What would happen with mining profitability if the difficulty didn't change?

[acaciosc]

There will be a point where difficulty will be way more stable, since the technology would be in a place without much room to improve, also people wouldn't have more physical room to place even more miners, right?

In this scenario, profit would gradually decrease, correct?

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[TheRealSteve]

If the difficulty didn't change at all, then people could just throw more miners at the network and all blocks would get mined a lot faster.

However, you're right that there's likely to be a state of equilibrium, most likely adjusting mostly in response to the Block reward (halving further and further) and transaction fees (going up/down as the market plays out).  Whether profits will decrease will depend mostly on the latter.  At least, as far as that aspect of mining goes.  It's entirely possible different industries will emerge around mining

[Amph]

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

[acaciosc]

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually? 

[Amph]

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually? 

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

[acaciosc]

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually? 

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

Seriously? Of course there are physical limits to place miners. Regardless, even if a really huge amount of PH/s came to the Bitcoin network, we would still have numerous SHA256 cryptocurrencies. Therefore, there is no need to worry in the long term, right?

[navigator]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

[acaciosc]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

[Amph]

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually? 

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

Seriously? Of course there are physical limits to place miners. Regardless, even if a really huge amount of PH/s came to the Bitcoin network, we would still have numerous SHA256 cryptocurrencies. Therefore, there is no need to worry in the long term, right?

yeah but the limit is far away that no one will ever reach it, come on.. you can't even dream of occupy the entire accessibility of the planet with asic..,.

not sure about numerous crypto, because every other sha256 is dead now, there were some good one in the past  but it's not the case anymore

also don't forget about miner efficiency, will be improved in the future

[GotaPauj]

i think if the difficulty didn't change, then time by time the mining hardware is going to be stronger/faster and the profit will increase

[acaciosc]

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually? 

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

Seriously? Of course there are physical limits to place miners. Regardless, even if a really huge amount of PH/s came to the Bitcoin network, we would still have numerous SHA256 cryptocurrencies. Therefore, there is no need to worry in the long term, right?

yeah but the limit is far away that no one will ever reach it, come on.. you can't even dream of occupy the entire accessibility of the planet with asic..,.

not sure about numerous crypto, because every other sha256 is dead now, there were some good one in the past  but it's not the case anymore

also don't forget about miner efficiency, will be improved in the future

Yeah, but saying that "there is no real limit vertically" sounds too wrong. What about peercoin? It's a POS/POW with also a great name AND sha256. I don't know what you meant with miner efficiency being improved in the future. If you mean in a sense that power consumption will be even lower, of course it is going to happen, but as I said before: Not as much as today. But since the price follows the mining difficulty, I conclude that mining will always be profitable, regardless of being Bitcoin or altcoins (except shitcoins, obviously).

[navigator]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

[acaciosc]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

[notlist3d]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible.   It is a very very very small chance it ever happens.  It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back.  This proves there can be the conditions there, but the community does actively stop it in the past.

[acaciosc]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible.   It is a very very very small chance it ever happens.  It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back.  This proves there can be the conditions there, but the community does actively stop it in the past.

But it's risky to have the top 3 pools accounting for 51% of the total hashrate, right? And why EXACTLY 51%? Just a coincidence?

[notlist3d]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible.   It is a very very very small chance it ever happens.  It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back.  This proves there can be the conditions there, but the community does actively stop it in the past.

But it's risky to have the top 3 pools accounting for 51% of the total hashrate, right? And why EXACTLY 51%? Just a coincidence?

I sleep nice with it split 3 way's.  That actually is not a bad split.   No way 3 mining pools get together and destory bitcoin.  Just will not happen.

If it was 1 pool with 50 percent or high 40's yes I would be worried.  Just like with Ghash back in the day.  But we have moved a lot and not one pool has the 51 currently.

[acaciosc]

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible.   It is a very very very small chance it ever happens.  It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back.  This proves there can be the conditions there, but the community does actively stop it in the past.

But it's risky to have the top 3 pools accounting for 51% of the total hashrate, right? And why EXACTLY 51%? Just a coincidence?

I sleep nice with it split 3 way's.  That actually is not a bad split.   No way 3 mining pools get together and destory bitcoin.  Just will not happen.

If it was 1 pool with 50 percent or high 40's yes I would be worried.  Just like with Ghash back in the day.  But we have moved a lot and not one pool has the 51 currently.

How can you be so confident that the three pool operators wouldn't decide to attack together? They may have some secret relationship. I will ask again: Why do the three top pools account for EXACTLY 51% of the total hashrate?

[notlist3d]

How can you be so confident that the three pool operators wouldn't decide to attack together? They may have some secret relationship. I will ask again: Why do the three top pools account for EXACTLY 51% of the total hashrate?

I mean this in the nicest way possible.  But it is stupid to think big companies that depend on bitcoin would do a 51 percent attack.  It would destroy their future business which if FAR FAR greater then amount they make from one 51 percent attack.

The current biggest is antpool.  Do you think they would risk sales on machines to pull an attack?  Not to mention pool earnings?

Second is f2pool... do you think antpool and f2pool are best friends and work together on much other then block size recently?

And bitfury is 100 percent different as they are not counting on any others outside of them for hash.



How long have you been with bitcoin?  Do you mine, if so how many T?  I'm trying to guage why you are so in fear of this thing that will never happen.

[spazzdla]

Controlling 51% is like pointing a gun at BTC..  doubling spending would be pulling the trigger

Why would a mining pool do that to themselves....?


Also many people on the pool might bail if they attempt to take over 51%.  A pool doubling spending doesn't make any sense that's why no one fears it.

[notlist3d]

Controlling 51% is like pointing a gun at BTC..  doubling spending would be pulling the trigger

Why would a mining pool do that to themselves....?


Also many people on the pool might bail if they attempt to take over 51%.  A pool doubling spending doesn't make any sense that's why no one fears it.

Some look for the worst case scenario.  If a pool would do a 51 percent attack it would cause BTC to plumit in price, and chances are everyone leaving their pool.

So with destroying their pools future they basically kill their business.  That's why I feel so confident that 51 percent attack will not happen.

Also I don't see a pool getting 51 percent of hash again, with Ghash when it happened the community worked together to fix it.  Big miners went to other pool to help, even industrial miners moved.   The community will work together to stop it from even being possible, we have seen this in past.

[acaciosc]

How can you be so confident that the three pool operators wouldn't decide to attack together? They may have some secret relationship. I will ask again: Why do the three top pools account for EXACTLY 51% of the total hashrate?

I mean this in the nicest way possible.  But it is stupid to think big companies that depend on bitcoin would do a 51 percent attack.  It would destroy their future business which if FAR FAR greater then amount they make from one 51 percent attack.

The current biggest is antpool.  Do you think they would risk sales on machines to pull an attack?  Not to mention pool earnings?

Second is f2pool... do you think antpool and f2pool are best friends and work together on much other then block size recently?

And bitfury is 100 percent different as they are not counting on any others outside of them for hash.



How long have you been with bitcoin?  Do you mine, if so how many T?  I'm trying to guage why you are so in fear of this thing that will never happen.

You are right. Sorry for my ignorance in the world of the cryptocurrencies. Answering your question: I have mined with an Antminer S1 in ~June 2014. I have also lost 0.05 BTC in a pool called 50BTC (oh, the irony), but also got ROI plus some profit by mining in two pools (eligius and another one that has closed recently - I miss this pool, but unfortunately I don't remember the name) and selling the miner to a guy from the same state that I live. I was lucky, since it's not profitable anymore. In fact, I would be paying to keep it running today, which shows that investing in miners is for the richest, who are able to invest huge amounts in ASICs that can offer a power consumption as low as <1W/Ghs. I didn't know for sure that S1s would become crap all that soon, so don't look at me badly for selling him, since I didn't know what was going to happen in the next few months. I already knew that it wouldn't be worth to turn on that miner after some time. But I didn't know that the difficulty would raise so freaking much in a short lifespan. Also, he is a rich guy, so he does not even care so much that it's not profitable. He is even in my fb friendlist. (:

I would, since I'm poor af.