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So everyone is well aware that GPU mining is the dominant way to make bitcoins right now. There is quite a bit of talk about the CIA or google setting up a FPGA or ASIC farms and owning the network. What I would like to do is examine some of these events:
A) The point where GPU mining is worthless.
B) The point where FPGA mining is more profitable.
C) The raw capital cost of instantly putting the network into these conditions.
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First let's start with what appears to be the cheapest setup right now.
3 x 5830 = $320
Motherboard = $100
Power Supply = $50
Processor = $30
Total = $500
My 5830's are putting out around 270Mhash/s, but I've seen 300 possible. Approximate power use is 200W each.
900 Mhash for $500 and 630W. 1.8 Mhash/$, 1.5 Mhash/W
This machine would produce around 2 coins a day and use 15 kwH of electricity.
Assuming electricity is about 13 cents, this means we currently make ~$20 at a cost of ~$2.
Which leads to point A:
Difficulty has to increase approximately 10x current values at current prices to make GPU mining by existing setups unprofitable
It is clear that we will all be mining for quite a while unless prices fall drastically. Investments in rigs are still profitable at this point, paying themselves off in about a month. Considering another difficulty increase coming up, maybe 2 months. Network size should continue to grow.
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From what I have cobbled together in the various FPGA threads, FPGA's have essentially the inverse cost of GPU's. Rather than being about 2 Mhash/$, FPGA's are 2 $/Mhash. In exchange for this you have virtually 0 power cost (for the sake of these 10,000 foot projections). Allocating our identical $500 gives us a rig that might do 250 Mhash/s.
So we've invested $500 for a rig that makes ฿.5 or $5 a day. We are tasked with finding the point where GPU mining only yields the same amount as FPGA's.
20$ * 1/x - 2 = 5$ * 1/x
x = 7.5
Difficulty has to increase 7.5x current values to make FPGA's more profitable at current prices.
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To push difficulty to the level of 0 profitability for GPU's, hashing power must go from 4 thash/s to 32 thash/s at current exchange rates.
To push difficulty to the level of FPGA>GPU profitibility hashing power must go from 4 thash/s to 25 thash/s at current exchange rates.
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At $500 per Ghash the US government would only need 16 million dollars in GPU miners with a power cost of $72,000 a day before everyone else on the network would give up mining. Pittance to prevent an upstart currency from toppling the dollar.
An organization looking to make a long term profit could invest around 50 million in FPGA's, and while not completely controlling the market, eventually incentivize all comers into buying whatever system they developed.
Another point to make is that the difficulty will automatically double in 2013. We will see if GPU power per price increases, but I doubt it. Bitcoins are trivial in comparison to the video gaming markets as a whole. My guess is that this will be the tipping point for GPU's assuming prices don't change drastically. FPGA's can almost always be justified as a positive longterm investment, while GPU's will likely lose their value in a year or so.
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