difficulty finally dropping like expected- dramatically.

[leowonderful]

Dropping significantly, probably a large farm turning off right now. No blocks have been mined for 50 minutes now, pretty dramatic drop. I expected this, though.
Sorry for the tiny picture, click on the image itself and it should be a lot bigger. :/
The next difficulty could be as much as 10% lower than now or even up to 20% if this trend continues, although I think 20 is pretty... out there.


Seriously, though, this has a huge impact on the mempool in the short, since the fees you need to get a transaction in for the next block are at nearly 100. To give you an idea, I deposited 20$ onto a website about an hour and 20 minutes ago, with the recommended fee of around 55 at the time, and 1 hour and 20 minutes later, it's still not confirmed and the recommended fee has blown up for at least these few blocks. Annoying, but I can deal with it for now. 10,000 unconfirmed may be happening soon with the block generation time this damn high.

 

[1715455262]

1715455262

[1715455262]

1715455262

[GreatNorthData]

Large scale operations have other factors, like the rent/mortgage/employees/electrical rates/other one time costs etc., which means that the exact date of the halving might not be the ideal time to unplug, it might be a month or two later. Halvings in the future will probably have a prolonged effect as the margins get tighter. It'll look more and more like the oil and natural gas rig counts that traders follow. Or in the mining industry, a lot of mines run until the most expensive piece of capital equipment breaks. That's when it is "under water" from fiscal perspective.

[xhomerx10]

It doesn't make sense that miners are shutting down now.  Before the block reward halving, KNCminer reprted they would have to declare bankruptcy due to their electricity costs.  At a time when Bitcoin was worth ~$480, they claimed their cost per Bitcoin was $440 (this is from memory, it might have been slightly more or less) and their electricity costs were $0.196 per kWhr.  I did some math and it turns out that about $200 of that cost per Bitcoin was electricity.  Difficulty has not increased significantly since their announcement so after the halving, the cost per coin for electricity would be ~ $400 and the total cost per coin ~ $640.  Bitcoin is still worth more than that.  Also, KNC would have been the most expensive miner out there with the cost of living in Sweden and the electricity costs considered not to mention their taxes are through the roof.  Consider also this:

422107 (Main Chain) 2016-07-24 16:59:14 KnCMiner  000000000000000001b63fcce1fa4b54bdf35971ac553ed7d50f97777d2963fc


Who is shutting down!?  I say it's just an anomaly and is simply an extended bout of bad luck that is indicating an apparent decline in hash rate even though all the equipment is still mining.  I don't believe it is caused by miners shutting down (at least not yet).

[cryptotore]

It doesn't make sense that miners are shutting down now.  Before the block reward halving, KNCminer reprted they would have to declare bankruptcy due to their electricity costs.  At a time when Bitcoin was worth ~$480, they claimed their cost per Bitcoin was $440 (this is from memory, it might have been slightly more or less) and their electricity costs were $0.196 per kWhr.  I did some math and it turns out that about $200 of that cost per Bitcoin was electricity.  Difficulty has not increased significantly since their announcement so after the halving, the cost per coin for electricity would be ~ $400 and the total cost per coin ~ $640.  Bitcoin is still worth more than that.  Also, KNC would have been the most expensive miner out there with the cost of living in Sweden and the electricity costs considered not to mention their taxes are through the roof.  Consider also this:

422107 (Main Chain) 2016-07-24 16:59:14 KnCMiner  000000000000000001b63fcce1fa4b54bdf35971ac553ed7d50f97777d2963fc


Who is shutting down!?  I say it's just an anomaly and is simply an extended bout of bad luck that is indicating an apparent decline in hash rate even though all the equipment is still mining.  I don't believe it is caused by miners shutting down (at least not yet).

0.19$/kWh can't be right. It's normal with prices around 0.07 for home residents in Norway/Sweden. Surely a huge operation like KNC had bulk prices..

Edit:
Actually the electricity price is around 0.02$/kWh when not paying for the transport of power. aka buying directly from a hydroplant like KNC did.

[alh]

It doesn't make sense that miners are shutting down now.  Before the block reward halving, KNCminer reprted they would have to declare bankruptcy due to their electricity costs.  At a time when Bitcoin was worth ~$480, they claimed their cost per Bitcoin was $440 (this is from memory, it might have been slightly more or less) and their electricity costs were $0.196 per kWhr.  I did some math and it turns out that about $200 of that cost per Bitcoin was electricity.  Difficulty has not increased significantly since their announcement so after the halving, the cost per coin for electricity would be ~ $400 and the total cost per coin ~ $640.  Bitcoin is still worth more than that.  Also, KNC would have been the most expensive miner out there with the cost of living in Sweden and the electricity costs considered not to mention their taxes are through the roof.  Consider also this:

422107 (Main Chain) 2016-07-24 16:59:14 KnCMiner  000000000000000001b63fcce1fa4b54bdf35971ac553ed7d50f97777d2963fc


Who is shutting down!?  I say it's just an anomaly and is simply an extended bout of bad luck that is indicating an apparent decline in hash rate even though all the equipment is still mining.  I don't believe it is caused by miners shutting down (at least not yet).

I wouldn't draw too many conclusions from KNC's decision to declare bankruptcy. They most assuredly didn't wait until they had no choice. Their decision looks to me to be more preemptive in nature. KNC must have some gear that's worth running anymore, and they can easily turn that off as they start to unwind their operations. They don't have to have a "fire sale", though liquidation companies sometime just want to get through the process of converting assets into money (fiat, not BTC).

I think there is plenty of gear being turned off due to the halving. It may not be just huge farms, but a thousand farms for which a small profit isn't interesting any more. When the easy money evaporates, some folks will just quit. If they can find a buyer, then their gear will return to service somewhere.

[DaveF]

1) Most of the US is having a major heatwave. So a lot of people running 1 or 2 older quiet miners at home (Avalon 4, S3 etc.) that were on the edge and "well why not leave it on after the halving anyway just to make some coin even at a loss"  might have turned them off.

2) S7s / Avalon 6s are no longer profitable to people with expensive electricity rates. Once they get their 1st bill after the halving then, off they go.

3)

4) Some other big player took a hit with the flooding in China.

-Dave

[xhomerx10]

It doesn't make sense that miners are shutting down now.  Before the block reward halving, KNCminer reprted they would have to declare bankruptcy due to their electricity costs.  At a time when Bitcoin was worth ~$480, they claimed their cost per Bitcoin was $440 (this is from memory, it might have been slightly more or less) and their electricity costs were $0.196 per kWhr.  I did some math and it turns out that about $200 of that cost per Bitcoin was electricity.  Difficulty has not increased significantly since their announcement so after the halving, the cost per coin for electricity would be ~ $400 and the total cost per coin ~ $640.  Bitcoin is still worth more than that.  Also, KNC would have been the most expensive miner out there with the cost of living in Sweden and the electricity costs considered not to mention their taxes are through the roof.  Consider also this:

422107 (Main Chain) 2016-07-24 16:59:14 KnCMiner  000000000000000001b63fcce1fa4b54bdf35971ac553ed7d50f97777d2963fc


Who is shutting down!?  I say it's just an anomaly and is simply an extended bout of bad luck that is indicating an apparent decline in hash rate even though all the equipment is still mining.  I don't believe it is caused by miners shutting down (at least not yet).

0.19$/kWh can't be right. It's normal with prices around 0.07 for home residents in Norway/Sweden. Surely a huge operation like KNC had bulk prices..

Edit:
Actually the electricity price is around 0.02$/kWh when not paying for the transport of power. aka buying directly from a hydroplant like KNC did.

 Okay let's say the price is around 0.02$/kWh to start...
I had to search it out and I was slightly off the mark but here it is:
http://www.breakit.se/artikel/3867/svenska-bitcoin-jatten-knc-miner-i-konkurs-konkurrensen-for-tuff
 and the relevant section is:

 Sam Cole also highlights the increasingly fierce competition - and the Swedish energy tax.

 In Denmark, for example, data centers pay about 0.5 cents per kilowatt hour - in Sweden the figure is 19.2 cents per kilowatt hour.


 Granted, Sam Cole has been known to embellish (a lot) and I'm still looking for the article in which he tells KNCminer's cost per Bitcoin.

[xhomerx10]

It doesn't make sense that miners are shutting down now.  Before the block reward halving, KNCminer reprted they would have to declare bankruptcy due to their electricity costs.  At a time when Bitcoin was worth ~$480, they claimed their cost per Bitcoin was $440 (this is from memory, it might have been slightly more or less) and their electricity costs were $0.196 per kWhr.  I did some math and it turns out that about $200 of that cost per Bitcoin was electricity.  Difficulty has not increased significantly since their announcement so after the halving, the cost per coin for electricity would be ~ $400 and the total cost per coin ~ $640.  Bitcoin is still worth more than that.  Also, KNC would have been the most expensive miner out there with the cost of living in Sweden and the electricity costs considered not to mention their taxes are through the roof.  Consider also this:

422107 (Main Chain) 2016-07-24 16:59:14 KnCMiner  000000000000000001b63fcce1fa4b54bdf35971ac553ed7d50f97777d2963fc


Who is shutting down!?  I say it's just an anomaly and is simply an extended bout of bad luck that is indicating an apparent decline in hash rate even though all the equipment is still mining.  I don't believe it is caused by miners shutting down (at least not yet).

I wouldn't draw too many conclusions from KNC's decision to declare bankruptcy. They most assuredly didn't wait until they had no choice. Their decision looks to me to be more preemptive in nature. KNC must have some gear that's worth running anymore, and they can easily turn that off as they start to unwind their operations. They don't have to have a "fire sale", though liquidation companies sometime just want to get through the process of converting assets into money (fiat, not BTC).

I think there is plenty of gear being turned off due to the halving. It may not be just huge farms, but a thousand farms for which a small profit isn't interesting any more. When the easy money evaporates, some folks will just quit. If they can find a buyer, then their gear will return to service somewhere.

 If I know KNCminer, they waited just long enough to post losses over and above what they owe to customers who are involved in the class action lawsuit.  IMO , they had nothing but contempt for their customers after the first miners were sold.  Maybe since the price of Bitcoin rose after the announcement, the bankruptcy trustee will be able to get some money from the sale of assets?  It could still be profitable for somebody paying less for power... such as in Denmark apparently?

[Goms]

Even though KNC miner has declared bankruptcy, it will still bounce back. You will see, they have gone too far to turn back now.

[cpfreeplz]

Even though KNC miner has declared bankruptcy, it will still bounce back. You will see, they have gone too far to turn back now.

What does that even mean? Do you understand what bankruptcy is? No they won't bounce back lol. They're bankrupt. Maybe the owners will open a new company but only time will tell.



Well right after the halving it seemed fairly flat (ip 3% down 2%, etc) so this could just be 'back to normal' because there used to be higher swings before the halving. +/- 8% was normal in any weekly period.

[Jebuswalks22]

What effect will it have on mining in a pool

[QuintLeo]

Even though KNC miner has declared bankruptcy, they will still bounce back. You will see, they have gone too far to turn back now.

 I would not bet on that. They alienated WAY too many customers and generated WAY too much negative reputation.
 They might be able to bounce back as a self-contained farm, but even THAT looks iffy.

[leowonderful]

Even though KNC miner has declared bankruptcy, it will still bounce back. You will see, they have gone too far to turn back now.

What does that even mean? Do you understand what bankruptcy is? No they won't bounce back lol. They're bankrupt. Maybe the owners will open a new company but only time will tell.



Well right after the halving it seemed fairly flat (ip 3% down 2%, etc) so this could just be 'back to normal' because there used to be higher swings before the halving. +/- 8% was normal in any weekly period.

Only time will tell. This could just level out or keep dropping, although I think the difficulty will stay where it is for now. Still pretty surprising, as we haven't had substantial drops in quite a while (difficulty-wise). Before the halving, the general consensus was to put in as much old hardware as possible, and mine till the halving. Now that the old mentality has died, looks like some of that extra old hashrate has fallen off. Just like every halving, but it could keep dropping as more old hardware falls out.





Edit 2
Yep, looks like it's old hardware going kaput. Could be as much as 10% down with these trends. Rechecked btcwisdom, and the drop is pretty damn substantial... last time we had drops like these were near last halving, and that was quite a while ago. Nice to see the hashrate finally bank downwards just a little bit after all this difficulty exploding.

As to the drops, I mean halving-wise, not the huge petahash-ish spike we had just now. This is a good downwards sign, and it makes a bit more sense than the other drops. Maybe someone selling off some old miners? Could be.

[tbonetony]

I think 6-8% for the very first drop after halving is modest but not dramatic. I am not sure it would last though. The halving has already shown how resilient and competitive this mining market is....

[talks_cheep]

I think 6-8% for the very first drop after halving is modest but not dramatic. I am not sure it would last though. The halving has already shown how resilient and competitive this mining market is....

I agree the hashrate will go skyrocketing again after this drop. S9 is selling like hot cakes, Bitmain is busily replacing S7 with S9 in their Antpool. Bitmain's attitude is "Let them eat cakes"!

[xhomerx10]

What effect will it have on mining in a pool

  On average, you will continue to get the same number of coins per day as you were since the last difficulty reset provided your own hash rate hasn't changed.
If the pool hash rate has dropped then it will take longer to see the rewards but each of your allotments will be proportionally larger than before the decline in hash rate.  So the net effect is still zero on you.

[philipma1957]

I think 6-8% for the very first drop after halving is modest but not dramatic. I am not sure it would last though. The halving has already shown how resilient and competitive this mining market is....

I agree the hashrate will go skyrocketing again after this drop. S9 is selling like hot cakes, Bitmain is busily replacing S7 with S9 in their Antpool. Bitmain's attitude is "Let them eat cakes"!

it won't skyrocket as fast as you think.

unless other companies start selling a competitive miner.
or price moves to 900 usd a coin

once again  you don't understand the amount of hashpower  that exists  and the math for a farm.

there is no need to rush to replace an s-7 farm of 1000 s-7's  if your power is 7 cents or less.

so 1000 x 4.7 th = 4.7ph  that is 3582 usd before power


1000 x 1300 watts is    1300kwatts at 7 cents cost 2184 usd  a day net daily profit = 1398 a day

1000 x 1300 watts is  1300 kwatts at 6 cents cost  1872 usd a day  net daily profit = 1710 a day

1000 x 1300 watts is  1300 kwatts at 5 cents cost  1560 usd a day net daily profit =  2022 a day

1000 x 1300 watts is 1300 kwatts at 4 cents cost   1248 usd a day net daily profit =  2334 a day


so if your 4.7 ph 1000 s-7 farm is in the 4 to 7 cent power cost.

you  buy 5 s-9's at a time.  cost about 8000-9000 usd  which at the profit I show above   takes 4 to 7 days to earn.


put in 5 s-9's   pull 10  s-7s

you add  55-65 th  lose 47th  a net gain of say 8th-18th

and your power   drops 6 kwatts    since you pulled 10 units of s-7.  this make ups for summer heat issues

Do this once a week to once every 10 days  you slowly upgrade to s-9s at basically next to zero risk.

and to further help your bottom line sell the 10 s-7's.

So skyrocket is not happening yet,  but it will happen  my guess is Oct Nov or Dec

[QuintLeo]

Hashrate is likely to remain flat or continue dropping a bit right now - Bitmain is being VERY slow to bring their next S9 batch to market (probably ran out of chips and their chipmaker's foundry is likely booked SOLID for a while due to many other folks moving to the 14/16nm node - AMD and NVidia GPU availability indicates serious saturation on foundry capasity).

 Still no clue where anyone is at on making Bitfury-based miners....

[Arnoldent]

According to https://bitcoinwisdom.com/bitcoin/difficulty, the estimated difficulty will drop 7%, quite large.

[Xircom]

Nope it wont. It will increase when farms are switching gear. It looks like Bitmain`s Iceland farm changed to S9`s finally and thats why hash skyrockets right now.