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Hey ASIC pre-order people, you're screwed :P Here's why:

#'s have been corrected with more accurate info.  Unfortunately not much has changed :P

I've been going around trying to get more exact numbers from the major ASIC manufacturers and so far they don't even seem to know how many preorders they have  ??? So we're going on ballpark estimates and rumors.  Many weeks ago, BFL had stated they have 7000 pre-orders total.  I heard from several other users that it's now stated to be 14,000, but taking into consideration other things, it's now much lower.  Let's say 5000.

Let's be conservative yet realistic and say that that's 4800 Jalapenos, 150 singles, and 50 mini-rigs.  That's 16,800 GH/s + 9,000 GH/s + 75,000GH/s =  100.8TH/s.

BTCFPGA's line of products:  They're the only other ones expected to ship before 2012 concludes so they've got to be a pretty good target.  Rumor has it, they're around 400 so let's go with that and split em between their 2 product levels.  That = another 16.2 TH/s.

The Avalon allegedly has a lot more than I thought despite shipping in fairly late 2013, like 3-4 months after their competition at which point ASIC mining will be extremely hard to profit form.  Well, they have some special 300 pricing but haven't hit it yet so let's say 150. That's another 9 TH/s.

So that's 126 TH/s total added in just preorders.

The number of people willing to risk lots and lots of money on a preorder for an experimental device from somewhat sketchy companies is definitely less than the number of people who will buy mining hardware soon after it's released to the public and proven to work for at least a short period of time.  I'd say it's 5:1 but let's go conservative and say for every 1 preordering daredevil, there are 2 people that will buy the hardware once it actually comes out and works.  Also they'd obviously be more inclined to buy higher end hardware than the Jalapenos for example once there's practically 0 risk (post-release) but once again, let's go conservative with a best case scenario and not adjust for that.  So with my numbers, that's another 252 TH/s for a total of 378 TH/s.

And the current total computational of the network is around 22.5TH/s.

So, since difficulty and price all scale evenly with each other, I can do this in any order.  A BFL jalapeno runs at 3.5GH/s and at the last price I recall from MTGox ($12.80 USD per BTC) and the current difficulty, that will pay for its $149 price tag in 11.19 days.  Not bad!  HURRAY, let's all pre-order!  Hell no, keep reading, lol.

By the time ASICs are released, 25BTC instead of 50 will be the mining reward per block and I think we all know the price won't magically jump to 2x overnight so let's go ahead and double that.  That's a 22.38 day payoff.  Now let's add all those new miners and readjust for the resulting difficulty increase of approx 16.8x, and you'll pay off your Jalapeno in 376 days which means you're making $0.40 USD per day.  That's all assuming that from release time to about 1-2 months afterwards, nobody ever buys another ASIC miner for that entire 376 days.  Let's factor back in future sales rates and....you're not going to pay it off, lol.  So let's say my numbers or estimates are somehow drastically off and give it a + or - 70% accuracy variance.  That results in...you still being screwed, lol.

Good luck with that!

Acording to BFL_Josh I would cut that BFL TH output in half due to a lot of fake orders.

Still, I agree that it doesn't look like a "sure thing" money for people that will order after and even for people that pre-ordered.

Wait, whaaaaat?  How do you fake a bitcoin or paypal order?  I mean yeah, demands for refunds via paypal's fraud tools but 20 or so of those would freeze their account instantly, let alone 7000.  Correct me if I'm wrong but I thought it was order + money now, hardware later not order now, money + hardware later.

If you go through the order process and never fwd the bitcoins or payment the order number still goes up by 1.

Ohhhh, they should clean that up, lol.

I put my best scientific minds on this and they came up with a simpler calculation that's guaranteed accurate!  There's still 50 BTC (well 25 soon) to go around every 10 minutes regardless of total TH/s.  That's how the protocol works.  So take whatever your hardware's capabilities are and divide it by the total TH/s of the system and multiply that by 25BTC and you'll get how many BTC you'll earn per 10 minutes :P

Ok, maybe fake is not the right word to describe it. I was saying orders that didn't go through (buyer changed his mind or just wanted to see what the number was at that point in time) but the order number incremented anyways.

you will be very pleased if you have a 20% ROE in most other industries, which approximately means that investors cover their investment in 5 years. ASIC is still good investment, though a little bit lower than the expectation.

First off, its not like these companies will be these products instantly. The network hash rate isn't going to increase 20 fold over night. This means early investors have a significant advantage over later investors. Second, your prediction over another 2x increase in network hash rate is probably not going to happen unless a price war occurs. People aren't going to invest in bASIC as the ROI goes down with the network hash rate going up. There will be some wall that is hit until all the ASIC companies lower their prices significantly which will result once again in an increase in hash rate..

Overall, if you are an early adopter you will definitely make a good chuck of bitcoin. The real question is, which company will ship first, whose theoretical numbers are most accurate (in terms of power use and hash rate) and for later adopters who is most likely ship out fastest.

As soon as someone hops in their time machine and tells me what the price of BTC is 5 years from now, I'll make that my target break even point, lol.  Ohhh waaaait, that's right, I'm broke as hell right now, so I would prefer money right now lol.  But yeah, this was mostly just to discourage horribly unrealistic people from thinking they'll make loads-o-moneyz after like 12 days when it's closer to 9 months to never :P

Btw my best math takes the 14000, includes BFL-hater trolling w/fake orders, people just curious about their total sale count, and people testing if the final page on their order site actually loads....*clicks calculator* they have 7 pre-orders, lol.

Squid's right about the timing thing of course.  That's why the only way I'm getting a device is if I am guaranteed to beat 95% of all other preorders by at least 5 days.  But then the whole theory goes out the window because no matter what any company says, they're ALL LYING!  They will plug in a top end device or two that they made to mine before anyone else.  If BFL just happened to switch on 10 of their rigs for 1 day, that's about $2300.  Or they could ship them and not make that money.  If I was a business, I'd run em for a few days before sending them out :P

oh and since like a couple million USD was turned into BTC to make pre-order payments at BFL and the price magically went from $4 to $12.80 because of it, without that demand and with paypal payments available, it's gonna see <$5 again.  So that puts my estimate at like 7 years hardware payoff, lol.  But apparently my BFL numbers were inflated anyway so it all kinda goes out the window regardless, lol :P

I know that for BFL and BTCFPGA, that there are orders that people never paid for but are included in the order #'s so your data might be off.  :)

So much wrong...

1) There are less than 7000 orders. I went through 7 order numbers myself trying to buy my first SC Single. I know other people go through 3,5, or 10+ order numbers, never paid, and those order number just keep adding up into nothing. WE don't know how many orders there are, but BFL does (and hasn't told us). The Pre-order thread (https://bitcointalk.org/index.php?topic=89685.0) is not at all complete, but does list at least 46TH/s. I'm expecting this to be closer to 100TH/s, to account for people who have not listed their orders there.

2) While your numbers for BFL were high, your numbers for both the bASIC and the Avalon are LOW. Tom has said that he has ~400 bASICs already preordered (which puts him over 21TH/s), and the Avalon pre-order capped at 300 (which puts them at 18TH/s).

3) Even after the pre-orders, I will agree that the network will continue to grow. Obv it will reach 300 or even 400, but who knows how long that will take?

4) The SC Single, MR, and bASIC all have ~50% more speed per $ spent, so they will obv pay themselves off faster than a Jalapeno, even in spite of a skyrocketing difficulty. And a 10 day payback period is just astounding, but that will not last long. I think the price will level out so that a Single or a bASIC will pay for themselves in about a 6 month time (which is what the market is used to now).

Here's a possible way to think of it I guess. Consider gold right now. Valuable for the known reasons. Now imagine there's an island discovered in the middle of the pacific that consists of 2-3 times the quantity of gold currently in circulation in trivially mineable form, all you need is a boat to get there. What does this do to the cost of gold? To the cost of boats? Is it worth buying a boat?

Actually, it's a crap analogy since the rate of bitcoins mined is a constant and you'd have to make assumptions about people not being able to monopolize access. Maybe someone could knock it into shape?

Yea except that gold isn't held together by a massive drug trade.

I want to share the fast calculations i did a few days ago.

1) let's suppose to be around 10M$ in ASIC preorder
2) the $/GH is 21.6 ($/GH) (1300$ for 60GH)
3) so there will be around 460TH of hashing power *added* when the preorders delivery (10M$/21.6$/GH)
4) as of now a 1GH/s miner does around 0.3512 BTC/daily with a total network power of 21TH
5) let's halve that amount since that we will soon go from 50 to 25BTC per block, that's is 0.1756 BTC/day
6) the hashing power will go up around 20 times, that means that your profit per day per 1GH/s will go down of around 20 times, that's is 0.00878 BTC/GH/day
7) now let's suppose to have around 60GH/s of hashing power, that's 60 * 0.00878, 0.5BTC/day @50-100W
8 ) you need 120BTC to payback your 60GH/s mining hardware, that's 240 days, not taking into account the power usage.
9) after 120 days the asic market will be completely different, with people buying 1TH for 1000$

Yes, you are all screwed.

Would you mind relooking at your numbers?

Sorry, copied pasted the wrong number, however the rest of the post is correct; fixed that.

You still got it backwards.

Yes, i fixed it before your post tough :)
Sorry for the confusion.

Yep, you are all screwed. Everyone cancel your orders so I can make a lot of money.

Thanks  ;D

I had orders for 0.2TH placed with everyone but BFL and i will not pay them.

I belive in what i wrote and i don't want to scare you so that i make money, i will buy BTC directly and maybe get into the ASIC business at a later time.

I made my calculations up to 250 TH & will still be profitable at that difficulty  8)

Just multiply 131,384 for every TH & see what you think.

If & when it gets near that 250 TH mark,I'll get more rigs to even out the income,maybe even way before   ;D

If the difficulty goes up, and the price doesn't immediately follow, the supply will eventually be purchased up by Silk Road addicts. Silk Road users don't care if they pay $100 for 10 BTC or $100 for .1 BTC, just as long as they get ~$100 worth of their "stuff". That said, after the supply of coin dries up and the price skyrockets, if the ROI for Bitcoin mining hits ~30days like it did in June 2011, you're definitely going to see people selling to make back their money. The only problem for the ASIC miners is going to be they have all their funds wrapped up in miners and not actual BTC, so they'll have no way to hedge their losses when the price does fall and they are looking at either unprofitability (European miners with $0.20/kWh) or multi-year ROI.

On the other hand, if you remember, after GPU miners came out, we actually saw a shortage of GPUs and a spike in the prices of them, so many of these miners may still be able to resell their miners for coin directly. On the other hand, these are only the first runs of what are likely to be many ASIC runs, with increased interest and purchases, the manufacturers will be able to make more and more efficient units for cheaper and cheaper.

My guess is that the next bubble will have a geo-political impact. I do believe it will still be considered an irrational bubble, though. The growth that I talked about in this post of December 2011 seems to have come to an end. Market irrationality is back and back in full force:
https://bitcointalk.org/index.php?topic=53949.0

My advice now is, get ready for "unstable growth".

To add to the wrong things...:

The Jalepeno now puts out 4.5GH/s.
The Single now puts out 60GH/s.
MR = 1500GH/s.

Now, if we get a 10x difficulty increase after the preorders are filled (which I think is quite likely), and if someone was to order a Single after said difficulty increase, and if that happened after the 25 reward drop, and if the price didn't move, then:

$253.67 / 10 / 2 = the single would make $12.68/day.  That's still a return on investment of 103 days (interestingly, almost exactly what the ROI was when I purchased my first-gen Singles).

So, I'll reiterate it this way:

• Current ASIC pre-orderers are most certainly not screwed.  Every one of them will make their money back and more.  And I'll take someone up on a betsofbitco.in regarding that to put my money where my mouth is.
• It is likely that the ROI will remain reasonable (under 12 months) for the forseeable future, unless the BTC price drops significantly.  The reason for this is that we will quickly reach a point where the

Desolator, why do you keep making these anti-ASIC threads anyway?  It seems you are jealous of everyone who actually can order an ASIC, and have made it your goal to prevent more orders and/or make current pre-order holders feel bad.  It doesn't make much sense to me, and frankly, your repetition of falsities in these threads are getting a bit stale.

That is absolutely absurd.  I'm just shocked at all the unbelievably stupid people who keep touting their "wow, it will pay off in 2 weeks!  I'm gonna be rich!" crap.  I thought people in the bitcoin community would be cautious and smart.  The rate is 50 (well 25) BTC per block and everyone has to share that.  So for like 50% of all miners switching to ASICs and all claim they're going to get rich off those amazing speed numbers, someone has to let them know that they're dreaming and remind them how the bitcoin protocol works.  The only people making money are the mega-sketchy jerks over at Butterfly Labs, which is run by a scam-participant asshole.  WTF is wrong with everyone?!  It really makes bitcoin look bad and makes people want to leave it behind when some get rich quick scheme doesn't work out as well as they hoped.  I guess a slap in the face with some cold, hard reality it better now than later.

I have no GPU miners at the moment, no ASIC pre-orders, and no interest in an ASIC pre-order if I'm not guaranteed to get it earlier than most people, and actually I have almost no bitcoins either at the moment, as they were convereted to USD at an opportune time so that kinda kills your basis for the accusation now doesn't it?

Btw WTF is $253.67 / 10 / 2?  That's not the most direct way to calculate it, or accurate.  Here, let's short version it instead.  378TH/s anticipated network speed.  Wait, let's go with your number! 10x 22.5TH/s = 225TH/s.  Your Jalapeno will be 0.002% of the block solving so 0.0005BTC every 10 minutes @ 25 per block.  That's 0.072BTC/day.  At $12.80 that's $0.9216 per day.  That's 161 days but A LOT more when you add in shipping and electricity.  Still not so great.  With my more realistic numbers, that's closer to 258 days + shipping and electricity.  Oh that's right, during that 258 days, more people will be buying ohhhhhhhhhh just a couple more ASICs so it's going to be 2 years if you're lucky before that pays for itself.  Welcome back to the former GPU payoff period :P Kinda my point.

When you resort to personal insults, it only makes one person look stupid.  I'll let you figure out who that is.

How about you try reading my post next time.

I'm talking singles, not Jalepeno's.

$253.67 is the amount that a 60gh/s single would make at today's price/difficulty rate
/ 10 accounts for the difficulty increase
/ 2 accounts for the block reward drop

Also, for your sake, I'll add in electricity and shipping to my calculations.

Shipping is $34 (?).  That's 3 more days.  106 days in total now.

Electricity is 60w x 24hrs x 106days / 1000kwh/w x $0.08/kwh = $12.21 in electricity.

107 days now.

So, we've added 4 days because of shipping and electricity costs.

I'll quote you again now.

No, not so much.

Wait, let me get this straight:

-You have no Bitcoins.
-You do not mine Bitcoins.
-You do not plan on mining, unless you can get an ASIC before everyone else. And even if you did...
-Your only purpose of mining Bitcoins is to sell them for USD.
-Then to top it all off, you start calling all of us "Stupid" for choosing purchase mining equipment.

So answer me this: why the FUCK are you trolling this Bitcoin forum? Some of us actually mine for the 1BTC, not the USD it can be traded for. Can you give some sort of response, defending yourself? If so, I'll take it back. Otherwise, your posts are worth absolutely nothing.

The ignore button,,,  That's what it's for !

Ps: I don't mind not paying my hardware back, It's only to protect the network.

See, I'd argue that if 5,000 individuals are mining, it is just as effective as 5 million (given the same hashing power in both cases).  Both are very decentralized, to the point that it would be impossible to compromise the network by compromising individuals.

On top of that, botnets will be made completely unviable/unprofitable.  Not only does that mean less malicious usage of other people's computers, it also means malicious entities cannot gain control of a significant part of the Bitcoin network via botnets.  I see this as a very good thing.


I prefer to showcase arrogant people's shortcomings instead.

Ah, so you are an FPGA guy then :)  I do hope that at least some ASIC vendors turn out to be legit and their shit works because there really are some cool FPGA gadgets that I would like to have (for things other than mining Bitcoin) and the aforementioned eventuality could depress the price of them.  We'll see.

You just pulled that 10m$ pre order out of your butt....

There is no way that there are that many pre orders for ASIC.

There are just not that many people in the community to invest that kind of money in mining equipment.

Again : It all depend a what price you'll buy fiat with your BTC..  If buying fiat is your goal.  Someone may want to exchange BTC for a wikispeed car or another product or service.. It all depend on when, and what for BTC are being exchanged.

Let suppose, someone invest reasonable amount of Fiat or BTC, ammount that this person can afford to lose.  Even if BTC fails, no worry, it was not retiree money, or a loan that must be paid back.. Like any investment, no one should risk value that can be lost overnight.

So, I've invested mush less than I can afford to lose, and if things get real.. I'll invest much more, always in a total value that I can afford to lose over-night..

Calling to everyone : "You'll get screwed" is, in my humble opinion, immature and shows a lack of tought !

- sorry for bad english !

The mining factor has been constant at 4-5 months ROI ($0.45/100mh/s) for over a year now, and this isn't going to change with ASIC arrivals. This consistency reflects a general risk/reward ratio that exists within the market, such that anticipations of price increases offsets mining purchases. As we can all see over the past few months, anyone who sold bitcoins to buy pre-orders missed out on a more than doubling of usd/btc. The mining factor will fall to 1/37.5 it is now, as this is the FPGA:ASIC mh/s efficiency, but when factoring in this increased efficiency, will equate back to 1 (37.5*(1/37.5)).

I see you have all fallen for the official bitcointalk forum troll....

Wasn't that an almost accepted data of how much BFL got on pre orders?

No - it is pure speculation.

I believe when BFL opened up their pre-orders on 6/23, Bit-pay set a new record for amount processed, and I think it was somewhere just over 1million USD in a 24 hour period. Considering that the waitlist (https://bitcointalk.org/index.php?topic=89685.0) only shows the first day going up by about 500 orders or so, and we're coming up on 9000 order numbers, it's quite possible to be around 10 million in sales.

Me and SgtSpike both have BFL links in our sigs, but we're disagreeing on how much has been spent on pre-orders. I don't quite understand what point you'er trying to make, but it is 2am, and I am overdue for some sleep. Please care to explain?

^risk ... ^reward

don't spend your life savings on any of this...

I was wrong and I removed the post before you did yours.
For the third time in the thread.
I'm gonna retire from posting for a while.

So your tought seems that it's better to hoard BTC instead of buying mining rig with them.. My tought is : Mine Mine Mine, more more more, because in 3, 4 or 5 years, i'll still be generating those precious BTC !

Let's see :)

No GPU, No Asic pre-order.. hmm, you sold your house to buy a container full of FPGA and that's why you're mad at those ASIC-Pre-Order folks ?

another lol thread
I'm really screwed, my graphics cards paid themselves off and left me enough coins to buy an ASIC, some tshirts hats and stickers + pay some of my electricty bills (inculding the whole $900 of the last one)

oh wait....maybe I'm not screwed after all???

oh and I don't expect to get ROI in 5minutes - 12 months or longer would be fine by me :)

over these bullshit threads based on really bad "guestimates" by self professed "experts"
have nice days :)

Haha, someone is so pissed off at being screwed that his typing turned into sesamestreet colors :D

_{No worries everyone, there's not going to be any asics. Everyone who still thinks there will be has never see an asic being developed.}

Wanna put your money where your mouth is?

you looked at the pretty colours but not the words eh?
oh well, you fail

Massive is completely an overestimate. There is only like 100 million in bTC... That is not enough cash to support a massive drug trade.

An impressive drug trade is a better term :)

But yes, all da coins are gonna be tainted with drug residue. Just like all the USD.

I agree that massive is an exaggeration, but your argument (Bitcoin market capilization) has nothing to do with it. Every Bitcoin can be used for a trade multiple times. For example, if I buy something from you for BTC, you can then buy something from me or someone else and on and on. So theoretically you can do lots of trades with only 1 BTC.

I think we need more threads like this one. ASICs pre-orders folks could use some FUD so that when the ASICs are delivered, they make (more) money. Yes, I pre-ordered one. </sarcasm>

Oh yeah, I post legit info and you all call me a troll.  What exactly am I wrong about?  Everyone's dumping thousands of dollars into this amazingly fast ASIC hardware and oops, there's still only 25BTC per block to go around.  Everyone is screwed.

In case you don't understand the logic, the GPUs I bought were like $130 and did 320MH/s ea.  So let's say for example all the GPU miners in the world cost $10 mil.  Now with ASICs are $1000+ for a good one, everyone's speeds go up so they all make the exact same income but now all the miners in the world will cost $100 mil.  Oops, everyone got scammed, lol.

But keep calling me a troll to pretend it's not true.

Might as well get a shovel to try and clear up the mountain of bullshit speculation about me.  I started mining over a year ago with a pair of 5830's and made a lot of BTC.  I also sold some computer hardware for BTC.  I also bought some more hardware with BTC from cablesaurus and others.  I only sold enough BTC to cover the cost of the hardware then kept the rest of my BTC.

Then the price went from $11 to $3.50 but obviously I especially didn't sell them then, lol.  I did do some buying and selling on the exchange during ups and downs and made about another 10%.  Then when it FINALLY hit $5.20 after about a year of being around $4, I sold the rest and held the USD balance on the exchange to wait to rebuy after it drops again.  That never happened and it skyrocketed so that sucks, lol.  But I had to withdraw the cash to help fund my new computer repair and custom builds store so I re-bought BTC when it was at about $5, held it for another 2% increase, then had that spendbitcoins site convert it with paypal at just the right time for cheaper than MTGox's EFT fees.

Now I was going to get back into mining with ASICs but when I did the math, I foud out I'm the only one who realizes how grim the situation is given the ridiculous amount of pre-orders.  Nobody is going to make much on ASICs but the vendors.

In case you didn't notice I'm somehow agreeing with you in the fact that people will get a shock when the difficulty will spike and they will have to redo their calculations. The ASICs won't be paying themselvse back in 2 weeks or 2 months ...

That's why we need more posts like this, so people don't pre-order more :)

However this is called "keeping up with the Joneses" or "staying in mining" or whatever you want to call it and not being scammed. Scammed is if BFL takes all the money and dissapears.

once again, I spent Bitcoins that were profit from gpu mining to buy an asic + I am not expecting a ROI in a couple of months, as an adult I made this decision for myself - how did I get scammed?
or: everyone with a GPU scammed the CPU miners by your logic

I choose not to gamble on horse races or go to casinos , gambling on asic isn't being scammed, gambling is gambling
if you don't like to gamble that is fine - telling everyone they have been scammed using rough "guesstimates" because you don't like the look of something doesn't make it fact :)

not that it will stop the next person that is a legend in their own lunchbox starting the same thread over again again lol

pointless threads are pointless apart from a lol

I can't think of other hardware that pay's itself back within 1 year, so I'm fine with that idea.

And what's next, a smartphone or laptop with some integrated asic chips that pays itself back within 1 year... I would like that :)

You two must be rich or something because if I had a decent amount of income, I'd definitely support the bitcoin system just for the sake of doing so and if it make me a little change, that's fine too.  But I'm freaking poor!  I'm quite possibly the only head IT manager at a decent sized company that works part time for a pathetic $14k or so a year and so the rest of the time I run a computer repair shop that I just opened recently.  So I'm lucky if I have money for living expenses every month and I'd say based on lots of forum reading that poor people like me outnumber ungodly rich people who can afford to buy ASICs for the fun of it at least 10:1.  So good for you guys, the rest of us need to know ASICs aren't going to make money.

Oh, and I plan to make money and support the system by selling some of my store's hardware for BTC on the forum soon and then hold it until significantly after the 25BTC split.  That keeps miner's money off the exchange and lets them spend BTC directly on stuff they need.

Also, newegg just brought me on as one of their invite-only certified egg expert hardware testers for their new program they're rolling out :D So they're gonna be shipping me a lot of hardware for free for the sole purpose of reviewing it.  Some of it shouldn't be sold before the release date but good luck finding me if it's with BTC, lol.

Unless some people get them earlier  :)

Yeah, the vendors lol.  See, it's an all-encompassing circle of bullshit  :D The difficulty is going to spike through the roof like a week or two before ASICs ship and every vendor is going to blame each other and claim they're not mining.

P.S. look a few threads away from this one.  Someone tried to get a loan from the bank to buy ASICs.  I am not underestimating the overestimating going on here about ASIC income and how unwise people are being with it.

Ok, I understand you need to eat but try to keep your karma balanced as well ;)

Instead of trolling you should be thankfull to the fpga/asic buyers spending this much money on expensive hardware because this makes it affordable for everyone in the future.

You just include the preorder units in your calculation. However, these companies will certainly manufacture extra units for themselves to mine, since the marginal manufacturing cost for ASIC is very low. The difficulty will go up to 1000TH/s or 1PH/s easily

I started mining about a year ago as well, but I havn't put any cash into my bitcoin mining hardware in about 8 months. I purchase more hardware with the Bitcoins I've earned, not selling them on the market. It can be done, but it sounds like you tried to play the market, and lost.

And no, I"m not uber rich. I also work in IT at a part time job, so it sucks. I'm not gonna be able to drop 60k on 3TH/s of hardware, but what's your point?

First, I don't think manufacturers will be mining, or at least at a significant level.

Second, you do realize that 1000TH/s and 1PH/s are the same thing?

Didn't tough about this. Another reason to avoid a preorder, even if i'm constantly tempted.


Why shouldn't they? They would only harm the future earning, not their current ones (not the preorders).

The centralizing nature of pools is why I am interested in p2pool (https://en.bitcoin.it/wiki/P2Pool (https://en.bitcoin.it/wiki/P2Pool)) though I have still a lot to learn regarding its functionality.

Because they're in the business of manufacturing devices, designing new ones, etc. Not in the business of Bitcoin mining.

There is however one manufacturer that is in both businesses: ASICMINER. All ASICs produced by them will be used for their own "mining company".

Maybe not as their core business, but Inaba happens to run a mining pool.

Hey guys i am looking for some pictures of these asic devices so that i can order some 10pcs SC or Avalon to make a super rig, does anyone know were i can find some pics and i am also intrested in there durability and were can i get some spare parts if needed..

i do know: they use almost no electricity and they make me rich in no time they also seem to be standalone and easy too configure even for a noob like me... wooow this exacltly what i was looking i am going to pre order me 10pcs ..or could i better buy me some avalon s from China it seems they have real good quality stuff over there real good self developed almost non counterfit economie they even just bought a aircraftcarrier even without aircrafts and staff but how cares ...i want it i chang it..give me the asic info fast please .... :P




              

The jalapeno mathematically is likely to use 6 watts minus a tiny hair of that in cooling overhead compared to the single.  But, the avalon rigs and such are a different story.  The top level rig at BFL is going to take over 1000 watts to operate so I would think its competition will be a still significant fraction of that.  Even 300W for example is likely to land around $25 a month so be careful with ignoring that expense.

Stop pulling numbers out of your ass. You did it in your first post, and you're doing it here. BFL has said their Jalapeno will use 4.5W, so why are you just adding on an additional 33% power?

Also, the top level BFL MR will use 1000W, yes, but will be ~16x faster than the Avalon. I don't see what point you're trying to make.

Seriously?  They said the single will run at approx the same wattage as their FPGA single which is around 80W.  The Jalapeno is 7.5% the speed so logically, since it's virtually the same chip and same structure, it will take 6 watts.  It's actually a trick question though because they claim it will run off of USB power and that will not work so it actually won't run on any watts, as it will not run, lol.

USB power ratings are different from system to system, is absolute crap on laptops, it runs over low gauge wires, it's a non-separate circuit so if voltage dips on the motherboard, it dips on the USB ports, running that many milliamps through a USB connection perpetually will fry it, most boards send audio and other electronic feedback down the USB power line, and their 1st gen experimental chips will not tolerate the level of voltage variance there will be.

If you honestly didn't know, then I apologize. But, BFL has release power specs for them, and the Jalapeno is said to use 4.5W. Their portal (with the announcment) is down, but check it out here: http://codinginmysleep.com/butterfly-labs-releases-more-data/

If there's one thing BFL is famous for, it's exaggerating hardware specs.  I think they were off by 400% on their FPGA's power rating :( I do think that given the release date vs current date, they did just get in the actual prototype units to test with.  But still, a precise 1:1 ratio of GH/s to watts is completely ridiculous.  If you slapped the biggest rig on a watt meter, it'd probably draw like 1653 or something, not 1500 precisely on the dot.  The probability is basically impossible so I do think it's just an abitrary alteration to their purely theoretical speed and power ratings.

It was only $250,000.
http://bitcoinmagazine.net/bitpay-exceeds-1000-merchants-accepting-bitcoin/

I am fairly certain $10M is a high estimate, by a fairly large amount, but I could be wrong.  My point was though, there is no "accepted" number, and certainly, $10M is a guess just as any other number would be.

Let me get this straight.

- A company releases specs.
- You don't believe them, so you make stuff up and state it as fact?

Am I missing something here?  This logic borders on insanity.

Uh huh,damn this guy is good  ;)

You ever think about running for President  ???

I can't wait for my BFL unit to get here to shut him up,but he'll keep going & going & going & going & going................................. ::)

http://i411.photobucket.com/albums/pp196/rickyzwalters/energizer-bunny.jpg

+1

making up stuff gets best response on these forums - talk sense and hardly anyone replies
My 7yo daughter is quite an attention seeker too ;)

+1

I am getting tired of all false speculation...

well maybe asic are false speculations...i am getting tired also havend found ANY PROOF OF ASIC DEVICES ARE OUT THERE AT ALL ...

It would indeed be nice if everybody just shuts up untill the first asic is delivered .....mmm could be silent for ever....or not.. its freaking OKTOBER i thought they promised to deliver in this month ..... i will shut up untill december the 7e..i m looking forward to these asic....also but nobody received an delivery date sofar...or am i completly wrong about this... my money is burning to buy asic for real....IF  ;)

Hey all the dumbasses above me, how am I wrong here?  You just keep posting immature bullshit and saying I'm wrong but seeing as how I'm not, I'm curious, how do you think I'm wrong?  Are you just assholes or are you all truly in denial about ASICs?  You must have A LOT of pre-orders to be that stuck in pretend land.

I hear BFL claimed their FPGAs would run on like 20W and it turned out they ran on 80W and the company's excuse was that they misunderstood the manufacturer's specs or something like that.  So there's your actual precedent that actually happen with BFL.  HELLO?!

So you disagree with me and think when they come out, your kill-a-watt meter will say 1500W on the rig with zero variance whatesoever.  You sincerely believe that and say I'm wrong and that it will be exactly 1500?  Okay, keep thinking that.  Good luck with that.  By the way, in case you missed the last paragraph, BFL has epically screwed up their power ratings on their last hardware release!

Oh and their CEO was convicted of fraud.  If that's not a little bit of a red flag, you're too stupid to be in the bitcoin community.  Just assume everyone is a scammer as a starting point and then get slightly more suspicious when you find out they are in fact a convicted scammer.

So in summary of your opinion, ASICS will make a ton of money, nobody in the community ever runs a scam ever, BFL is famous for exact specifications, and ummm I think leprochauns exist was in there too.  Alrighty then.

Perhaps you can give her your forum account? Chances are quite big she'll come across more mature than you.

I never said BFL's actual power usage would be right on the money.  I said it was ridiculous to add a completely arbitrary amount of power usage to their released specs, then claim it was true and base your ROI calculations on it.

Also, you're on ignore now, don't expect me to respond to any of your other absurd allegations.  I'll unignore you when I pay off my ASIC, just to rub it in your face a bit.

Hmmm and when they ship and are way off from the listed specs and don't make any money, I'll rub it in your face.  Btw I <3 internet arguments!

http://i129.photobucket.com/albums/p227/wizzerd911/gvp8SvqZv02wq8i_-Je_dg2_zps6d0ea8be.jpg

I hope people will get their moneys worth. Once it's not worth mining anymore the ASICs will be worthless and useless as well.
GPU mining weren't as risky. You could use them for other purposes or resell for a fair price.

If we don't find another use for the GPU's LTC and such. Once those GPU"s get on the market, expect the price of the GPU's to drop.

still an ROI of 100% (if mined enough and bought 2ndhand your self)..gpu will sell to gamers, stockbrokers (need multi screen setups).. one highend set of 5970,s or 6990,s are still very very wanted even if dumped in to the market... asic is still a big IF...and useless after mining indeed.  :-\

(also give me one example of an highend custom made product, produced from scratch produced massevely that got deliverd in two months or so because thats whats going on with ASIC.)  ??? ???

Asic mining is very risky indeed, but payoff could be worth it if the price of BTC goes up. Its a risk, you may lose you may gain. Thats the way I see it.

There is this thing called a database that comes into play here. If you want to run a store you will have a database that keeps track of every customer, product, service, shipping rates, etc. Most importantly this database tracks ORDERS, and every order needs to be tracked. Some sites do this for every item added to a cart or (like BFL) every time someone hits "checkout" and starts the order payment and confirmation process.

The order number is actually tied to each attempted order so that if there is a problem, it can be traced back. If your CC fails to work, or your BTC took too long to transit, you as the customer are gong to want to be able to call/email them and complete the order once whatever is wrong is fixed. Some companies even will actively mine this information about discarded orders. To see this you can setup a business card order for 20,000 cards on a well known website and then cancel it to get a 60% off coupon in your email the next day.

In the case of BFL there have been confirmed cases where folks have abandoned carts, the real number of orders is at least 1/2 that, maybe as low as 1/5.

+1

I believe someone did the math a long time ago and determine bitcoin mining is still like 1% or less of AMD's GPU market so it might not drop as low as you think.

I would think that the 5850 would not be a super desirable gaming card anymore, right? This means that instead of having a resale market based on BTC mining, it would have to compete with newer, cheaper, cooler cards in the gamer resale market.

I agree that the retail market is unlikely to really notice, unless you are a vendor focused on the BTC market. (although that ship sailed a while ago and I doubt that many think that GPU is going to have a revival or anything.)

Actually the 5850 is still better than the 7770, or about comparable to any other low-to-mid range card.

Good to know, thanks.

Still a bit of a beast for the average user, but it holds at least >$100 value for now.

Who would ever use an AMD card for gaming? lol.  The severe recurring driver problems that seem to only ever affect brand new games and complete crappiness of their driver design overall means I'm staying far, far away!  Nvidia is the only way to go for serious gaming.  Also a piece of crap GT440 with CUDA has been tested and proven to be 8x faster at rendering in Premiere than dual 10-core hyperthreaded Xeons on a server board.  Compared to an AMD card with OpenCL, it'd probably be faster to hit the render button, run to the store, buy a 440, install it, reload the entire project, and then hit go again.  The 440 would still finish first :P

I'm expecting a 20-30x difficulty rating, no meaningful increase in BTC/USD price, a halving of the block reward, and a ROI of around 6-8 months... Agree that people expecting to get all their $$$ back in a week are crazy but over the long term the BFL power consumption means it will continue to be paying for itself well into 2013.

Will

I hate to break it to you but that doesn't add up.  I myself am expecting a 16x difficulty rating but that was before I found out just how many BFL pre-orders were fake. I agree with a lack of increase in BTC/USD price and obviously the halving of the block reward but even my estimate puts the ROI at 9+ months, and that only adapted for 2x the original number of preorders in additional orders after they release the products.  a 20-30x difficult would mean closer to 1.5 year for a 100% ROI.

Lol, you must be joking.
Best performance per price, best linux support. It even works under Xen pci passtrught!

Not going to happen.

There's one key aspect everyone misses when they predict their massive difficulty increases...and that's profitability. With a Jalapeno at 4.5GH/s, a 20x difficulty increase with NO increase in BTC/USD price would mean you're making 1.1 BTC per month. That's not even worth anyone's time for a $160 investment as it would take over 12 months to equal out (how you managed to calculate out 6 months I have no idea). And if you still think things will be the same in 12 months, chances are you're quite mistaken (look how far we've come as is...).

To compensate, either the value of BTC would need to drastically increase or the cost of ASIC devices would need to decrease.


EDIT: Missed this as I posted:

Much more likely. Inaba already noted well under 10x for BFL alone, so I can't imagine getting near 20x for quite some time even with all the other ASIC companies' preorders added in.

And we all know that the cost of the ASIC devices will plummet as the marginal cost of producing the chips after the initial investment is close to zero (or very low)

The money vs performance ratio is better because their drivers suck and nobody would buy their products if they were even with Nvidia.  Did you ever notice if you install their driver on XP, it will load then reboot then tell you it relies on the .NET 2.0 framework and can't load anything in the driver's GUI without it?  Why would they write such big name software from such a wealthy company in freaking .NET?!  I'm a .NET programmer and I even think that was a stupid choice.

Then you've got crashes, crashes, and more crashes in any game that's been newly released followed by the game manufacturers advising you to turn off XXXX if you have an AMD card.  Nvidia doesn't seem to ever have that problem.  Then you've got shadows and lighting drawing incorrectly in 1 game and when they fix it, they break 5 other games.

I also couldn't possibly care any less about Linux support :P

i don't consider an investment of 100-200 btc as high risk, come on guys!
high risk is if ASICs manufactures never deliver :p
 But since we have faith in BTC and  its value continue to rise then this investment will pay off even after 6-12 months.
I wonder though what device/technology will be more "profitable" than ASICs in the future!

Everyone seems to be throwing that around but I don't see it happening.  The 3 manufacturers almost have a monopoly.  BFL will release first in all likelihood and they have a monopoly on "budget" hardware that's a bit slower but more affordable.  bASIC will have a monopoly on larger rigs that are actually built well.  All the pics I've seen suggest BFL uses REALLY sketchy parts like cheap fans and stuff.  And Avalon is releasing their products so unbelievably late, they're not even in the picture.

So that means they can all charge whatever they want.  Here's my theory.  Once a company has sold XX amount of mining hardware up front, jack up the price.  That's because for every ASIC miner you sell, you devalue your product.  The less people mining, the more you can charge because people's ROI calculations will result in a smaller time period.  Let's say it takes $50 to build a Jalapeno.  If the price is $300, less people will buy it but they'll be willing to pay more seeing as how less people are buying them.  Then it's just a cost of manufacturing thing.


You do know the more "faith" people have in bitcoins, the more ASICs will sell and the less money you'll make, right? :P  oh and since ASICs are basically the end of the technological ability of modern computers in relation to bitcoins since it's like a mini-computer designed to run mining calculations, it'd have to be quantum computers or something.  That or just faster ASICs with smaller nm transistors or whatever that can run at faster speeds but lower heat.

totally agree that everyone needs to make up their own mind based on their own risk profile for an investment.  I've made my calculations (and just redid them!) based on the information I have, and view my investment in mining hardware as a high risk investment that I expect to pay off in 6-8 months, but if it doesn't (and takes a year?) then that's part and parcel of a high risk investment.

I advise anyone making investments in ASIC mining to do their own calculations and bear in mind exactly what Korbman/Desolator are saying in particular that things probably won't be the same in 12 months :)

Will

You contradict your own post where you say that people buying an SIC now will not make their money back...

So how does increasing the price afterwards make more people buy your product if they can't even make their money back on the earlier bought models....

Apart from Avalaon, bASIC and BFL there's also Tycho coming with an ASIC in Q1 2013 and ASICMINER will be heads on with BFL in rolling out the first ASICs albeit they will use the 1st 15TH wordt of chips to mine for their shareholders and then start selling them.

With an increasing network speed prices will have to come down or no-one will buy

In 6-12 months those ASIC devices will be replaced with better equipment.
During that time they will not lower their Price and here is why.

Reason 1. Have a product to offer that is better then your competitor makes you money.
Reason 2. During the time of development they will have to fund that research.
Reason 3. If you lower the price of the devices your existing customers bottom line will be effected.

Solution 1. Reveal a 2nd generation device before your competitor.
Solution 2. If it makes business sense offer full value trade-in on  first gen pre-order devices.
Solution 3. If you happen to lower your prices. Offer trade-in options will less credit towards 2nd generation pre-order devices.

IMHO To have a successful business and or project you should adopt a policy that will never burn your bridges with your customers.... Ever...

The customer should never see the order# (or at least the row number in the database). They understood this even back before computers were in common use http://en.wikipedia.org/wiki/German_tank_problem

Are you counting the ROI from when you start mining or when you sent your money?

I think that they use .net for something different than the core drivers.

Most probably the GUI of the AMD control center or something like that.

It would make sense to me.

Np at all with drivers my side, i must be lucky.

yeah, .NET wouldn't be idea for the driver operations  :D Although they obviously use DirectX lol.  But yeah, it's the freaking interface!  To just show a window on a screen to millions of customers, they picked the least likely to work method and then don't even include the framework installer itself in the driver or a downloader for it!  That's like a $100,000 company mistake not a $1 billion+ company mistake.

Cough. Oracle. Cough.

Nobody is immune from bad installer decisions, larger companies just have more inertia, and tend to get stuck longer.

Succinctly put and overall quite right.
I actually remember a quote from one of my business classes later in college, and it comes from Sam Walton: "There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else."
In other words, keep your customers happy and they'll keep coming back to you. BFL had some trouble with this to start, but given they have a fair amount of competition this time around I don't see why they wouldn't want to make us happy. Otherwise I'll go buy from bASIC :P

Oh, and:

LOL yay for vastly overestimating quantities!

You need a unique reference to run a business, the customer needs that reference as well. The best they could do is obfuscate it (with double SHA2?) or something, but why would makers of web-store software even care about that in a general case? Outside this fishbowl community attempting to decode order numbers is generally a futile exercise, so why expend the effort on the feature?

Yes, you do. But the rowid of the database is not the way to do it. A better way is to choose an arbitrarily large number space, choose a number from it randomly and check for uniqueness. There are other methods too. At the least, they should not be easily guessable.

The people expecting to get all their $$$ back in a week are the ones that had preorders in on the first day, and will (likely) be receiving the first ASICs out.  And those people very likely will have a 100% ROI in around a week, provided the BTC price doesn't take a sudden dive.

I'll let you know.  ;)

Uhhhh maybe you should read BFL's shipping policy before saying that :P I had assumed everyone reading this post had done that but that does not appear to be the case  :D ;D



That unfortunately results in an almost 100% chance that you won't get 100% of your order during the initial shipment and also that if you didn't place an order before July 2012, you're definitely not getting 100% of your order (if you ordered more than 1)

Unfortunately in SOME form of the business system there will need to be an orderly ascending unique identifier for each transcation. Typically this is done at the invoice # level where each new invoice is +1 above the previous, regardless or how/what/why. This is needed for auditing purposes.

That said.. for a sales order #, there is likely a lot more freedom with that, but i would imagine it would still need SOME kind of rhyme or reason vs just being totally random.

The fact is:

Even BTC price drop to 1$, there are plenty of people waiting there to pick all of them up
Even difficulty drop to very low, there are plenty of people waiting there to mine more coins

Since all of them know that the total amount of BTC is limited

C'mon haven't you people ever worked for a real company?

As a lead developer you provide a project plan to do the project right.

As a mid level manager you find ways to shave time and dollars off of the project plan.

Developers complain "but it will suck"

They give the installer task to the intern who is sucking the mid level managers cock. She can't code but she works late and produces poor quality rubber band and duct tape shit spaghetti code  quickly.

The boss's boss gives the boss a bonus for coming in under budget.

Neither the boss, nor the boss's boss will ever (EVER) actually look at the software.

The support team deals with the fallout and hates the developers for being so lazy.

It's how it works.. When you've been doing this for 22 years like I have you just roll with it. You don't get upset when projects you put your life and soul into get tossed in the trash because of the color of a button (but we can change that!) just so some manager can get credit for having produced a revolutionary new software product. You become jaded, you've already written everything ever so you become a cut and paste programmer while reading news on the web and running your bitcoin side business from your relatively high paid senior developer job.

All is right in the world...

But at my company, we have 1 programmer: me :D So all the code works flawlessly and I don't have to deal with incompetent morons that are in programming for the money instead of due to their intelligence level.

During college I had to work on a huge car rental program and my partners in my group were a guy that was dropping out the next semester and a 55 year old lady being retrained by her work.  It got a score above 100% because I wrote 90% of it plus the bonus extra hard part :D

Someone's hacked into my autobiography...

Given that the first site I checked, Newegg appears to have such a system for their order numbers, I'll concede this (not sure what their invoice numbers are doing though). Thinking back, when I worked on an e-commerce site back in the late 90s, we used an increasing-by-1 system but just started with an arbitrarily large number.

Exactly, what manager is going to defend that feature azhead of their bonus? If you really want the feature to stay in, they have to really want it too.

Software never makes it to ideal, someone always releases it...

+1 :)

Given the posts I made on this thread, I find it fair to disclose that I ended up investing a fair amount into ASIC.
Lets see what happens.

What made you change your mind?

A roi of 1 year with a difficulty x15 of what it's right now, and the hope of receiving my hardware soon.

These 2 alone are not enough, what made me really change idea is that I really think the bitcoin economy to grow of several orders of magnitude in the future. I will mine to keep, not mine to sell.

It's a bet.

Fair enough. I guess the odds are better than playing the lottery.

I sincerely wish you good luck.

Haha, really funny.
Yes, you are right, i have better odds than that case, with the difference that i don't play the lottery/whatever other similar game, i consider that a tax on the poors.

Thank you for your wishes :)

I have the same feeling. However I also want to use some of the coins I mine, because the economy won't grow if everyone will only hoard coins...

+1

Gotta spend a little bit so that the economy gets moving. If everybody hoards, no more transactions, people leave, BTC value goes down the drain.

BTC is imo both a "storage" and an "online" concurrency. You can use it either to safely store your money and to pay online.

Spending your BTC in stupid online stuff will not help the btc economy to grow, only an increase of demand of btc would.

What we should do is to create business that accept bitcoins, or find new alternative ways to persuade existing e-commerces to accept bitcoins.

We have to push them, to give them a solid reason.

Buying coffee online will not help us.

I think as long as there is SR and BMR markets out there BTC will survive for the good or the bad..there are a lot more srry to say so addicts who must find out about BTC still out there...

I also think that own a GPU@800Mh now will be the same as own a SC@60Gh in 6 months (IF ASIC,s are 4real) so not that mutch will change except that the network security will be better off also 2many preorderd people counted themself to rich i think, BFL and other comp. took adventage of that...we will see

The only thing is that really, we will see. There are too many variables by far in this game. I will be happy if my ASIC will return me 50% of the investment before becoming obsolete! :P (yes, i'm serious).

but that's not going to happen and we both know it :) Scenario which is more probable is that you will actually make a lot of money on those ASICs, whatever is said in this thread...

I really doubt it and i have zero hopes on something like that to happen...

But sure, with Avalon out till at least the first of February ad BFL that will run away with the money leaving their employes trying to figure out how to buy ASIC chips on ebay... Well, that might a profitable mining period! :D

In 5 weeks halving day is a fact, then it,s up to BFL and Avalon,s testbatch etc. to deliver ASIC a week later orso??..mmm i don,t know if that is a fact to.. but it,s going to be a very very intresting end of the year in BTCminingland... :D

we shall see... I'm actually thinking about preordering more singles...

If you really have to, place the orders on different vendors.

It's not a great idea to depend on a single one.

on the other hand if you have to solve for example a malfunctioning piece of hardware, it's much easier to work with one supplier then all of them. Or if there is an ASIC 2nd generation, then BFL will refund the 1st gen and send you 2nd gen for reasonable price. At least that's what they are saying. I'm a realist, but I have high hopes for ASIC mining, so in this case I think that I'm an optimist...

And if no super mega 1TH machines come out, I'll have made my money back in under a year, and hopefully bitcoin will be super popular (making the payoff time a lot shorter)

well they do give lifetime garanties, mmm what if they are outrunned or run in lets say 2 or 3 years?? how the fuck can they make such promise in a speculative market as BTC is...this al sounds to damn wrong,..i don need an 140+ IQ to figger this out. . :o :P ::)

They do NOT give a lifetime guarantee like the one you mentioned. It's called a lifetime warranty and it says that they will repair / exchange the unit if it stops functioning because of hardware failures.

They also said that they plan to have some sort of upgrade paths for older devices in case newer and better devices come along. But that's a completely different thing.

I have a low IQ and after reading this, I am scared now.
I fall into a scam by buying BFL asics and also buying bASIC equipment.
Will I loose my money in the near future?
Or will I aggressively adding more units to mine mining operations?
Only time will tell.

If you have low order #ids, and have 50% of orders in both companies, my speculation is that you will not lose more than 50% of your investment, with the opportunity of earning more than you invested.

A low IQ means nothing.

Here is a quick little representation of the mining income upon ASIC release.

The only assumptions are 2 BFL SC singles and a linear rate of difficulty adjustment per day. Not completely realistic but close.

https://i.imgur.com/7u8sv.png

Yep, it's low EQ you have to watch out for on these boards. http://en.wikipedia.org/wiki/Emotional_intelligence

OP there is a low probability that the price will stay at or below $12.80 for very long. If the price goes up the time it takes to pay off the cost of BFL hardware will go down.

What is there to drive the price up? At the moment it feels like we have been fluctuating at ~ 11.6usd/btc for awhile now...

You forget that there is 1.5 Quadrillion Dollars floating around the planet in different forms.

Not much needs to go into bitcoin to push the price up to $15, $20, $50, $100.

DO the math.

yep..

and we could use some trendsetter kind of famus company to adopt BTC and take it to another level so that more retailers and online webshops will adopt/accept BTC ( or some colombians tired moving cases of cash across boarder)  and after halving day less BTC will be pumpt in the economie and if the demand get bigger that also could make some price rise..we will see..i think the price will stay around 11,- untill some big changes in BTC accured like halving day and the yes or no of ASIC release.. :P

To all those people who think they get more BTC in the first few days-weeks.....

What will happen if the ASIC manufactures blow up the difficulty before they start shipping? they got there money anyways.... Who ever gets them late thinks they are not the first inline....

Whos gonna benefit...

i think i keep away from all this mining and just trade BTC's. its more profitable that way

who hit rewind...

BFL, CablePair, Avalon have all publicly stated they will use testnet in a box.

ASICMINER is the only one I worry about, because it is their intent to mine with them first, and they have stated so all along. It sounds like they might be 2-4 weeks behind BFL though, and Tom is shipping in November/December as well, so the race is on...

what is he shipping it,s 23-10-2012 no signs of any WORKING ASIC yet everyone keeps pointing delivery dates as soon as november/december ??? ??? i just don,t understand how this could be possible...tell me if i missed the actual working device with the custom chip..that will get shipped next week or three from now ??? ???

Sure I believe them. Especially BFL. Come on, don't be naive. What stops any manufacturer from mining for themselves and ignore it is them?

they're in it for selling the hardware, so why should they mine...

In spite of your (repeated) unwillingness to accept it, folks tend to have this thing called a "business model." In the case of BFL this business model is to sell hardware to all us crazy people who want to buy it. THIS is what they got investment capital on, not the power of Bitcoin, and their investors will (righteously) be pissed off if they find out BFL was using their own product (bad in the drug trade, bad in business) rather than selling it to their customers.

Mining with the equipment they want to sell would directly devalue said equipment as the potential profit falls and the next generation of hardware would have to be cheaper. Right now BFL can keep raising the (overall product) price with each generation, they don;t want to do anything to prevent that, including mining themselves.

You don't see Husqvana opening up a lumber mill, same principle here.

Nicely said. +1

And bitcoin community, fickle as it is, it will negatively react to any attempts by the hardware producers to mine first, sell later. That doesn't bode well for their future business if any of them tries that.

Quite right. The object is to keep your customers happy and coming back when you release product updates (or new products altogether). For BFL to use their own product would completely alienate the bitcoin community, effectively signing their own letter of insolvency as we all switch to using products from their competitors.

Just wondering. Hypothetically, an ASIC manufacturer could mine with prototypes themselves (or have it done by an accomplice) and blame the increase in difficulty on another manufacturer.

Ha, good point. bASIC goes all out with mining and we all blame it on BFL  ..and then out of anger for BFL we start preordering from the competition  ;D

That's just a waste of money. They should mine real BTC during the burn in but put them in a paper wallet they include in the box.

Far from it. The point is to isolate mining with the prototype devices to prevent network disruptions (in total hash rate, difficulty, and profitability). If it was discovered the any of the companies were profiting on their own product, it wouldn't make the community very happy, including their investors. It's a terrible business model.

The same applies to the drug trade...don't use your own product ;)

Well, they wouldn't profit as they'd be passing it on to their customers. It might also count as a bit of reassurance : "This device generated x bitcoins in y minutes". Not that I mind either way as I'm not going ASIC, it just seems a shame to waste energy (assuming all other things equal)

Like to quote yourself much?

Of course the answer in reality in a physical sense is nothing can be done to stop it, but you should ask instead why would they?

OTOH, if you run BFL and your investors come and take the company you built away because you violated their trust and the trust of your customers, you might regret the decision to voilate that trust.

BFL is not 2 guys sitting in a basement somewhere. There are real business agreements, salaries, leases, and other things ties up in running a business than you seem to acknowledge. There are real world obligations and long term opportunities for these businesses to continue serving a community for quite a white, or get acquired by someone if it starts amounting to more than chump change. Contrary to what some would have you believe, BFL keeps investing and appears to be in this for the long haul. CablePair and ngzhang are similarly trying to grow a stable business. Unlike a scam, these businesses must continue to build trust and keep customers coming back.

In case it had not occurred to you, the ~180TH/s that has been sold so far is a drop in the bucket compared to the market available for ASIC. We should see 1-2 Petahash/s sold over the next 12-18 months. 90% of the ASIC profits for this period are still up for grabs, why bow out now!?

It's a nice idea, but it should have been conceived of, communicated, and articulated in the plan up-front. What you refer to may happen as a promotional thing in the future, but at this point everyone is all "shut up and take my money" so why put all that extra effort into some (very) fancy coupons? When you have a business venture growing at a massive rate the last thing you want to do is add any complications that are not absolutely needed.

??? I'm going to be burning 1-2Gh/W compared to .01Gh/1W with an FPGA single. This is wasteful? ???

Of course, all other things are not equal, every miner helps add to the security of the network which is why it pays in proportion with the contribution. Contribute less security, get less Bitcoin.

If you want to be green, decide on a wattage that you are willing to donate to bitcoin, and pay for carbon offsets to match that wattage. Every 3, 6 or 12 months buy the gear with the best GH/W rating that fits in your wattage allowance (and get some extra carbon credits for the manufacturing cost offset)

Personally this is too much trouble for me, so I'm replacing a standard light bulb with a florescent or LED bulb for every 10Gh and calling it even.

Sorry, that was a little ambiguous. I mean that running against testnet is wasteful (assuming that you are reasonably confident that your operations will be valid).

So trust from their customers and not wanting to violate that trust prevents an ASIC manufacturer from mining for themselves is what you are saying?


Your opinion is that ASIC manufacturing is very profitable long into the future (To me it is just one possible scenario). Combined with the first point you are saying that an ASIC manufacturer does not want to risk its own business and potential future profits by violating trust of its customers.

That is absolutely a valid point. Mine is that corruption is also possible and I find it likely to happen when large additional profits can be made and chances to get caught are almost zero.

You have to be joking... If they mine enough to matter, someone will notice. Both the risk of getting caught and the consequences of doing so are more significant than you seem to realize.

Fine, let's game this out:
They are making millions of dollars worth of mining equipment, so to match risking that they would need a hefty profit, at least in the $100k range. So they get a couple MiniRig-SC units assembled, and decide to run them for a couple weeks to make an extra $173k (based on current info, no hardware cost) and then ship them out for an additional $30k each for a total of $233k from 2 rigs. The problem is that the 2 minirigs just generated 3TH/s for 2 weeks, impacting the difficulty by 10%. This means that the (say) 20 minirigs that ship out are only making 90% of what they should have if you had not stolen from your customers. Unless you think that Josh can keep his mouth shut forever, eventually someone would leak, or the 4x size of EMC would show and folks would cry foul. Every customer then joins a class action lawsuit and sues you into oblivion, or you get to live the live of a fugitive with $170k.

If you make the reward bigger, the detectability goes up, and if you lower it to a couple singles it's an inconsequential amount of money. In any case it is not worth the prison time. Why risk millions (and a long term opportunity) for thousands (and a lack of long term options?)

You keep asking for reasons why not and I keep giving them. Maybe you should refocus on the why would they part of the equation more.

When dealing with a guy running a financial trading house from his basement, the risk of vanishing deposits is high, when you have a known brick and mortar business the risk is a lot lower and you generally have more ways to get relief or detect problems.

+1... the people thinking that BFL will try to mine and not get caught are not fully thinking through the situation and consequences.

Mining is a function of Quality assurance.........

Since these manufacturers need (hopefully) to test the kit before it is sent out ,and a 1 hour burn in would be totally acceptable.
Personally We used to run 24 hour burn ins to remove 'bath tub failures' on lighting.

Unless they setup dummy  mining servers or utilise dummy back ends, it is feasible that they will 'impact' the generation of bit coins.

Now we could in theory use that 'meta-data' to see when they actually start manufacturing /shipping these rigs.


HC

Well there are no asic out there yet, but they will be shipping them nov/dec  mmm testing them for 4 weeks then ship them to customers they hang them on the net 24/7 and after 6 weeks they blow up then there super customer service will deliver a new one in few days??? yeah right dream on people...

This is an interesting chart... if this holds true, I stand to only make back 1/3 of my investment (relative to BTC, not USD) in this timeframe.

Another assumption is that you are up and running with your singles while the difficulty is still at <30TH/s ;) What make you assume that you get your equipment on day one and not on day 30? (Honest question, perhaps BFL stated that they will ship everything on the same day or something similar, and I missed it).

There should be plenty of units in the wild initially if BFL sticks to their 1/3 policy.  The real weak assumptions are just how fast everyone will get their units online and how the difficulty will react accordingly.

I did a similar chart with the 10x increase in difficulty spread to 60 days and the picture is much rosier.

I am not saying that BFL (or any other ASIC manufacturer as we are talking in general here) will mine.

It is speculation at this point and both scenario's are possible. No black and white outcome yet, it's all odds. We can and seem to disagree about how likely both possible scenario's are, but if you do not even want to consider the scenario in which they will mine themselves, I guess no argument can be made.

A good investor however should look at all possible outcomes.

There's really no reason to think they'll use the ASICs to mine (for profit) any more than you'd expect your car dealer to take your car on a trip to Mexico before they deliver it to you.

The analogy would be a little more accurate if 'landspeeder' were substituted for 'car'.  I've seen no compelling evidence that custom Bitcoin mining ASIC chips currently exist in the real world at this time.  Admittedly though I have not looked very hard since I would not have even a potential interest in obtaining any until they are demonstrated.  I don't even follow the mining forum normally.

but for totally different reasons.

FFS: They are all using TestNet In A Box!

Here's BFL's announcement:
https://forums.butterflylabs.com/showthread.php/52-ASIC-Pre-Shipment-Testing-Policy

Here is info about Testnet in a box:
https://bitcointalk.org/index.php?topic=4483.0


WTF? We HAVE looked at it, I'm ignoring anything. We looked, we asked them, we got the answers, and we moved the heck on.

get another freaking topic already.

There's a difference between claiming to use artificial testing methods and actually doing it.  Like someone said, they can mine on the main network and blame it on others.

I said that and according to opinions here that is not at all possible, because.   I give up, reality is not welcome here.

There is also a difference between a bait and switch scam, and a real legitimate business.

You are just saying "no, no, no, no" I'm adding more and more evidence to my side of the scale. Make an argument other than whining and I'll give it some real weight, but right now I see nothing you have said that is even slightly convincing.

Deeplink, I respect your opinion, as well as yours Desolator, you both can continue to believe that these guys are scams and can never get caught, but at this point the chances of that are less than that of Mitt Romney getting elected and declaring this the Peoples Republic of America.

There are thousands of eyes watching them, and employees working for them, if there is a breach in this policy, even the suspicion of violating their direct statements to us, and you know the size of fecal hurricane that will hit them. It will not require proof, only suspicion, I've been on this board long enough to see that!

This is business. If you piss off your customers, they fire you. Generally they get a lawyer and sue you if there is real money involved. If you think some of the guys buying multiple mini-rigs will hesitate to take BFL to court if they violate this, then you are nuts. I bet they get sued anyway even if they ship on time.

Go back to my previous post. If BFL mines enough to be worth the effort, it will skew the difficulty by at least 5-10% Anything less and they will make more money selling a dozen more singles. We have examined this issue and long ago passed the "they would be nuts to try, they know that, and they have stated they won't" point.

WTF do you want? Videographic proof of the birth of Jesus Christ? What is your standard of proof, or are you going to continue whining about this forever, no matter how much ASIC is manufactured?

If this is indicative of your risk assessment methodology, I recommend investing in a rock to hide under.

Scrybe, reading what you just posted, you have absolutely not understood what my point was. You either read it all again or you don't. I do not care anymore. Also the aggressive tone and personal attacks are unnecessary.

Please do not apply an aggressive tone to my messages, I tend to type like a thesarus by long habit and I also do tend to have strong opinions, like many on this board. I would much rather have a spirited argument followed by a beer (or alternate SR product as appropriate) and resolve an issue than have it fester and cause grief in the long run. This was not intended as a personal attack in any way. I truly am confused with this morbid fascination some seem to have with ASIC manufacturers cheating their customers.

I came into this thread because it said I was screwed. I encountered on page 8 a statement by mpradeep that had previously been debunked, and I tried to put it back to bed. I refuted every reasonable argument for it, as well as several unreasonable ones. I have done so with details where appropriate to allow others to learn something about this complex, crazy world of ours at the same time.

I thought I was refuting the notion that mining for profit of any reasonable size would be undetectable? It more likely than not if someone was trying to do this it would be a huge spike much larger that $100k worth. And you parroted the "but we can't tell" line so you got caught up in the thread too, if you wish to refute it, my hypothesis is that if any ASIC manufacturer "blows up" the difficulty, the information will leak out and/or rampant speculation will lead to a reaction against someone, a case of Business Russian Roulette at best. Your arguments come down to "not knowing == 50% chance", when I'm trying to point out  that it is reality much more like a 0.5-2% chance. You are the one who has accused me of not even considering the possibility when I obviously have given it both a lot of thought and typing. I'm not sure what you thought was a personal attack, but I certainly didn't mean to malign your intelligence or honor, only question your current point in the current context.

Apologies if I have offended, but if you think I've missed your core point, please wait until I address the OP, then we can talk more.

Additional stuff that might be interesting:
For reference, have you guys ever attended a business ethics course or workshop?
(http://highered.mcgraw-hill.com/sites/dl/free/0073524565/324445/jon24565_ch05.pdf is a good basic primer for those of you following along at home who have not done so (experts who lol'ed, I did say basic))
So far I've been focused on the Practical Rule for ethical business behavior. "Because they would not want the public to find out, it is unethical." The same result happens if you view this business decision on the part of the ASIC manufacturer from the viewpoint of the Utilitarian, Moral Right, and Justice Rules as well.

Original post from Page 8 by mpradeep (emphasis added):

Nice, succinct post. +1


I have (yay)...I've got a degree in this sort of stuff haha...and part of the reason why I also agree with you scrybe.

Thanks for your clarification. Then I misinterpreted your intentions. Let's forget about it.

The idea that ASIC manufacturers might cheat is based on experiences in the real world and the Bitcoin community where I have seen people and businesses take the chance of getting caught and cheat the hell out of their customers. Some cases we know of, others we don't and whether or not we know, many have gotten away with it. Look at the scammer threads on this forum or pirateat40, Bitcoinica, GLBSE (both shareholders and most asset holders), or in real life, see your local newspaper: politicians left- to right-wing, company directors and boards, even CEO's of humanitarian organizations may cheat for their own gain. Even with a large risk of getting caught. It has always been like this as long as I can remember. Also, at the time it is happening, everyone suggesting so is attacked by people who have an interest in it not being true.

Of course I am not saying that everyone is a crook. But my belief is that most people are if it comes to money.

You may hold another view about the world and humanity and I sometimes wish I did, but I don't and I think this may be the root cause of our disagreement about the possibility that ASIC manufacturers may be dishonest. If that is it, we should just agree to disagree and go and grab that beer (or SR product of your choice) sometimes. I hope that all of them prove me wrong, I really do, but I am not betting on it.

I think scrybe's point is, even if they are crooks, it would be a dumb move to try and mine on the hardware before sending it out.  It is logically a bad choice, even if you assume they have ZERO morals.  This isn't an issue of morality - it is an issue of logicality.  It would be completely illogical for them to mine on the hardware before sending it out due to the extremely low revenues relative to their revenues made from selling the units.

Yes - we have a list of variables that influence the decision of a manufacturer to decide to mine on the hardware:

Manufacturer morality
Likelihood to get caught (and the event of being caught leading to an unknown loss on revenue due to angry customers)
Pre-order and future revenue of selling the units
Additional revenue by mining for themselves

Whether it is illogical for a manufacturer to mine is a function of ALL variables. All variables are extremely uncertain and we have found to disagree on at least two of them.

A couple technical assumptions to get started:

• Tom has closed pre-orders for BTCFPGA bASIC round 1, he has about 900 orders, <100 of which are 27Gh/s units. Please update his total to 45,900 GH/s.
• I think your BFL number is also low, I've been using 165TH/s for their total preorder backlog (note: not the same as the first shipment
• Avalon has completed 2 rounds of 300 units each at 66GH/s, so that total is ~20TH/s twice for 40TH/s total.
• Additionally as you state there will be a rush of folks that are relieved that ASIC is real (it's real already, but some folks need more) who buy additional equipment, but it will not all happen at once.
• BFL should ship in November, maybe slip into December. bASIC may ship in late November, more likely early December. Throughout December BFL has claimed they will catch up to their current pre-order backlog.
• Avalon comes out in January, along with a second batch of bASIC and more BFL from October, November pre-orders. More of the same moving forward, but it will be directly impacted by feedback in the price of BTC and the hardware ROI.
• This feedback exerts a constant tension that tries to pull the price per GH of mining equipment down to a 12-18 month ROI, and may eventually succeed if bitcoin does not increase.
• Mining Hardware will continue to evolve with at least a moore's law expansion rate, but will exceed this growth rate until mining hardware reaches current process nodes and then stabilizes it's rate of growth.
• This will eventually result in at least one hardware generation per year, but at 1.5x faster per year, not 100x like ASIC vs GPU.
• Bitcoin has demonstrated growth far in excess of mining impact and mining does not have a direct impact on BTC price (halving might be different, but difficulty generally is invisible to SR folks)
• If the price of BTC shoots up, then the profit opportunity will also shoot up, and we will start seeing mining rigs that are the size of refrigerators and need a datacenter to run, but are still profitable.

So given this environment we are going to have a progression something like this:
November:
Difficulty starts at 3.7M, block duration ~ 10 min
BFL Ships first batch of ~50Th
3-4 minute block average from block 209664 to 211680
A very few lucky bastards get 50% of the last 336 50BTC blocks with ASIC (I hope to be one!)
December:
12/2 block 211681 has difficulty ~12M, duration of 5.5 minutes
BFL second batch, bASIC first batch
12/10 block 213696 difficulty increases to ~20M duration of ~8 minutes
BFL Final initial preorder Batch, bASIC same
12/21/12 (yep, I LOVE that my calc is predicting  difficulty change that day!) block 215712 has difficulty ~25M and duration of ~9.4 minutes
January:
Slow first part with a gap in BFL and bASIC shipments as things get ready for a second wave of preorder clearing. Avalon ships first batch
1/3/13 block 217729 has difficulty ~26M and duration of ~9.2 minutes
Second Avalon Batch, BFL and bASIC start shipping in sustainable quantities (but not sustained rate) instead of batch processing.
Month ends at ~32M difficulty
February: ~48M
March: 60M
April: 75M
May: ~95M
June: ~120M

I know that this is all speculation (based on the ASIC shipments I think are going to happen, tempered with price/power costs, time cost of fiat, lots of factors included) but I included it more for the point I'm about to make, rather than the numbers themselves. Let's see how this plays out. I'll base the scenarios on a bASIC because it's a less confusing shipping policy, and it is at an assumed disadvantage of second shipping.

Initial pre-order first ship results (the irregularities are an artifact of my block-based spreadsheet, so my months don;t 100% line up. It's a (fairly) smooth decline if you look at it per block):
Spent 98BTC in September
December: 47BTC
January: 33BTC
February: 15BTC
March: 16.6BTC
4 month ROI 114%

Mid-Janaury delivery of bASIC:
Spent 98BTC in November (assuming flat here)
January: 20BTC
February: 15BTC
March: 16.6BTC
April: 8.15BTC
...
January 2014: ~100% ROI without power costs
August 2014: 100% ROI with power costs

Finally I come to my key point. You cannot simply estimate a final environment and calculate for it, you have to look at how items enter and leave the equation over time and take the area under the curve as profit. This IS calculus to do properly, but most of us approximate it with series of algebraic formulas. You simply cannot capture the whole thing in one equation, so the time-series analysis approach is important. It is also important to incorporate uncertainty in your models, I have models that range from 500TH/s to 2.8PH/s at the end of 2013, as time goes on I throw some away, create new ones to match new data, and incorporate more feedback where appropriate. The one I used here is a "pretty bad case" model after the initial ASIC Zerg Rush, if your scenario plays out with an overbuy of ASIC then the market will correct itself at least to self sufficency, I seriously doubt that anyone who gets an ASIC in Nov/Dec is going to lose money on the deal.

Your Thesis Statement that those with pre-orders are screwed is exactly, 100% backwards. Those that have preorders are almost guaranteed a profit, those that have not are taking a bigger risk, and it might be prudent to wait on the next price-drop or tech-bump to place another set of orders.

Of course if we add back in a reasonable set of swings for BTC value (up to 4 doubling/halvings per year was used recently, It jives well) then the mining rate will be fluctuating in response to that as well. If appreciation of the BTC exceeds the Jan/Feb ship rates there will be plenty of profit for everyone.

That's a good restatement SgtSpike, thanks.

There is a big difference between most of those scams and this scenario. Pirate offered nice returns by investing in a ponzi and operating a pass-through, it was a scam from the start. 3 of 5 ASIC projects to sell to customers have been selling gear already, so they have given us some indication of their morals. I'd score the current situation like this:

Morality: 4 of 10
Caught: 4 of 10
Revenue: 9 of 10 >10:1 difference in risk/reward

Aggregate that together and you still have a better than even chance that they will not cheat. and I think the morality and caught scores should be higher given the level of scrutiny. If we did the same thing with Pirate (when trusted) it might be 9, 1, 1, resulting in a 66% chance he was going to rip folks off. Either way we will see as it plays out. Remember what I said about lawsuits next year...

Interesting. How does the BTC/USD price point react to such scenarios? I'm assuming you've included economic modeling into your hash rate predictions?

Great post scrybe. A whole lot of smart people begin their speculative musings with something like "difficulty = x and therefore pre-orders are screwed", but they fail to include a time element. I think you're correct, barring a huge scam scenario it is the pre-orders that will have a best opportunity to make a quick ROI and the subsequent batch orderers that should carefully consider the landscape before they invest.

I'm assuming that the folks who claim that BTC is not tied to mining are correct and BTC will mostly follow it's own price path based on the value of goods and services that are traded with it. The only real control over the exchange rate that mining plays directly is pressure based on how fast or slow the collective miners sell their BTC, but that population often sells at market rate which exerts no real force. Block halving may cause this second factor to get more important, but I doubt it.

In my most common model for BTC price model I'm assuming that BTC will get higher than $16 around halving day, crash down to $6-8 sometime in the new year, and climb back to $25 by midyear (and with a lot of drama) making it to $50 before the next year is out. This is based on an overall model that has the overall BTC market cap at $20Bn by the end of 2016. A more pessimistic model I use only has a max of $200 in the same time frame, but what fun is that!?

Honestly I'm in BTC for the long term, so the BTC rate really only impacts my re-buy schedule and eventual portfolio value. Of course it impacts everyone's investment rate in mining equipment so it is an important factor and I recommend putting at least 1-2 crashes of price into your model to ensure that your strategy can keep up with them. It's a strategy so it requires tactical adjustment based on reality, but knowing what actions you are likely to need/want to take when the forecast looks certain ways will arm you to recognize them more easily. (FYI, there is an intellectual trap where you can get caught up in your models and miss reality though, so it is important to keep updating and refactoring your models to help avoid the trap.

An old (and successful) investor friend once told me that models are great, as long as you know that they are all flawed in some way. When you start believing that you have everything accounted for you are about to lose your shirt.

OP is mad that he can't afford/doesn't have the guts to pre-order. That's all.

Well, that's all well and good, but if, say, the hashrate went up to a nice 1.65PH/s (an average of your two extremes) the difficulty would be a nice 213,125,000,000 (rough estimate of course). That would mean at an exchange rate of $200 a coin, you'd be making a sexy $10.33 per year with your $1300 Single SC....losing it all to energy costs (or if you have free electricity, it would only take 126 years to break even).

But on the bright side, if that Single was $1 it would take just over a month to break even.

My point is that something has to give in order to support high hashing rates.


A wise man, this investor is.

Yep, I think I mentioned that. The mining equipment is going to have to become cheaper, more powerful, or both. I fully expect a Single to pay back 2-3x (maybe up to 7x if things go nuts, or I lose that particular shirt) in the next 12 months but that is 80-90% of the BTC that it is ever likely to mine. It's trash (for BTC at least) in less than 2 years almost guaranteed.

The exception to this would be a skyroketing price that takes the block reward from $250 (assuming the price keeps falling to hit $10 today) to $5000 ($200/BTC) over 12 months. This would mean that a bASIC could be earning about $96 in January in (@$8.82/BTC) , but $220 in December (@$200/BTC), even though the profitibility in BTC has gone down by 90%. Assuming that this major price swing didn't impact difficulty even further.

I doubt such a thing will happen, but even if it does the exact scenario above will not play out since a LOT more mining gear will be able to be sold every for every block generated. Instead we will see shorter ROI cycles and more frequent gear purchases required to keep up with all the other folks who are getting "rich." I have been thinking about putting together an ASIC shipment model based on the value of bitcoin which would allow me to get more accurate, but until then I'll just have to say that I deduce that we would see difficulty spike up to something like 600-800M and 12 month ROI on a $700,000 miner the size of a refrigerator that consumes 10KW (well maybe with $1000 BTC)

I think that the easiest formula I have seen to capture this is a "Spend half my income on upgrades" model. After block halving this means that each month each miner will have a portion of a bit over BTC100,800 so if we add in the 50% rule we get ~BTC50k spent on mining equipment. At $10 this is $100k/month, at $200 this is $2M/month, at $1000 it's likely $5M/month,assuming more than 4 years to get there.) It's easy to do this with constant increases and an easy forecast just by adding mining capacity with a 2-6 week delay for ordering/shipping. Unfortunately the reality is to be useful it will require a basic P/L forecast analysis for every time period to see if it is a buy or hold period for hardware, hmmm.

Until ASIC at least comes out and we see the first difficulty change or 2 I'm going to stand pat, and continue to calculate on BTC based ROI. Any fiat based bonuses I get due to exchange rate are awesome, but I'm not counting on them.

Just for grins I did the math for the $700k miner above assuming it comes out in a year with double the claimed efficiency of BFL SC Single (and likewise assuming that this will replace 100% of the current theoretical average 1Gh/s miners that were replaced by SC class devices in 2012 (~24,000) increased by 50% due to the profit opportunity of mining (they are worth $200!))

10,000w*2GH/w=>20TH/s * 36,000 miners=>720 Petahash = a difficulty a bit over 1 Billion.

average miner takes home 3BTC a month with this monster everywhere, BTC is going to have to be >$500 before it even pays for itself, but we could see some big gear happen if that block reward start becoming worth thousands of dollars or more. Honestly once BTC gets past $100 I'm going to start getting nervous that we will see REAL ASIC Wars when multinationals and governments start playing. (of course if this happens we can all get drinks in Monte Carlo if we have more than a few bitcents to rub together.

Are you fucking retarded?  If I had one, I'd have sold it by now.  but I was smart enough to not get one in the first place, given BFL's past history with wrong specs and late releases.  Sounds like you're just mad that you're so utterly screwed.

By the way, there's so much wrong with Scythe's estimate that it's beyond all correcting.  He's off by a factor of 2-3x.

Scrybe please.

You might want to quit throwing stones there, Mr. Glass House. I did a lot less than that and you got your back up, why should you get special treatment?

If you don't provide ANY details of what I'm off on, how do you expect me to see your point? Remember, you told me I was screwed, not the other ways around. You have a burden of proof that I do not feel you have even approached. I just tried again to engage intelligently, and you have nothing specific to say? I even made a special effort to directly respond to your OP, with a quote, and provide you updated numbers that are higher than the ones you have published. If anything you should have to re-evaluate your model and tell us how much worse it got, maybe you are just guessing instead of analyzing?

I'm off by 2-3x? No, some of my models will be off by 20-30x in some areas, others will be closer. Until reality catches up with them they are just projections. This one is using the best available information on the forums, but you don't dispute the framework, or the data, or the methods, I'm just wrong? I acknowledge the fact that more than one thing can happen that will have major impact, and you say I am within 2-3x? COOL! Honestly anyone who thinks they can predict difficulty more than 3 months out right now with less than a 2-3x error range are very (over) confident in their model, I doubt my numbers a lot!

You have still ignored the most key point, time If I make 50% of the value of my unit cost back in 1 month, 25% the next, and it takes a year to get up to 100% then the risk is decreasing each month as well that things will go nuts and make the unit suddenly unprofitable. Early adopters have a good chance at this area under the curve, late adopters have little chance at it. Hence there is more profit opportunity with less risk by investing in ASIC now (diversified to prevent scams) than continuing to plan on GPU or FPGA in the long term, or investing in ASIC in January. Once we see the next hardware generation you will have a chance to get back on the train, but I think this is the cheapest a ticket will ever be.

You are not doing your case any favors, if you want to convince me (and most likely others as well) then you have a long way to go to build credibility for this argument.

If mining does not become profitable the companies that are creating the products to mine with will have no customers to sell to. The miners that stick it out over time with what they have and with the best products will profit and never need to upgrade.

I call that the plateau 

If the reward drops there will be less btc to mine and less btc to sell and that will increase demand and price of the btc. The other plateau will be the demand for the btc to retailers which will require customers in which most will be the miners. then you have the speculators that will be putting pressures on the price of the btc going up and down..


The way I see it if there is not enough reward to satisfy enough miners to keep the system going then the system will falter. BTC needs miners and the serious will stay.



The ones that stick it out will profit over time the rest will drop out or sell their stuff.

People buy houses on the top of the market and lose. It happens and people will continue.

If the risk is too much then by all means sit this round out and jump in when you feel more better. I appreciate the heads up and wish you well.


EDIT :I added a few more things

I got a shipment date from  BFL, just before doing a Pay Pal.

I decided based on what I was told , that I would NOT be placing an order.
Based on their own production figures quoted elsewhere and working backwards from the 'tag' i was given, means they are going to be dumping a SHIT load of product into the market before I receive mine.
Return on a 60GH rig would be over a year.

HC

Few of things here...
1) For your 'tag', are you referring to the randomly large order number? And you think that's the amount ordered?
2) BFL is shipping in 1/3rds...some of the early buyers, some mid-range, some recent...all at the same time to "even it out".
3) Typical returns on purchased hardware in the past have stuck to around 8-10 months, depending on what you buy and when. My guess is that this will stay relatively the same, but the network hash rates and BTC/USD prices will fluctuate to match it.

Hmm...my understanding was that BFL's overly complicated 1/3 shipment plan was only centered around pre-orders placed within the first month or so in addition to upgrade units. I'd surely not be a happy camper if I'd sent them funds in the spring and someone who ordered in Sept got a unit ahead of me. :'(


I generally agree with you doggie, but I think you're off on this one. I don't see all that much downside to pre-ordering and there's potential to get a decent ROI in the short term.

Wow no angry masturbation allowed....... you are not the only person in the world who is allowed to express an opinion.

I think it will be much higher difficulty jump than some people think.

Biggest difference over GPU/FPGA is the low electricity consumption.

60 ghash/sec for 60 watts is crazy. This means that when block halves to 25BTC assuming electricity costs of 0.15USD per kwatt/hour this means a theoretical Max hash rate of 11,000 terahashes/sec!
(25*6*24*365=1.3m BTC per year = 15m USD per year).
11,000 kilowatts would cost you 0.15*11,000*24*365=15million USD per year.
And you can get 11,000 terahash/sec with 11,000 kilowatts!
This is a difficulty of about 1,700,000,000

Assuming that people keep buying ASICS till the payback is more than one year.
In this case the electricity cost is insignificant so we can just do the following:
60 Ghash costs $1300
1 Ghash costs $22
So just divide the total revenue for year by 22 -> 15m/22=717,000
This is 717 terrahashes or a difficulty of 102,000,000 - a 30 fold increase!

So my prediction is difficulty will increase as fast a ASICS ship to 102,000,000 and will then slowly increase to 400,000,000. This increase could be MUCH faster if there is a price war between ASIC providers.
But will never get above 1,700,000,000 until there is a "New" technology.


And this assume a constant exchange rate! As rate goes up so do all the numbers.

Nope, but I'm not going to let others use my words to call people retards, that is unacceptable. If you think I was angry at this post, please reread it and the one after it. The one that made me angry came later.

I do expect the opportunity for dialog on a forum, and if Des does not want to talk to me or address my many real points, then that is fine. I have tried repeatedly to engage in an honest, non-insulting, considered evaluation of the situation, but all I gets is "you're wrong?"

Puh-Lease.

What will push it up , is the Chinese.
They are absolutely shit scared the Government will take the money off them, consider the tax rate at 35% for anything over the income of a tramp.
They believe it is better to put all the money into the stock market or real-estate, because even if it crashes, then you end-up with exactly the same as if you gave 35% to the government.

However since the RMB is HIGHLY controlled and difficult to get out of the country, there is a very strong black market for bit-coin currency in China, potentially billions of $ as the government slowly gets on top of paypal and other more 'traceable' money transfer systems.
Bit coin allows you to buy bit-coins locally, carry a flash over the boarder and then re-cashout the money.

I made a small speculation, the only thing what I dont know the difficulty thing, is the difficulty depedning by the total hash power? (this is how I get it and  calculated a bit)

So let's say after the ASIC's come out there will be a huge overhashing power in the network.
I estimated this at 50X so 50X ~28Thash/s (the total hash power at the moment) = 1,400 Thash/s =>

difficulty from 3, 000, 000 will be 50X this number so 150, 000, 000
so to jump to this difficulty we will need 1, 400- 28 = 1, 372 Thash power in the first day.
After this I devided this number in 60 Ghas so 1, 372, 000 / 60 ~ 22, 800 orders of a 60 Ghash/sec ASIC
like I saw there are just ~ 13, 000 orders so ~ 10 000 really offers that number is still the half of what I'm waiting for.

After this I putted this numbers in the TP calculator and got that at a 50X bigger difficulty time than now I can get my money back in 4 month. That's not bad if we think about that the difficulty will be rising exponentially and not linear (like I think because the curretn difficult rate will be much ower the power of the new Total hash power), so I can get the invested money still faster than Im waiting for.

So to sum up to get back the in 4 month the inveted money the avvarage of the tottal difficulty of the 4 month's difficulty should't be higher than 150, 000, 000.

Am I right? I would thank you very much if someone could correct me if I made somewhere a mistake, I couldn't mine ever, and now thinking to try it out, and wanting to buy a Little SC. What you think about this? 

Reading this made my head hurt, but I'm sure your heart is in the right place.

I'm not really following your calculations, so I'll just jump to the end, 50x the current difficult is 165,217,800; we can round that to 150,000,000 for you. ASICs will not be released until after the coin halving, by everyones estimate, so each block yields 25 coins for our calculation. 60GHash/sec mining on 150,000,000 difficulty will generate 1 block roughly every 5 months or so, yielding 25 bitcoins. If in 5 months 25 bitcoins are worth $11 each, that is $275, or roughly 1/5ths of the cost of a Single SC. So you would be able to repay your Single SC in approximately 25 months (2 years 1 month) at that difficulty.

Hope that helped, even if it was rough calculation.

... or store online in wallet or .dat backup

50 * 1.4 = 70 , not 28.

Imagine how screwed people with GPUs are.
Considering this (GPUs, and things near their speed) are the only alternative, if you want to keep mining youll have to switch to ASICs.

@the moment the onlyones making the BTC thus money are the GPU rigs fpga,s ect.
@the moment the ASIC doing 0 BTC

in 4 weeks 80% precent of easy BTC are mined after halvingday de marketprice will decide if people keep there gpu,s on the net.. the time between this and the ASIC shipments the diff could go down..good for the gpu owners doing 10gh+ and already payed off there complete rigs ...when IF ASIC get shiped in 2013 we will see what happens but the next few moonths will be very very intresting...GPU en fpga rigs are still no1 as we speak... :D

Haven't been following for the past few months. So these ASICs are still happening? I was under the assumption this whole thing was a huge scam. This thread pretty much confirms that they'll happen, but basically since everyone will have one, then no one will profit.

Bingo! Unless of course you keep discussing it, do lots of calculations and bash everyone who points out you are wrong.

No.
 

You were right.


No it doesn't.


No they won't.


Correct.

;)

About the only correct point was the last one... other than that your statement shows a fucking tragic lack of REAL research...........
An example:
http://www.cast-inc.com/ip-cores/encryption/sha-256/cast_sha256.pdf

ANOTHER example:
http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.106.5391&rep=rep1&type=pdf

Tis post is awesome.
Everyone cancel your ore orders now.
I can be the only ASIC buyer. I will den be rich :).
ASIC buyers ain't screwed. Gpu users who think ASIC is screwed up are in trouble. If ur rig can't reach 4 ghash your below the cheapest and slowest ASIC.

How are they in trouble? Most GPU miners have mined more Bitcoin than the average ASIC miner ever will.

You're not comparing apples with apples here.

Maybe you don't understand the comparison then. I am just wondering why or how a GPU miner who thinks that "ASIC is screwed" is in trouble. As I said, most GPU miners have already mined (lots of) Bitcoins. ASIC miners have not. GPU miners were the real early adopters and ASIC miners are the wanna-be early adopters (caveat: an overlap will exist). On average total earnings of an ASIC miner will never exceed that of a GPU miner.

It's like a poor guy with a lottery ticket for a million dollar jackpot saying to a rich guy, that he is screwed because he has less money than the poor guy might win.

I'm sure the vast majority of ASIC pre-orders originated from former/current GPU & FPGA miners, they're not exactly backing into this with blinders on.

Anyway, if BTCFPGA ships on schedule and BFL delays shipping one more time, those early bASIC pre-orders will pay out months of GPU mining worth of BTC in days before difficulty increases much. Certainly not everyone is screwed equally. :D

Yuuuuuuuuuuuup +1

What I mean is some gpu users are too wary of the ASIC. Most of them believe th ASIC will never come. They could ahve point. But when it does. Most gpu miners will need to move to ASIC.wha to mean is this post is a load of rubbish. ASIC miners areant screwed. Lol what did the CPU miners think of it when gpu mining became possible?

Why do they need to move to ASIC? They can just say: screw mining. If they want coins, they can just put a risk-free bid on one of the markets.

Why even bother with bitcoins..... shove your money into the stock-market for the day when you see an opportunity.

Why even bother with the stock market and money, sink all your currency into some raw material and try to barter it for some other valuable resource.

That's exactly what I understood. And that's the reason you're not comparing apples with apples. GPU miners were the early adopters and had an "unfair" advantage that ASIC miners will never be able to catch up with.

If you care to explain more precisely what you mean by the above please do, because I still don't follow the apples vs. apples argument. I agree that is a simplification, for arguments sake, but I don't see why I cannot compare the situation of these two different kinds of miners.

I also disagree with it being called an "unfair" advantage. GPU miners took a big risk by investing time and money into this project at an early stage. (By the way, all information was public and everyone had the same opportunities, could have joined in at an early stage.) Do you also consider it unfair that early shareholders of Microsoft, Apple and Google made much bigger profits than later investors? And would you also find it "unfair" if GPU miners had lost money and time?

Though I agree with the rest of your argument, I don't agree with this statement. If we're talking riskiness (on a scale of 1 [least] to 5 [more] risk), then I'd scale it like this:
CPU - 1
GPU - 1
FPGA - 4
ASIC - 5

The reasoning behind this is because CPUs and GPUs can easily be used for other things besides mining. It was [is] super easy to just set up some software and mine with whatever current hardware you have in your system. Even if you invested quite a bit into GPUs specifically for mining, you can still quickly and easily resell the hardware when you're done with it because it serves secondary purposes.

FPGAs can still be used in other situations besides mining, but they require quite a bit of work to reprogram them for another task.
ASICs, on the other hand, serve one purpose. If they're developed specifically for hashing on the bitcoin network, then they will be completely useless if bitcoin disappears. Reselling them requires pandering to a specific niche market.

I did that and it gave me 2 mhash/s on my nvidia onboard card ;>. Wasn't viable so I bought a fat GPU plus PSU and stuff I needed. True about the resale possibility with GPU.

I think we agree about that. It was in response to the "unfair" statement of bobitza. Note that I am saying big risk, not bigger risk, because I wasn't comparing GPU and ASIC risk. But if you insist: I also think ASIC miners are taking an even bigger (actually huge) investment risk, more like a gamble, one which I certainly wouldn't take at this point. But I see nothing unfair about it.

But your scale is not complete, because you only look at monetary risk of depreciation of the assets needed for the mining operation but you neglect some other important risks. If you look at a larger picture: Two years ago it was even harder to predict the future of Bitcoin and it is certainly not rocket science, but not trivial either to get a GPU farm running => Time invested in learning about Bitcoin, plus the time and money needed buying, building and tuning the mining rig, electricity costs and depreciation (hardware minus reselling value) could have easily been completely lost from a profit perspective.

While I agree that ASIC purchases are a sizable risk, those early adopters that chose the right supplier could potentially receive a large payoff for their gamble and that to me made the risks worthwhile.

At this point I'd rather be allocating fiat toward direct investment in cryptos than any purchases of mining equipment, though that wasn't the case when this thread was started.

... so you can't actually compare the two because the GPU miners have that headstart. So they can't be screwed. Perhaps the GPU miners that just jumped into mining ...

I'm actually agreeing with you. Perhaps the fact that I'm using an expression (apples to apples) that is usually used to disagree with someone's statement is confusing. I apologize for that.

Absolutely. If you are voluntarily taking a risk with your own money you are free to do so. And if in hindsight you have made the right decision, nobody should call that unfair, because they could have taken the same risk and earned the same payoff.

So it seems in the end we all agree, isn't this great?  ;D

Must be a first!

Let's get Inaba in here...there's entirely too much goodwill in this thread. ;D

Not meaning to pick on you this morning bobitza but with the impression there may be too much agreement going on here ;) I'll stick my oar in...

I disagree with the idea that GPU miners 'can't be screwed' by ASIC investment.  I'm guessing you mean GPU miners who already broke-even and are re-investing profit.  But by no means does this apply to all GPU miners - i) because they may have been late to come on board and are yet to break even; ii) because they may be investing way more than they've profited, out of overconfidence arising out of profitability to date, out of fear of being left behind or simply because they conclude it's a good time to be risking more.

More to the point I would venture to suggest those who look at losing money earned by one means differently to the way they look at losing money earned by another means are seeing things from a hobbyist perspective.  Serious business folk who want to remain in business, once the money is earned, look at it simply as money.  How it was earned does not affect the risk involved.  Of course there is a difference between money already designated to risk for further gain and money 'borrowed' from safer projects it might originally been intended for (such as retirement funds etc.).  But it matters not whether the money came from a nice severance deal, from speculation in other fields such as shares or property or from GPU mining.  For those who have money designated to risky ventures, just as for everyone else, the risk is of losing it.  Losing it just has a much lesser potential impact than it does for those risking money they maybe shouldn't be (regardless of whether or not they have a history of GPU mining).

Maybe the distinction between who is potentially screwed or not could more helpfully looked at as those who are risking what they can afford to lose versus those who are risking more (maybe way more) than they can afford to lose.  I would suggest it is the latter who have, depending on which of the various predictions put forward in this thread come to be, a reasonable chance of being screwed.

Yes, I'm referring to those that already broke-even.
Yes, it does not apply to all GPU miners, especially the ones that arrived late on board or the ones overconfident in the future profits.

I know ASICs pre-orders started 5-6 months ago, which means ASICs were talked about even earlier. Any serious GPU miner that likes to keep himself updated with the news in the Bitcoin world would have considered the scenario that this might be real  and would have made appropriate plans such us: do not buy truckloads of GPUs and/or pre-order the ASICs as future replacements. Even if you started 7-8 months ago (just prior to ASICs announcements) I think that would have been enough time to recoup the investment made (especially since ASICs keep being postponed, lol).

Now, if you just joined teh mining community and blindly bought GPUs and FPGAs when everybody was talking about ASICs and how they are x100 times more efficient ... you deserve to be screwed.

^^this.

If someone ends up sitting on your 'asic pre-order' for several years before getting something out the door which is pretty capital intensive and at least as high-risk as Bitcoin itself...you deserve to be screwed.

Lol, that too ...

Since ASICs are finally *shipping* (I guess?) should we update this with new calculations?

I'd be curious to know more actual payoff examples and how people come up with their network hashrate figures, etc...  I saw the graphs in the other thread just need more reasoning!

Better just wait. For JGarziks unboxing and showing his real ASIC before any dumb discussion will start over and over again...!!! Right..??

dude nice  waster of bableber there

bfl has 75k chips in preorder with is like 700th  with avalon prime etc its 1000th  payd for already

aka ul be making  2 cois a day with a minirig

i think thats somes up ur monolouge

Wow, who gimbled your mimsy?

yah i fundeled ur moommys