Coin-Hive

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Coin-Hive and the less bleak advertising future

Most people have probably heard of Bitcoin by now; when it first came out they were each worth less than 1c and are currently up past $4000 each. They'll probably go up even further as they're proving a good hedge for personal savings for those living in places where the local economy is undergoing shocks, additionally the Russian government is also looking into Bitcoin mining as a good use for their excess electrical production that would normally be discarded.

Mining is the process where processed transactions are validated by a server through an exceptionally computationally intensive process and added onto that -coin's permanent record. For coins like Bitcoin that grow over time, this is also the point where the miner gains some new coins from the mining process (meant to allow the coins to grow over time and be naturally allocated between users as popularity grows) .

There are other coins as well, all of them focus on different attributes. For example Moneiro and Litecoin both use a different function that is much harder to run in parallel. The main difference is that both coins will remain mineable on regular processors instead of running on GPUs or ASICs like Bitcoin. This makes it much harder for a small group of people to posses all the mining machines at once and corner the networks' processing power.

One interesting aspect of Moneiro is that the hashing function runs very well in JavaScript. That's where coin-hive comes in. Their alternative to ads is to allow site owners to run a JavaScript library that mines Moneiro coins as users browse the site. The pay rate is supposed to be pretty good too, much better than conventional advertising and far less intrusive, the user doesn't have to think about it and none of their data is collected.

So far it seems to be taking off like a rocket. However the Coinhive team is getting worried since virus scanners are picking up on it, some Javascript blockers are also stopping the code automatically. Their new plan is to make it opt in. Personally I think that will probably kill it, and we'll end up with a replacement that does the same thing from a different company.

The problem with opt in is twofold.

  1. Users have been conditioned to click "No" to anything they're asked to do. Do you want to give your personal information? No. Do you want to sign up to our newsletter? No. Give us.. No. You don't even have to think about it anymore. So of course presenting them with a menu will just mean it gets clicked off before people even think about it.
  2. People never want to pay for anything. Wikipedia is the most used site on the internet, but how many people actually donate? By all accounts it's less than 5%. Same for most places on the internet. Even assuming that some people opt in, which less than 5% will. That just means that a small fraction of users are supporting the usage of all the others, which is hardly fair.

Not that I'm saying you should be running this stuff in secret, you do need to tell people what you're doing. Also it should come with throttling by default so it doesn't affect the user experience. Still, if it's meant to replace ads then it should be transparent and unnoticeable. Anything else and you're better off running advertising.

Of course when I found out it exists I had to try it out. I'm running it now and I can definitely tell it's a bit noticeable on the experience. It's annoying that the developers are focused on opt-in (which will immediately kill it's current rush of popularity)  and not on building in more effective throttling to limit the user impact.