Difficulty: 917. Value: Unchanged.

[Ground Loop]

It's relentless..  "difficulty" : 917.83093744!   That's 6.57 gigahash/second running right now, or about 2,000 modern (3500 khash/sec) desktop PCs.

The puzzling thing is that the dramatic rises in difficulty seems to have absolutely no effect on the dollar conversion rates.  This can only mean that the meeting between buyers and sellers is totally independent of any specific machine generation rates.

It seems likely that the people buying coins have no perceived competition in generating their own btc, so the value is immune to difficulty.

I'm just spouting off...

[1714969730]

1714969730

[1714969730]

1714969730

[1714969730]

1714969730

[mpkomara]

Speak for yourself.  I am buying bitcoins so I can participate in mostly ignored lotteries, buy broken ipods, play pixel darts, donate to the bitcoin faucet, offer bounties for letter-writing and bet on snooker.  who wouldn't want to buy these things?

[nelisky]

Speak for yourself.  I am buying bitcoins so I can participate in mostly ignored lotteries, buy broken ipods, play pixel darts, donate to the bitcoin faucet, offer bounties for letter-writing and bet on snooker.  who wouldn't want to buy these things?

So you are the one person betting on my lotteries... besides me, that is :p

[TTBit]

It's relentless..  "difficulty" : 917.83093744!   That's 6.57 gigahash/second running right now, or about 2,000 modern (3500 khash/sec) desktop PCs.

The puzzling thing is that the dramatic rises in difficulty seems to have absolutely no effect on the dollar conversion rates.  This can only mean that the meeting between buyers and sellers is totally independent of any specific machine generation rates.

It seems likely that the people buying coins have no perceived competition in generating their own btc, so the value is immune to difficulty.

I'm just spouting off...

I would think that as difficulty increases, this would also mean an increase in value of the coins. A 3500 khash machine currently produces 50 blocks every 13 days, which is about $3.00, or ~$0.27 per day. When the difficulty hits 9,178.3093, coins should be worth about 10x as much, but take 10x as long to generate, so I'm still making the same $0.27 per day. Of course, some of this is negated by faster computers & code.

As long as difficulty keeps increasing, I'm going to continue to buy coins.

[FreeMoney]

I think the value will be more affected by the appearance of new things to do and buy with coins.

The average cost of producing a coin may actually be going down anyway. The hashing software has gotten more efficient, people are generating with faster and more efficient GPUs, and more people in cold climates and cheaper power areas have heard about bitcoin. So we might be in a decreasing cost phase. 

[eurekafag]

When the difficulty goes down, people will join generating because it can become profitable. And the difficulty would go up again. It's a matter of balance.

[nelisky]

When the difficulty goes down, people will join generating because it can become profitable. And the difficulty would go up again. It's a matter of balance.

I don't think FreeMoney meant difficulty going down, but generation power going up. My laptop did 1.4MH/s when I first joined. That same laptop does 7.7 now, so I can handle roughly 6x the difficulty and profit just as much (negatively ) as I did when difficulty was 6x lower. Thus, for the same actual difficulty level, the difficulty dropped 6x for me.

[Timo Y]

There is going to be someone somewhere in the world for whom the marginal cost of generating bitcoins is zero.

For example:

1) A server farm that is used for some other profitable purpose during the day and sits idle during the night.

2) A geographical location where electricity made from cheap, always-on sources and surpluses produced during the night are wasted anyhow. Iceland comes to mind.  I'm sure in some parts of the world it's possible to negotiate contracts where you pay nothing for electricity during certain hours. Or some sort of pure flat fee.

That someone will always be motivated to generate coins no matter what the price. The only limit to the generation rate will be the amount of capital at her disposal.

For the vast majority of users, however, generation will become unprofitalbe and they will give up.

Hence difficulty will not depend on bitcoin price, but on the number of new users who find ways of generating coins for free.

[Syke]

It's relentless..  "difficulty" : 917.83093744!

Oh, it's relentless all right:  "difficulty" : 1318.67045503