490,000 Avalon chips already ordered - 150T hashrate spike coming in August

[organofcorti]

Unlike with gpu asic  has not other useful purpose. If diff is too high, people will get rid of them and never come back. Consolidation of hash power is ineviteable.

I'm not following you. I say that mining difficulty correlates strongly with past BTCUSD prices. Are you saying this is or is not the case?

here is what i think:
gpu has other purposes besides btc mining. if marginaly profitable i'll mine. if not i'll stop. at worst sell off a card or two. but i can always be back if need be. so yes, current diff is based on past price.

asic is different. i'll buy it to mine period. if unprofitable i'll sell it. but it's likely that to be profitable i need to run it like a business. large scale because of upfront cost. if in this scenario i loose interest in mining then i'll sell hw and whole company to a competitor. and will not be back.

with asic it's a one way street. and will result in small number of dominant players.

And so you do or you don't think difficulty will correlate with the exchange rate?

as i said:
- with gpu: price drives diff (price up is followed by hash up, price down hash down)
- with asic: price up hash up, price down hash remains and miners consolidate i.e. there are fewer but larger miners

Ah, thanks. Sometimes I need my information pre-chewed

I agree to a point, but I think that electricity prices will have a significant effect as well.

Edit: What you're suggesting already happened after the last exchange rate bubble, so it's not specific to ASICs, although the effect may be greater.

[1715003870]

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[1715003870]

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[Signus]

You can look at an estimate for loss of profit based off of the expected rise in difficulty from now until about the 1st of August.

I did the analysis for a 47.3GH/s FPGA rig as an example. An ASIC rig would just have a lower initial cost but the profit degradation would be the same.

Look for my post here: https://bitcointalk.org/index.php?topic=178051.msg1910302#msg1910302

[Dalkore]

I think what that earlier fellow meant was that pricing and difficulty will be relatively in sync when actors behave rationally. It seems that this asic phase is akin to the 2011 gpu phase when bitcoin price exploded, in that people acted foolishly. Just as people were taking out $20k loans to retrofit their house and buy GPUs and rigs (that they later regretted), we now see people pricing themselves in at $50,000 for a batch 1 avalon, $9000 for an ASICMiner blade, $80,000 for a batch of avalon chips, rather willy nilly. If this thread is correct, and 150TH of chips has been ordered *already* and people have shown little sign of slowing down on that unlimited train, there might be another glut of "oops, I spent way way way more than I should have" rolling down the track.

Would not surprise me if we once again surpass any reasonable plateau, and find ourselves in deep waters. A shame too, because it makes it very difficult to participate when I can't count on the other actors to not slit my throat along with their own.

Well put.   Yes, I believe we are in "deep waters" so you will need to be really patient to ROI.   One interesting side-effect is that now the network will be more secure for a longer period of time because miners want to recoup their investments.  This creates an interesting situation.   With the ROI being pushed out this far, I will be looking to expand my management service into a very very cheap power district much sooner than I thought to allow people to send their machines to me so their ROI time-frame improves.  Road-trip time.

[Transisto]

What indicate 490k chips ?  The five 3000Btc orders aren't factors of 782btc.

[minternj]

What indicate 490k chips ?  The five 3000Btc orders aren't factors of 782btc.

I thought the same but if you follow the transaction infro from addresses they are orders of ~15k BT which is 2 orders of chips. Someone pointed this out and I now agree that is all chip orders in that address.

[mrb]

What indicate 490k chips ?  The five 3000Btc orders aren't factors of 782btc.

The sending address(es) sent 15614 BTC which is exactly 20x the cost of one batch + domestic shipping (780.7 BTC).

[Dalkore]

40,000+ BTC at this funding address.  That equals 50 order of 10,000 chips (approx.).    You can see where the 490,000 chip estimate comes from.

[glendall]

Damn. That's a whole lot of ASIC going on.

And it actually looks like BFL might be shipping stuff in quantity in another month or two.

The difficulty is going to explode.

Sigh...my batch 3 Avalon order could not arrive soon enough.

I wonder if there will be an unheralded excess of used video cards going up for sale come summertime, or if many will stick around for the razor-thin margins.

[Knecke]

Or GPU miners will switch to Litecoin or other Cryptocurrencies.

[glendall]

It's possible but I'm not convinced there will be this giant exodus from BTC to LTC . There will be a big one, but I don't think most GPU BTC miners will go to LTC after ASICS roll out en masse.

I mine LTC (albeit only have 5 gpus so I'm just a hobbyist miner guy) currently. The ROI is already not much over BTC returns due to difficulty. Thing is, while BTC will be raising, and float LTC's boat some much, I don't see as much USD/fiat gains rising for LTC to conceive that it will be worthwhile when the difficult goes up by 5000%* in a couple of months time. I don't think the valuation of LTC will increase at the rate needed to match the incredible skyrocket of difficulty that would result if most BTC miners switched over.  

* made this number up obv, but it'll be insanely ridiculously large when the asic wave crests

Guess this is more a speculation-type post so maybe I'll just leave my thoughts on this as that, to not derail the thread...

[Keninishna]

watch yifu inadvertantly end up destroying bitcoin when all he was trying to do was protect it.

[zedicus]

Well avalon better seriously change their little equation for batch mini 4 then huh?

Avalon doesnt seriously have to do anything but..  

All this difficulty speculation makes you wonder!?  

So does avalons formula hold true for the batch 4 that was announced? If so for how long? Is there a chance that youre batch 4 @ 45Gh/s develops an unfavorable ROI before it ships or no ROI at all.. Tho, no date for purchase was announced, I think it was a late may or early june delivery time quoted..

Whats the life span of such a device in terms of profitability on its own at the speculated difficultys..






 (    (.)(.)  This thread went from difficulty rising to were all dead pretty quick! )

[jermwerty]

Everything about ASICS has been late so far.  BFL super late, but even AVALON has yet to get ONE batch 2 in the "wild" and it was supposed to ship a month ago.  From when Jeff got his batch 1 it pretty much still took over a month for anyone else to report having one - really took two months to have them out "in force".

While a half million chips may have been ordered, lets hope Avalon is as late with them as they have been with the rest of their stuff!

August?  You really think whoever is buying these chips has enough capacity to get raw chips online and all that quickly?

[hardpick]

watch yifu inadvertantly end up destroying bitcoin when all he was trying to do was protect it.

may the force be with you

[Dalkore]

Everything about ASICS has been late so far.  BFL super late, but even AVALON has yet to get ONE batch 2 in the "wild" and it was supposed to ship a month ago.  From when Jeff got his batch 1 it pretty much still took over a month for anyone else to report having one - really took two months to have them out "in force".

While a half million chips may have been ordered, lets hope Avalon is as late with them as they have been with the rest of their stuff!

August?  You really think whoever is buying these chips has enough capacity to get raw chips online and all that quickly?

Yes, there might be delays but overall, the capacity will be coming online this year.

[CoinHoarder]

The network speed is certainly going to explode this year.

Throw all profitability calculator numbers out the window.. there is so much Th being deployed from so many different places that calculating ROI within reasonable doubt is quite challenging.

[peetah]

Challenging is a good thing! If it was easy, where is the fun?

 2P by 2013 year end. 500T BFL. 250T Avalon. 500T Avalon chips. 250T asicminer.

The only unknown is whether litigation will stop BFL (a minus) and whether Avalon comes up with higher spec asics for the fourth quarter (a plus). P x EV for both is of similar magnitude, so I'd say 2P give or take 10 percent?

[bcpokey]

Kind of OT but related, did Avalon confirm that they had shipped Batch 2? I believe the date for shipping was set to 4/15/13, but they might be staying mum to avoid bribing officials again.

The delays on everything ASIC is what kept me from ordering into the Chip batches, which I may or may not regret ~3months from now. Scares me that someone had 16k BTC to drop on chips, plus whatever they will pay to have them made into whatever they will become (unless burnin finds himself with an order for 1600 modules from one source )

[minternj]

Kind of OT but related, did Avalon confirm that they had shipped Batch 2? I believe the date for shipping was set to 4/15/13, but they might be staying mum to avoid bribing officials again.

The delays on everything ASIC is what kept me from ordering into the Chip batches, which I may or may not regret ~3months from now. Scares me that someone had 16k BTC to drop on chips, plus whatever they will pay to have them made into whatever they will become (unless burnin finds himself with an order for 1600 modules from one source )

People still waiting on batch 1. check the batch 1 thread.

[Bitsaurus]

KH-->MH-->GH-->PH/s.  We're going to run out of letters!