difficulty calculator

[fixxi.net]

Hello All,

In regards to this calculator , http://www.bitcoinx.com/profit/, could someone please clarify how the "Profitability decline per year" value should be used to specify the expected difficulty increase ? For example , by default they have "0.61". What does "0.61" mean ? Over the calculation period It has gotten 60 % harder to mine ?

[suryc]

The Mining Factor 100 is the value in USD of the bitcoins you can generate if you let a 100MHash/s miner run for 24 hours. If the Mining Factor 100 rises above $2 or so everybody buys mining equipment and thus increases difficulty. If it falls people will stop mining eventually. The estimate starts with the current Mining Factor and decreases it exponentially such that the decrease accounts for the factor decline per year. Please note that a profit/loss by holding the coins is not accounted for in this estimate.

If I read this correctly, the profitability decline per year specifies the factor by which the amount of dollars generated in 24 hours by 100Mh changes in 1 year.

So with the default of .61, it is saying that in 1 year the amount of money that can be generated by 100Mh every 24hours is reduced by a factor of .61. (A very optimistic view in my opinion).

[fixxi.net]

The Mining Factor 100 is the value in USD of the bitcoins you can generate if you let a 100MHash/s miner run for 24 hours. If the Mining Factor 100 rises above $2 or so everybody buys mining equipment and thus increases difficulty. If it falls people will stop mining eventually. The estimate starts with the current Mining Factor and decreases it exponentially such that the decrease accounts for the factor decline per year. Please note that a profit/loss by holding the coins is not accounted for in this estimate.

If I read this correctly, the profitability decline per year specifies the factor by which the amount of dollars generated in 24 hours by 100Mh changes in 1 year.

So with the default of .61, it is saying that in 1 year the amount of money that can be generated by 100Mh every 24hours is reduced by a factor of .61. (A very optimistic view in my opinion).

Hmmmmm... Is reduced by a factor of .61 ? What is .61 ? 61 % ?

In this example, If today I make 1 bitcoin with 100 Mhz in 24 Hrs, then in 1 year I would make 0.39 bitcoin ? ( 1 bitcoin minus 61 % equals 0.39 bitcoins )

[suryc]

Hmmmmm... Is reduced by a factor of .61 ? What is .61 ? 61 % ?

In this example, If today I make 1 bitcoin with 100 Mhz in 24 Hrs, then in 1 year I would make 0.39 bitcoin ? ( 1 bitcoin minus 61 % equals 0.39 bitcoins )

I was just playing with some values on their and I see the confusion. It doesn't make much sense.
With the sample value of .61 they have there, it says currently 24hrs@100Mhs makes .31 and that would go down to .24 in 12 months
With a value of .5, it goes from .31 to .20.

So, I too would be curious to know how that number affects the calculation.

[bcpokey]

It is a simple value. What you make today x Decline/yr = what you make in 1 year.

So, you make 1BTC/day currently. 1yr from now you make .61BTC / day. Whether the calculation for the interim is linear or not I dunno. It is close to linear however, as if you look at 3 month projection, the amount mined in 3 months is listed as 0.32 per day, and a linear decline would project .3051 per day.