Don't listen to all the propagandists. Mining is fine.

[KedP]

Again, I'm not going to lower myself to calling names.

Where have I lied? No one has showed me a single "lie" that I have posted.

I'm just telling them to use their heads and be rational. That is all.

Nobody needs to "encourage" any newbie -- greed (which is part of human nature) does that role just fine. My "job" is to balance things, to help people think more clearly.

I am having the same problem in my mining thread.  One guy follows my threads around to tell me how I am a troll and liar, but won't refute the facts I have put out.

The fact remains that because the network is doubling every 18 days, your output halves every 18 days and you won't ever break even because of that.  The mining calculators don't take that into consideration.

Stating facts isn't the bullshit part.

The bullshit part is when you tell people "you won't ever break even" when YOU DON'T KNOW THAT.

Did you tell those people that by your same calculations, mining would be considered unproftaible in may? In april? In march?

Because all these calculations are the exact same calculations done for the last year, and these calculations say very little, because the people who do these calculations (you!) cannot predct the single important factor that actually matters: price.

All ROI calculations are bogus because all ROI calculations make assumptions about price. Any conclusion other than "I don't know what's going to happen, your guess is as good as mine. Just depends where you think the price will go." is bullshit.

[1713242881]

1713242881

[1713242881]

1713242881

[1713242881]

1713242881

[Swishercutter]

Again, I'm not going to lower myself to calling names.

Where have I lied? No one has showed me a single "lie" that I have posted.

I'm just telling them to use their heads and be rational. That is all.

Nobody needs to "encourage" any newbie -- greed (which is part of human nature) does that role just fine. My "job" is to balance things, to help people think more clearly.

I am having the same problem in my mining thread.  One guy follows my threads around to tell me how I am a troll and liar, but won't refute the facts I have put out.

The fact remains that because the network is doubling every 18 days, your output halves every 18 days and you won't ever break even because of that.  The mining calculators don't take that into consideration.

Stating facts isn't the bullshit part.

The bullshit part is when you tell people "you won't ever break even" when YOU DON'T KNOW THAT.

Did you tell those people that by your same calculations, mining would be considered unproftaible in may? In april? In march?

Because all these calculations are the exact same calculations done for the last year, and these calculations say very little, because the people who do these calculations (you!) cannot predct the single important factor that actually matters: price.

All ROI calculations are bogus because all ROI calculations make assumptions about price. Any conclusion other than "I don't know what's going to happen, your guess is as good as mine. Just depends where you think the price will go." is bullshit.

Thank you for stating what I should have said in the first place...I am the "guy following the troll". LOL
He is starting multiple threads with the same garbage...not one of his threads is a new argument...all of them are negative.  Spreading FUD

[Hook^]

Again, I'm not going to lower myself to calling names.

Where have I lied? No one has showed me a single "lie" that I have posted.

I'm just telling them to use their heads and be rational. That is all.

Nobody needs to "encourage" any newbie -- greed (which is part of human nature) does that role just fine. My "job" is to balance things, to help people think more clearly.

I am having the same problem in my mining thread.  One guy follows my threads around to tell me how I am a troll and liar, but won't refute the facts I have put out.

The fact remains that because the network is doubling every 18 days, your output halves every 18 days and you won't ever break even because of that.  The mining calculators don't take that into consideration.

Stating facts isn't the bullshit part.

The bullshit part is when you tell people "you won't ever break even" when YOU DON'T KNOW THAT.

Did you tell those people that by your same calculations, mining would be considered unproftaible in may? In april? In march?

Because all these calculations are the exact same calculations done for the last year, and these calculations say very little, because the people who do these calculations (you!) cannot predct the single important factor that actually matters: price.

All ROI calculations are bogus because all ROI calculations make assumptions about price. Any conclusion other than "I don't know what's going to happen, your guess is as good as mine. Just depends where you think the price will go." is bullshit.

Sorry, I misspoke.  I should have said that mining isn't profitable at the current price, and is less profitable than investing in bitcoins directly with increasing prices.  The only thing I am predicting is that the network continues to grow at 4%/day, which it has on average over the last year.  Almost perfectly.

Check out http://bitcoin.sipa.be/  to see just how perfectly.  As long as that remains the same, you won't make as much money as just investing in bitcoins.

So yes, I would have said in April that mining is less profitable too.  If you had bought $1,000 in bitcoins you would have $20,000 in bitcoins now.  Did anyone buying $1000 worth of mining equipment make $20,000 in that same time period?

[KedP]

Again, I'm not going to lower myself to calling names.

Where have I lied? No one has showed me a single "lie" that I have posted.

I'm just telling them to use their heads and be rational. That is all.

Nobody needs to "encourage" any newbie -- greed (which is part of human nature) does that role just fine. My "job" is to balance things, to help people think more clearly.

I am having the same problem in my mining thread.  One guy follows my threads around to tell me how I am a troll and liar, but won't refute the facts I have put out.

The fact remains that because the network is doubling every 18 days, your output halves every 18 days and you won't ever break even because of that.  The mining calculators don't take that into consideration.

Stating facts isn't the bullshit part.

The bullshit part is when you tell people "you won't ever break even" when YOU DON'T KNOW THAT.

Did you tell those people that by your same calculations, mining would be considered unproftaible in may? In april? In march?

Because all these calculations are the exact same calculations done for the last year, and these calculations say very little, because the people who do these calculations (you!) cannot predct the single important factor that actually matters: price.

All ROI calculations are bogus because all ROI calculations make assumptions about price. Any conclusion other than "I don't know what's going to happen, your guess is as good as mine. Just depends where you think the price will go." is bullshit.

Sorry, I misspoke.  I should have said that mining isn't profitable at the current price, and is less profitable than investing in bitcoins directly with increasing prices.  The only thing I am predicting is that the network continues to grow at 4%/day, which it has on average over the last year.  Almost perfectly.

Check out http://bitcoin.sipa.be/  to see just how perfectly.  As long as that remains the same, you won't make as much money as just investing in bitcoins.

So yes, I would have said in April that mining is less profitable too.  If you had bought $1,000 in bitcoins you would have $20,000 in bitcoins now.  Did anyone buying $1000 worth of mining equipment make $20,000 in that same time period?

I think it's cool that you're trying to learn how to be an amateur investment advisor.

So here's a lesson: risk is the single most important variable in an investment.

Buying bitcoins is, by a fundamental law of the universe, always going to be more potentially profitable than mining because it is higher risk.

Mining is lower risk, but also lower expected returns.

An investor's choice of where they should put their money and time depends on their risk profile.

Is the investor looking for a high risk, high yield investment, and is comfortable taking losses but still acting rationally? He should buy bitcoins.

Is the investor running tighter on money and can't afford to lose much, but also isn't aiming to make more? Is the investor willing to invest personal time and effort managing his investment? If yes he should consider mining.

Variables that matter for deciding about an investment in bitcoins:
- Your risk profile
- Your beliefs about future price
- Your skills (Are you capable of trading wisely? Avoiding panic? Not getting scammed?)*
- Your interests (Does system administration turn you on?)**

Things that don't matter:
- Other people's calculations about difficulty increases
- Bogus ROI calculations based on unknowable assumptions
- Stuff your competition says to discourage you from competing with them


*Lots of people who attempt to become traders end up losing their shirts because they panic. The ideal trader is a person who is rational and level-headed even when others scream that the sky is falling. Not every personality type is a good trader: people with the letter "F" in their MBTI are often naturally bad traders for instance and tend to buy high and sell low despite their best intentions. If you have an "F" in your MBTI you should consider if you can handle the pressure of knowing you could lose all your money.

**Running a bitcoin machine is like buying a pet. It takes regular maintenance and a non-zero recurring time investment. It also requires a variety of computer skills that many miners take for granted, but which newbies may not have and may not have an interest in learning.

[Hook^]

Stating facts isn't the bullshit part.

The bullshit part is when you tell people "you won't ever break even" when YOU DON'T KNOW THAT.

Did you tell those people that by your same calculations, mining would be considered unproftaible in may? In april? In march?

Because all these calculations are the exact same calculations done for the last year, and these calculations say very little, because the people who do these calculations (you!) cannot predct the single important factor that actually matters: price.

All ROI calculations are bogus because all ROI calculations make assumptions about price. Any conclusion other than "I don't know what's going to happen, your guess is as good as mine. Just depends where you think the price will go." is bullshit.

Sorry, I misspoke.  I should have said that mining isn't profitable at the current price, and is less profitable than investing in bitcoins directly with increasing prices.  The only thing I am predicting is that the network continues to grow at 4%/day, which it has on average over the last year.  Almost perfectly.

Check out http://bitcoin.sipa.be/  to see just how perfectly.  As long as that remains the same, you won't make as much money as just investing in bitcoins.

So yes, I would have said in April that mining is less profitable too.  If you had bought $1,000 in bitcoins you would have $20,000 in bitcoins now.  Did anyone buying $1000 worth of mining equipment make $20,000 in that same time period?

[/quote]

I think it's cool that you're trying to learn how to be an amateur investment advisor.

So here's a lesson: risk is the single most important variable in an investment.

Buying bitcoins is, by a fundamental law of the universe, always going to be more potentially profitable than mining because it is higher risk.

Mining is lower risk, but also lower expected returns.

An investor's choice of where they should put their money and time depends on their risk profile.

Is the investor looking for a high risk, high yield investment, and is comfortable taking losses but still acting rationally? He should buy bitcoins.

Is the investor running tighter on money and can't afford to lose much, but also isn't aiming to make more? Is the investor willing to invest personal time and effort managing his investment? If yes he should consider mining.

Variables that matter for deciding about an investment in bitcoins:
- Your risk profile
- Your beliefs about future price
- Your skills (Are you capable of trading wisely? Avoiding panic? Not getting scammed?)
- Your interests (Does system administration turn you on?)

Things that don't matter:
- Other people's calculations about difficulty increases
- Bogus ROI calculations based on unknowable assumptions
- Stuff your competition says to discourage you from competing with them
[/quote]
Difficulty increases aren't just an assumption, look at the graph of the last year.  What I am saying is that as long as difficulty increases are growing at the current rate, mining will never be as profitable as investing directly.  At the current rate, you have to have an increase in bitcoin value to compensate for the increase in difficulty to just break even.  So indirectly, you are speculating on the increasing value of bitcoins when you mine.

Now, if the growth of computing horsepower slows down to 2% or less, then mining obviously is the better option.  Like for the first year of bitcoin's existence when the growth was flat.

[KedP]

Difficulty increases aren't just an assumption, look at the graph of the last year.  What I am saying is that as long as difficulty increases are growing at the current rate, mining will never be as profitable as investing directly.  At the current rate, you have to have an increase in bitcoin value to compensate for the increase in difficulty to just break even.  So indirectly, you are speculating on the increasing value of bitcoins when you mine.

Now, if the growth of computing horsepower slows down to 2% or less, then mining obviously is the better option.  Like for the first year of bitcoin's existence when the growth was flat.

Mining is lower profit, but it's also lower risk. You can sell your rig, you can use it on other projects, or you could play games with it. Mining can also remain profitable even if the price goes down, especially if, as the price goes down, network growth rate decreases.

Your extrapolation of the difficulty growth is still just a guess. There is no reason why difficulty has to keep growing at that rate. It could easily fall to 2%.

In conclusion, mining makes as much sense now as it did on May 1st. Which is to say, it's anyone's guess what will happen.

[Hook^]

Difficulty increases aren't just an assumption, look at the graph of the last year.  What I am saying is that as long as difficulty increases are growing at the current rate, mining will never be as profitable as investing directly.  At the current rate, you have to have an increase in bitcoin value to compensate for the increase in difficulty to just break even.  So indirectly, you are speculating on the increasing value of bitcoins when you mine.

Now, if the growth of computing horsepower slows down to 2% or less, then mining obviously is the better option.  Like for the first year of bitcoin's existence when the growth was flat.

Mining is lower profit, but it's also lower risk. You can sell your rig, you can use it on other projects, or you could play games with it. Mining can also remain profitable even if the price goes down, especially if, as the price goes down, network growth rate decreases.

Your extrapolation of the difficulty growth is still just a guess. There is no reason why difficulty has to keep growing at that rate. It could easily fall to 2%.

In conclusion, mining makes as much sense now as it did on May 1st. Which is to say, it's anyone's guess what will happen.

You are absolutely correct that in the worst case, you still have hardware you can sell or use.  In the worst case of investing directly you have nothing.

As far as network growth, I wouldn't say it easily go down to 2%/day because it hasn't in the last year.  That being said, it will have to slow down at some point because there are only so many GPUs out there.  When that happens no one knows, but betting it will happen next week is a risky bet.  Of course, once someone makes some custom ASIC arrays the game is over for everyone.

[_s3v3n_]

Can't we just have big sticky saying "Buying mining hardware is risky, buying BTC is risky, You don't like risks go somewhere else"  So we don't have to read these posts 15 times a day? 

This ^^^^

 

If you're chicken enough to lose money, then don't even think about Bitcoin.

Chickens!

[KedP]

Difficulty increases aren't just an assumption, look at the graph of the last year.  What I am saying is that as long as difficulty increases are growing at the current rate, mining will never be as profitable as investing directly.  At the current rate, you have to have an increase in bitcoin value to compensate for the increase in difficulty to just break even.  So indirectly, you are speculating on the increasing value of bitcoins when you mine.

Now, if the growth of computing horsepower slows down to 2% or less, then mining obviously is the better option.  Like for the first year of bitcoin's existence when the growth was flat.

Mining is lower profit, but it's also lower risk. You can sell your rig, you can use it on other projects, or you could play games with it. Mining can also remain profitable even if the price goes down, especially if, as the price goes down, network growth rate decreases.

Your extrapolation of the difficulty growth is still just a guess. There is no reason why difficulty has to keep growing at that rate. It could easily fall to 2%.

In conclusion, mining makes as much sense now as it did on May 1st. Which is to say, it's anyone's guess what will happen.

You are absolutely correct that in the worst case, you still have hardware you can sell or use.  In the worst case of investing directly you have nothing.

As far as network growth, I wouldn't say it easily go down to 2%/day because it hasn't in the last year.  That being said, it will have to slow down at some point because there are only so many GPUs out there.  When that happens no one knows, but betting it will happen next week is a risky bet.  Of course, once someone makes some custom ASIC arrays the game is over for everyone.

When it comes abstract mathematical metrics derived from the interaction of complex human behaviour, past performance does not predict future performance. This is economics 101.

Difficulty is not a physical object. It does not obey Newton's first law. Abstract, arbitrary metrics generally don't. (And when they look like they do, it's usually just because they haven't changed yet. See: LTCM. See: Housing prices. See: Tulips. When stuff looks predictable, it's usually because you're suffering from selection bias.)

[bcpokey]

It's nice to see a new 35 post count user that wasn't created just to post about the doom of bitcoin. I don't want to call him an anti-troll because it still seems to have created a lot of friction, but this is as close as it gets. I'm not a fan of the topic title, but my favorite part is what I've been trying to tell people

you don't know what will happen

Yes. A million times yes. We obviously make our little personal models and try to fit them as well as we think we can so that they'll be useful, but who the crap knows what will happen. A huge solar flare might erupt sending an EMP down that surges the power grid, blowing up tens of thousands of mining rigs. Or a news report might come out on CNN saying "bitcoin is a way to make free money forever! Roll over to cnn.com/bitcoin_moniez to see how!"

Or something more reasonable in between those extremes. Bitcoin is small enough that external events can have a huge huge huge impact on it. For good or ill.

[Hook^]

It's nice to see a new 35 post count user that wasn't created just to post about the doom of bitcoin. I don't want to call him an anti-troll because it still seems to have created a lot of friction, but this is as close as it gets. I'm not a fan of the topic title, but my favorite part is what I've been trying to tell people

you don't know what will happen

Yes. A million times yes. We obviously make our little personal models and try to fit them as well as we think we can so that they'll be useful, but who the crap knows what will happen. A huge solar flare might erupt sending an EMP down that surges the power grid, blowing up tens of thousands of mining rigs. Or a news report might come out on CNN saying "bitcoin is a way to make free money forever! Roll over to cnn.com/bitcoin_moniez to see how!"

Or something more reasonable in between those extremes. Bitcoin is small enough that external events can have a huge huge huge impact on it. For good or ill.

I don't think there will be any bitcoin doom.  I think it is the future.  And I think there is still a lot of money to be made with it.  If it becomes the world reserve currency, watch it go up another 10,000 times over.

My only small issue is dedicated mining rigs at the current network growth.  And right now, the numbers have been pretty consistent.

[hugolp]

Nobody has mentioned yet the risk of the ASIC that different groups have announced for the end of this year begginning of the next one. When that hardware is ready your GPU wont be able to compete and will be an obsolte investment. And the prodcution is halving every 18 days because of the increase of difficulty. If you are not able to break even under those conditions by the end of the year, you should think very carefully what you are doing, otherwise you are going to loose money since you wont be able to keep your GPU generating (profitably).

There is only two things that can change to make mining profitable. 1) The difficulty stops growing so much giving miners some room to get more bitcoins. 2) The price rises consierably, to $30 and beyond.

(This part is speculation obviuosly) Regarding 2) I dont see that happening for a long time, probably until 2012 because the initial rush because of the press has happened and there is a lot of people looking to unload in the $20 range and beyond. It will take time and a lot of demand to break that resistance. Also, the kind of people the rush has attracted to Bitcoin is not people looking to improve the Bitcoin economy, but a lot of those are looking for a quick and easy way of making money, so when the price rises to those levels they will sell.

Regarding 1) is the part that I see more posible to change. I still dont understand how anyone can be buying dedicated miners at this point, so it makes sense to me that at some point not so much capacity will be added to the network and the difficulty will stop growing so much. I really dont understand some people that are buying and buying GPU's right now. What are they going to do with their 50+ gpu farms when the ASIC chips make their hardware obsolete? The second hand market wont be abel to absord so many gpu's going on sale all together. But again, its not guranateed that the difficulty will grow slower, for all we know it could grow even faster. But I think its more probable that we see the difficluty slowing than the price rising a lot in the rest of 2011.

But anyone has to keep in mind that if there is not a big change in the difficulty trend or in the price, buying a dedicated miner right now is NOT profitable, you wont break even. Anyone can do the math. Mining is not fine. We are in a very delicate moment.

[Swishercutter]

Nobody has mentioned yet the risk of the ASIC that different groups have announced for the end of this year begginning of the next one. When that hardware is ready your GPU wont be able to compete and will be an obsolte investment. And the prodcution is halving every 18 days because of the increase of difficulty. If you are not able to break even under those conditions by the end of the year, you should think very carefully what you are doing, otherwise you are going to loose money since you wont be able to keep your GPU generating (profitably).

There is only two things that can change to make mining profitable. 1) The difficulty stops growing so much giving miners some room to get more bitcoins. 2) The price rises consierably, to $30 and beyond.

(This part is speculation obviuosly) Regarding 2) I dont see that happening for a long time, probably until 2012 because the initial rush because of the press has happened and there is a lot of people looking to unload in the $20 range and beyond. It will take time and a lot of demand to break that resistance. Also, the kind of people the rush has attracted to Bitcoin is not people looking to improve the Bitcoin economy, but a lot of those are looking for a quick and easy way of making money, so when the price rises to those levels they will sell.

Regarding 1) is the part that I see more posible to change. I still dont understand how anyone can be buying dedicated miners at this point, so it makes sense to me that at some point not so much capacity will be added to the network and the difficulty will stop growing so much. I really dont understand some people that are buying and buying GPU's right now. What are they going to do with their 50+ gpu farms when the ASIC chips make their hardware obsolete? But again, its not guranateed that the difficulty will grow slower, for all we know it could grow even faster. But I think its more probable that we see the difficluty slowing than the price rising a lot in the rest of 2011.

But anyone has to keep in mind that if there is not a big change in the difficulty trend or in the price, buying a dedicated miner right now is NOT profitable, you wont break even. Anyone can do the math.

ASIC's were mentioned in his nearly identical thread.

Not his thread...another one.

[Hook^]

Nobody has mentioned yet the risk of the ASIC that different groups have announced for the end of this year begginning of the next one. When that hardware is ready your GPU wont be able to compete and will be an obsolte investment. And the prodcution is halving every 18 days because of the increase of difficulty. If you are not able to break even under those conditions by the end of the year, you should think very carefully what you are doing, otherwise you are going to loose money since you wont be able to keep your GPU generating (profitably).

There is only two things that can change to make mining profitable. 1) The difficulty stops growing so much giving miners some room to get more bitcoins. 2) The price rises consierably, to $30 and beyond.

(This part is speculation obviuosly) Regarding 2) I dont see that happening for a long time, probably until 2012 because the initial rush because of the press has happened and there is a lot of people looking to unload in the $20 range and beyond. It will take time and a lot of demand to break that resistance. Also, the kind of people the rush has attracted to Bitcoin is not people looking to improve the Bitcoin economy, but a lot of those are looking for a quick and easy way of making money, so when the price rises to those levels they will sell.

Regarding 1) is the part that I see more posible to change. I still dont understand how anyone can be buying dedicated miners at this point, so it makes sense to me that at some point not so much capacity will be added to the network and the difficulty will stop growing so much. I really dont understand some people that are buying and buying GPU's right now. What are they going to do with their 50+ gpu farms when the ASIC chips make their hardware obsolete? The second hand market wont be abel to absord so many gpu's going on sale all together. But again, its not guranateed that the difficulty will grow slower, for all we know it could grow even faster. But I think its more probable that we see the difficluty slowing than the price rising a lot in the rest of 2011.

But anyone has to keep in mind that if there is not a big change in the difficulty trend or in the price, buying a dedicated miner right now is NOT profitable, you wont break even. Anyone can do the math. Mining is not fine. We are in a very delicate moment.

If growth slows down, mining will become profitable until ASIC time.  But that is a big "if".  So far it hasn't shown any signs of slowing down.

[Hook^]

ASIC's were mentioned in his nearly identical thread.

That is because everyone knows that ASICs are the inevitable end game.  Whoever has those wins.

[rograz]

That is because everyone knows that ASICs are the inevitable end game.  Whoever has those wins.

Even a ASICs design will have a hard time vs a few million gamers worldwide who consider their graphics cards free and GPU shrinks that happen every 18-24 months on average. Any ASIC design brought out today will have to compete with the radeon 7xxx series and not current hardware.

[hugolp]

That is because everyone knows that ASICs are the inevitable end game.  Whoever has those wins.

Even a ASICs design will have a hard time vs a few million gamers worldwide who consider their graphics cards free and GPU shrinks that happen every 18-24 months on average. Any ASIC design brought out today will have to compete with the radeon 7xxx series and not current hardware.

The point of the ASIC's is lower consumption. How can a 7XXX compete with a device that consumes 10 times less energy for the same bitcoins? ASIC's will make GPU mining obsolete.

[Hook^]

That is because everyone knows that ASICs are the inevitable end game.  Whoever has those wins.

Even a ASICs design will have a hard time vs a few million gamers worldwide who consider their graphics cards free and GPU shrinks that happen every 18-24 months on average. Any ASIC design brought out today will have to compete with the radeon 7xxx series and not current hardware.

The problem is that an ASIC can be custom designed to go orders of magnitude faster than a GPU for a specific task.  As just a very rough estimate, one SHA256 engine with bitcoin hash difficulty detection would take something like 1 million transistors.  The latest ASIC technology allows 2 billion transistors.  So that would allow 2,000 of these engines per chip.  If you layed them out by hand, you could probably get them up to 4 GHz.  Assuming one hash per clock, this ends up being 8 TH/S per chip.  In other words, this one chip could outperform the entire current BitCoin network.  And once the multi-million up front tooling costs are covered, you can make each chip for $50 each.  So for another $10,000 you could make a system with 200 chips that would be able to dominate the entire network at 200 times its current capacity.  It would pay for itself in about 20 days, because you would get every bitcoin made in that period.

If the exchange rates hold, you could multiply your earnings and buy thousands more chips for a low incremental cost to maintain your dominance.  I don't see how GPUs could begin to compete with this.

[jhansen858]

By every coin you mean the 2 weeks you would have to pull this off before you set off the biggest difficulty increase ever seen?  Highly doubt you could mine fast enough to generate 1,500,000 worth of coins before the difficulty increase...

I have been trying to decide if its worth it to go big right now..

In 2 months the difficulty will most likely be in the 2 million range.  If coins don't increase by then, and you are someone who pays for power, you sir will most likely be priced out of the mining market. 

Currently if you pay .10 / kwh and your machine takes 5 amps of power ( i measured it with a power meter today dell with 1000 w power supply and 2 6970's) then your coins are cosing you ~$13.08 each to generate..  Thats not taking into account any 3% or 2.5% that your mining pool is taking.  Since coins are in the 15-20 range.. people are still making money.


Difficulty                    Electricity Cost per bitcoin
877226.66666667       $13.082351858737873   <----------current
1877226.66666667     $27.9956603066546       <--------- projected 1 or 2 months
2877226.66666667     $42.908968754571305   <---------- projected 3 or 4 months

If the market price of bitcoins does not exceed the power cost, then you sir are assed out...

There are a lot of people who don't pay for power and a lot who do. 

My prediction is there is going to be a huge run up, then an over correction down or a leveling out when only the people not paying for power are left in the game.

I would say if your in it for at least a year, then you might be ok, anything less and if your paying for power get ready for the blood bath that is about to happen.

[fcmatt]

That is because everyone knows that ASICs are the inevitable end game.  Whoever has those wins.

Even a ASICs design will have a hard time vs a few million gamers worldwide who consider their graphics cards free and GPU shrinks that happen every 18-24 months on average. Any ASIC design brought out today will have to compete with the radeon 7xxx series and not current hardware.

The problem is that an ASIC can be custom designed to go orders of magnitude faster than a GPU for a specific task.  As just a very rough estimate, one SHA256 engine with bitcoin hash difficulty detection would take something like 1 million transistors.  The latest ASIC technology allows 2 billion transistors.  So that would allow 2,000 of these engines per chip.  If you layed them out by hand, you could probably get them up to 4 GHz.  Assuming one hash per clock, this ends up being 8 TH/S per chip.  In other words, this one chip could outperform the entire current BitCoin network.  And once the multi-million up front tooling costs are covered, you can make each chip for $50 each.  So for another $10,000 you could make a system with 200 chips that would be able to dominate the entire network at 200 times its current capacity.  It would pay for itself in about 20 days, because you would get every bitcoin made in that period.

If the exchange rates hold, you could multiply your earnings and buy thousands more chips for a low incremental cost to maintain your dominance.  I don't see how GPUs could begin to compete with this.

it all sounds so good except that one or a group of people have to come up with millions of dollars to do this. And i have a feeling
2 million is just enough to go bankrupt trying without producing a single thing.

sure.. if you get lucky and manage to rope in a few experts in the area you have a greater chance of success.. and if they donate their
time for basically a shot at making bitcoins... and if several stars align just so... maybe someone will make a package that can do this.

i am not an expert in the field. i am known to be wrong and probably am. this is just a gut feeling that if people guess that it will take
1 million dollars to do the job.. i normally multiply that in my head by a factor of 5 to really make it happen.

edited to add:

10:31    TD   so it's $1000 per gigahash?
10:32    ArtForz   well, if support components, PCBs, cases, ... grow on trees, yes

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but he wins on the power side of things for sure.