ASICs raising difficulty and reducing profitability in Bitcoin and alt coins

[Crindon]

Anyone else afraid of ASICs? The issue is when the difficulty skyrockets upon the flooding of Bitcoin ASICs, profitability will drop substantially even for the ASIC miners. The existing GPU-based miners will then leave Bitcoin mining and switch over to alt coin pools increasing alt coin network hashrates, increasing the difficulty, and significantly dropping the profitability. Does this mean that it won't be worthwhile to do any mining very soon? The cost of electricity may make mining unsustainable for many miners. I realize that some of the alt coin prices could increase, but the increase will be entirely offset by the increasing difficulty. Am I being too pessimistic? After all the Bitcoins have been mined, do Bitcoin ASICs become nothing more than really neat looking paperweights and conversation pieces? What are your thoughts on this?

[CanadianGuy]

it's called supply and demand
if difficulty gets too high and miners drop out, difficulty will drop, as new miners who can take on the challenge take over
that simple

[JesusStillLoveU]

Just get yourself an ASIC then. Innovation. I don't have an ASIC but I don't have good GPU either. I only get 24Mhash/s if I am lucky. I still mine though.

[Crindon]

Just get yourself an ASIC then. Innovation. I don't have an ASIC but I don't have good GPU either. I only get 24Mhash/s if I am lucky. I still mine though.

At that hashrate, does the cost of electricity run you more than your mining profits? I know guys who live in campus residences and apartments who have electricity covered. Another guy has GPUs at work and he runs them when the office is closed for the night.

[Mikeologist]

Just get yourself an ASIC then. Innovation. I don't have an ASIC but I don't have good GPU either. I only get 24Mhash/s if I am lucky. I still mine though.

24MH/s ?
What equip? You are likely using 3-5 time the cost in power.

[Mikeologist]

Anyone else afraid of ASICs? The issue is when the difficulty skyrockets upon the flooding of Bitcoin ASICs, profitability will drop substantially even for the ASIC miners. The existing GPU-based miners will then leave Bitcoin mining and switch over to alt coin pools increasing alt coin network hashrates, increasing the difficulty, and significantly dropping the profitability. Does this mean that it won't be worthwhile to do any mining very soon? The cost of electricity may make mining unsustainable for many miners. I realize that some of the alt coin prices could increase, but the increase will be entirely offset by the increasing difficulty. Am I being too pessimistic? After all the Bitcoins have been mined, do Bitcoin ASICs become nothing more than really neat looking paperweights and conversation pieces? What are your thoughts on this?

https://www.lloydsshop.com/data/images/515x515/lloyds-paperweight-img13360-161.jpg
http://finalscoreproducts.com/images/8320PaperWeightOceanicAirlines.jpg
http://images1.vat19.com/bulls-eye-pen/paperweight.jpg

The biggest change we will see is a drop in the pps or other payout rates from the pools.
Do your best to maximize your hash rate while minimizing your power consumption; yes this is possible.

[Jaden]

Nice paperweights.   

[rudrigorc2]

Simple: do not sell your coins for less than you think it should be valued at.

[g8bluSti]

I think the asic domino effect will probably kill one or two of the less innovative alt coins.

[klovishey]

Hey, CPU minnig is gone and who cares, why GPU shoud be different? About the alt coins, it will finds the hashrate it is profitable to mine and convert to BTC (only use to mine alt coins) by thosewith cheap electricity and those with expensive electricity will just shut down their GPUs?

[jlsminingcorp]

It depends if you're looking for a quick buck or a long term reward. If you're lucky enough to get an ASIC early on then you're on a winner and will probably make quite a bit of money quite quickly. If you buy when the whole world has got one then as long as you have the most up to date technology then you'll make some steady money, but the ROI may be quite long. I don't think they will kill things.

[JSMill]

After all the Bitcoins have been mined, do Bitcoin ASICs become nothing more than really neat looking paperweights and conversation pieces? What are your thoughts on this?

No, see transaction fees.

[Gabi]

After all the Bitcoins have been mined, do Bitcoin ASICs become nothing more than really neat looking paperweights and conversation pieces? What are your thoughts on this?

You don't even know how Bitcoin works and despite that you are happily judging everything?

[Crindon]

It depends if you're looking for a quick buck or a long term reward. If you're lucky enough to get an ASIC early on then you're on a winner and will probably make quite a bit of money quite quickly. If you buy when the whole world has got one then as long as you have the most up to date technology then you'll make some steady money, but the ROI may be quite long. I don't think they will kill things.

Yeah, you have a point. I would like to hold onto Bitcoins and play long-term, at least for a portion of it.

[Crindon]

Simple: do not sell your coins for less than you think it should be valued at.

Thanks, I agree with this to some extent.

[alinsaviuc]

Transaction fees will go up for sure, to make up for the difference...

[OFtheclique7768]

Transaction fees will go up for sure, to make up for the difference...

What happens when bitcoin distributes another 11 billion coins and then there's no more blocks to get as the maximum coins have been given by the system? What happens then? Do they make more somehow, or the cost rise and it rises too high to the point where no one wants a bitcoin anymore?

[alinsaviuc]

Transaction fees will go up for sure, to make up for the difference...

What happens when bitcoin distributes another 11 billion coins and then there's no more blocks to get as the maximum coins have been given by the system? What happens then? Do they make more somehow, or the cost rise and it rises too high to the point where no one wants a bitcoin anymore?

Probably the transactions fees will go up to get an incentive for miners in order to help secure the network.

[Crindon]

Looks like a good jump in difficulty today 15,605,632.6813. Waiting to see what happens in August and September when a whole flood of Avalon chip-based miners flood the network. GPU miners are already starting to feel the burn.