$504000 per day

[Peter Lambert]

The miners are currently being paid an equivalent of about $324000 per day through the block reward. (about 90 USD per BTC, 25 BTC per block, 144 blocks per day)

Do you think this amount is a reasonable amount to keep the network going?

Edit: Changed title due to increased price.

[Matthew N. Wright]

The miners are currently being paid an equivalent of about $324000 per day through the block reward. (about 90 USD per BTC, 25 BTC per block, 144 blocks per day)

Do you think this amount is a reasonable amount to keep the network going?

Nope. SELL SELL SELL!

[DeathAndTaxes]

It doesn't matter if it is "reasonable" or not it can't be changed.  It is what it is.  Today the amount of economic activity on the network likely doesn't warrant that level of security (like buying a $5K safe to protect $1K in gold) but the move to ASICS is essential.

"Bad guys" will always have access to ASICs, one can't simply pretend away that threat.  Today if someone wanted to attack Bitcoin they wouldn't build a GPU farm they would fab some chips and build a smaller easier to manage ASIC farm.  It wouldn't matter if BFL and Avalon didn't exist an attacker would STILL go that route because it is the most economical.

The high reward paid to miners indirectly funds the R&D necessary to make the move the transition to ASICs.  Hopefully mining will be a large enough "pie" that we will see 4 to 6 well capitalized ASIC suppliers.  2013 is going to be an interesting year.  If the network has moved to ASICs by the end of the year it permanently removes that "cheat card" vulnerability.  Sure an attacker can still use ASICs to attack Bitcoin (but they always could) however they wouldn't be able to gain a massive economic advantage (i.e. $2M in ASICS 51% attacking $20M in GPUs).

[cbeast]

"Bad guys" will always have access to ASICs, one can't simply pretend away that threat.  Today if someone wanted to attack Bitcoin they wouldn't build a GPU farm they would fab some chips and build a smaller easier to manage ASIC farm.  It wouldn't matter if BFL and Avalon didn't exist an attacker would STILL go that route because it is the most economical.

Yep, but even "Bad Guys" have enemies/competitors that will counter-attack by supporting the network.

[Peter Lambert]

It doesn't matter if it is "reasonable" or not it can't be changed.  It is what it is.  Today the amount of economic activity on the network likely doesn't warrant that level of security (like buying a $5K safe to protect $1K in gold) but the move to ASICS is essential.

The high reward paid to miners indirectly funds the R&D necessary to make the move the transition to ASICs.  Hopefully mining will be a large enough "pie" that we will see 4 to 6 well capitalized ASIC suppliers.  2013 is going to be an interesting year.  If the network has moved to ASICs by the end of the year it permanently removes that "cheat card" vulnerability.  Sure an attacker can still use ASICs to attack Bitcoin (but they always could) however they wouldn't be able to gain a massive economic advantage (i.e. $2M in ASICS 51% attacking $20M in GPUs).

I like your point about the mining reward funding ASIC development.

The thing about ASICs is they have a higher efficiency than GPUs. So they will be able to continue mining even when the GPUs are no longer profitable to run. This means that the overall power use of the network could go down while the security of the network continues to rise. Good for bitcoin, good for the environment.

One way to look at it: the price goes up as more people save money using bitcoins. As they save more money, the cost to keep that money safe goes up.

[zif33rs]

It would be ok if I had a bigger slice of the pie!   
zif


The only problem I see is that a small number of people are ending up with a majority of the wealth...just as we have in fiat.

[Peter Lambert]

Just to give us something to compare to, I looked up the financial statement of Visa:

If I am reading it right, in 2012 they had expenses of 2.47 billion dollars, revenue of 10.42 billion dollars, leaving 7.95 billion dollars profits.

http://www.marketwatch.com/investing/stock/v/financials

The 118 million per year to miners seems like a lot for a network so much smaller than Visa? I would be surprised if bitcoin was 1% as big as the Visa network, anybody know a good way to measure it?

[mai77]

that is a huge rip-off !

they are far too greedy !



STOP IT !

encourage "bitcoin free transaction relay policy"

[mitty]

The value of the coins created by miners is the value which people place upon the value of bitcoins.  People who think miners receive too much don't buy coins, reducing the demand and therefore reducing the value of mined coins.

As for most of the wealth concentrated amongst relative few individuals; I think that's an inevitable artifact of a free market and not really related to governments or fiat money or anything like that.

Relatively few people have the skills or are willing to take the high risk (e.g., investors) required to become extremely wealthy, so there are relatively few extremely wealthy people. (There are definitely exceptions, like inheritance or theft & theft-like activity such as scams, fraud, etc. but I'd think those cases are more exception than rule)

Back to mining; there's a huge risk required to make a profit by mining.  Some can argue that mining is a high risk yet low yield investment.  Mining hardware is not cheap, buying ASIC preorders is both expensive and risky, and there's no guarantee of bitcoin's value making ROI calculations into both speculation and science.  Mining profitably is a skill and those who do it well are paid accordingly as with any other venture.

[mai77]

what utter bull, mitty

[gollum]

The miners are currently being paid an equivalent of about $324000 per day through the block reward. (about 90 USD per BTC, 25 BTC per block, 144 blocks per day)

Do you think this amount is a reasonable amount to keep the network going?

The money earned through mining should be reinvested in mining hardware to ensure the stability of the network (to keep it decentralized).

[mai77]

well how much more does their revenue have to rise until folks have enough of it ?

[Prattler]

Litecoin is $16,000 per day 

If litecoin can do $16,000 / day, bitcoin can do $1M / day, no problem!

[gollum]

Litecoin is $16,000 per day 

If litecoin can do $16,000 / day, bitcoin can do $1M / day, no problem!

If Federal Reserves Ben Shalom can do billions per day Bitcoin can do millions per day

[mitty]

what utter bull, mitty

Care to explain?  Other than "create a relay free transactions policy"? (btw, free transactions are relayed all the time; transactions with a fee just have priority)

Miners provide a service to the network in exchange for a reward.  They would not provide this service at the current level (i.e., hashrate) without the reward.

[Peter Lambert]

that is a huge rip-off !

they are far too greedy !

STOP IT !

encourage "bitcoin free transaction relay policy"

This has nothing to do with the transaction fee. This is about the 25 btc block reward. The transaction fees are added on top of that.

[Matthew N. Wright]

what utter bull, mitty

I didn't see a single thing wrong with what he said.

[mai77]

what utter bull, mitty

I didn't see a single thing wrong with what he said.

because you're both some brainwashed neoliberal ****

[d'aniel]

It's obviously way more than enough to prevent double spends.  But the inflation schedule is not debatable, and the exchange rate is not controllable, so go be windbags about something else.

[prezbo]

what utter bull, mitty

I didn't see a single thing wrong with what he said.

because you're both some brainwashed neoliberal ****

Don't know if troll or just not very bright.

You should read up on how and why bitcoin security works. The whole mining game is zero-sum. Apart from a select lucky few, they are spending pretty much as much on electricity and hardware as they are earning.

If you think they are getting too much money for it, why don't you try it yourself and see how it works out for you.