, and I had never made an issue about it, other than showing concern for her health (her family has a history of diabetes and heart disease). She said that despite me continuing to support her in all her hobbies (she likes dancing and volunteering at the pet shelter), me not having a job was stressing her out because she wasn't sure that I could keep helping her. Despite my reassurances, she believed that I was going to leave her for someone better, and that she needed to leave before I did. No re-assurance I gave her would stop her from believing that I was going to be gone the next time she came home from work.
She started self harming. When she was younger, she frequently thought that the reason that her mother was never around, her father left, her brother abused her, was all her fault. Hurting herself made her feel like she was being punished, and that her sins were being forgiven. Her church growing up was very abusive. They would make people stand up in front of the entire congregation and "confess" their sins in front of everyone. When she had premarital sex with her first boyfriend, she almost killed herself after when her mother found out and made her "confess" to the congregation. She hospitalized herself with a suicide attempt after this happened, and has never respected her mother since.
I called up our PCP and told her that my wife dseperately needed help. After an appointment, blood work, and a CT scan for the issues with concieving, she was diagnosed with Severe Depression, Insulin Resistance, and PCOS. She was put on medication and around this time I had found a job, so I told her that she could cut back on her hours and I would start helping her with her bills. We also started looking for a therapist for her. She started going to the therapist and she seemed a lot happier. We were having fun with friends again, and she felt like the happy, bubbly woman I married again.
In early 2016, we got great news! We were pregnant! Because I was making enough money at the time to pay her bills and mine, she was able to only work 20 hours a week through her pregnancy, and then her job gave her 6 months leave when the baby was due. While she was a few months along, she unfortunately got into another car accident, and so again, I helped her buy a new care, this time a minivan, because she wanted it for our kids. She was going to pay for it again, because she said she was tired of me paying for everything for her again. I have no issues with this as I never have, because whenever I try to pay for something, she doesn't let me.
When we had our child, I had saved up enough money to start my own business. Using the money I had saved, I started up a computer system building company, and servicing the local area, I was able to be home a lot more than working my job, and still make the same amount of money. The business started doing extremely well, and I hired a few employees and a friend of mine to work for me, letting me spend more time with my wife and newborn daughter.
Then, we started having problems again. My wife was in a lot of credit card debt from not managing her money ($30,000), and she had been hiding it from me. She was having issues breastfeeding our kid and would break down for hours at a time over not being able to do it. She was diagnosed with post-partum depression and started going to a different therapist. I wasn't making enough money for paying for our insurance, electrical, car payments, taxes and the credit card debt she had built up. I was upset, but it's extremely uncharacteristic for me to get mad about money, because I have always had money. I offered to use our house savings (we were saving up for a bigger house to have more kids) and pay off her debt again. She said no.
She decided she was going work full time again. I helped her get a debt consolidation loan for her cards, and she began working full time while I took care of our daughter.
This was in the beginning of 2017.
Towards the middle of 2017, our life was going great. My business had taken off, and I was making $10,000 dollars profit a month. I had gotten early in on cryptocurrency back in 2013, and was riding high on the bull run from Bitcoin. My company made crypto mining machines due to having a ton of stock from system building, and we were selling those for record amounts. My wife had cut down to part time because I could afford the extra to help her bills, and she could spend more time with me and our daughter. Things couldn't of been better.
Then in 2018, the crypto market crashed. My cryptocurrency that had been worth almost $500k crashed down to $60k of value in the span of a month and a half. I had to start selling it to pay off debt the company had taken on to expand, or else it was going to hurt me more. But I kept holding onto the majority of it.
I kept my business running, but things were winding down because the crypto run was over. We were operating on razor thin margins. In May of 2018, I stopped paying myself while still running the business to make sure I could keep paying my employees. I was still getting a stipend from investments every month in the amount of a few thousand, so I could afford to not pay myself. I was still taking care of my daughter, but my wife had to go back up to full time. I started looking for jobs, figuring with my 2 associates degrees and my master degree, I could get a good job easy.
In the beginning of 2019, I found out my wife had gotten another $25,000 of credit card debt she was hiding from me. She was eating out daily, bringing home for us to eat, and telling me she was making enough money to afford it. She was now up to almost $45,000 of debt, not including her car. I was upset. I told her she can't keep spending money like we have millions. My business wasn't going well, and we needed to cut back our spending so we can get a bigger house to have another kid like she wants. She broke down again.
She admitted she had a money management issue. She locked all her credit cards up in the house safe, and she agreed to only spend money off her debit card.
Then, the trade wars hit. Our stock account took a huge hit, and because I didn't have strong hands, I sold, at a loss of almost $55,000 dollars. Our stock brokerage trading account that had almost 70k of assets was only worth around $15k dollars. I no longer had the money to cover paying off my wife's debt in an emergency.
In April of 2019, we just received our income taxes, due to my losses from last year, and reduced income, we were due back a large amount. I had unfortunately cut down the business to only myself working for it, as the company still had debt that was used a few years ago to expand to pay off. I still have kept the business operating, unable to pay myself for close to a year now, having to sell crypto to cover bills when business wasn't good enough.
The first day of May, I took this money and put it back in the stock market, but due to weak hands again, I lost 60% of it again before the markets rebounded. The trade wars had taken a ton of my wealth again. Our brokerage account was now worth less than $10k, and I withdrew the rest to put it into my checking account.
Over the past 6 months, I've had to sell off all my remaining cryptocurrency. I have none left. I have to continue running my business in it's dilapidated state, only making enough to pay the bills at the end of the month. I have gotten down to my last $5,000 in cash, and my monthly inheritance stipend, barely pays the bills for the house.
All of the money my wife makes goes to paying off her credit card debt, her student loans, and her car payment. When she comes home, she sits down and plays video games while letting our 3 year old run wild and destroy the house while I sleep. We are trying to potty train, but that's not going well, and when I'm sleeping, our daughter will routinely use the bathroom on the floor then smear it on the walls. My wife will not always notice, and I will wake up having to clean up shit off the walls.
I have been breaking down nonstop. I cannot handle the level of stress I have been having. I have interviewed for 12 jobs in the past 6 months, and not gotten hired. I have applied to over 30. I have lost over $100k of our savings in the past year alone. I never get to see my wife because when she is working, I have to take care of our daughter, and when she gets home, I have to sleep so I can make sure I'm able to work while they are sleeping, because I am unable to work while they're both awake. I make it a priority to make sure I spend a few hours with my wife and daughter a day, so they have time with me.
My wife has not been a responsible adult for months now. She doesn't do her small part of the chores, which is simply do the laundry every week. Every week I take out the trash, clean up the yard, do all the dishes, cook dinner daily, vacuum the house daily, clean up my daughters shit and piss off the floor daily, clean up the mess that my daughter makes when she's playing. We recently found out my daughter is going to need speech therapy. Our house looks like a disaster zone. Our PCP said the speech therapist will come to our house to make it a more "secure environment" for our daughter to get help in. I'm terrified that we're going to get social services called for the state of our house and lose our daughter, but I physically cannot keep up with keeping it clean by myself, because every time I clean something, something else gets destroyed because my wife doesn't watch our daughter.
My wife will throw trash on the floor in the house. She won't pick up dishes. She won't clean up the toys or help our daughter do that when I'm sleeping. There is shit caked on the wall in the nursery because almost every day I can't find it all and clean it all up when my daughter is awake.
I cracked. I cursed at her for the first time in my life. She broke down, she said she's been so stressed and she's trying. I understand how it is to be stressed, I'm stressed too, but I said we need to try harder for our daughter. I told her I don't want to lose her.
Then 2 weeks ago, a text sent late. I'm sure everyone heard about the Verizon bug where texts got send late. You can read about it https://www.theverge.com/2019/11/7/20953422/text-messages-delayed-received-overnight-valentines-day-delay
I had an old text get sent that said "Do you still need me?"
My wife thought I was going to commit suicide.
She said that if I don't get help she's going to leave me and take our daughter with her. She didn't believe me when I showed her the text issue. She says I've been having depression issues for months, and that she's been asking me to get help. She said her therapist has been telling her for months that I need to go get help, and that the idea to threaten to leave me was her THERAPIST'S IDEA, because that threat has MOTIVATED ME BEFORE. This made me extremely upset. I tell her the same thing I did every time, unless they are going to give me a well paying job or hand me a million dollars, therapy is not going to help me.
But I need advice. I love my wife. I have no reason to leave her. In the almost 8 years we've been married, I've never told her I was going to leave her. I pointed this out to her, she still says she can't trust me when I tell her that. I told her why am I being punished for her insecurity. I have done nothing but try to give her a great life. Yes, we've been having a hard time with money for the past year, and I've been very frustrated, but all couples have issues throughout their relationships. She says she doesn't want our daughter growing up hearing her daddy talk about suicide and her maybe hear that.
I'm just trying to figure out how to handle this. I have friends telling me I should leave her. I don't see why I should. I love my wife. I would never leave her, and I feel like now she needs help again. She has gotten happier in person or at least it seems so, but her therapist telling her to threaten me to make me take action seems like a flag for her therapist. But she likes her therapist and likely wouldn't listen if I asked her to find a new one. I asked her to get therapy when she was severely depressed because she didn't seem like the woman I fell in love with anymore. Maybe part of her has come back, but the woman I fell in love with wouldn't be so irresponsible with our daughter, and wouldn't ignore her chores like she does.
I just don't know what to do. I'm scheduled to see our PCP in Janurary for depression, but I don't think it's going to go like she expects, and she hasn't set any expectations of what she's expecting me to get out of this. She says I'm not the man she married any more, but of course I'm not when I'm broke and at the end of my rope with trying to find a job. I feel like anyone would be frustrated and upset if they were in the same position as me. Every day I wake up, work for my failing business that doesn't pay me, take care of my toddler while my wife works, and never get to do anything fun with my family because we have no money and no one will hire me.
I just don't know what to do. I don't want to lose my wife. I have sacrificed so much for her. I want to make her happy. I want my daughter to not have a broken family like my wife had and grow up happy. After her threatening to leave me again, it feels like she doesn't need me anymore. It hurts me severely that she can say that so easily after everything I have done for her. I know she is stressed, and I feel like her saying she's going to leave me helps her cope somehow. I'm resenting her still seeing the same therapist, giving her advice on her home life off my wife's singular perspective. I just don't know what to think anymore.
I want to make the people I love happy.
submitted by ThrowRALovemywife to relationship_advice [link] [comments]

Providing Some Clarity on Bitcoin Unlimited's Financial Decisions

Providing Some Clarity on Bitcoin Unlimited's Financial Decisions

https://preview.redd.it/zjps7jpg7rg41.jpg?width=1601&format=pjpg&auto=webp&s=defb61fb45c1a2ad5c7e31fe9200541783ba6478

Introduction

As promised in our previous article, we wanted to provide some extra clarity on Bitcoin Unlimited financial choices. We wanted to do this as there has been a lot of confusion and misinformation within the community as to the reasons behind these choices.
It has been claimed by a small number of influential people in the ecosystem that Bitcoin Unlimited does not support BCH (see the previous article debunking this claim) and that BU’s holdings are supposedly evidence of this. Background Bitcoin Unlimited was founded in 2015, and was set up as a response to the Bitcoin block size debate. More specifically, it was created to provide software that allowed on-chain scaling as originally proposed by Satoshi Nakamoto. As we all know, on-chain scaling is a vital component required for peer-to-peer electronic cash to serve the world’s population. Without it Bitcoin would be limited to serving only a small number of people willing and able to pay exorbitantly high fees. Our organisation was created to make Bitcoin unlimited. This prediction of high fees and limited capacity was played out in the BTC we know today as we predicted.
Bitcoin Unlimited received a large anonymous donation in BTC in 2016 from supporters of the ‘on-chain scaling’ movement. This donation allowed our organisation to remain independent and focussed on building software that allows on-chain scaling.
As you all know, in August of 2017, Bitcoin Cash was created after an unsuccessful multi-year effort to allow Bitcoin (BTC) to scale on-chain. Bitcoin Cash was created with the goal of on-chain scaling to support the world’s population right at its heart and BU has been supporting it since the idea was originally formulated.
Once Bitcoin Cash was created it also meant that all funds Bitcoin Unlimited held (BTC) were forked into two equal sets of coins, BTC and BCH. This put BU into a position where we had to make an important decision on how to handle these funds in a way that was in the interest of both BCH and BU.

Financial Prudence

Any organisation that wants to be effective in its goals must aim to always be financially sustainable. Without money, achieving anything becomes significantly more difficult. Cryptocurrencies only magnify this issue even further. Highly volatile asset values, opaque and dynamic tax and regulatory environments, and the unique properties of cryptocurrencies all contribute towards making the financial operations of an organisation an extreme challenge to say the least. Navigating this challenging landscape is a necessary requirement for the success of any organisation within our industry though.
While Bitcoin Unlimited’s primary goal is to make sure peer-to-peer electronic cash (as set out in the Bitcoin white-paper) becomes a reality, a secondary goal must be to make sure that it has the resources required to make its primary goal achievable, and an important part of these resources are its funds.
After Bitcoin forked into BTC and BCH, Bitcoin Unlimited then held an equal number of both. Although a BUIP was passed to authorize some extra conversion, significant practical obstacles to doing so exist (although this is still being worked on). However, since the overarching reason to convert a significant number of BTC to BCH is to maintain financial prudence based on the reasons outlined below and the poor BCH price performance has heavily skewed our holdings, we do anticipate some rebalancing when these obstacles are resolved.
We will further expand on these reasons below. Historic Volatility It is a fact that BCH has historically been more volatile than BTC. An organisation that wishes to maintain a lower level of risk must aim to hold a majority of funds in assets which will maintain their value over time, i.e. be less volatile in their price. It is unfortunately true that BCH has been a more volatile asset than BCH since its creation. While there has been lots of progress and maturation of the BCH ecosystem, this price volatility is likely due to BCH still being a smaller and less developed ecosystem than BTC. The graphs below show levels of volatility in the two coins compared.

BTC
BCH
This higher volatility in BCH has meant that to significantly increase BU’s holdings of BCH would expose the organisation to a higher level of risk for ideological reasons. BTC is already a high-volatility asset and to expose the organisation funds to even higher volatility and further risk is a decision that should not be taken based on simplistic ideology, but rather with the strategy of maximising the ability for the organisation to achieve its primary goals. This meant making the decision to not take on a higher exposure to price volatility, and instead maintain a more conservative risk profile.

Lack Of Say In The Protocol

One argument that has been put forward to suggest that this decision does not make sense because it is analogous to a CEO of a company holding more shares in their competitor’s company. This analogy does not accurately reflect the current scenario for BU or BCH. In this analogy BU is the CEO and BCH is the company. Ignoring the shareholders, A CEO is able to have the largest impact on a company compared to any other stakeholder. Their actions have a direct impact on operations of the company and therefore its value and the value of the shares.
Unfortunately, Bitcoin Unlimited currently has little to no input on the BCH protocol. It has no way to directly influence the direction or success of BCH. There are two reasons for this. Firstly, BCH has a mining software homogeneity that is as centralised as BTC (i.e. essentially all miners and pools run a single client, BitcoinABC). This means that, all though BU has a slight majority in non-mining and in-consensus nodes, BU has no say in protocol decisions unless a collaborative and decentralised development model were to be used by BitcoinABC. This is an unfortunate situation considering the fact that the community split from BTC for this very reason and is strongly in support of decentralised development. Secondly, BitcoinABC does not take a collaborative approach to development. All decisions and features are dictated by BitcoinABC.
In fact the situation is unfortunately even worse than this. BitcoinABC has decided to take an actively hostile position against Bitcoin Unlimited (and many other valuable participants in the ecosystem) and would rather that it did not exist at all.
While a number of members of BitcoinABC were previously members of BU, they unfortunately used their privilege as members to try (but fortunately failed) to sabotage the organisation.
https://www.bitcoinunlimited.info/voting/rendeproposal_vote_result/7eb0ded0487a6593ac3976b63422294e1a84b209be1307c46f373489922212a0
https://www.bitcoinunlimited.info/voting/rendeproposal_vote_result/6285fcef8fa44416b8e83f25bfebe79aff502c1446a7b60bfab28ec58c35b609
https://www.bitcoinunlimited.info/voting/rendeproposal_vote_result/b10f54ece2ea3b9001086ebdde0001fbef9dc2fd83729a65ba207c0f1d9dfceb
These three voting records show members of BitcoinABC voting for the purchase of BSV coin, voting for an unfeasibly large block size increase (10TB), and voting for implementation of and miner-activation of BSV features into the BU client. None of these actions were implemented in the ABC client, and the inclusion of BSV features is likely the single biggest criticism certain ABC affiliated people have made against BU, yet members of BitcoinABC voted for it.
While it is important to assume good faith, under no interpretation can this be seen as anything other an act of bad will towards BU. Unfortunately this kind of behaviour is rather the rule than the exception and has likely been a major factor in BCH’s struggle to attract quality developers into the ecosystem.
Regardless of the hard work done by members of BU to create useful software for Bitcoin Cash, and its continued commitment towards peer-to-peer electronic cash for the past 5 years, ABC will unfortunately never allow any of BU’s work to go into the BCH protocol willingly.
If BU were to invest all its funds into BCH it would be making a highly risky bet on BitcoinABC’s leadership, a leadership that has not only been historically unsuccessful (when looking at the price of BCH since its creation, both in dollar terms and BTC/BCH ratio terms), but also actively hostile to our organisation. A more cautious approach that takes these factors into account is to keep the funds held where there has been less volatility.
Regardless of all of this, BU is still 100% committed to supporting Bitcoin Cash.

Game Theory: The Strategy of Betting Against Yourself

Counter intuitively, a strategy where you bet against yourself can provide a beneficial low-risk profile. When you bet against yourself, if you lose you win and if you win you win. With BU’s current asset holdings of BCH and BTC the organisation is financially hedged in a way that it wins if BCH wins, and if BTC wins then BU lives to fight another day for worldwide peer-to-peer electronic cash.
If BTC goes down and BCH goes up then it means BCH is succeeding, and our funds in BCH will sustain us for longer. Not only that, but there would likely be more funds available for BCH development in this scenario. If BTC goes up and BCH goes down then BU will be sustained for longer to continue the fight for BCH and peer-to-peer electronic cash.
This is very similar to the strategy of BCH-supporting miners mining on BTC and then converting the BTC block rewards into BCH in an effort to use BTC gains to support BCH price. BU is similarly using its gains in BTC and converting them to efforts and initiatives in support of BCH. In doing so Bitcoin Unlimited is able to turn any BTC win into a positive for BCH.

Incentives

It has been suggested that the situation created by holding a larger portion of funds in BTC than in BCH creates negative incentives that push BU towards supporting BTC. It is important to keep in mind that Bitcoin Unlimited is not a profit driven organisation. While an increase in value of its assets is of course beneficial to the organisation, our primary goal is to accelerate the global adoption of peer-to-peer electronic cash as described in the Bitcoin white-paper, and the officials, membership and founding articles of Bitcoin Unlimited are the driving force for this.
It is also important to point out that there is no evidence to support the claim that BU is in support of BTC (or BSV). In fact the voting record clearly shows the opposite of this. BU has continually worked in support of peer-to-peer electronic cash, and specifically in support of BCH since it was created. This is thanks to the strong commitment by the BU officials and members, all of whom are long time Bitcoiners and supporters of the ‘on-chain scaling’ movement. The only members who receive any payment from the organisation are those who provide significant value in the form of various skilled services, and all of these are voted on by the membership. The BUIP record also shows that compensated individuals are often compensated at far under market rates for developers of their caliber. Should the price of BTC increase, no member receives any direct benefit from this beyond any appreciation in value of any BTC they privately hold. Therefore there are no strong incentives for BU to drive the price of BTC up and push the price of BCH down as this would be counter to our primary goal.

Has This Strategy Been Successful?

Bitcoin Unlimited and its members, all being long-time Bitcoiners, are acutely aware of the need to play the long game to make sure a globally adopted peer-to-peer electronic cash becomes a reality. BU is the oldest entity within the BCH ecosystem and with good reason. The financial strategy of BU to date has been highly effective in sustaining the organisation over a long period of time, and allowing it to independently support BCH development initiatives. This is made clear by the fact that BU continues to have enough funding to provide value to the BCH ecosystem for the foreseeable future.
Had BU converted all funds to BCH at, or at almost any point after, the time of the BCH/BTC fork in August 2017, then for much of the time since it would have been forced to either scale back operations or shut down support for BCH developers completely. We now see development teams such as BitcoinABC facing the prospect of being unable to fund their development of BCH, and their financial strategy may have contributed to this reality. This is despite the fact that nearly all the funds donated in the recent community funding drive sponsored by bitcoin.com were directed towards BitcoinABC.
Lack of a sustainable funding model also seems to have been a major factor in pushing BitcoinABC to make the highly controversial decision to support a change to the BCH protocol that would divert 12.5% of the block reward to themselves. Being financially prudent and sticking to its principles (as defined in the founding Articles of Federation has allowed Bitcoin Unlimited to steer clear of any conflicts of interest such as this.

Summary

Through its financial strategy Bitcoin Unlimited has been able to maintain its independence and financial sustainability and has therefore remained in a strong position to support Bitcoin Cash. BU’s officials and membership have continually made good decisions that have allowed BU to provide long-term support for the Bitcoin Cash ecosystem.
submitted by BU-BCH to btc [link] [comments]

MiniSwap -- A New Hybrid Incentive Model in DeFi

Cryptocurrency exchanges process over $20 billion in trade volume per day. Most of the transactions are going through centralized exchanges, where the users need to fully trust them for managing their assests and transactions. However, the risk of trusting these centralized exchanges has also been seen. For example, QuadrigaCX, which was the largest cryptocurrency exchange in Canada, lost $19 million of their customers' assets [1].
Decentralized Exchanges (DEXes) have been introduced to address this problem -- they allow traders to purchase and sell cryptocurrencies in a peer-to-peer manner, so no involvement of any trusted party is required. Atomic Swap is one of the promising technology for implementing a DEX. While it enables pure peer to peer trading, it also introduces problems such as unfairness and long confirmation latency. While existing work [2] has provided a solution towards a fair atomic swap protocol, the issue of long confirmation latency is inherent.
Another promising direction is leveraging liquidity pools. With liquidity pools, pairs of assets are reserved for trading. For any pair of assets supported by the liquidity pool, traders can exchange their assets without any third party. As traders can only perform the transactions if there are reserved assets, one core problem is how to attract liquidity providers to provide liquidity by reserving assets. It is not difficult to see that incentive [3,4], which has been a key component of all permissionless blockchains, can be equipped to incentivize liqudity providers. However, flawed incentive designs will lead to attacks and other concerns [5-13].
There are two main types of incentive designs, namely "trans-fee mining" and "liquidity mining". They are different from the Proof-of-X mining in blockchains for reaching consensus (a detailed analysis can be found in the survey [14]). Rather, they are used to incentivise users to join the ecosystem.
"Trans-fee mining" was proposed by FCoin in 2018 [15]. With FCoin, each time a transaction is created, 100% of its transaction fee will be returned in FCoin token to the payer as a reward. This is one incentive design to encourage traders to join the system. However, as FCoin may have no value to the trader, FCoin also introduces extra reward to all coin holders -- 80% of the transaction fee in its native currency (such as ETH) will be distributed to all coin holders. So, traders are incentivized to join the system, becoming a holder of FCoin token, and obtaining a share of the transaction fee of every transaction in the FCoin ecosystem.
While this had successful attracted traders, it is not sustainable. Rather than charging a trader to perform transactions, FCoin rewards traders. Profit-driven traders will create transactions at full speed to earn FCoin token and the share as a token holder. Indeed, the trading volume of FCoin was the top one among all exchange services, and the daily reward can be as high as 6000 BTC [16]. However, once all coins are minted, then the system would lose liveness as there is not enough supply to be distributed.
"Liquidity mining" aims at giving reward to the liquidity providers rather than the traders. There are different ways to implement liquidity mining. Compound [17] is a famous example of protocols deploying liquidity mining. With Compound, users become a liquidity provider by supply assets to a pool and obtain interests for its contribution (similar to depositing money into a bank). Liquidity providers first reserve some assets in the pool and obtain "cToken" of Compound which entitles the owner to an increasing quantity of the underlying asset. Users can use their "cToken" to borrow different assets available on the Compound and pay some interests to Compund. The borrowers may have some quick gains through the financial games [18]. Both borrowers and liquidity providers can withdraw their asset by trading them back with "cToken". Oners of "cToken" can also manage the business direction and decisions of Compound through weighted voting. The potential concern here is that rich users might be able to take over the control of the system.
Uniswap [19] is another popular DEX deploying liquidity mining. Uniswap incentivizes liquidity providers by giving them a share of the earned transaction fees. In particular, Uniswap changes each transaction a 0.3% fee, where 0.25% will be distributed to the liquidity providers, and 0.05% will go to the Uniswap account. One issue is how to incentivize traders. With Uniswap, traders are incentivized by the potential profit it can gain through the price difference between Uniswap and other exchanges. Uniswap price oracle is based on a constant function market makers [20,21], where the product of the number of reserved tokens is a constant. For example, if Uniswap has a pair of X token A and Y token B, then when a user using X' token A to buy Y' token B, the product of the reserved number of tokens should remain the same, i.e., XY = (X+X')(Y-Y'). The price of Uniswap (V1) is also defined in this way. This allows traders to speculate in the exchange market as the asset price on Uniswap is changed dynamically and is different from other exchanges. This, on the other hand, may have a security risk as the price can be easily manipulated. Uniswap (V2) fixed this problem by taking an accumulated price over a period of time [22]. However, as speculation/manipulation becomes harder, the trading volume may decrease.
MiniSwap [23] introduces a hybrid model (a mixture of "trans-fee mining" and "liquidity mining") to address the above issues. MiniSwap provides three types of rewards. For each trade with transaction fee f ETH in MiniSwap, a number of MiniSwap tokens (called MINI) worth 2f ETH will be minted. A (parameterized) portion of the tokens are given to the trader, and the rest are distribued to the liqudity providers. The transaction fee (f ETH) is used to exchange MINI in the liquidity pool. 50% of the obtained MINI will be distributed to all MINI holders, and the other 50% will be destroyed. In this way, both traders and liquidity providers are incentivized to join the ecosystem.
Recall that with FCoin, there is a problem when all coins are minted. MiniSwap has an upper bound (of 500,000 tokens) on the number of tokens can be created every day, and this limit reduces every month until a point where the limit (18,000 tokens) remains unchanged. This guarantees the sustainability of the system as the mining process can last for 100 years. The parameterized ratio of tokens as the reward to the trader and liquidity provider can also strengthen sustainability. It enables the system to dynamically balance the incentive of different parties in the system to make it more sustainable.
Overall, the MiniSwap hybrid model has taken the benefit of both "trans-fee mining" model and "liquidity mining" model, while eliminated the potential concerns. Formally defining and analyzing these models, e.g. through the game-theoretic approach [24], would be an interesting direction.
Reference
[1] The Guardian, Cryptocurrency investors locked out of $190m after exchange founder dies, 2019.
[2] Runchao Han, Haoyu Lin, Jiangshan Yu. On the optionality and fairness of Atomic Swaps, ACM Conference on Advances in Financial Technologies, 2019.
[3] Satoshi Nakamoto. 2008. Bitcoin: a peer-to-peer electronic cash system
[4] Jiangshan Yu, David Kozhaya, Jeremie Decouchant, and Paulo Verissimo. Repucoin: your reputation is your power. IEEE Transactions on Computers, 2019.
[5] Joseph Bonneau. Why Buy When You Can Rent? - Bribery Attacks on Bitcoin-Style Consensus. Financial Cryptography and Data Security - International Workshops on BITCOIN, VOTING, and WAHC, 2016.
[6] Yujin Kwon, Hyoungshick Kim, Jinwoo Shin, and Yongdae Kim. Bitcoin vs. Bitcoin Cash: Coexistence or Downfall of Bitcoin Cash, IEEE Symposium on Security and Privacy (SP), 2019.
[7] Kevin Liao and Jonathan Katz. Incentivizing blockchain forks via whale transactions. International Conference on Financial Cryptography and Data Security, 2017.
[8] Ayelet Sapirshtein, Yonatan Sompolinsky, and Aviv Zohar. Optimal Selfish Mining Strategies in Bitcoin. Financial Cryptography and Data Security, 2016.
[9] Ittay Eyal and Emin Gün Sirer. Majority Is Not Enough: Bitcoin Mining Is Vulnerable. Financial Cryptography and Data Security, 2014.
[10] Ittay Eyal. The Miner’s Dilemma. IEEE Symposium on Security and Privacy, 2015.
[11] Miles Carlsten, Harry A. Kalodner, S. Matthew Weinberg, and Arvind Narayanan. On the Instability of Bitcoin Without the Block Reward. ACM SIGSAC Conference on Computer and Communications Security, 2016.
[12] Kartik Nayak, Srijan Kumar, Andrew Miller, and Elaine Shi. Stubborn mining: generalizing selfish mining and combining with an eclipse attack. IEEE European Symposium on Security and Privacy, 2016.
[13] Runchao Han, Zhimei Sui, Jiangshan Yu, Joseph K. Liu, Shiping Chen. Sucker punch makes you richer: Rethinking Proof-of-Work security model, IACR Cryptol. ePrint Arch, 2019.
[14] Christopher Natoli, Jiangshan Yu, Vincent Gramoli, Paulo Jorge Esteves Veríssimo.
Deconstructing Blockchains: A Comprehensive Survey on Consensus, Membership and Structure. CoRR abs/1908.08316, 2019.
[15] FCoin, https://www.fcoin.pro
[16] The Block Crypto. Cryptocurrency exchange Fcoin expects to default on as much as $125M of users' bitcoin, 2020.
[17] Compound, https://compound.finance.
[18] Philip Daian, Steven Goldfeder, Tyler Kell, Yunqi Li, Xueyuan Zhao, Iddo Bentov, Lorenz Breidenbach, Ari Juels. Flash Boys 2.0: Frontrunning, Transaction Reordering, and Consensus Instability in Decentralized Exchanges. IEEE Symposium on Security and Privacy, 2020.
[19] Uniswap. https://uniswap.org
[20] Bowen Liu, Pawel Szalachowski. A First Look into DeFi Oracles. CoRR abs/2005.04377, 2020.
[21] Guillermo Angeris, Tarun Chitra. Improved Price Oracles: Constant Function Market Makers, CoRR abs/ 2003.10001, 2020.
[22] Uniswap V2.0 whitepaper. https://uniswap.org/whitepaper.pdf
[23] MiniSwap. https://www.miniswap.org
[24] Ziyao Liu, Nguyen Cong Luong, Wenbo Wang, Dusit Niyato, Ping Wang, Ying-Chang Liang, Dong In Kim. A Survey on Blockchain: A Game Theoretical Perspective. IEEE Access, 2019.
submitted by MINISWAP to u/MINISWAP [link] [comments]

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