Exclusive interview with CEX.io Ghash.io CIO Jeffrey Smith about Future of Exchange and the Pool

Just notice – this interview was done before 51% thing happening [around wednesday] but we managed to get it updated with info about 51% attack today [monday] In the interview we will not only speak about current Cex.io state but also future and side-projects. Enjoy the read.

So for the start, tell us who you are and what are you responsible for in Cex.io and other projects?

I am Jeffrey Smith, Chief Information Officer of CEX.IO. I am responsible for the whole informational flow coming from our company.

Cex.io started in times when there was not so many ASICs out there, how does the ‘pool’ look like from the hardware side. What do you have there, how does it change userids so fast [when buying/selling on cex.io] – what kind of hardware/software is behind that?

We’ve got main and side servers placed in data centres all over the world. Some of them contain our own hardware, varied in power and ASIC vendors. Actually, it doesn’t differ from any other back-end system.

CEX.IO
How big is the spot holding all these ASICs and how many people take care of it?

As said, it is actually not one spot, but a couple of them, placed in various countries. All the data centres are maintained by lots of professional engineers.

What will happen in future when difficulty is very high and block rewards are very low, how will those who own the mining shares profit?

We are confident that mining will be always profitable in any case. That is, mining rewards will exceed electricity and maintenance costs provided the Bitcoin price continues growing.

Cex.io is mainly to buy/sell hashes that mine BTC and merge mined coins, but you also added LTC and made scrypt multipool. What pushed you there and how often will you be adding extra coins there?

CEX.IO is a very user-oriented platform, keen on novelties and trends. That is why we decided to expand mining options at GHash.IO mining pool, which resulted in a range of altcoins for both scrypt and multipool mining. We have also added DarkCoin, which is generated according to x11 algorithm, and are looking into creating a multipool within it as well.

Are you planning to make buy/sell hashes for scrypt too just like Cex runs for BTC? If so what kind of machinery would you be using.

Yes, we are planning to introduce scrypt cloud mining as well, and this is a very popular question from our users. Currently, we are in the process of holding negotiations with respective hardware vendors. If any of them are reading this interview and have special offers, free feel to contact us.

What would you do if a government ever came with a court order (like a National Security Letter) with instructions to hand over controls of the pool, or to submit to directions of operation? How are you protected from gov trying to get on your business and how would you protect the users?

CEX.IO is protected by a team of competent lawyers. If such a situation ever happens, we will act on behalf of the Bitcoin Community and within the limits of applicable legislation.
But anyway, we have made everything possible to make such course of events not come true.

So the next thing that you guys plan is white label exchange script – how will it exactly work?

CEX.IO is partnering with VBBB — provider of a white label solution for building cryptocurrency exchanges. Thus, anyone can launch his or her own exchange in a short time with minimal efforts. Apart from easy installation and strong back office, such exchanges get a unique advantage of a shared order book. That means that their clients will not come to an empty market. And CEX.IO assists VBBB by providing mining contracts for the exchanges.

By the way, all this is already working, so if you are thinking of starting an exchange business, check out VBBB.com. A good example of a white-label is 1WBE.com

Will people be able to add their own currencies – at charge or not, and if so – how would that be maitenaited? BTC/LTC might not be enough for many people.

We have not thought about giving an opportunity for users to add new coins yet. And it should be hard to bring into life from the technical point of view. Still, we try to listen to our users and satisfy their demands. If the majority votes for the cryptocurrency to be added to CEX.IO, then it will be presented in the trading pairs as soon as possible.

For the end, just speculating – do you see BTC getting back to 1k$ and raising or rather stabilizing where it is and letting other currencies to get the crown?

We believe in Bitcoin and it will surprise everyone this year. No more comments.

EXTRA QUESTION ABOUT 51% ATTACK ADDED AFTER INTERVIEW:
Ghash.io got 51% of the network hashes. Could you elaborate if (and if so how) Ghash can protect the pool from such hashes amount? Do you have anything planned ie BTCGuild when they got near 50% put up such high fees that many people left them.

We are aware of the buzz going around GHash.IO getting 51% of the mining power, and the communities worrying that GHash.IO is executing an attack on the protocol.

We absolutely agree that Bitcoin mining should be decentralised.

Initially, when we got close to 51% back in January, we quickly released the statement that we were doing everything possible for GHash.IO not to get 51% of the mining power, so we stopped adding new miners to the pool, as well as tried to allow cloud miners of CEX.IO mine on other pools.

Pretty soon, the buzz was mitigated, and GHash.IO’s percentage lowered to 30%. We hoped that after this wave the pool infrastructure would become more stable and balanced, until June of 2014, when we really did come close to 51% and some users even posted screenshot proves of us getting that 51%.

I must assure you that we do not intend to harm the Bitcoin protocol or do any actions to manipulate with transactions. With CEX.IO and VBBB.com, we have seriously invested into Bitcoin and any actions would result in a short-term benefit and a large amount of losses, so we are working effectively to make sure that the community is not worried again.

We would also like to state that stopping sign ups and other actions of this type would only be a temporary solution, and there would be no guarantees that later on some other pool would get the percentage close to 51%, and their intentions would not be so true and assuring as ours.

We STRONGLY agree that no Bitcoin user should fully trust a single entity that they will not harm and manipulate users’ funds and assets, and we will soon present a valid solution to the “Achilles heel “ problem of Bitcoin, and will start an open dialogue with other pool owners to impose this solution.

 

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