ASICMINER Speculation Thread

[ianp]

I've got no horse in this race, but I believe BTC's max is currently 7 T/S

Follow-up question -- why is there a 7 transaction/s limit?

10min blocks* -> 6 blocks / hour
(6 blocks / hour)(1 hour / 3600 seconds) = 0.0016667 blocks / second

Max block size = 1 MB
(0.0016667 blocks / second)(1 MB / block) = 0.0016667 MB/s
(0.0016667 MB / second)(1,000,000 bytes / 1MB) = 1666.7 bytes / second

According to dooglus, there are (in*148 + out*34 + 10 plus or minus 'in') bytes in a transaction. This equals a minimum tx size of 180 bytes, and a 1-input 2-output minimum size of 225 bytes. Example.

(1666.7 bytes / second)(1 tx / 180 bytes) = 9.26 tx/s
(1666.7 bytes / second)(1 tx / 225 bytes) = 7.41 tx/s

*Note that an ever-increasing hashrate (like the current scenario) means blocks are generated faster, on average, than once every 10 minutes, and a decreasing network hashrate would slow block creation.

Thanks for the follow-up.

Maybe I'm a bit simple minded, but I do not see how this directly correlates to the BTC USD exchange rate.

I do appreciate the info, however.

[1714663061]

1714663061

[nimda]

Thanks for the follow-up.

Maybe I'm a bit simple minded, but I do not see how this directly correlates to the BTC USD exchange rate.

I do appreciate the info, however.

Visa handles, at peak, ~4000 transactions per second. With Bitcoin, there are multiple solutions, but none of them involve doing nothing and continuing to use the blockchain alone:

- Move most transactions off-chain
- Increase MAX_BLOCK_SIZE
- Increase blocks per day
- Make smaller transactions somehow

[ianp]

Thanks for the follow-up.

Maybe I'm a bit simple minded, but I do not see how this directly correlates to the BTC USD exchange rate.

I do appreciate the info, however.

Visa handles, at peak, ~4000 transactions per second. With Bitcoin, there are multiple solutions, but none of them involve doing nothing and continuing to use the blockchain alone:

- Move most transactions off-chain
- Increase MAX_BLOCK_SIZE
- Increase blocks per day
- Make smaller transactions somehow

What would the net effect be of a 5M max block size, reward halving, and difficulty retarget of 1 block/5 minutes?

Ian

[nimda]

What would the net effect be of a 5M max block size

It would allow for, but not necessitate, 5 times the blockchain size rate of increase and 5 times the transaction rate.

reward halving

The reward has no effect on the block size, except for the fact that it increases the importance of fees.

and difficulty retarget of 1 block/5 minutes?

These are conflicting things. The difficulty retarget happens every n blocks. The block rate is a (blocks / minute) number.

[ThickAsThieves]

So much for the AM speculation thread...

[TaxReturn]

Current Bitcoin can't be sustainably much over $400.

Justification: the 1MB block size limit and the fact that the price has pretty much grown hand in hand with the number of transactions per block (in the long time trend). We have free transactions now (for old enough coins). Eventually a minimum transaction fee for ANY transaction will be several dollars, when the block space scarcity really starts to constrict usage. If BTC adoption grows at the current rate, in a couple of years this scenario is going to be real. This will mean, by the way, that the block subsidy will be insignificant far sooner than most people think. At 20,000 tx/block and $1 fee per tx, assuming $400/BTC and current reward level, fees will be two thirds of total miner revenue.

This gives absolutely no explanation for the $400 figure.

Within the last year the number of transactions per day went from ~40k to ~60k (+50%), in the same time the usd/btc price went from ~6.5usd to ~110usd (+1692%). Stating these two values have "pretty much grown hand in hand" is a lie of epic proportions.

Wild theorizing on my part, take it with a truck load of salt: TX fees will not raise to several usd/tx even if the block size limit was not lifted. The reason is that a majority of all transactions will be relatively small sums and people will simply refuse to pay such high fees. Eventually average small time users would rather drop bitcoin and the network would be left exclusively to the movement of larger sums, this development would rather decrease the number of transactions than increase it.

Again, where does the 400 come from??

[ianp]

What would the net effect be of a 5M max block size

It would allow for, but not necessitate, 5 times the blockchain size rate of increase and 5 times the transaction rate.

reward halving

The reward has no effect on the block size, except for the fact that it increases the importance of fees.

and difficulty retarget of 1 block/5 minutes?

These are conflicting things. The difficulty retarget happens every n blocks. The block rate is a (blocks / minute) number.

Sorry -- I was unclear. I meant adjusting the difficulty to allow for 1 block every 5 minutes, as well as cutting the reward in half. The net effect is the same for miners (ASICMINER), but would this allow for greater throughput?

Ian

[ianp]

So much for the AM speculation thread...

I'm not sure what to speculate about until we figure out why the hashrate is hovering around 10 th/s over the past 24 hours.  

With that said -- the two hour number is ~35 th/s. However, that is a rather small sample size.

[nimda]

I meant adjusting the difficulty to allow for 1 block every 5 minutes, as well as cutting the reward in half. The net effect is the same for miners (ASICMINER), but would this allow for greater throughput?

Ian

Like I said earlier, the reward only affects throughput by affecting change in hashrate and influencing transaction selection.
1 block every 5 minutes would double the possible transactions / second, but it would also double the possible blockchain size increase speed.

[ianp]

I meant adjusting the difficulty to allow for 1 block every 5 minutes, as well as cutting the reward in half. The net effect is the same for miners (ASICMINER), but would this allow for greater throughput?

Ian

Like I said earlier, the reward only affects throughput by affecting change in hashrate and influencing transaction selection.
1 block every 5 minutes would double the possible transactions / second, but it would also double the possible blockchain size increase speed.

Okay, I understand. Thank you for the information.

Ian

[bitfair]

Current Bitcoin can't be sustainably much over $400.

Justification: the 1MB block size limit and the fact that the price has pretty much grown hand in hand with the number of transactions per block (in the long time trend). We have free transactions now (for old enough coins). Eventually a minimum transaction fee for ANY transaction will be several dollars, when the block space scarcity really starts to constrict usage. If BTC adoption grows at the current rate, in a couple of years this scenario is going to be real. This will mean, by the way, that the block subsidy will be insignificant far sooner than most people think. At 20,000 tx/block and $1 fee per tx, assuming $400/BTC and current reward level, fees will be two thirds of total miner revenue.

This gives absolutely no explanation for the $400 figure.

Within the last year the number of transactions per day went from ~40k to ~60k (+50%), in the same time the usd/btc price went from ~6.5usd to ~110usd (+1692%). Stating these two values have "pretty much grown hand in hand" is a lie of epic proportions.

Wild theorizing on my part, take it with a truck load of salt: TX fees will not raise to several usd/tx even if the block size limit was not lifted. The reason is that a majority of all transactions will be relatively small sums and people will simply refuse to pay such high fees. Eventually average small time users would rather drop bitcoin and the network would be left exclusively to the movement of larger sums, this development would rather decrease the number of transactions than increase it.

Again, where does the 400 come from??

I'm also waiting for someone to connect dots here. How exactly does the "transactions-per-time-limit" affect the USDBTC exchange rate?

[ianp]

I'm also waiting for someone to connect dots here. How exactly does the "transactions-per-time-limit" affect the USDBTC exchange rate?

It certainly has a direct correlation to transaction volume, but I'm not seeing anything between BTC and USD.

I may not have enough insight as to why they are related, though.

Ian

[Mastergerund]

The argument is based on the assumption that BTCUSD exchange rate is based on transaction volume (specifically, the likelihood of BTC replacing USD for various transactional sub-economies).  If the transaction volume that BTC can handle is limited, the exchange rate is likewise limited.

Dots well enough connected for you?

I don't accept the underlying assumption, so I'm not overly concerned.

[velacreations]

Hash rate is dropping, competitor pools are increasing, hardware sales are minimal, and the mining dividend is stuck at .015.  If BTC/USD crashes in the next day or so, I am afraid that AM may go to 2.5 or lower.

Seriously, the hash rate looks like something major happened.  I haven't seen any news from Friedcat, but I'm expecting issues at the data center. I certainly hope not, because this is really the wrong time for mining revenue to decrease.

We could be seeing a perfect storm brewing OR it could be nothing, and Friedcat is bringing in loads more TH/s to increase the mining revenue.

So, what do you guys think?  Cash in on some profits before dividend drop or what?  Where will we see the floor by next Sunday?

[ianp]

Hash rate is dropping, competitor pools are increasing, hardware sales are minimal, and the mining dividend is stuck at .015.  If BTC/USD crashes in the next day or so, I am afraid that AM may go to 2.5 or lower.

Seriously, the hash rate looks like something major happened.  I haven't seen any news from Friedcat, but I'm expecting issues at the data center. I certainly hope not, because this is really the wrong time for mining revenue to decrease.

We could be seeing a perfect storm brewing OR it could be nothing, and Friedcat is bringing in loads more TH/s to increase the mining revenue.

So, what do you guys think?  Cash in on some profits before dividend drop or what?  Where will we see the floor by next Sunday?

Every time I try to outsmart something like this in the short-term, I lose. We are flirting with 10 th/s over the past 24 hours, though.

I'm going to ride it until the wheels fall off, or I can pay off my house. Whichever comes first

Ian

[velacreations]

Mining revenue is lower than last week:


Shares on the TAT.AM went for as low as .025!  Bitfunder dropped below 2.8! Can I start freaking out, yet?

[SOSLOVE868]

Hash rate is dropping, competitor pools are increasing, hardware sales are minimal, and the mining dividend is stuck at .015.  If BTC/USD crashes in the next day or so, I am afraid that AM may go to 2.5 or lower.

Seriously, the hash rate looks like something major happened.  I haven't seen any news from Friedcat, but I'm expecting issues at the data center. I certainly hope not, because this is really the wrong time for mining revenue to decrease.

We could be seeing a perfect storm brewing OR it could be nothing, and Friedcat is bringing in loads more TH/s to increase the mining revenue.

So, what do you guys think?  Cash in on some profits before dividend drop or what?  Where will we see the floor by next Sunday?

I am retaining my profit first, because I saw all people holding AM try to hold there ask line very strong ,but there are lack of bids ,I though this ask line will be broken soon if the hash rate not coming back in short time.

[SOSLOVE868]

Mining revenue is lower than last week:


Shares on the TAT.AM went for as low as .025!  Bitfunder dropped below 2.8! Can I start freaking out, yet?

As long as if your selling AM shares at profit level, you should not call it freaking out, but I personally think the difference between bid and ask is mean the ask line is hold by people's will .

[velacreations]

well, I'm freaking out that I didn't sell at 2.9, like some other people around here. 

That ask line is dropping, little by little, we are going to be in the 2.7s in a few hours if something doesn't change.

[velacreations]

I have been watching the buy orders very closely.  They have been extremely weak after the run up to 3.  The demand just isn't there right now, and with today's situation, I don't see demand picking up until we have very positive developments.  Weak dividends are the least of our worries with the hash rates like they are.