The future of Prohashing
Posted: Wed Nov 08, 2017 10:13 am
After the huge influx of customers began in June, on July 9 we began an investigation into the economics of Prohashing in an effort to determine its future profitability and potential. The investigation, which lasted for the last four months, involved a review of the project's finances and projections about future hashrate and the prices of coins. The most arduous part of the task involved a legal examination. Because there is almost nobody experienced in cryptocurrency law, it took almost four months and contacts with six law firms to find a qualified lawyer and determine the benefits and risks of different business models.
Today, I'm pleased to announce that we decided to select the "aggressive expansion" option.
We've always strived for transparency and honesty. With this decision, we plan to take it one step further by moving mining out of the shadows and into the realm of regulated, established corporations. Many of the world's mining pools are run by anonymous individuals with a lack of accountability and transparency. We see a competitive advantage in providing a service that people can trust, where they know that they are not getting swindled, and where they know there is legal recourse in the case that we were to defraud them.
Every part of the cryptocurrency industry has gone through this transition over the past few years. Coinbase, for example, was the first to do that with exchanges. In 2013, exchanges were often run by anonymous proprietors, who suffered from "hacks," many of which are actually thefts by the exchange operators themselves. As the number of exchange customers grew, there was enough profit available to become public and transparent, creating an ecosystem of exchanges almost indistinguishable from the banking system. With our now being confident that bitcoin prices will remain above $980 and litecoin prices above $15 after the next crash, mining has now reached that point of rapid expansion. The number of miners has grown enough to support large professional operations that cater to the general public.
We plan to spend half a million dollars to improve our services. As part of this decision, we will transition from 1.25 to 3 full-time employees initially. Chris will continue to work full-time on coins, infrastructure, and our backend trader. I will transition from 25 hours to 60 hours per week and focus almost exclusively on continually improving performance, as well as other highly technical tasks, taking a less public role. We're also pleased to announce the hiring of Constance Hilliard, who will be joining us full-time as a developer and manager. Constance will initially start by providing support, and as she learns the system, she will focus on the user interface development, public relations, HR, and compliance side of the business. We may hire an additional person who will work full time on taxes and accounting in the future so that Constance can focus more on development.
Here are the things we will be focusing on as priorities:
We want to acknowledge that there may be some customers will will turn out to be disappointed by the business path we've chosen. We will always continue to strive our hardest to provide the absolute highest profitability across all pools, and we are happy to announce that we will not need to increase fees as a result of this investment. That said, we anticipate that the initial changes to set up more servers, to improve legal compliance, and to transition to the new manpower levels may be disruptive. Pools that operate anonymously are not encumbered by the issues that we face, and those who are willing to risk their money might be able to eek out slightly more profit with them.
That's not who we're competing against. What we are striving to provide is a professional service, run by known individuals, that is high performance, that won't be shut down by governments due to involvement with drug dealers or shady people, with great customer service, with an easy-to-use interface, and which you can count on to pay what is owed to you.
Thanks for your continued support, and we look forward to serving you as we significantly increase capacity and set our sights on becoming one of the largest mining pools in the world!
Today, I'm pleased to announce that we decided to select the "aggressive expansion" option.
We've always strived for transparency and honesty. With this decision, we plan to take it one step further by moving mining out of the shadows and into the realm of regulated, established corporations. Many of the world's mining pools are run by anonymous individuals with a lack of accountability and transparency. We see a competitive advantage in providing a service that people can trust, where they know that they are not getting swindled, and where they know there is legal recourse in the case that we were to defraud them.
Every part of the cryptocurrency industry has gone through this transition over the past few years. Coinbase, for example, was the first to do that with exchanges. In 2013, exchanges were often run by anonymous proprietors, who suffered from "hacks," many of which are actually thefts by the exchange operators themselves. As the number of exchange customers grew, there was enough profit available to become public and transparent, creating an ecosystem of exchanges almost indistinguishable from the banking system. With our now being confident that bitcoin prices will remain above $980 and litecoin prices above $15 after the next crash, mining has now reached that point of rapid expansion. The number of miners has grown enough to support large professional operations that cater to the general public.
We plan to spend half a million dollars to improve our services. As part of this decision, we will transition from 1.25 to 3 full-time employees initially. Chris will continue to work full-time on coins, infrastructure, and our backend trader. I will transition from 25 hours to 60 hours per week and focus almost exclusively on continually improving performance, as well as other highly technical tasks, taking a less public role. We're also pleased to announce the hiring of Constance Hilliard, who will be joining us full-time as a developer and manager. Constance will initially start by providing support, and as she learns the system, she will focus on the user interface development, public relations, HR, and compliance side of the business. We may hire an additional person who will work full time on taxes and accounting in the future so that Constance can focus more on development.
Here are the things we will be focusing on as priorities:
- Mining server performance: we plan to parallelize coin assignment as soon as possible so that we can open registrations. We have implemented code that accomplishes this task and will now be available 24/7 so that we can release it and be available to fix the bugs it causes.
- Improving response times: we plan to improve response times to support tickets so that customers can get important questions answered immediately.
- Reducing support tickets: there are user interface changes we can make that would significantly reduce the number of repetitive support tickets and improve customer satisfaction. There are also changes we can make in the payout code to ensure that customers encounter "stuck payouts" less frequently.
- Improving compliance with laws and regulations: we plan to make it easier for customers to comply with regulations. A recent topic on the forums regarded taxes, for example, and we will be making detailed tax information available.
- Supporting additional algorithms: we plan to focus on SHA-256 first, since it is the easiest, and then add Dagger-Hashimoto, since it is the most profitable. We have ordered 0.7 bitcoins already in new servers, racks, uninterruptable power supplies, and an electrician to run higher amperage to support the coin daemons.
- Purchasing a testing environment: we plan to purchase a mining farm to use for better testing on the development system. Currently, testing uses fake miners, which don't advance blockchains and therefore leave bugs in block submission and some race conditions undiscovered.
- Improving our Internet connection: we plan to purchase an enterprise-grade Internet connection, which will reduce latency by about 20ms.
We want to acknowledge that there may be some customers will will turn out to be disappointed by the business path we've chosen. We will always continue to strive our hardest to provide the absolute highest profitability across all pools, and we are happy to announce that we will not need to increase fees as a result of this investment. That said, we anticipate that the initial changes to set up more servers, to improve legal compliance, and to transition to the new manpower levels may be disruptive. Pools that operate anonymously are not encumbered by the issues that we face, and those who are willing to risk their money might be able to eek out slightly more profit with them.
That's not who we're competing against. What we are striving to provide is a professional service, run by known individuals, that is high performance, that won't be shut down by governments due to involvement with drug dealers or shady people, with great customer service, with an easy-to-use interface, and which you can count on to pay what is owed to you.
Thanks for your continued support, and we look forward to serving you as we significantly increase capacity and set our sights on becoming one of the largest mining pools in the world!
Hope thats a priority. Thanks for all you do.