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Title: In the horizon: difficulty crashes! Post by: dree12 on September 26, 2012, 08:09:06 PM I don't usually write posts about difficulty, being the secular (as in, separation of mining from price) person I tend to be. However, with the upcoming buzz on the reward dropping, I figure I'll give my take.
Mining will become insanely profitable weeks before, and a while after, the reward halving. Why? Well, I see three reasons:
Naturally, with lower difficulty and higher price, mining should be insanely profitable. Mine away! Title: Re: In the horizon: difficulty crashes! Post by: SkRRJyTC on September 26, 2012, 08:39:39 PM I am confused. Why would difficulty crash if mining is profitable?
Title: Re: In the horizon: difficulty crashes! Post by: Inaba on September 26, 2012, 08:40:19 PM Want to bet on it?
Title: Re: In the horizon: difficulty crashes! Post by: dree12 on September 26, 2012, 08:42:52 PM Want to bet on it? I never bet on my speculation. If anyone wants to bet, they probably know more than me :D.Title: Re: In the horizon: difficulty crashes! Post by: meebs on September 26, 2012, 08:44:30 PM There will always be a "free market" equilibrium with mining profitability and hashrate.
If mining is very popular than more people will get in on the action. If mining becomes less popular than the GPU guys will be first to bail, than FPGAs, and the asic folk will be unlikely to drop out.. due to it being nearly free once you have the hardware. Now if the price was to crash to say $5 again and stay there.. difficulty would probably drop a decent bit as the high electricity cost folk couldn't afford to mine anymore. Title: Re: In the horizon: difficulty crashes! Post by: cedivad on September 26, 2012, 08:47:38 PM Difficulty might go down but it will not compensate the 50% less coins per block.
Title: Re: In the horizon: difficulty crashes! Post by: dree12 on September 26, 2012, 08:48:25 PM There will always be a "free market" equilibrium with mining profitability and hashrate. The Bitcoin free market is not efficient yet. That's why speculators can earn money. There can still be slumps and riots.If mining is very popular than more people will get in on the action. If mining becomes less popular than the GPU guys will be first to bail, than FPGAs, and the asic folk will be unlikely to drop out.. due to it being nearly free once you have the hardware. Now if the price was to crash to say $5 again and stay there.. difficulty would probably drop a decent bit as the high electricity cost folk couldn't afford to mine anymore. Title: Re: In the horizon: difficulty crashes! Post by: smoothie on September 26, 2012, 08:56:48 PM Want to bet on it? This is the same guy who refuses to answer simple questions about the CEO or the person who runs the day-to-day operations for BFL. What a joke... :D Title: Re: In the horizon: difficulty crashes! Post by: labestiol on September 26, 2012, 10:44:41 PM Want to bet on it? Ready to bet that BFL will deliver ASICs before 2013 ? Interesting :) Title: Re: In the horizon: difficulty crashes! Post by: Stephen Gornick on September 27, 2012, 12:21:31 AM Miners shutting off or liquidating If they haven't by now, they probably are holding until block 210,000. There's little risk to just seeing what happens. Price appreciating[//quote] That would definitely make mining more profitable. I'm not convinced though. It isn't a shock that it will occur -- and a lot of speculative buying has already occurred with the expectation of a rise. If it doesn't happen, there could be a lot of dumping instead. Delayed ASIC[/b] No ASIC until 2013. There's still a month backlog of FPGA shipments even. Plus, even if the ASICs aren't shipping, doesn't mean they aren't mining! Nobody knows for sure, but I would bet that unless the exchange rate rises, mining profitability will be decreasing from here through block 210,00. Title: Re: In the horizon: difficulty crashes! Post by: mb300sd on September 27, 2012, 03:18:58 AM Miners shutting off or liquidating If they haven't by now, they probably are holding until block 210,000. There's little risk to just seeing what happens. Price appreciating[//quote] That would definitely make mining more profitable. I'm not convinced though. It isn't a shock that it will occur -- and a lot of speculative buying has already occurred with the expectation of a rise. If it doesn't happen, there could be a lot of dumping instead. Delayed ASIC[/b] No ASIC until 2013. There's still a month backlog of FPGA shipments even. Plus, even if the ASICs aren't shipping, doesn't mean they aren't mining! Nobody knows for sure, but I would bet that unless the exchange rate rises, mining profitability will be decreasing from here through block 210,00. Title: Re: In the horizon: difficulty crashes! Post by: dree12 on September 27, 2012, 08:09:23 PM Miners shutting off or liquidating If they haven't by now, they probably are holding until block 210,000. There's little risk to just seeing what happens. Price appreciating[//quote] That would definitely make mining more profitable. I'm not convinced though. It isn't a shock that it will occur -- and a lot of speculative buying has already occurred with the expectation of a rise. If it doesn't happen, there could be a lot of dumping instead. Delayed ASIC[/b] No ASIC until 2013. There's still a month backlog of FPGA shipments even. Plus, even if the ASICs aren't shipping, doesn't mean they aren't mining! Nobody knows for sure, but I would bet that unless the exchange rate rises, mining profitability will be decreasing from here through block 210,00. |