Ecash enables accountless mining pools. I think your mind is stuck in the account based model and this thinking leads you to false conclusions.
As nostr:npub12rv5lskctqxxs2c8rf2zlzc7xx3qpvzs3w4etgemauy9thegr43sf485vg said, pool redemptions decouple submitted work from redeemed value. The pool won't be able to link these two because eHash tokens can be freely traded before redemption. The value represented by a proof of work share can go through any number of splits, joins, and trades before it is redeemed. How do you disentangle that using IP tracking? You could try, but if there is any significant volume...good luck with that.
BOLT12 and on-chain addresses just add the account aspect back in. This is a strict reduction in privacy for the user. They can certainly choose this option if the pool offers it but in terms of privacy it is better to receive ecash mining rewards and spend it directly. This way all your activities occur within the anonymity set of the ecash mint.
The ecash model simplifies accounting because the pool no longer needs to track the work of every user that connects to it. Instead, the pool accounts for all shares within a time window and that's it. Instead of maintaining hundreds or thousands of accounts in perpetuity the pool manages one 'account' per hour with a prearranged start and end date. I prefer to think of them as contracts. When the contract end date approaches all the assets (mining shares) and liabilities (eHash tokens) of the contract can be zeroed out and removed from the books. The pool never needs to carry a balance for users that have not met their withdrawal threshold.
This is a dramatic simplification in accounting because it removes an entire class of liabilities that need to be tracked. The business owner no longer needs to be concerned with unredeemed shares.
The eHash tokens (1token = 1share) need to be redeemed first by the miners, before they can be traded.
So, the pool needs to send them *somewhere* - otherwise they remain on the pool's books.
The tokens are probably locked to the miner's npub until he withdraws - which is an "account" (same as some pool use Bitcoin addresses as accounts)
Right?
> The eHash tokens (1token = 1share) need to be redeemed first by the miners, before they can be traded.
No, that is the entire value proposition of eHash. Trade it before it matures.
> The tokens are probably locked to the miner's npub until he withdraws
Again, no. The miner submits a blinded message (random number) with each share. The mint returns a blind signature over the blinded message. The miner unblinds it to get a valid signature from the mint's private key that commits to a secret value that the mint has never seen before. In order to redeem the token, the miner or whoever they have traded with presents the unblinded secret + unblinded signature. The mint has never seen this value before but it knows with cryptographic assurances that it is a valid ecash token.
"trade it before it matures"
1) how can I, the user (=miner), trade something I have no possession of??
The token either resides in the mint (=is not yet redeemed by the miner), or is already redeemed by the miner meaning the miner has been paid already.
2) The pool runs the mint? Or is the mint a separate party?
PPS: how the fuxk is i quote respond in amethyst?
Ecash lets the mint custody some value and issue a bearer asset IOU in exchange for the custodied value. It's digital free banking. https://en.wikipedia.org/wiki/Free_banking
The hard money value is custodied by the mint. The bearer asset ecash token is custodied by the user. I hope that is clear.
In my model the pool runs a mint. They are one and the same.
> PPS: how the fuxk is i quote respond in amethyst?
lol I just manually do it. "> message" is email formatting for a quote. Some nostr clients respect, some don't. 🤷
I know what ecash is, thx 😉
When the miner does work (submits shares), the pool/mint credits him with eHash tokens in his book.
They remain in the pool's book (custody), until the miner withdraws them; that can be once a day, once an hour, whatever.
My question was/is, how would the miner be able to trade this eHash token *when it is still in custody with this pool*??
He has nothing in hand, other than a promise (which he can't even prove). Who would trade for this?? They would trade for an IOU (from the miner) of an IOU (from the pool)
You are making assumptions and running away with them. Slow down and think it through, Hoss.
> When the miner does work (submits shares), the pool/mint credits him with eHash tokens in his book.
correct
> They remain in the pool's book (custody), until the miner withdraws them; that can be once a day, once an hour, whatever.
Currently, mints do not expire ecash tokens. This is unsustainable and it doesn't scale. We are going to a place with expiring ecash tokens. Mark my words. In my model, all eHash tokens expire a fixed amount of time after the token fully matures. If the user doesn't redeem it for ecash in time, the value is lost.
> My question was/is, how would the miner be able to trade this eHash token *when it is still in custody with this pool*??
As explained in my previous email, there are two assets being custodied. The user custodies a bearer asset token. An IOU. The pool custodies the proof of work share while it accrues value from each block the pool finds in the maturity window. The user can hold or trade the IOU while the mint keeps track of the proof of work share. I hope this is clear now.
> He has...a promise (which he can't even prove).
All pool and mint operations will be verifiable after the fact.
> Who would trade for this??
Any market maker seeking privacy or willing to take on a little risk for a larger bitcoin payout would be incentivized to buy these tokens. Any miner seeking access to immediate liquidity would be incentivized to sell them.
> All pool and mint operations will be verifiable after the fact.
This is an understatement. Miners can actually prove the value backing their share before it matures or is redeemed. Although, if they trade it away they lose the ability to fully verify it.
They can even prove what block template they were mining on. And I have some ideas on how to leverage this. ;-)
> The user custodies a bearer asset token.
No. The bearer asset token (eHash) is minted by the mint (=pool). And yes, that balance accrues, then more shares the miner submits. But the token
But these tokens remain in custody with the pool - until the miner withdraws them. Then, and only then, he can trade them.
Up until then (when he eventually withdraws the token and therefore takes ownership of them) he can only trade claims to the tokens. Hence my comment "he can trade IOUs of IOUs".
Now the core question: Why would anyone trade for these claims to the token (who are then claims to actual Bitcoin)???
Firstly, the miner would have to prove to the buyer that he is entitled to these token that are currently accruing with the pool. So a) there has to be some record, some ledger (account) at the pool level to keep track of how is owned what. And b) the miner has to proove to/convince the buyer that he is actually the person who is owed this token balance. (How?)
Secondly, even if we assume the miner were to find a buyer for these IOUs of IOUs, they are less worth than actual bitcoin; they'd trade for 90cents on the dollar. Why on earth would any miner sell his bitcoin at a discount?
"Need for immediate liquidity" you say???? Are to you telling me there are miners how have intra-day liquidity requirements, such that they would be forced to sell at a discount??
Because even now, any miner/seller can already get payouts on a daily basis via Lightning (https://academy.braiins.com/en/braiins-pool/faqs/rewards/#are-there-any-limits-for-lightning-payouts)! And keep 100% of his bitcoin, instead of 90% (or whatever the discount would be at which he can sell). Or every ~1.5day if they use BOLT12 payouts at OCEAN.
Bottom line - I still dont see why this construct would make sense
Keep noodling on it, maybe it will make sense one day. I'm not gonna wait for you. I'll be busy building the future.
