Out of context that can be misinterpreted. To explain fully, your interest rate is the daily pct * Days Held * reward pct.

With Reward pct being an array {100.00, 97.54, 95.93, 94.35, 92.78, 91.24, 89.72, etc.. } and being the first entry if transaction occurred in month 1, the second in month 2, etc... with the month being calculated as the transaction's previous block height / 43836

FYI... the actual interest rate hardcoded into the count is approx 0.2424 pct a day

And a few more possible reasons:

The projections probably made assumptions about the distribution of survey coins and other coins that were most likely off.

It was probably assumed that these coins would contribute to growth with some high percentage transferring to growth accounts. That probably didn't happen and instead I have a feeling a good portion of that distribution was either sold or are being held in private wallets  The same for many pre-sale buyers.

I would suspect many private held private wallets probably just aren't staking. It's pretty clear the neucoin didn't think as many people would choose to hold privately and instead would go for the growth account option.

Yep... I have been give different reasons for the high orphan rates. First it was longer block chain... provider a counter example. Then first come first serve due to network latency... provided counter examples. The latest reason is due to earlier timestamps (ntime) on the blocks/transactions, which is just not true, but provided counter examples. Only reason remaining is "trust" which is based on entirely on the amount of funds in the wallet that created the addres..



Yes a lot.  In just the last month over 1000 POW blocks orphaned (that 1,141,000 million coins)  and over 100 PoS stakes orphaned... don't have the total on those.


No if neucoin.io has a lower balance orphaning would total explain.

EG. Block is mined, both explorers would credit the miners account balance. When the block is orphaned by a PoS for that account if neucoin.io doesn't reorganize nuecoin.io will have the lower balance for that account. Nuecoin.org does reorganize and the PoS account is credited with the stake while the miner's balance is debited. Hence a possible explanation for the higher balance on the nuecoin.org explorer.

I haven't look into the inconsistencies and the only possible explanation I can offer up is neucoin.io not handling the reorganize. It is certainly possible the larger accounts such as NdoQ1 are orphaning stakes from smaller accounts... but not sure.




A possible explanation for this the originally projected monthly drop in interest rates is exactly following what was projected. The decrease isn't actually done on a monthly basis but instead done every 43,836 blocks. So the third drop in interest rates is to occur after 132,000 blocks are on the chain. So it was projected. using the 9/11 date on the genesis block there would be 131,508 blocks on the chain at the start of the 4th month. If we take a month to be 30 days, then we 7 days from the 90 day marker... about 76% or the way through the month. Taking the current block height of 111599 -87672 (the block for the second month) we are only 23,927 blocks into month 3. That's only only about 54.6% of the way into the month( again being 43,836). So clearly block generation isn't happening as fast as project. I have seen the projected coin creation rates but I am sure they were tied to this. Do you have a link to that?


Can only speculate. I can say sometimes when pow blocks are not orphaned it seems to cause a "hiccup" in the staking from the foundation accounts. Its even more noticeable when 2 or 3 successive POW blocks are mined. Why?

I can only speculate but one possible explanation: There is clear latency with the large accounts PoS stakes. Say a block is mined, it gets broadcasted across the network and peers clients begin generating a PoS stakes are generated using the mined block as the previous block hash. Then 30,60, 120 seconds later a Foundation stake hits the network. Orphaning the mined block. All the other peers must now "reset" to use the foundations PoS stake. If they did already mint a PoS stake and already sent it out the block chain these might not even show up as orphaned shares to many nodes on the network... certainly the wallet the generated would receive a reorganize. Combine that with the fact if a PoS stake is orphaned the wallet just doesn't attempt to immediately mint another stake. Instead the waiting game begins. This also lowers the effective compound interest rates which in turn a a whole will reduce future PoS staking and in turn make slow down the rate of block generation. Of course this and the obvious fact that several thousand blocks themselves have been orphaned and hence not making it onto the chain and hence not contributing the amount of funds created and hence not staking and hence not generating compound interest either. I highly doubt this rate of orphanage was factored into the original projects.

Thanks that's an awesome portrait of me. I am going to frame it on my wall!

The wallet puts the official money supply at 3394656794.950989 neu. It matches is what is on the official explorer.

Could totally be possible the neucoin.io total includes orphaned transactions it has not reconciled.

Okay, getting to the end there are more specific accusations but even these accusations are clouded in obscurity and you can certainly pick apart claims in certain paragraphs which are contradicted by statements of facts given in other paragraphs.

Yes, this is civil suit and given the weakness of the complaint will most likely stay that way.

I wouldn't be surprised if this becomes a class action lawsuit in which those allegedly defrauded are paid out 5 to 10 cents on the dollar for what they were defrauded for.

Another key point to make is the actual "charges" being alleged all seem to hinge on "hashlets" being a security. That is the underlying basis for the three compliants, that they were sold under the pretense of fraud, that they were bought under the pretense of fraud and that the said exchanges were done without registering them as a security.

I imagine defense will certainly argue that these were not securities. In order for "hashlets" to fall under the definition the scope of what consists as a security would need to be widened to an almost incomprehensible scope. I say that because such a broad scope would encompass such a wide array of online services, not just mining, but services such as cloud computing offered by Amazon and Microsoft which in turn begins the path down the slippery slop of cloud storage being a security.

If defense counsel has any wits about them at all they will file to dismiss. Even if plaintiffs were to refine the complaint and limit the cloud computing services to those involving the mining of an online currency then such same definition must apply to sites such as Nice Hash which in a similar manner offer could mining services to buyers.

You would certainly have a better chance of charging GHASH.IO with selling an unregistered security given the direct tie to an exchange but given either example both I think are a far stretch to consider a "security".

Unless the courts are willing to broaden the definition of a security to include cloud computing services such  as Microsoft Azure, Amazon's EC2, GigaHash and NiceHash the SEC might have problems bringing this case before a Jury. That is if the defense counsel has any wits and the defense doesn't fold into the aforementioned class action settlement.

Claims by that the "hashlets" were marketed as 'never being obsolete', etc... certainly muddies the waters. But as I have previously done this certainly could be argued. Counter examples can easily be given in analogies for example referencing  the marketing tactics of nearly any given Web Development shop, SEO company or a Pod Casting Company.

Oh it gets better... Here's the SEC reasoning on why 29 was fraudulent:



Really... because the profitability of mining a currency depends on unforeseeable factors? Of course then switch to a different currency. Bringing in electricity or cooling is entire debatable. With proper engineering, from a strictly theoretical purpose, you can get both for free (via lets say solar) or next to free given some initial investment and/or Geo-strategizing.

As far as the extent of computing tech, moore's law is still in play AND when (and it will) that threshold plateaus hit mining difficulty will also plateau as, whether it is part of current design or not, WHEN difficulty increases to the point that mining is far to expensive to maintain the block chain either a) the code base (bitcoin speaking that is) will be changed from the planned incremental increase in difficulty or b) a fork will be created eliminating the need for the unsustainable mining capacity in which case the original fork will most likely continue to exist due to dissenters and will need to implement a to continual survival.

So back the SEC claims, not only the babble spilled out the previous paragraph but guess what there are always alt coins.

Digitization is not exempt from Darwinism. The same theories that explain the extinction of many biological species throughout the ages certainly apply to the digital organism created by mankind.

So once again, trumped up charges by the SEC.

Okay.. even more:


What entrepreneur is going to say otherwise? You could certainly state that (without the claim of always being profitable) make similar claims. "Host your data with us. It will be protected for ever and will never be obsolete. You can't say that about your current cell phone or PC. Just think a decade ago people were storing images and videos on zip drives and floppy drives... now obsolete. Hard drives and SD cards in the same way will be obsolete in another decade... File formats will change, Image compression algorithms will go by the wayside all part of planned obsolescence....."

For the claim about "always making money" really need to dig in specifics... Sure make that claim and if at some point for some reason you can't profitably mine one currency then mine another. If all mining is unprofitable then shutdown shop and return the deposits for the mining contract. This claim by no means spells fraud or intent to defraud.

For example, in the beginning of the complaint it certainly paints a picture that the company in question had little or no mining capacity.

The complaint uses prejudicial adverbs and adjectives to persuade the reader such as:


I certainly read and other claims at the beginning of the claims, especially in regard to the ponzi accusation, and come to the conclusion that the charges are the company was just outright selling mining contracts for non-existent hardware "mining power" and in turn using those sales from new customers to pay off the "fake mining reward"

The sensationalist continues:


However, digging into the details that's not the case. The company did have mining power. And it's first week of sales (in August) 3-4 times more bitcoin hashing power was sold than the company actually owned:


Note Alt coins were not mentioned above and if there were fraudulent Alt coin mining sales it sure would be mentioned.

So 3-4x oversale? That's not dramatic... no problem. Order my asic miners and voila... the contract paid for the hardware (or will pay).

For example, If Microsoft or Amazon suddenly sold 3-4x more hard drive space for cloud storage than they physically owned would that be fraud? Certainly not if the increased storage capacity to meet the storage needs in there data centers...

Continuing...


Well 3 points here. First, they certainly had capacity since the start and they continued to expand it to the point that the company actually set up a data center to increase mining capacity. Second, given the sensationalized language throughout this complaint, I read 50) as regarding the data center containing "significant capacity for mining bitcoin" in November as the company bitcoin mining capacity is no longer "dramatically oversold" at 3-4x capacity. Instead the company can now deliver that and more.

The complaint doesn't mention this convenient little fact and instead uses a literary technique in the previous paragraph called foreshadowing in an attempt to (mis)lead the reader down the narrative of ongoing and perpetuate fraud but turning focus on alt coins now that bitcoin capacity has been take care of.

I am not familiar with the company nor the crypto currency scene that long ago so I can be entirely wrong. However, my intuition tells me that during this time frame there was probably a drop in Bitcoin Price coupled with a spike in one or more alt coin price causing the influx of orders to be diverted from bitcoin to AltCoin.


Certainly bad news for the company after just opening a data center for mining bitcoin. Fraudelent


I'll continue reading the complaint and given the comments on this thread I am most LIKELY ENTIRELY WRONG, but something just doesn't add up. So far I take it this as an ambitious entrepreneur getting caught by the market and going belly up.

If there was deliberate fraud and scam I hope the SEC makes a better case for its complaint in the last 8 pages besides contracts were being sold at slightly higher capacity, which can easily be remedied in hours or argued against that it was never expected for all of those contracts to be utilized at the same time... (much like ISPs and cell providers over sell capacity for internet and data bandwidth and offer "bursting").

Okay, I am confused and admittedly don't know the history of this firm or its activities.

I am currently on page 15 of 23 of the actual SEC complaint and so far, there a few "wild cards" that are like damn, if this guy did that he is toast....

However... !!!! When reading the actual statement of facts in the complaint, which spell out claims the SEC it so far appears to me that the SEC is failing to substantiate the claims it made in the first few pages of the complaint, almost to the point the snippets in the news articles on the complaint are "sensationalist" claims being made by the SEC.

To be fair, I don't know any of the facts, but from the actual complaint itself I get the feeling these charges are being beefed up.

I take it from the comments on this post that the company in question went belly up. That does not mean there was a deliberate attempt at a ponzi scheme, but again I don't know all the facts. However, the accusations in the compliant, thus far aren't being substantiated well and if this guy did do in fact what he is being accused of Defense counsel is going to have a field day ripping apart the claims being brought forth because so far, and I am not all the way through, many of them seem bogus and sensationalized.

While you have made many good points,I don't think this one has any basis.

It is evident that foundations are not buying the coin to support the price, which is why it has fell so sharply. I have seen an 18 neu (less than .10 usd) sale drop the price 10%.

The increase in wealth displayed on these graphs comes not from buying on the exchange but instead from "interest" their accounts are gaining from staking.

For proof you need only look at the block chain. About every two minutes  two PoS award gets posted and they usually result in a payout of 1000-10000 in Neu.

Because they hold so much neu, their accounts stake while others are waiting weeks or months to stake.

That's why their holdings are growing so much, not because they are buying on Bittrex. The buy limit orders on Bittrex are another fraud. As soon as the bid gets anywhere near the bigger buy orders they are cancelled and re-entered with a much lower bid.

For example, the 18+btc bid a day or two ago was "buying" at 0.00002375..f and was much larger... as soon as some one bought few, the order was cancelled and the bid was lowered to .00002000. Those orders a facade giving the impression that coin is actually being backed by real money.

And, for the record, a mod has contacted me via IRC and asked for my debug logs to troubleshoot the issue while suggesting that perhaps I was somehow "seperated" from the network and being the only mining pool would make me vulnerable to such disconnection.

I kindly replied, that I was on the internet the entire time, as was the daemon running neucoin.io's block explorer and even the daemon that is feed the official block explorer, all of which report the same block chain with the same PoW awards for hours before forwarding the logs.

While not part of that response, truth is during the entire time that as everyone else was connected to the "network" known as the internet that all other wallets connect to, the foundation's wallets failed to mine, which are the only wallets with enough funds to mine with any frequency. After hours of not mining, with the pool getting 100k+ in mining rewards, the block chain just ends up entirely being replaced with the foundations wallets earning the interest they would have if their wasn't an outage in their internal network.

I don't believe they are intentionally manipulating the block chain. Here's my theory...

They are marketing this as a decentralized currency when it is in fact a federalized currency controlled by a few master nodes that no one is ever supposed to find out about.

However, the foundation address are being held in a wallet that is not directly connected to the internet (arguably for security reasons) which also happen to be the master nodes in federalized system.

As these nodes stake, on their private internal network, their communications are relay (probably through some slow ass java/php appliance) through an internal network proxy which first captures the transactions and analyzes them to show their shareholders how much money they have made. That database which is storing the transactions is performing slowly and instead of the relay happening milliseconds or seconds later it is taking dozens of seconds or minutes (and in the case of today's almost 4 hours worth of disappear blocks even longer) for the proxy to receive, analyze and relay the transaction to the public nodes.

For some reason the client's are accepting these transactions, even when received hours later, as the authoritative version of the block chain even though the block chain with the most blocks is supposed to be the true version. Several examples I have posted showed it occurring in less than an hour, with the exception of the nearly 4 hour long erasure of the block chain.

It does not make sense for a block to be received hours later and be chosen to replace an entire sequence of blocks and transactions.

In some cases, but the late arriving time-stamps are earlier than mined blocks, but even those should not be accepted on a decentralized block chain because the said late arriving block with the supposed earlier time-stamp because that time it could have been maliciously manipulated. For example, I could go back 20 blocks set a static time stamp and brute force it until I find a suitable hash and broadcast it an essentially rewrite the block chain.

However, I have also pointed out instances where the mined block that was orphaned was replaced by a block with a time stamp that was two minutes older with the same exact transaction and credited to another miner.. (which could be an internal foundation miner because I only know of one pubic mining pool).

It would be nice to hear from some non-biased knowledge people on what is happening hear.

Again, my suspicion is the foundation wallets are mining on a network that is segregated from the internet and there is a delay in the relay of their transactions and those nodes have been configured somehow be authoritative nodes in deciding consensus.

I would really like to know...

Look at the latest example:

So yeah, I have forked this projected and working on it. I tried to contact the original devs to no avail.

Redis just has all kinds of bugs, I will probably end up ripping it out.

Right now, I have refactored all calls to the redis client wrapping them in a (lock) statement... seems to be working so far.

To be fair, that's after about a week of ripping my hair out and mitigating numerous bugs.

Unfortunately, cryptocurrency programming is new to me but fortunately I a quick learner a Luke-JR has plenty of source code and documentation to follow.

I have used this code to set up a NeuCoin mining pool  (I know I am going to get blasted for that but spare me I am a virtual currency newb ) at http://173.61.3.30:3334/

Point is, after several days of working out bug after I bug I was able to get three CPU mining clients to work. Then someone sent an array of 9 grids (of what I don't know) at the pool and I started getting the Redis errors everyone else is referring to.

Not easy hammering out concurrency bugs when 20 M/hps is getting sent your way.

Anyway, after some trial an error it seems that wrapping all calls to the the redis client inside of a lock statement has stabilized things.

Some pointers to anyone starting from scratch from a git pool. Change the target frame to net 4.5 first. Then use the package manager to uninstall and reinstall every package (listed in package.config) so they are updated. The packages in the git are way out of date and have numerous bugs.

As outline previously, you'll have to do a decent amount of configuration with the json config files as while some examples are provided in the source others require you to go to the wiki for examples.

Also, you'll have to be able to run your wallets with RPC enabled and spend some time troubleshooting errors calling the json-rpc.

With NeuCoin, I recieved error after error until I pulled bitCoinLib and send a direct RPC to GetBlockTemplate to the wallet. The wallet itself would crash entering it into the debug console. After that, I had no issue connecting to the daemon.