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No, it will become LESS important as time goes on.
Presently people mine with GPUs and FPGAs. They are relatively inexpensive with the price of electricity being a not-insignificant portion of the cost of mining.
We are beginning to see a switch to custom ASICs. They are much faster and consume far less power but the price of the chips themselves are expensive.
As time goes on we will see hardware that is more expensive and consumes less electricity. The cost of the hardware will dominate over the cost of electricity.
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You don't actually need a copy of the whole blockchain!
You only need the recent part of it that deals with the bitcoins you own or receiving or storing.
Right now, everyone stores the whole thing because the blockchain is still pretty small.
But as time goes on, it is likely that the average user won't hold the whole blockchain on only large servers or "bank"-like entities will keep the whole thing.
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This happened to me too.
I was talking about bitcoins last October and no one was listening to me.
I tried to start a mining pool with my friends and only 2 joined in.
Now everyone is asking me and giving me money to buy them bitcoins on mtgox because the queue to get verified is so long!
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Lag went and away and the price begins to rise again. Go figure.
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Wow, really didn't think we'd break 120 as there was a large wall there early, but, well, we did!
Good jorb
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The market changed how?
Bitcoins are not any less useful this week.
What changed was that people freaked and sold.
The people who are getting greedy now aren't even the same people.
They are new investors that just learned about bitcoin and want a part of it.
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First question, 3-4 months???
The most recent announcement from Butterfly 2 days ago says: "We are gearing up to start shipping out some dev boards and a few Jalapeno's most likely this week (at least a few dev boards) and then as more chips roll in we'll be shipping out the Jalapeno's. When the new boards land in KC, we'll start shipping Little Singles and Singles at that time. I don't currently have a time frame for those, but I should have something later this week in regards to that."
This implies we'll see singles by early May perhaps. Of course, the date always seems to slip, so I'm not holding my breath but I'd be surprised if they claimed 3-4 months at this point (for early orders at least). If you ordered now, I could see 3-4 months, but for those that ordered last summer/fall, I'd hope it would be much sooner.
Butterfly labs has about 50,000 orders presently (going by their order numbers). It's going to take them a long long time to ship that many units, so let's look at what happens if they ship just 25,000 of those:
Let's assume 70% of those are for Jalapenos (5 GH/s) and 30% are for Single SCs (50 GH/s). And let's assume 30 minirigs (1,500 GH/s) were sold.
The half-speed 25 GH/s miner didn't exist until recently.
Now, these numbers could be way off but they will give us a general idea.
Total hash power from butterfly labs would then be:
25000 (0.7) (5GHs) + 25000 (0.3) (50GHs) + 30 (1500GH/s) = 437 TH/s
The current hashrate is only about 65 TH/s currently so this will complete change mining.
That is, of course, not taking into account Avalon ASICs which will continue to arrive on the scene.
Using the bitcoin profitability calculator, with bitcoins at about $90, it will take you roughly 45 days to recoup your hardware costs, assuming that you bought a 50GH/s mining unit back when they were half the price. If you bought it more recently and spent $2500, well, first there will probably be more than 25000 units out there before they get to you, and you paid more so it will take you at least twice as long.
I think the only people who are going to do well are the people who ordered early, like within the first 10,000 orders, and that is assuming butterfly ships in the next month or two before Avalon has a change to take over.
Good Thoughts This calculator here http://www.bitcoinx.com/profit/ , doesn't seem to take into account that the difficulty is raising constantly ... which is a key omission. Considering your suggestion at 437 TH/s increase in the next 6 - 7 months or so, and this chart http://bitcoindifficulty.com/ here , then we are looking at 7x difficulty increase in that same time frame of 6 - 7 months. ( The time frame may vary depending on when butterfly ships ). But then as devices continuing shipping, we are looking at 7x difficulty increase every, what 2 - 4 months ? ( because the difficulty increases after a set amount, irrespective of number of miners? ) Seems like a 50 GH device may get you 10 000 usd profit in the next year , if you are lucky, may be less than that. But then from the year after, the device is next to worthless. All this assuming bitcoin keeps growing in terms of devices and coverage, which I think it will, as the current bank system is going down fast. With lower butterfly GH devices, we are looking at even less profitable margins. I get the "long-term" prospect, I just don't like all the money shelling that is going on. It does take difficulty rising into account. Look at the "Profitability decline per year" parameter. That decline fudge factor in there is to estimate how much the difficulty is going to increase and thus your profit will decline. I mostly agree with what you are saying though but not quite. It's not going to go up by 7x every few months because that is an exponential increase. The coming exponential increase is going to be due to the move to ASICs but the difficulty will increase linearly with each ASIC sold, not exponentially. So the difficulty might go up 7x in 6 months as 25,000 ASICs are shipped and then it will simply double again when 25,000 more are shipped. Butterfly labs is gong to take a long time to ship that many ASICs, and as they do, mining will become less profitably and the rate of increase will actually slow down when the cost of purchasing an ASIC will no longer cover your expected profits. There will be some losers, though, namely everyone who tries to get in the game when they see how great ASICs are only to find that by the time their hardware arrives, difficulty is so high that it is not worth it to mine anymore. So yes, I agree, once the ASICs become popular, they will not be worth anything anymore. The windows of profitabilty is maybe only 6 months to a year depending on quickly they will be shipped. |
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If it happened now, to be honest, I'd sell all my bitcoin off as soon as possible in any way I could before the price plummeted.
I'd keep like 10 or so as souvenirs.
Making bitcoin illegal, at least in the US would kill it.
I don't believe this will happen though. At least not in the near future.
If bitcoin gains wide acceptance before it becomes illegal, I'd probably hold on to them.
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This is actually what I'm doing.
But I will probably start cashing out 1/3 of my coins at $200 in the short(er) term, whenever it gets back up there, and hold the others for a very long time (years).
I actually cashed out a little into gold, but gold is a HORRIBLE investment, at least in Massachusetts where I live. First, it is always taxed as a short-term gain, so that means 28% tax (my tax bracket) PLUS 12% state tax (MA short term capital gains). Also gold is in a bubble right now and has been dropping. Finally, coinabul charges you about 8% over spot for gold so you lose money right off the bat.
The only reason to buy gold is if you expect it to help you evade taxes (it won't).
Aren't Bitcoins taxed at 40% as capital gains when you try to cash them out? That would be higher than gold. No, hold them for a year and pay long term capital gains. In MA, that is 15% plus ~5% state, or 20%. And short term capital gains is the same for both gold and bitcoins. Gold is worse because it is always considered a short term gain. |
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Congratulations- crowdsourcing speculation on Bitcointalk is successful and one week later the price is ~$93.
let's do this again for next week! |
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<crickets>
No one is going to take your ridiculous bet.
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If you have that much power, why use a pool at all! Just mine yourself!
Do the math and it will be clear. I did the math. With 700 GH/s, you will mine a block every 15 hours on average. That is low enough that you can just mine yourself and keep your whole block. If it were weeks, well than you could get unlucky and not get a block, but a 15 hour average is short enough that it should even out after a couple of weeks/months. |
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First question, 3-4 months???
The most recent announcement from Butterfly 2 days ago says: "We are gearing up to start shipping out some dev boards and a few Jalapeno's most likely this week (at least a few dev boards) and then as more chips roll in we'll be shipping out the Jalapeno's. When the new boards land in KC, we'll start shipping Little Singles and Singles at that time. I don't currently have a time frame for those, but I should have something later this week in regards to that."
This implies we'll see singles by early May perhaps. Of course, the date always seems to slip, so I'm not holding my breath but I'd be surprised if they claimed 3-4 months at this point (for early orders at least). If you ordered now, I could see 3-4 months, but for those that ordered last summer/fall, I'd hope it would be much sooner.
Butterfly labs has about 50,000 orders presently (going by their order numbers). It's going to take them a long long time to ship that many units, so let's look at what happens if they ship just 25,000 of those:
Let's assume 70% of those are for Jalapenos (5 GH/s) and 30% are for Single SCs (50 GH/s). And let's assume 30 minirigs (1,500 GH/s) were sold.
The half-speed 25 GH/s miner didn't exist until recently.
Now, these numbers could be way off but they will give us a general idea.
Total hash power from butterfly labs would then be:
25000 (0.7) (5GHs) + 25000 (0.3) (50GHs) + 30 (1500GH/s) = 437 TH/s
The current hashrate is only about 65 TH/s currently so this will complete change mining.
That is, of course, not taking into account Avalon ASICs which will continue to arrive on the scene.
Using the bitcoin profitability calculator, with bitcoins at about $90, it will take you roughly 45 days to recoup your hardware costs, assuming that you bought a 50GH/s mining unit back when they were half the price. If you bought it more recently and spent $2500, well, first there will probably be more than 25000 units out there before they get to you, and you paid more so it will take you at least twice as long.
I think the only people who are going to do well are the people who ordered early, like within the first 10,000 orders, and that is assuming butterfly ships in the next month or two before Avalon has a change to take over.
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Short term Bet for Short term bulls
A=24
B=100
X=1
Y=1.8
I will accept this bet without taking into consideration the MtGox price, higher or lower than 100.
Open offer for 1 hour.
LONG term Bet for LONG term bulls
A=1000
B=100
X=1
Y=2.8
I will accept this bet without taking into consideration the MtGox price, higher or lower than 100.
Open offer for 48 hours.
Still a horrible bet. You need to offer BETTER than even odds. Everyone, this guy is trying to scam you. DO NOT take these bets! |
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People read waaaay too much into charts.
The only reason to even learn about that BS is so you can take advantage of other peoples chart superstitions.
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The Bull: Buying BTC now with the hope the price will be HIGHER later. That's the definition, right? So, until now I could not get any bull to post here. At least not a short term bull. Is it a bear market? Then I may become a bull myself  What about this bet: A=1000 (about 40 days) B=100 X=1 Y=5.5 I agree I was out of line with 1:6 odds Your odd are still horrible. Try this: A=100 B=91 X=1 Y=1 Someone might take you up on that. If you are determined to use B=100, try: A=100 B=100 X=6 Y=1 Someone might take you up on that too. Just because most of us have invested in bitcoins, doesn't mean we are idiots. |
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So what kind of odds would an Intelligent Bull Human Being would accept?
If your answer is 6:1 then you are wrong.
Your number "B" is HIGHER than the current price. If you are neither a bull nor a bear and consider bitcoin to be a random walk (and with this volatility in a 24 period it is!), then you have a 50/50 chance of it being higher (or lower). Since B is higher than the current price, you need to offer better than even odds and you have offered way way worse. |
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wow, only an idiot would take your bet.
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