It's obviously the more and faster they produce ASIC, the worse their products will be priced due to rising difficulty caused by their delivery  And control the speed of rise in difficulty also has a benefit of stablize the bitcoin price appreciation so it could be more predictable |
|
|
|
|
It is becoming more difficult to measure the risk now when BFL is going to ship their 30,000+ orders in the coming months. It has always been difficult to predict the possible return of mining rigs, but it has never been so uncertain like it is now
If the network hash rate reach 1PH by the end of the year, an Avalon will mine 0.2376 coins per day, now a batch 3 unit cost 75 coin will need 315 days to breakeven exclude electricity cost, means almost never ROI when electricity is included
In such a environment of fast rising difficulty, the most economical choice is always buy bitcoins directly, but for a hardware fan there might be some other considerations
ASIC mining device manufacturers face a strange market condition: Every device they sold will increase the network difficulty thus decrease the profitability of their next customer, thus they have to constantly aggresively cut the price following the difficulty rise, which means their production might become unprofitable in just a couple of months, I call it "kamikaze" business model
In PC/electronics industry, this effect is also clear, but that is due to market saturation and it takes many years to reach 100% market saturation. But in bitcoin's case, the market saturation is always 100%, which exaggerated this effect
|
|
|
|
Hey there was a governing effect that gave value to the crypto currency which involved the price of electricity. It could be argued that by using asics that require less electricity to create more hashs it devalues the bitcoin. Even though the amount is finite. This is the reason why gpu's are leaving in the first place.
Eventually a 600W ASIC device will only mine several dollars worth of bitcoin per day, barely pay the electricity, but by that time the amount of people who are mining might be magnitudes higher than today It is difficult to follow the hardware trend, eventually people will just buy coins and leave mining to a couple of companies to handle the infrastructure of this payment network |
|
|
|
|
The other 10 btc were spent, which is just a spending of $890 (purchase price)
So you start with $1780, spent $890, earned $270 through capital gain, end up with $1160
Tax for capital gain $270 has to be paid
If you always spend bitcoin to buy things, you don't need to pay any tax, since there will be no capital gain
This has a very interesting indication: People will have motivation to spend the coin directly to purchase things instead of exchange it (paying capital gain tax), which also means the merchant can expect a higher sale price if paid in bitcoin (since the consumer are willing to pay more due to saved tax cost)
|
|
|
|
Taxes have paid my education and founded a stable society that have enabled me to make a decent living, food in the stores, reliable public services etc.
Taxes did no such thing. Money printing allowed that. Taxes exist in the fractional reserve system as a mechanism to increase the value of the unit of account by removing some of the supply from the user base. Governments and banks can print all the money they want. They don't need our taxes to survive but they do need to take some of our money away as means of regulating the supply of their increasingly worthless product. This is the most accurate observation Governments are poor, they have to facilitate lots of public services using either tax money or borrowing money from banks. If they tax too much, they will not be voted, so their best option is always issuing bonds instead of increase tax, and the result is the national debt keeps rising And, in a debt driven money issuering system, no matter how much tax the government charge, the society as a whole would still be debt laiden, since every dollar in existance are borrowed from central bank at the first place, no matter how you redistribute these money, the total debt will not change |
|
|
|
|
I think after 75% of coins are mined, these kind of thoughts will become more and more
Just feel strange that people never complain that central banks being the only early adopter of fiat money creation
|
|
|
|
|
Actually there was a discussion about keeping coin generation rate forever at 50 coins per block, but the linear increase of coin supply would still make any newly generated coins insignificant comparing to all the existing coins, just the curve is not that steep
But the impression is totally different
1. Daily coin generation is 7200 coins
2. Total coin generation will be 21M
Comparing the two statements, the second one obviously give the impression of a limited supply, while the first one still feels like endless supply. This impression affect people's interest and trust, in the first case, bitcoin might never reach the status it has today
|
|
|
|
Bitcoin is almost a perfect store of value due to its technology advantage and limited supply
Wait... What? Your store of value is about to eat 50% of its value in mining costs in the next 4 years. The bitcoin network is a terribly expensive network to run, at least for now. It's a really poor store of value. Everything that can act as a store of value will ultimately be generated by certain amount of effort (energy), that's the reason when gold price was very low, there were many miners shutdown the mine |
|
|
|
|
And actually this is good, it pushes more people to research for the more efficient energy resource
|
|
|
|
Bitcoin may or may not be deflationary in practice. For one thing, forks and clones can always be made, increasing the virtual money supply beyond the goods that it is being spent on... that's inflation. For another thing, Bitcoin is a technology, which is subject to the same rapid depreciation as other technologies. That is, for all we know, someone may have a superior replacement to Bitcoin already in development, that will make everyone drop Bitcoin and move to it. Bitcoin pretends to be deflationary with its fixed supply of coins, but that only remains true as long as it is able to crowd out alternatives, and as long as people want to continue using it. Alternative currencies generally do not have a long lifespan.
Also, your analysis of alternatives to Bitcoin is not persuasive. Yes, homes depreciate, but they are still attractive because you can live in them and avoid paying rent. Yes, the use of physical gold in trade is not especially convenient in modern terms compared to paper currency or credit cards. But gold is still attractive as a long-term savings vehicle, with a market thousands of times larger, more well established, and with a longer history than Bitcoin.
Finally, nothing prevents investment as a form of saving in regular currency. You can always save money in national currencies like the US dollar, and at most times, get real returns. People fail to save, however, not because saving is not attractive, but because they prefer short-term consumption, an issue of human nature and not of the currency.
I'm shorting gold, but I dare not short bitcoin  |
|
|
|
|
It is possible that in the future, a handful of ASIC companies developed extremly power efficient mining rigs with leading <10nm technology to mine and raise the difficulty, thus majority of miners would mine at a loss and quit the mining, so the total power consumption will be less
The worst case is everyone in the world will have same technology and mine, the electricity usage will be huge
But then there is a limit on circuit breaks in each household
|
|
|
|
I also thought about this myself.. a currency that final encourages saving rather than investing.
Exactly, saving is the first step, then investment can happen, but investment should use risk capital. In such a system all the risk have already been paid, the financial stability is extremly strong |
|
|
|
|
The medium of saving property is the most important character of bitcoin. In a fiat money inflated world, there is no reliable long term medium of saving: House will depreciation, gold is not convenient to use, bond have risk of default, stock will crash when recession strikes ... Bitcoin is almost a perfect store of value due to its technology advantage and limited supply
In the future, when bitcoin becomes the medium of majority people's life saving, the value of bitcoin will still keep rising, because there is no limit to the amount that people can save. Maybe for 1% of the rich people, they have already saved enough, but 99% would still like to save for the future (Saving does not mean cutting spending, it is just a sign of very high productivity: You can't spend as much as you produce, so you save the rest into bitcoin). This will also solve today and future's problem of over production
Bitcoin will have the highest credit rating on the planet: Even a country/government can disappear, but a network protocol will not
|
|
|
|
That auction got stupid real fast. It's pitiful. Just throw out the word asic and people lose all common sense, rationality, and throw their money out the window.
The spirit is: If you don't own an ASIC miner, you are not a true bitcoiner  |
|
|
|
|
A question to kncminer:
If bitcoin price crashed back to single digits and many people abandoned bitcoin, are you still believe in bitcoin and want to make ASIC devices?
I think that current ASIC device manufacturers all have this belief when they started the project one year ago
|
|
|
|
Being a digital asset doesn't make it a tax evasion tool, those who buying houses actually get tax deduction |
|
|
|
Okay! You win! I thought it was a pretty crazy theory and all, but wanted to toss it out there nonetheless. There's no way in hell that ORSoC could've been aware of Bitcoin and what it incompasses until Kennemar and Coles brought it to their attention. Unless, that is,... http://opencores.org/project,btcminer© copyright 1999-2013 OpenCores.org, equivalent to ORSoC AB, all rights reserved. OpenCores®, registered trademark. Has anybody ever heard of a company called BTCMiner before? Maybe it's a new company that's going to work hand-in-hand with KNCMiner. Any insight will be appreciated. I love this forum!  So they are going to use ZTEX's code? I have seen even more simple codes |
|
|
|
|
Avalon raised 300x$1299=$389700 for just prototyping and they made 2 prototypes using those money, I think a large part of this money went to R&D and first wafer of chips
|
|
|
|
|
Interest in ASIC devices are big, I think they will collect enough pre-order fund to drive the project, just time to market is a variable
In my past experience, projects in Sweden are typically 6 months to couple of years long, only a small amount of them started to use Agile working method recently
|
|
|
|
So, obviously it's a little late to jump on the ASIC bandwagon. If I were to buy now, the market would be flooded by the time I got one. So I'm looking to the future. If current Avalon and BFL(if they ever get around to shipping) are the current gen of ASIC, when do you think they'll start accepting preorders for the next-gen(twice as fast, twice as cheap, if ASIC follows all the other electronics on the market)? I'm thinking next year, but I haven't been around that long and don't know these companies as well as the older members here. I'm honestly not expecting there to be any concrete facts, I'm just asking your opinions. But I welcome concrete facts too. In GPU mining era, even there were thousands of users running GPU and FPGAs, you still can get some decent amount of coin if you have a GPU mining rig. We are still in early stage of ASIC mining |
|
|
|
|
Show Posts
