Bitcoin Mechanic on Ocean and Permissioned Pools

The first time Bitcoin Mechanic came to Miami, in 2021, his Uber account stopped working. He tried to hail the yellow cars with taxi signs on their roofs. They were private cars. The taxis, as he told it, were gone.

He told that story on stage at Mining Disrupt Miami 2024, held June 24 through 26, 2024, speaking for Ocean, the Bitcoin mining pool. Bitcoin was at $61,272 that week. Today it is at $81,859.

His point was that Amazon and Uber are cheap and convenient until the day you can't use them, and by then there is nothing left to fall back on. In his words, "So this is not how you build resiliency." Bitcoin, he said, is not about optimizing for efficiency. It is about redundancy, the kind that can look unnecessary and is what lets a system last.

Then he put up a chart of the network's hashrate by pool. Foundry at the top. Behind it, Bitmain's own pools and the pools affiliated with Bitmain, a group he called AntMain. Most people, he said, only worry when one pool gets close to a majority. He argued the trouble starts earlier: "So the two biggest pools you see here, which overtly account for more than 50% of the network, both require permission."

He compared that to a world where you need a passport to take a taxi, and where the only store is Amazon and you need government ID and a credit card to shop there. Mining that needs permission, he said, puts a permissioned layer on top of a permissionless system.

Ocean had launched the November before. Bitcoin Mechanic said it was built on two sayings every Bitcoin holder learns: not your keys, not your coins, and don't trust, verify. The first came out of exchange failures such as Quadriga in Canada. The second is why people run their own nodes.

On the first, he said that when the other pools on his chart find a block, they pay themselves and settle with their miners afterwards. When Ocean finds a block, most of the new coins go straight to the miners who helped find it, and the pool never touches them.

On the second, he took aim at FPPS, the payout model most of the other pools use. He called it unverifiable: the pool tells miners what they are owed by its own formula. It also turns the randomness of block discovery into guaranteed pay, and he called that a very, very expensive service. Miners who can wait for blocks, he said, cut out the middleman and can make much more money.

He closed by crediting Bob Burnett of Barefoot Mining with Ocean's first block, found on an S19 XP, the machine Burnett was bringing to the Ocean booth that day.

The full story is on Mining Disrupt at miningdisrupt dot com, and many more like it play around the clock on Bitcoin Radio.