Swedish ASIC miner company kncminer.com

[DeathAndTaxes]

I can't argue with your conclusion (and already read the thread you linked & your thread estimating hashrate based on pre-orders -- thanks).  I think we disagree on minor details -- i think the irrational component, and inability to accurately predict the difficulty three months in advance (average pre-order time -- i might be off), play a greater role in the hashrate increase.  It's not simple math -- it's estimating the ability of others to estimate the ability of others (...) to do simple math.  

BFL is largely to blame with their >1 year "pre-orders".  However the good news is pre-order timeframes are coming down.  

BFL >1 year delivery time
KNC started taking orders in June? and will ship in Oct (last day of Sept is close enough to Oct) = 4 month delivery time
Bitfury started taking orders in July and delivered early Sept = 3 months delivery time
HF started taking orders in Aug and will ship in Nov = <3 months (last batch 1 order was Aug 24)

Second batches should tighten that schedule further. As that shrinks and the network gets larger there becomes more visibility on what difficulty will be the day you get your unit.  The combo working together will be very powerful.  Still I agree on the larger point and the one reason I find mining unattractive at the current time is the largest factor on your return is the actions of others.

[1714117590]

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[1714117590]

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[1714117590]

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[donch]

I think the missing factor in all of these analyses of ROI is how much of the daily volume on all the currency exchanges combined comes from mining output. Above a certain threshold and the price is influenced by the costs of entering the mining arena. In other words, miners can convert their gains to fiat with limit orders and as the cost of mining goes up or the amount of bitcoins received per miner goes down, surely some of those miners will insist on a higher ask price?

Obviously markets are chaotic and unpredictable, but I haven't seen any decent analysis of how much an impact the mining community does have on the exchange rates. Any theories or evidence?

[DeathAndTaxes]

I think the missing factor in all of these analyses of ROI is how much of the daily volume on all the currency exchanges combined comes from mining output. Above a certain threshold and the price is influenced by the costs of entering the mining arena. In other words, miners can convert their gains to fiat with limit orders and as the cost of mining goes up or the amount of bitcoins received per miner goes down, surely some of those miners will insist on a higher ask price?

Obviously markets are chaotic and unpredictable, but I haven't seen any decent analysis of how much an impact the mining community does have on the exchange rates. Any theories or evidence?

Market volume is significantly higher than the rate of coin generation and that trend will only continue the subsidy will be cut by 50% again in 3 years and one would certainly hope year over year market volume will continue to rise.  Miners have very little pricing power today and it will only be reduced in the future.  Difficulty follows price, price doesn't follow difficulty.

[donch]

Market volume is significantly higher than the rate of coin generation and that trend will only continue the subsidy will be cut by 50% again in 3 years and one would certainly hope year over year market volume will continue to rise.  Miners have very little pricing power today and it will only be reduced in the future.  Difficulty follows price, price doesn't follow difficulty.

Any numbers to quantify that statement?

[soy]

I can't argue with your conclusion (and already read the thread you linked & your thread estimating hashrate based on pre-orders -- thanks).  I think we disagree on minor details -- i think the irrational component, and inability to accurately predict the difficulty three months in advance (average pre-order time -- i might be off), play a greater role in the hashrate increase.  It's not simple math -- it's estimating the ability of others to estimate the ability of others (...) to do simple math.  

BFL is largely to blame with their >1 year "pre-orders".  However the good news is pre-order timeframes are coming down.  As that shrinks and the network gets larger there becomes more visibility on what difficulty will be the day you get your unit.  The combo working together will be very powerful.  Still the one reason I find mining unattractive at the current time is that the largest factor in your return is the actions of others.

I would like The Genesis Block main page to have one large obvious button that gives a calculation of what cost, $/GH/s for a miner, if starting mining that instant, using the best projections for future miner shipments obtainable to estimate future difficulty, will produce ROI in 12 months - you enter only kw cost.

[DeathAndTaxes]

Market volume is significantly higher than the rate of coin generation and that trend will only continue the subsidy will be cut by 50% again in 3 years and one would certainly hope year over year market volume will continue to rise.  Miners have very little pricing power today and it will only be reduced in the future.  Difficulty follows price, price doesn't follow difficulty.

Any numbers to quantify that statement?

http://bitcoinity.org/markets/list?currency=ALL&span=6m

In the last 6 months there was >17,586,579 BTC traded.  That is >97,703.22 BTC per day.  Miners produce ~3,600 BTC per day.  The market trades over 27x as much.  Note that doesn't even include all exchanges, and excludes all off exchange transactions.   In reality it is probably closer to 50x.  Also remember those 3,600 BTC are spread out across thousands of miners.  It is far easier to be a big player on the market then to try and be a big player on the supply side.

I don't have a link but someone did a statistical analysis of price and difficulty way back in the dark ages of GPU mining and showed a correlation where difficulty is dependent on price but price isn't dependent on difficulty.  Anecdotally I have seen this effect in GPU mining.  There were many times were for marginal miners (those with low efficiency and high power costs) returns went negative.   Operating margins improved when difficulty went down not because some mining cartel removed enough supply to push prices up.

[soy]

I can't argue with your conclusion (and already read the thread you linked & your thread estimating hashrate based on pre-orders -- thanks).  I think we disagree on minor details -- i think the irrational component, and inability to accurately predict the difficulty three months in advance (average pre-order time -- i might be off), play a greater role in the hashrate increase.  It's not simple math -- it's estimating the ability of others to estimate the ability of others (...) to do simple math.  

BFL is largely to blame with their >1 year "pre-orders".  However the good news is pre-order timeframes are coming down.  As that shrinks and the network gets larger there becomes more visibility on what difficulty will be the day you get your unit.  The combo working together will be very powerful.  Still the one reason I find mining unattractive at the current time is that the largest factor in your return is the actions of others.

I would like The Genesis Block main page to have one large obvious button that gives a calculation of what cost, $/GH/s for a miner, if starting mining that instant, using the best projections for future miner shipments obtainable to estimate future difficulty, will produce ROI in 12 months - you enter only kw cost.

So, some manufacturers or at least one will dump massively into advertising while not really shipping so as to take in as much money as possible while skewing the projections.  So the easy $/GH/s needed for 12 months would quickly kill sales of overpriced miners.

And add a separate Delivery Projection button.  Say, x miner ordered on March 15, 2013 expected to be delivered on .... all based on historical data.

[donch]

http://bitcoinity.org/markets/list?currency=ALL&span=6m

In the last 6 months there was >17,586,579 BTC traded.  That is >97,703.22 BTC per day.  Miners produce ~3,600 BTC per day.  The market trades over 27x as much.  Note that doesn't even include all exchanges, and excludes all off exchange transactions.   In reality it is probably closer to 50x.  Also remember those 3,600 BTC are spread out across thousands of miners.  It is far easier to be a big player on the market then to try and be a big player on the supply side.

I don't have a link but someone did a statistical analysis of price and difficulty way back in the dark ages of GPU mining and showed a correlation where difficulty is dependent on price but price isn't dependent on difficulty.  Anecdotally I have seen this effect in GPU mining.  There were many times were for marginal miners (those with low efficiency and high power costs) returns went negative.   Operating margins improved when difficulty went down not because some mining cartel removed enough supply to push prices up.

Thanks for the reply and don't want to go too off-topic, but a 6 month figure includes all the volatility (and associated volume) surrounding  the "external" factors such as media engagement and big players entering the market when the $260 point was reached. In periods of low volatility, such as in recent times, the volume to bitcoin mining supply ratio seems to be between 1:3 and 1:6 extrapolated from the last 30 day and 7 day periods:

http://bitcoinity.org/markets/list?currency=ALL&span=7d
http://bitcoinity.org/markets/list?currency=ALL&span=30d  

It's all speculation and time will tell, but I get a feeling that the market "idling" price is at least in some small way affected by mining costs.

[s1ms3]

Has someone already asked for a refund at this late stage of developement?

[DeathAndTaxes]

Well as a miner you can't control how much increased volatility there will be.  Over an extended time mining say 6 months you are going to go through multiple periods of both.  I never said miners have absolutely no influence on price just that they have very little pricing power.  Miners aren't a single unified cartel. They all have different price points, risk apetites, efficiencies (range from 0.8 J/GH to >8 J/GH) and power costs.  What is a negative operating margin for one miner is a a massive 90%+ margin for another.  Some miners may hold coins or place higher limit prices but some may just dump as they see the current price as good and have thousands of dollars a month in electrical cost.

[Miz4r]

Market volume is significantly higher than the rate of coin generation and that trend will only continue the subsidy will be cut by 50% again in 3 years and one would certainly hope year over year market volume will continue to rise.  Miners have very little pricing power today and it will only be reduced in the future.  Difficulty follows price, price doesn't follow difficulty.

Any numbers to quantify that statement?

http://bitcoinity.org/markets/list?currency=ALL&span=6m

In the last 6 months there was >17,586,579 BTC traded.  That is >97,703.22 BTC per day.  Miners produce ~3,600 BTC per day.  The market trades over 27x as much.  Note that doesn't even include all exchanges, and excludes all off exchange transactions.   In reality it is probably closer to 50x.  Also remember those 3,600 BTC are spread out across thousands of miners.  It is far easier to be a big player on the market then to try and be a big player on the supply side.

I don't have a link but someone did a statistical analysis of price and difficulty way back in the dark ages of GPU mining and showed a correlation where difficulty is dependent on price but price isn't dependent on difficulty.  Anecdotally I have seen this effect in GPU mining.  There were many times were for marginal miners (those with low efficiency and high power costs) returns went negative.   Operating margins improved when difficulty went down not because some mining cartel removed enough supply to push prices up.

It's not just about what miners produce, I agree that has a neglectable impact on the price. But the amount of money that goes into buying mining hardware can have a significant impact on the price, as when mining becomes an unprofitable investment a lot of money will be looking elsewhere to invest and part of that money will go back into bitcoin itself driving up the price. Until the price is high enough (and difficulty low enough) for mining hardware to become an attractive investment again.

[Vedran Yoweri]

Has someone already asked for a refund at this late stage of developement?

Boom! Another one bites the dust.

[Miz4r]

Has someone already asked for a refund at this late stage of developement?

Boom! Another one bites the dust.

Those who ask for a refund now at least get their investment back, those who don't will be most likely looking at a negative ROI. Gonna be interesting to watch.

[Vedran Yoweri]

Has someone already asked for a refund at this late stage of developement?

Boom! Another one bites the dust.

Those who ask for a refund now at least get their investment back, those who don't will be most likely looking at a negative ROI. Gonna be interesting to watch.

Boom! Another one bites the dust.

[Miz4r]

Has someone already asked for a refund at this late stage of developement?

Boom! Another one bites the dust.

Those who ask for a refund now at least get their investment back, those who don't will be most likely looking at a negative ROI. Gonna be interesting to watch.

Boom! Another one bites the dust.

Hope you don't mind if I quote this post again in a few months from now.

[Xialla]

Has someone already asked for a refund at this late stage of developement?

check auction/goods section..there are couple of guys, which are trying to sold their 1st day preorders and I'm pretty sure, that because we are 3 working days from promised deadline and KNC not revealed video of working unit, pressure is higher and higher and more and more guys asking for refund.)

KNC: if you want to improve your sales, video of working unit is much better than auctioning slots for adverts at 20.5BTC/annoying banner.

[gateway]

hmm.. ugg.. 113 million diff to 148 today..

If Jupiter can do 500Gh/s..
The expected generation output, at 500 Ghps, given current difficulty of 148819199.80509 , is 1.68968181173 BTC per day and 0.0704034088219 BTC per hour.

At 400 Gh/s
The expected generation output, at 400 Ghps, given current difficulty of 148819199.80509 , is 1.35174544938 BTC per day and 0.0563227270575 BTC per hour.

[Meizirkki]

Has someone already asked for a refund at this late stage of developement?

Boom! Another one bites the dust.

Those who ask for a refund now at least get their investment back, those who don't will be most likely looking at a negative ROI. Gonna be interesting to watch.

Boom! Another one bites the dust.

Refund = 100% ROI within days
Mining = 100% ROI in 4 - infinity months


Disclaimer: no horse in this race ... don't base your descisions on my posts yadda yadda yadda ...

[frankenmint]

Has someone already asked for a refund at this late stage of developement?

Boom! Another one bites the dust.

Those who ask for a refund now at least get their investment back, those who don't will be most likely looking at a negative ROI. Gonna be interesting to watch.

Boom! Another one bites the dust.

Refund = 100% ROI within days
Mining = 100% ROI in 4 - infinity months

what econ class did you take?  that's not ROI that's simply getting your money, back, breaking even.  There is no ROI in term of BTC gained unless you are mining lower difficulty alts and selling them for a good price on the exchange.

[itod]

KNC: if you want to improve your sales, video of working unit is much better than auctioning slots for adverts at 20.5BTC/annoying banner.

Like they don't know that, if they would have a video of working unit you can bet it would be already posted. Even if they have a photo of a chip it would be a sensation. In the meantime, adverts will have to do to avoid panic.