Bitcoin Forum

Hey All,

Just wanted to bring your attention to this article I caught on The Genesis Block about Avalon's chips getting stuck in customs:
http://thegenesisblock.com/56-4-ths-of-avalon-bitcoin-mining-asics-held-up-in-customs-225-ths-arriving-in-a-few-weeks/

They're is a discrepancy between the quoted TH stuck in customs in the title versus the text; doing the math quickly in my head: 200k * 282 MH/s = 56.4 TH/s, but there could be some rounding error I'm not accounting for wrt a GH being a little more than 1000 or something. In any case, it is a pretty f-ed up situation, I definitely feel for those of you stuck in batch 3 pre-order hell given the way BitFury and KnC are about to drop.

What's possibly more interesting is that Avalon claims to have another 800,000 chips currently in production, so before it's over we can expect a full 250+ TH/s to be added to the network over the next couple of months from Avalon alone, increasing the network by over 40%. If I recall correctly, KnC has at least 2000 customers, so even if we conservatively estimate that each customer only averaged a Saturn (agreeably a laughably low estimation), you're still talking about another 400 TH/s coming online by the end of October just from them.

Discuss amongst yourselves. Possible topics:
How in the world will HashFast or Cointerra or even BitFury's October delivery ever be profitable?
Will Avalon's 55nm Gen 2 chips be priced out of the market before they ship?
Who are the sheep that are still placing orders with BFL?

This recently happened to we nerds who had preordered Oculus Rift dev kits.  Something like 3500 kits were stuck in customs for almost 2 months.

This should be extended to include all ASIC hardware that hasn't yet been deployed.  Assuming that a large portion of these up and comers manage to ship, I wouldn't be surprised if nary a machine made a positive ROI in any (bitcoin) respectable time frame.

I'm sitting here with an itchy trigger finger trying to take in the facts and place my bets.  As far as I can tell, at this point in time, every single (purchase) option is a loser.  Things are about to get extremely ugly, I'm just thankful that this whole thing has largely been a shit show of failure for the last year and that I never sold off my GPU farm.

Heh, I'm not placing much (if any) faith in Yifu these days, if I hear something from ngzhang I'll be more inclined to take statements at face value.  I see no reason that they couldn't sell their chips within the bounds of the market, it all depends on how greedy they are.  


Newcomers who are getting sucked in by their marketing BS.

they were cheap. You had to expect a huge rise in difficulty, if you didn't, frankly: your fault.

Agreed. I never once got a calculator out but simply did the math in my head after watching a few difficulty increases and then reading the forums and seeing the TH coming. I started paying close attention around 8 mil and now we are over 37 million and climbing faster. I had predicted 60 million by September - November assuming all machines shipped and I completely stopped following in late June early July since it appeared too flakey for me. Now there are so many more options I truly dont see why anyone would get involved until it settles down.

An even bigger concern to me has been Bitcoins stale nature...I truly expected a fortune 500 to have picked them up by now. The demand has to go up before value can, otherwise I fear Ponzi.

Yep.  Given that the hashrate chart now has an almost vertical slope, the profitability calculation has an intolerable sensitivity to the x-axis time value.  Any slight movement rightward on the curve, even measured in days, makes previous calculations moot, and ROI goes negative.  It's worse than gambling: at least at a casino, the odds are against you but they're relatively stable in the time dimension, with no dependencies on other people's promises.

The only sure-fire way to make money in mining right now, is to build mining goods and services and offload the risk onto stupid people willing to preorder insanely time-sensitive products in an environment where broken promises and missed deadlines have been the norm.  The sellers have no skin in the game whatsoever: in the best case they win, in the worst case they lose nothing.  A brilliant business model if you can find enough lemmings to sign up willingly.

It is sad to see a community whose genesis block laments the asymmetric risk profile of legacy banking, falling all over themselves to gift the mining industry a free put option on every piece of equipment they produce.

Preorder = Prebailout.  Simple as that.

Previous post very well put. 

A very large number of people, alot of them on this board, are about to realize how much money they've effectively lost.  Not a single transaction for a preorder or asicminer products or anything in the last several months has been worthwhile that i have see.  This effectively means that a huge number of people 'didnt see this coming' despite many of our warnings.

It cant continue indefinately, no, but by the time difficulty flattens, thy'll be very little money being made, so it might as well continue.. Theres little difference in this case between asymptotic growth and a flatline at some intolerably high diff..

It's entirely possible that the "leveling off" will be at such a high point that the lower efficiency ASICs will not even be profitable to run based on power costs - they won't even pay for power, much less their purchase cost.

As in any previous gold rush, the best person to be is the person (or people) selling shovels, picks, food, clothing, etc.  Not the sucker down in the ground digging in the dark.

Buying hardware now is like paying taxes, we do it to protect the system. A corporate takeover is coming, its already happening; they're fewer pools and fewer, full nodes every day.  
I bought four Block-Erupters at one Bitcoin each, I will never make a ROI; even at 0.10 they're not profitable. As with every market in the world, the top one percent will take control.


Edit: what I meant to say was, the system is rigged; soon 90% of the network will be in the hands of 3 or 4 companies. This is how Bitcoin dies.

I'm one of the lucky ones who got their orders in early for both FPGAs and ASICs. A very modest operation, but one thing is for sure, when my ASICs become unprofitable (which I expect will be shortly after the new year), I'm totally out of the mining game.