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Firm Identify: DEMAND
Founders: Alejandro De La Torre and Filippo Merli
Date Based: 2023
Location of Headquarters: Lisbon, Portugal and Florence, Italy
Quantity of Bitcoin in Treasury: “Presently being bootstrapped”
Variety of Staff: 2
Web site: https://www.dmnd.work/
Public or Personal? Personal
Alejandro De La Torre is deeply involved that Bitcoin mining is just too centralized, and he’s on a mission to alter that. Because of this he began DEMAND, a Bitcoin mining pool that places energy again within the palms of unbiased Bitcoin miners.
Earlier than entering into how DEMAND works, although, it’s vital to grasp what De La Torre has discovered from his time within the Bitcoin mining trade in order to higher perceive his motivation in beginning DEMAND.
De La Torre’s Historical past In The Bitcoin Mining House
De La Torre has served because the VP of Poolin, one of many largest Bitcoin and crypto mining swimming pools on this planet, in addition to the VP of Enterprise Operations for BTC.com, which additionally operated its personal Bitcoin mining pool. What he noticed throughout his time in these two roles made him understand that there was little time to waste in decentralizing the Bitcoin mining panorama.
“The expertise I had within the final swimming pools made me understand that we wanted a change within the mining pool trade and we wanted it very, in a short time,” De La Torre instructed Bitcoin Journal. “There is a very clear drawback with centralization in mining swimming pools right now, and I used to be capable of pinpoint that difficulty whereas working at BTC.com and Poolin.”
De La Torre went on to explain what number of Bitcoin mining swimming pools at the moment are proxies for a bigger pool, which he didn’t point out by title (it’s Antpool), and defined that such centralization has the facility to noticeably harm Bitcoin.
“The anchor pool is near 50% of the community now. It permits for a 51% assault on the community, which might be catastrophic,” stated De La Torre.
“I don’t suppose they might ever do it, however the risk is there, which is already an enormous purple flag,” he added.
De La Torre additionally identified that such ranges of centralization pose dangers in the case of community censorship, highlighting that it wouldn’t be troublesome for this main pool to censor half of the transactions on the Bitcoin community.
The potential for censorship and a 51% assault “are a really clear and current hazard that now we have in Bitcoin proper now,” in response to De La Torre.
Energy To The Solo Miners
In response to this, De La Torre and his enterprise associate, Felippo Merli, launched DEMAND Pool in November 2023 with the intention of placing the facility again within the palms of solo miners.
DEMAND is the world’s first Stratum V2 mining pool. Stratum V2 is an open-source messaging protocol that permits miners and swimming pools to speak straight with one another, lowering mining infrastructure necessities in comparison with its earlier iteration, and enabling solo miners to decide on their very own mining templates. This latter functionality is without doubt one of the main options that units Stratum V2 aside from different mining pool protocols.
“Swimming pools right now are those who’re answerable for constructing the blocks and including the transactions into the blocks,” stated De La Torre. “With Stratum V2 — with DEMAND — the miners themselves will have the ability to construct the blocks and add the transactions that they need.”
Most filtering in mining swimming pools right now is completed on the pool stage, not the person miner stage. De La Torre understands that particularly within the wake of the introductions of protocols like Ordinals and Runes, miners need extra management over what sorts of transactions they embrace of their blocks. And De La Torre believes miners ought to have this energy, as a result of it provides to the ethos of decentralization.
“This provides me much less energy. That is what I would like. I do not need the facility. I am achieved with that energy,” stated De La Torre. “I’ve had it earlier than, and it is an excessive amount of energy within the palms of too few. And that is not what Bitcoin is. Bitcoin is decentralization, and that is furthering that.”
In efforts to assist miners with filtering, DEMAND has created a sequence of mining templates that miners can readily use of their operations.
Incentivizing Solo Miners
De La Torre is conscious that the percentages of mining a block are towards small-scale solo miners, however he doesn’t suppose they shouldn’t give discovering one a shot, and he’s additionally created different methods to incentivize solo miners to come back on-line.
“You’ve obtained to warmth up your property throughout winter, proper? Why not simply use a Bitcoin miner as a heater?” stated De La Torre.
“If you happen to’re fortunate, you hit a block and also you simply made your spouse very blissful,” he added with fun.
Solo miners who be part of DEMAND Pool may even have the choice to promote the hash fee they produce on a market, making certain that they obtain some revenue for his or her efforts. DEMAND has arrange a cope with the hash fee market Rigly and plans to determine extra partnerships.
De La Torre additionally touched on how DEMAND funds might be achieved through the PPLNS (Pay Per Final N Share) system. With PPLNS, earnings are allotted primarily based on the quantity blocks a mining pool mines per day and payouts fluctuate primarily based on the pool’s luck in mining blocks.
This technique differs from the FPPS (Charge Pay Per Share) system, which is often used within the main mining swimming pools. With FPPS, miners cost a service price primarily based on theoretical revenue, and miners receives a commission whether or not the pool finds a block or not.
De La Torre is conscious that it could sound enticing to miners to receives a commission persistently with FPPS, however he was fast to level out that payouts via each PPLNS and FPPS are comparable over the long run.
“Lots of people have some misunderstandings about PPLNS,” stated De La Torre.
“FPPS provides you fixed payouts, which is ok. I perceive why a miner would discover FPPS. Nonetheless, PPLNS over sufficient time averages out to about the identical,” he added.
“Sure, you will not have fixed payouts, however you should have incorrect payouts in response to how a lot hash fee DEMAND has — and we intend to have quantity. You’ll nonetheless be getting a continuing payout, or it could common out to kind of the identical. So, there is not any actual draw back to it.”
De La Torre additionally identified that solo mining as a part of DEMAND’s pool is without doubt one of the finest methods for Bitcoin lovers to get their palms on non-KYC bitcoin.
He additionally burdened the truth that solo miners’ coming on-line will do one thing else that’s important to conserving Bitcoin decentralized — it can carry extra nodes on-line.
Ship Nodes
To make use of DEMAND’s block templates, miners should run their very own nodes. Which means solo miners wouldn’t solely contribute to the decentralization of Bitcoin’s hash fee but in addition to the decentralization of its governance.
“Not solely do we wish the solo group and the house mining group to flourish and to earn more money, however we additionally need node proliferation,” stated De La Torre.
“Solo miners will present hash fee to safe the community and probably make some bitcoin and likewise assist with sustaining Bitcoin Core or no matter Bitcoin consumer they need. Nodes are good for the well being of the system,” he added.
Trying Forward
De La Torre additionally stated that DEMAND is at the moment engaged on increasing its providers to pooled mining, and that DEMAND will actively be searching for miners to come back on board.
He’s vowed to make DEMAND a “steady and reliable pool with clear payouts,” differentiating it from the “black field” swimming pools on the market.
De La Torre appears to be doing all the things in his energy to carry extra unbiased miners on-line, and as he laid out his plans for DEMAND in my dialog with him, there was a palpable sense of urgency in his voice.
“The centralization of Bitcoin mining swimming pools is turning into a really critical difficulty, and it is as much as us because the mining group to do one thing about it,” stated De La Torre. “If we don’t, it’s not good.”
