For sale: 8 BFL chip credits

Price: 0.06btc each.  Can do escrow if the buyer wishes.  PM please.

The interesting thing for me is the last bitcoin bubble was partly blamed on Cyprus and their catastrophic banking situation.  Whether it was actual Cypriots buying bitcoin to get money out of the country, or speculators buying in anticipation of that event (sell the sizzle, not the sausage, buy the rumour, sell the news, etc), is unknown at this point.  If it was Cypriots buying to save their money they really went out of the frying pan and into the fire.  Some would be looking at losses of well over 50% right now.

The important thing is bitcoin may have shown itself to the world as not being a safe haven in troubled times.  Sure, it's useful for getting money out and bypassing an autocratic government, but for actually keeping money there it's about as stable as any third world currency.

To be fair it does state on their site that it's 2 months or more for the order to ship.  All sales are final.  Products are shipping.

The one thing everyone should keep in mind is the millions of dollars recently spent on ASICs at BFL alone, not even counting the other groups.  Over the coming months those miners will be keen to recoup their costs if they paid with US$ (many did).  The selling pressure may be too intense and entice many to get what they can for their bitcoins.  Companies creating miners today have to convert their bitcoins to money as no chip or PCB maker takes bitcoins as payment.

Right now ASIC mining is profitable even if bitcoin falls to US$2 each, which it did as recently as late 2011.  I don't think it will fall anywhere near that as the price would be far too tempting for speculators.

My Jalapenos made it through Australia Customs without hassles.  I've had other gear delivered from the USA, Europe and China with their plugs and no one cared.

When I first heard of the 'CE' China Export tag a few days ago I thought it was a silly online joke.  It staggers me that someone in China thought this was a great idea.  Total coincidence that the two logos look virtually identical 

I have purchased a Dell laptop PSU online that turned out to be fake.  It had a couple of spelling errors on the label and got quite hot in use.  I'm not surprised Customs may be picky about laptop PSUs as it's a real safety issue.

No 'UL' mark on my Jalapeno PSUs, and of course no markings apart from a serial number on the actual Jalapenos.

The USA has a habit of projecting its own laws onto other nations.  If a bank dealing with bitcoin exchanges is locked out of the USA market it pretty much automatically gets locked out of the whole international market when the EU and allies follow. 

Take note of the recent sudden airspace refusal for the Bolivian president's plane from France, Portugal, Italy, etc.  Permission was suddenly, mysteriously revoked when the USA thought Edward Snowden might be on the plane.  The USA gets what it wants from its allies, and right now the USA is very interested in choking off the money supply to MtGox.  Where is MtGox located?  Japan.  All the USA has to do is remind Japan whose forces are stationed on their soil, and how said forces might not intervene in a conflict with China.  I am quite frankly surprised MtGox is still around today.

Jarosław has been quite active on this forum recently ever since bitcoin's price started going down like a Tu-154.

These threads usually receive one of two responses:

"Thanks for shutting down, more bitcoins for me!"

or

"Mine now, sell when BTC is worth more USD$"

The first scenario is interesting as unless the respondent is mining with ASICs he or she is in the same boat as the poster.  Mining at a loss.  Not yet perhaps?  Well they soon will be.  Free electricity?  Someone, somewhere pays.  If the rented apartment comes with 'free' electricity don't be surprised when the miner is booted out as a mining farm was not reasonably foreseeable by the landlord.  Now mining becomes expensive when they're forced to pay to move into a new place or pay increased rent even when they stop mining.

The second reply assumes "when", not "if".  Dangerous thing to do when predicting the future.  If the respondent is so sure that bitcoins will be worth more USD$ in the future, why go to all the trouble of mining when you can just buy bitcoins in anticipation of their increased value? 

GPU mining for many is now where CPU mining is for all.  More people are joining the GPU abandonment ranks every two weeks or so.  It's a one way street.

Well, BFL has stated they intend to have all current back orders fulfilled in September.

Yes, I know.    Cue the laughter soundtrack at BFL timelines and promises.  But anyway, anyone who knows about bitcoin difficulty, the current companies shipping ASICs and the effort to build many more must surely know generating US$3850 from 8Gh/s is fanciful.  Maybe someone has plugged in the hash rate and difficulty into an online calculator and figured they will pay off their unit in 7 months.     I guess there's a sucker born every minute and if I can find one I'd unload my Jalapenos onto them at that price.

Speaking of selling BFL products...

http://www.ebay.com.au/itm/Butterfly-Labs-ASIC-8-24-GH-s-Jalapeno-Bitcoin-Miner-IN-HAND-NOT-PRE-ORDER-/171061799365?pt=LH_DefaultDomain_0&hash=item27d413e9c5

This can't be serious.  US$3850 for a product anyone can get within a few months if they order today.  I would bet an 8Gh/s Jalapeno at that price wouldn't ever pay for itself either when rising difficulty is considered.

Well, my Jalapenos have shipped (honestly thought I'd never see the day) and was wondering how many people are solo mining with their units.  Currently an upgraded Jalapeno will take about half a year for 25 bitcoins, at the current level of difficulty.  Realistically it could be years before a single block is hit, and quite possibly never.  Risky proposition when one considers the unit may never pay for itself with solo mining.

There is no incentive to loan money in a deflationary currency where the economy is growing.  Why risk not being repaid when the potential lender can just sit on his or her pile of bitcoins and see their value rise (buy more goods per bitcoin) without lifting a single finger?

The problem: if bitcoin becomes popular in a growing economy there is no incentive to lend bitcoins to anyone else.  Why?  Because the would be lender can just sit on his or her bitcoin stash and wait for the bitcoins to progressively become worth more without any effort.  A growing economy means more goods chasing a dwindling supply of bitcoins (some are lost to HDD crashes, etc).  In this scenario why risk lending out and losing your bitcoins? 

Anyone borrowing bitcoins would have to put in an extraordinary amount of effort to repay the loan, as bitcoins in a growing economy are worth more as time goes by.  To borrow a bitcoin today for business purposes and repay it in a year's time means having to do a lot of work to repay that bitcoin even before any interest is considered.

Bitcoin cannot be the basis of a modern economy as we know it.  The incentive to sit on a pile of bitcoins and wait for their purchasing power to improve is too great.

The good news is the unit works.  The bad news is you've invalidated the warranty by opening the unit 

The surprising thing is I didn't suggest such conversations should be banned or moved to another section.  I merely stated my belief that people wildly speculating about huge price increases (and thus their own personal gain) are not helpful in the grand scheme of things.  I mean hey, bring it on.  I'd like to pay off my mortgage some day for running a GPU app back in 2011.  I'm also aware that promoting such beliefs draws negative opinions from the wider community.

Maybe difficulty is dropping right after the last increase due to GPU miners giving up in higher electricity cost areas?  Right now most miners in Australia are priced out (US$0.24 to US$0.32 per kWh).  Some European miners would be struggling too.  As BFL continues to ship units we should see most GPU miners give up.  Only those left on some hydro and nuclear power will stay, or those with 'free' electricity.

I personally feel that all threads along the lines of 'bitcoin going to $10k' or 'bitcoins worth $1M' do more harm than good to bitcoin's reputation.  While speculation is fun there are two factors at play: No one can predict the future value of bitcoins with any certainty, and outsiders reading this forum may form the idea that bitcoin is just one huge get-rich-quick scheme full of people sitting and waiting to become millionaires. 

Factors (IMHO) pushing bitcoin down:

- MtGox requiring all currency withdrawls to have ID.  I've made several without any ID at all with MtGox, but from May 30 photo and address ID is required.  Scares some people away.

- Liberty Reserve.  Most articles stating the alleged criminal nature of LR also put bitcoin into the same article.  Some people may associate bitcoin and crime.  Not good at all for attracting people who want to use bitcoins for legal transfers.  Users who got burnt with funds stuck in LR are unlikely to rush into another structure like bitcoin, unless they have no other options (drug purchases, child porn purchases, etc).


Factors (IMHO) not pushing bitcoin down:

- BFL shipping product to end users, with those users cashing out bitcoins into money to recoup their purchase costs.  It's too early in the shipping cycle, the vast majority of BFL customers haven't got their units yet, and if BFL miners decide to sell whatever they generate we would be heading down to single digits pretty damn quick in the next few months.

If the day ever comes where a bitcoin is worth an absurd amount of money, new users jumping onto the bandwagon at that stage will note two things:

1.  It was possible to mine 50 bitcoins with minimal effort once upon a time.  Is a new user looking at million dollar bitcoins going to think that's great?  Someone ran a CPU miner in 2011 and made US$50 million every few weeks.

2.  This point naturally follows on from #1.  There is nothing special about bitcoin.  Anyone can start a new tree and start mining to transfer value across the internet.  This is likely to be become very attractive if a bitcoin ever reaches an absurd value level.

The catch, of course, is creating a new commodity that other people will want to use too.  But if bitcoins ever reach a million dollars there could be a lot of like minded people seeking a much cheaper solution.  Never underestimate the driving force of jealousy.

I predicted this situation last year, where BFL customers who are still waiting and looking at others receiving their orders are going to turn on the early receivers and declare it's not fair.  This was always predictable.  BFL was not and cannot be in a position to ship everyone's orders at once.  So the 5Gh units are ready first.  Well, so be it.  Ship what's ready instead of annoying an even larger pool of customers. 

Imagine if BFL declared they're delaying shipment of all 5Gh units a few months so that all product lines can be ready at the same time.  There would be a riot.