Difficulty jumps 28%

[SGExodus]

It would appear Avalon stopped new orders on units...maybe BFL should stop also?

With the climbing difficulty there comes a point that the cost of a BLF unit will never be returned to a miner even at very high BTC rates.

That point is fast approaching if not here now.

Because of climbing difficulty in 8 months a 50 Gh single will not even produce enough BTC to cover the cost of electric and therefore be near worthless with little to no resale value.

By massive production of hash rate introduced to the public it appears the hardware producers (all of the asics producers) have manufactured their own obsolescence.

Thoughts?

The mark up on the chips are very high, so they are already making handsome profits.     In addition, they sit on the orders, and mined with customer equipment to double/triple their profits.

In the future, they will just market the next generation ASIC with higher efficiency and slightly lower cost, and they will be able to start the pre-order + bulk buy scam all over again to reap even more money from the community. 

They are smart people.  Don't need to worry for them

[1714605176]

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[1714605176]

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[larem]

With the climbing difficulty there comes a point that the cost of a BLF unit will never be returned to a miner even at very high BTC rates.

The problem is most people don't know the first thing about economics. Look at it like this:

You have spent $1,000 for your ASIC. It is generating 1 BTC a month that right now is worth $10. In a year, you've earned $120. Now you are earning 0.5 BTC but the price of each BTC has gone up to $1,000. So now you are earning $500 a month. You've "recouped" your initial investment now in 14 months, right? Wrong!

Instead of spending $1,000 on that ASIC, you could have bought 100 BTC's at $10 each. Now, 14 months later, you have not broken even on your $1,000, but you instead have $100,000, 100 times your initial investment.

This is what people are failing to realize. They are considering how many BTC they get, vs. what they may be worth in the future, but the fact is that they would be earning a LOT more if they had spent their money to buy BTC outright and held it. Not to mention they would have their stuff right that second, instead of waiting it out.

People who paid, say 100 BTC back when they were $2 each for an ASIC are happy because they have made a few hundred in profit. If they had held those same 100 BTC, they would be worth $10,000+ now. In essence, they have lost money by getting ASICs.

[MooC Tals]

With the climbing difficulty there comes a point that the cost of a BLF unit will never be returned to a miner even at very high BTC rates.

The problem is most people don't know the first thing about economics. Look at it like this:

You have spent $1,000 for your ASIC. It is generating 1 BTC a month that right now is worth $10. In a year, you've earned $120. Now you are earning 0.5 BTC but the price of each BTC has gone up to $1,000. So now you are earning $500 a month. You've "recouped" your initial investment now in 14 months, right? Wrong!

Instead of spending $1,000 on that ASIC, you could have bought 100 BTC's at $10 each. Now, 14 months later, you have not broken even on your $1,000, but you instead have $100,000, 100 times your initial investment.

This is what people are failing to realize. They are considering how many BTC they get, vs. what they may be worth in the future, but the fact is that they would be earning a LOT more if they had spent their money to buy BTC outright and held it. Not to mention they would have their stuff right that second, instead of waiting it out.

People who paid, say 100 BTC back when they were $2 each for an ASIC are happy because they have made a few hundred in profit. If they had held those same 100 BTC, they would be worth $10,000+ now. In essence, they have lost money by getting ASICs.

This is only true in hind sight. Very easy to say now. Uncertainty and risk can move this the other way now. Although you are correct how many are applying this with alternates now. I believe all alternates are not being purchased with cash but most are with existing btc that have already gained in price.

[larem]

With the climbing difficulty there comes a point that the cost of a BLF unit will never be returned to a miner even at very high BTC rates.

The problem is most people don't know the first thing about economics. Look at it like this:

You have spent $1,000 for your ASIC. It is generating 1 BTC a month that right now is worth $10. In a year, you've earned $120. Now you are earning 0.5 BTC but the price of each BTC has gone up to $1,000. So now you are earning $500 a month. You've "recouped" your initial investment now in 14 months, right? Wrong!

Instead of spending $1,000 on that ASIC, you could have bought 100 BTC's at $10 each. Now, 14 months later, you have not broken even on your $1,000, but you instead have $100,000, 100 times your initial investment.

This is what people are failing to realize. They are considering how many BTC they get, vs. what they may be worth in the future, but the fact is that they would be earning a LOT more if they had spent their money to buy BTC outright and held it. Not to mention they would have their stuff right that second, instead of waiting it out.

People who paid, say 100 BTC back when they were $2 each for an ASIC are happy because they have made a few hundred in profit. If they had held those same 100 BTC, they would be worth $10,000+ now. In essence, they have lost money by getting ASICs.

This is only true in hind sight. Very easy to say now. Uncertainty and risk can move this the other way now. Although you are correct how many are applying this with alternates now. I believe all alternates are not being purchased with cash but most are with existing btc that have already gained in price.

I brought this up because of the number of people willing to throw, say 300 BTC in to a 72 GH/s ASIC and claiming it will get them a positive ROI. They are making that decision based on the assumption that BTC will be going up in value, but if that's true they will still have earned more by keeping the 300 BTC. The only way to get a true positive ROI out of the investment is not to receive the amount that was paid (in this case we'll say $30,000), but rather 300 BTC. It doesn't matter if BTC goes up to $50,000,000, if the ASIC does not earn the same amount of BTC that was put in to it, the investor has lost money.

[zvs]

 I am guessing this 19 million thingy will stop here for another while? How long until we see 20 million+? so whens the next jump I started out on this march madness and was 9 million or so , now 19 million I think I was a 'wee' bit late

here, what i posted on june 16th:

It'll go up 20%, 25% or more for the next few cycles.  Then eventually the hobbyists will stop spending all their excess cash and the difficulty level won't increase as much.

all the prices for ASICs and such I have seen lately are ludicrous

but I applaud the business savvy of those folks that have sold/are selling their avalon 2's atm

wtf thinking it would stay at 19m?

[ujka]

This isn't technically true - if the network has rate doubles before the next difficulty readjustment block then you'll see ~7000 BTC/day.  As it stands difficulty seems to be lagging a fair bit behind so we're likely getting ~400 BTC/day on average.
Let me know if I'm wrong here.

That's why I don't tend to calculate btc/day, but rather btc/retarget, and retarget is 2016 blocks. no matter how many days.
btc/retarget = myHashes * 600 (seconds) * 2016 (blocks) * 25 (reward)  / 2^32 / diff

Is this formula right?

[Shimple]

The best part is that, most consumers still don't have their hand on ASIC.

ASICMiner and other private equity folks are happily printing money, while the rest of the forumers continue to get screw by pre-order delays

Exactly lol. All the delay stories are the companies mining away themselves. Funny huh?

[Frizz23]

Exactly lol. All the delay stories are the companies mining away themselves. Funny huh?

Bitcoin should change the hashing algorithm (from SHA-256 to SHA-512 or Scrypt or ...) to show those fuckers this here:



Bitcoin was meant to be democratic and decentralized. What we see since about 1/2 year is quite the opposite development: Bitcoin becomes more and more Bankster-like.

[Operatr]

Exactly lol. All the delay stories are the companies mining away themselves. Funny huh?

Bitcoin should change the hashing algorithm (from SHA-256 to SHA-512 or Scrypt or ...) to show those fuckers this here:



Bitcoin was meant to be democratic and decentralized. What we see since about 1/2 year is quite the opposite development: Bitcoin becomes more and more Bankster-like.

Profitability is tanking because of the combined greed of miners and these companies, the problem will correct itself in time when the hashpower plateaus, because why would you buy a miner now that the ROI is nowhere near what it was. Sales of these things will flatline along with it.

Unless Bitcoin increases in value dramatically nothing good will come of all this. Gold Rush 2.0, get ready to see some digital ghost towns appear

[MooC Tals]

Exactly lol. All the delay stories are the companies mining away themselves. Funny huh?

Bitcoin should change the hashing algorithm (from SHA-256 to SHA-512 or Scrypt or ...) to show those fuckers this here:



Bitcoin was meant to be democratic and decentralized. What we see since about 1/2 year is quite the opposite development: Bitcoin becomes more and more Bankster-like.

Profitability is tanking because of the combined greed of miners and these companies, the problem will correct itself in time when the hashpower plateaus, because why would you buy a miner now that the ROI is nowhere near what it was. Sales of these things will flatline along with it.

Unless Bitcoin increases in value dramatically nothing good will come of all this. Gold Rush 2.0, get ready to see some digital ghost towns appear

Yea you got the greed part right! What they should have done was come out slowly with USB sticks first where you could run along side with GPU's with out the power consumption. To be honest I don't think it matters anymore or I just don't give a shit. Bitcoin is going down the wrong path and we will see by the end of the year what that means.

Either way very interesting drama and I wonder if the next jump will look like the one we just saw.

[DPoS]

just because the mining has turn into the sport of kings doesn't mean btc itself just dies..  that is pretty self serving to say that.  You must be the ones that mine alt coins and try to pump and dump all of them..

if you are sick of the mining game, then create services or retail that deals in btc and get your btc that way..  you don't have to just mine and dump

stop thinking you all are saints if you can't see past your own greed

[zvs]

i think bitcoin price will keep falling as long as ppl keep buying overpriced asics and then think they can "pay it off" by mining with it at 50 trillion difficulties

[glon]

i think bitcoin price will keep falling as long as ppl keep buying overpriced asics and then think they can "pay it off" by mining with it at 50 trillion difficulties

I'm thinking exactly the same thing. In fact the recent fall from ~130 to ~100USD pretty much corresponds to the onset of ASICs.

Mining/speculation is a HUGE part of the market.

[zvs]

i think bitcoin price will keep falling as long as ppl keep buying overpriced asics and then think they can "pay it off" by mining with it at 50 trillion difficulties

I'm thinking exactly the same thing. In fact the recent fall from ~130 to ~100USD pretty much corresponds to the onset of ASICs.

Mining/speculation is a HUGE part of the market.

I think that trend will continue, too  

well, I was wrong about difficulty, anyway... it's going to go up like 11%, not 20%.. so I guess I'll leave the GPUs I have left going as I sell them off, well.. I'm also basing it off a price of $95, which I think will drop more...  too many people still trying to "pay off" those overpriced ASICs from asicminer... but @ $95, it's about $40/mo for ghash, after elec

(if it had gone up like 25% or so, i think i'd just shut them off, possibility of equipment failure + my time spent == greater than what I get from it, etc)

[MooC Tals]

i think bitcoin price will keep falling as long as ppl keep buying overpriced asics and then think they can "pay it off" by mining with it at 50 trillion difficulties

I'm thinking exactly the same thing. In fact the recent fall from ~130 to ~100USD pretty much corresponds to the onset of ASICs.

Mining/speculation is a HUGE part of the market.

I was predicting this happening to my self a while ago. My thoughts were along the line of 'easy come easy go' and anyone who does not have sufficient amount of money will tend to hold it stronger.

So if we have Asic's coming in thinking this is easy money they will trade it much easier. If this begins to happen then BTC drops and scares the rest in selling before it drops further.

I also believe a great deal of ASIC purchaser are new to the game and will not hold. With the first dump being the cashing out to pay for the units before they become useless.

After the easy money is over with the plateauing of difficulty then prices will rise. Before this Litcoin will increase to 10 dollars and that will pull a great deal of attention from Bitcoin.

Nevertheless Bitcoin will drop, as for a guess I suspect 65-75-85 range. Who knows?

[ujka]

During that 28% jump, and the next (24%), network hashrate increased for about 60 Thash.
I'm trying to figure out who put that new hashing power online.
Acording to http://www.asicminercharts.com/, ASICMiner increase is about 20T in that period. In that time Avalon shipped a few batch 2 units, and BFL some (hundreds?) jalapenos. That would be 10 T tops, I think.
Where did the rest, 30 T of that new power come from?
And still hashing online.

[MooC Tals]

During that 28% jump, and the next (24%), network hashrate increased for about 60 Thash.
I'm trying to figure out who put that new hashing power online.
Acording to http://www.asicminercharts.com/, ASICMiner increase is about 20T in that period. In that time Avalon shipped a few batch 2 units, and BFL some (hundreds?) jalapenos. That would be 10 T tops, I think.
Where did the rest, 30 T of that new power come from?
And still hashing online.

Remember not all asic miners are going to pools. I really don't know if it's greed or maybe just being bashful of possessing a large hasher. So how do you gauge solo miners out there?

Anyone know?

[ujka]

During that 28% jump, and the next (24%), network hashrate increased for about 60 Thash.
I'm trying to figure out who put that new hashing power online.
Acording to http://www.asicminercharts.com/, ASICMiner increase is about 20T in that period. In that time Avalon shipped a few batch 2 units, and BFL some (hundreds?) jalapenos. That would be 10 T tops, I think.
Where did the rest, 30 T of that new power come from?
And still hashing online.

Remember not all asic miners are going to pools. I really don't know if it's greed or maybe just being bashful of possessing a large hasher. So how do you gauge solo miners out there?

Anyone know?

Wasn't talking about pools.
Total network hashrate increased for 60T, and there is only about 30T of that hash power that we can say we know the source (ASICMiner + Avalon batch 2 + BFL). And that other 30T?

About gauging solominers: http://blockorigin.pfoe.be/top.php. No data for 7.94% network hashrate. Increased 2% last week.

[Eastwind]

About gauging solominers: http://blockorigin.pfoe.be/top.php. No data for 7.94% network hashrate. Increased 2% last week.

The unaccounted for mining power is worrying. That could be the potential source of attack. If the accounted for mining power is increasing faster, that is reasurring.

[MooC Tals]

Has anyone notice other than me that this is exponential?

What I mean here is that you need new hardware sooner and you get less time to make your money back. Also the new hardware needs to be 1000 times more powerful.

To make things worse less people get a chance at this every tech cycle. These trends are very disturbing.

Hey has anyone figured out where that 9% of unaccounted hashing power is coming from?