I see what you mean, though this is a bit of a loose analogy. Payment by devaluation, again a bit of loose usage with the term payment. Well that is fair, though I don't know that people are unaware of this fact, or at least not as unaware as you say. If it is known that X coins are generated every day, at a specific rate, it is fairly clear that this needs be made up for in some way.

Would be nice, but very unlikely to happen, that guy is a bit off the rail imho. There's no reason for a 100x valuation increase in coins, due to a decrease in mining reward.

People probably forgot about it because it looks like nothing came of it. cablepair offered "raw" ASIC chips, which probably means they have not been coded to actually hash.


Topic is still listed as "Bounty Offered" from September. No posts by this user have referred to this again.


Referring to this topic, it's clear that payment processing and whatnot is all that is happening. Tom has not announced an actual timetable for completion and shipping, and as of a few days only said that things look like they "should be on time", meaning things are not finalized, and as with all things in life, are susceptible to unforeseen circumstances.

With that said, bAsic at least on paper sounds like it will be first out the door, time will tell.

To what end? People should not in their own self-interest see the coming technology as a way to profit? Should they avoid ASIC altogether? It is something that has been a long time coming, and there really is no way of stopping it (whether it is now, or if it's a scam, in the future). Ideally there would be tons of kick-ass services, and easy to use mining for everyone, but the system has to grow organically, and as always happens that means inefficiently at best, and crazily at worst. I'm glad that there are people working towards the best interest of bitcoin as a whole, by providing services for BTC, and programs to help make the network more accessible, but I certainly don't expect everyone to stop themselves from any venture if it could be at all potentially harmful to BTC.


To be fair, I do have a problem with paypal, and also need to send money halfway around the world, and there are no good options for me, sadly bitcoin is not really a good solution for me here either. If it were to grow however I would certainly be quite happy to use it in this manner, and it would be a great legitimate service. I see many others, who would be interested as such.
Mining does matter, but it is separate from the use of bitcoin, and the two need not be considered together.

As regards Ponzi schemes, people will be people and will always mislabel things, because they don't bother to learn the proper terminology, so it goes. Doesn't help that Ponzi schemes have been on peoples minds lately in larger news, what with Madoff and whatnot.


This one I'm not sure I follow. How are mining proceeds paid for by anyone simply holding currency? Do you mean that people who support the current valuation of BTC are paying miners? Or is it something separate? As it stands, mining is not hidden anything, they generate X coins per day which are then either held or dumped into the system, very transparently.

Interesting article, but mostly reflects my original post, in terms of not really knowing how to approach the subject.


The taxpayer should determine on their own whether taxes are due, and abide by whatever rules you think you're impacted by, hmm.

Well, as to the moment it seems like my original guess is the safest, I was curious if anyone had come up with a workable rationale to alternate tax treatments other than simply declaring money taken from exchanges as income, which would I think stand up the best to any kind of scrutiny.


I don't think this is an entirely irrelevant question though, especially as I contemplate the jump into ASICs, if I were to plunk thousands of dollars into hardware that could potentially generate more (tens of) thousands of dollars, it becomes something that I expect the IRS would be quite interested in. And can of worms or no, when the IRS comes along auditing, I believe the burden lies on the taxpayer to defend their choices.

For those who have been or going to begin mining, how do you handle your operations for reporting?

Is there a more effective way of reporting other than simply Selling XX coins for YY fiat = income - cost of electricity/hardware to generate them? Do you have to account at some level for the coins you've generated and stashed away in your wallet?

If you sell/rebuy/sell after you generate coins, do you take capital gains/losses on the difference of what you're buying/selling after generation? How does one account for this (usually brokers generate a statement I believe for cap gain/loss)?

I guess it doesn't need to be an exhaustive tax treatment, but I am curious how others are handling their gains/losses at the hands of BTC gods. I imagine others are thinking about this with the upcoming ASIC release as well.

Clock speed simply refers to the frequency at which computational device runs. In your case, my suggestion would be to reduce the clock speed of your Memory (Meatball's suggestion of doing this increments is good, but ideally you will want to be in the low triple digits, so 25Mhz at a time might be a bit extreme), and your Core. You can also play with the VDDC (lowering) as you lower. It will be a lot of little tweaking, to find a stable point, and you might not find one if the GPU is just dying.

60C is nothing to worry about. I believe most people suggest 85C as an upper limit, and I ran my cards over 90C for months (I regret this, but what's done is done).

I still also recommend a video stress test, as I suggested before. Visual feedback is very helpful, and easily understood (clipping/ errors / bad frames etc.)

Whether true or not is unknown, but Tom claims he had been working on bAsic for many months before he announced it for pre-sale. My suspicion is that after FPGAs, many heads got the same idea to adapt to ASIC. Considering the time tables for release, a BFL secret development project would not have yielded very good results for them. Not to mention 90% of the development costs were likely raised through pre-sale orders. Which would make it difficult to secretly develop and mine on.

The hell? That was random, thanks for the quotes. This crap is still a surprise to me.

I think is a slightly pointed, but fair answer. No one knows. Based on *current* trends, yes you can make back your investment if:
1) You get it early enough that your 4.5GHash is chomping away at a difficulty designed for ~23THash total.
2) Difficulty doesn't shoot to the moon in the next year. This is not entirely impossible, but no one knows, look what happened during the GPU crazy, difficulty went way past expectations.
3) Price remains stable or increases. Decrease changes the game completely
4) You're happy waiting out the return, it will likely be > 1 year to payoff a jalapeno, no matter when you get it.
5) The jalapeno specs are what are being claimed, no guarantee there.
6) You don't factor in the cost of the rig running the jalapeno. Depending on where we go with bitcoin, the 100+ W a regular computer chomps on while idle needs to be factored in to the cost of running the jalapeno.

and more.

If BFL is for real these are factors to be considered. But they are not necessarily barriers.

Here's the thing, regardless of whether you feel personally slighted, you've not approached this at all properly.

You believe that I am suggesting people should mine solo, but... I don't suggest that at all. I merely suggest your statement was preposterous, because it was. In my opinion, you made the argument, so you should back it up (which you in this entire thread, have not done).

If you really think I should have to give reasons why your baseless statement is baseless, I can do that, and then we can argue and argue and argue (if you present counter-reasoning).

Quoted in entirety so that no context is removed:

I will ignore numbers since you feel I nitpick them too much. What remains is the statement which I will paraphrase, 'pool mining makes more sense the more hash power you have because you take out luck.'
Let's look at 4 distinct scenarios:
.1%, 1%, 10%, 100%.
.1%, finding a block will take on average 7 days (21 days for 95% probability to find a block)
1% finding a block on average 17hours (2 days 2hrs for 95%)
10% avg 1.75 hours (5hours 95%)
100% avg 10minutes (95% 30mins, but you get all the blocks anyway, so it doesn't matter).

Now these numbers are for total hashrate moving 6 blocks/hr. The "flat" rate so to speak. You can already see that the more hashing power you have, the less likely it is that no matter how unlucky you are, that you will get "0" coins, not that it would matter, as the difficulty would remain flat.

So what about for network rate far above difficulty? As that's the scenario we are thinking about, that's a fair question. If the network were moving 12blocks/hr we get a simple halving of the above numbers. 24blocks/hr, 4x. All things are in proportion (the time to difficulty change is halved when your time to find a block is halved).

So, going back to our original numbers, assuming you were incredibly unlucky, and went to 95% every time (this is really very very unlikely to happen repeatedly, but for the sake of argument)...
100% Hashrate finds 2016 blocks (all of them)
10% hashrate finds 67 blocks (3 1/3rd% of all blocks)
1% finds 6.75 blocks (rounded down to 6, .3%)
.1% finds 0 blocks.

The more hashrate you have, the better you are doing while solo mining, even in the scenario of an incredibly unlikely string of awful bad luck (you can argue for one block going beyond 95% probability, and entering even the most extreme scenario, even 1% is almost guaranteed to find at least 1 block before change). This is the opposite of your statement, even giving you the benefit of the doubt for someone with the most improbable of bad luck.

Let's look at pool mining, the most favorable and least variable method is PPS, this typically carries a 5% pool fee (p2pool is an exception, but I'm not sure how long they will keep up their system as-is), so then how would this compare to pool mining. Here I will look at average rates rather than worst case scenario. Let's say your pool collectively owns 100% of the hashing power, and you own X% of that pools power, for ease of calculation. Solo vs. pool payout

100% hashrate: 2016 blocks vs 1915 blocks (this would actually be paid in coins, but I don't want #s to get too big)
10% hashrate: 192 blocks vs 191
1% hashrate: 19 blocks vs 19
.1% hashrate: 1 block vs 2blocks

Again as you increase in personal power, fees begin to take more of a toll.

All very simple calculations, but I don't believe you need to get overly fancy here. The opposite of your statement is true, the more hashing power you have, the better off you are mining solo, if you do not feel that you are the unluckiest person on earth.

So my original advice stands, in my opinion from the numbers above it seems that if you are low on the hashing power totem pole comparatively, I'd suggest going with a pool (and not a PPS, but that's personal preference), as you increase your personal stake, the better off you might be on your own, if you are ok with a little risk.

I feel I've met all your criteria in this post. I didn't pick on your numbers, I ignored them completely, I gave a (hopefully) non-condescending list of calculated reasons why your statement was incorrect, and gave a reasoned statement of what I think is the most rational course for people to follow based on their circumstances.

The reason I didn't do this in the first place is that it seemed obvious, and I've now written about 20x the length of your posts to do so. Hardly fair that I'm the troll unless this is done.

_{An interesting side note, that relates to the point I discussed with AMDD. Recalculating PPS pool above, assuming the pool has 20% of total network hashing power, and you have 10% (or 50% of the pool)
On average the pool will find 384 blocks, 192 of those will be blocks found by you. The share calculations are their own beast, but working with average times, it should take an "average" number of shares to find blocks in that difficulty window, so if you assume 50% of 95% total paid out to you, that is 182.4 Blocks you earn, out of 192 you found. Yuck. But one pays for security, as should be obvious.}

People doubt ASICs because they are difficult to develop, and expensive. The concept that bitcoin is successful enough to drive entrepreneurs to sink hundreds of thousands, or potentially > $1M & > 1 year of professional development, into a bitcoin project, is hard to swallow (not my words, just an explanation).

That said, bitcoin has always been a "scam" where people keep paying more money to match difficulty, that is inherent in the design. This is just the natural progression, CPUs started it, GPUs being faster more specialized CPUs took over, and now fully dedicated processors in the form of FPGA/ASIC are on the scene. This is the root of bitcoin, and it isn't necessarily a problem.

Good post, and kudos for the impressive modelling. It really honed in there.
I was all set to buy some bitcoins when they fell to $10.50ish (I've been out of the game for a while but picking back up interest), but alas around $10.70 they started trending upwards, and are now ~$11.70, so I have no bitcoins to pass along for your fine work 

And I don't say that simply because I got an honorable mention

Don't be asinine. I have clear and useful discussions with everyone but you, but for some reason you're special enough for me to troll? Perhaps the simpler and more logical explanation is that I am correct and you do not have an understanding of things you are espousing an opinion on, and therefore bring no argument/fact/logic to the table, and thus there can be no discourse?  

Of course we are capable, but we do not do so on an every day basis, so as to undermine the foundations  of our basic communications. If we had to rewrite the definition of the words we used every time we had a conversation in order to accept every and all viewpoints everyone brought to the table, communication would be literally impossible (or at least improbable/burdensome).

Excepting specific case-by-case basis where there is a NEED to use common terminology in an unaccepted way, to make useful conversation we are constrained, this is why we agree to use certain words in specific ways. In the case of this thread the concept of redefining waste because it does not apply to plants is stupid and only done to serve the purpose of those who are either trolling, or for some reason seriously believe dumping toxic (to humans I now have to define) gases in unlimited quantities into our atmosphere is at worst a neutral event, and feel that "waste" is a negative propaganda term.

I still question why you would defend this viewpoint. As you mentioned yourself earlier, by viewing "waste" either as "something which is not useful to someone", or as "something which not useful to anyone", you make the word worthless, as it now applies to everything, or nothing, respectively.

Agreed with Ates, my suggestion would be to try turning down the clocks on your 5830, when mining see if that helps. Can also run GPU stress tests (like 3dmark) to see 1) if it crashes and/or 2) if you get video errors to help see if the card aging and abuse has finally gotten to it.

I understand, but in some ways games can be as bad or worse, as they tax the CPU as well as the GPU, which are both on the 12V rail. If you play a game that doesn't really push your GPU (though a 5870 is fairly old and likely to be taxed by most modern games) and/or your CPU. you might be ok for a lil while.

Raidmax is a pile of dogcrap. I wouldn't even trust it to do 20A on 12V, it has more A on the 5V than 12V, I would expect it to go out of ATX spec at full 12V load and deliver dirty whacked up power. Were it me I wouldn't trust expensive equipment to such an inferior product, but to each their own.

Then the dude who secretly saved 1000 bitcoins will be the richest person on earth

Well, it is somewhat the point, if the pool never found a block, you would quickly bankrupt the pool owner. If the pool owner lacks funds for payout, you would lose whatever mining time you dedicated before hopping. The more mining power you have on tap, the greater the loss to any time lacking payment, to return to the original point. That is however a subsidiary part of the discussion, I merely meant to point out that a pool is no more a guarantee of payment than solo mining, in that they require the luck of the coins to be able to payout as much as anyone else.


The fact that you think 50% is the same as .001% is exactly why I said that it sounds like you do not understand mining.


+1 to this. I quite enjoyed this calculator, and it gives you a very good sense of how risky soloing will be based on your proportion of the network.