hashrate is dropping below prediction

[notme]

Every single other device out there bought today is already unprofitable and will be so until ASIC makers cut their prices at least in half.

So true...  I feel sorry for peoples who still buy 50GH/s miners at twice the price you could get a 60GH/s miner a few months ago...  I would definitely wait for prices to drop before buying another ASIC now.  Being at the end of the line, when you receive your order, you won't make ROI.

The only one thing is that to still be "part of the game" in a few months, you'll need an ASIC.  All the rest will be like having a very power-hungry CPU today.  And I think it's safe to assume that once the difficulty goes up, and people calculate the ROI, then ASIC will just stop selling at the ridiculous prices they are now.  The prices will drop, and ASIC will get faster too.  Until then, as said, the high prices are sustained only because peoples are bad in math and basing their ROI based on today's difficulty, in an dream world where they would get their ASIC tomorrow, with current difficulty.

Aye. Also, think about the fact that ASICs are mostly (or entirely?) sold in usd, so if and while btc/usd goes down they become even more unprofitable at current prices.

So you got difficulty AND btc/usd both directly affecting ROI: diff quickly going up, and btc/usd trending down.

Looking bleak.

ASICMiner is the only one shipping with reasonable lead times.  They sell for BTC.  Anyone selling for USD is only selling you a preorder.

Yeah but they are not exempt from the crime. Take for example the usb miners they are selling right now. Approximately 1btc according to the groupbuy currently ongoing.

1btc = 330mh

That's absolutely ridiculous. That much hashing power with the current (somewhat slowed down) diff rate growth will never generate 1 btc, never ever.

Let's walk through this: http://www.bitcoinx.com/profit/

Let's do it in BTC terms, so set USD/BTC to 1 and price to 1.  Set electrical rate to 0.0009 (about $0.09/KWh).  Set hashrate to advertised 334.  Power Consumption: 2.5 W

Now, let's set profitability decline to 0.05, which is an assumption that we will have a 20x increase in difficulty over the next year.

Hardware break even   1 year, 1 day

Oh, and the ones I have in hand are hashing at 400MH/s, but shhhh.

[lazydna]

Every single other device out there bought today is already unprofitable and will be so until ASIC makers cut their prices at least in half.

So true...  I feel sorry for peoples who still buy 50GH/s miners at twice the price you could get a 60GH/s miner a few months ago...  I would definitely wait for prices to drop before buying another ASIC now.  Being at the end of the line, when you receive your order, you won't make ROI.

The only one thing is that to still be "part of the game" in a few months, you'll need an ASIC.  All the rest will be like having a very power-hungry CPU today.  And I think it's safe to assume that once the difficulty goes up, and people calculate the ROI, then ASIC will just stop selling at the ridiculous prices they are now.  The prices will drop, and ASIC will get faster too.  Until then, as said, the high prices are sustained only because peoples are bad in math and basing their ROI based on today's difficulty, in an dream world where they would get their ASIC tomorrow, with current difficulty.

Aye. Also, think about the fact that ASICs are mostly (or entirely?) sold in usd, so if and while btc/usd goes down they become even more unprofitable at current prices.

So you got difficulty AND btc/usd both directly affecting ROI: diff quickly going up, and btc/usd trending down.

Looking bleak.

ASICMiner is the only one shipping with reasonable lead times.  They sell for BTC.  Anyone selling for USD is only selling you a preorder.

Yeah but they are not exempt from the crime. Take for example the usb miners they are selling right now. Approximately 1btc according to the groupbuy currently ongoing.

1btc = 330mh

That's absolutely ridiculous. That much hashing power with the current (somewhat slowed down) diff rate growth will never generate 1 btc, never ever.

Let's walk through this: http://www.bitcoinx.com/profit/

Let's do it in BTC terms, so set USD/BTC to 1 and price to 1.  Set electrical rate to 0.0009 (about $0.09/KWh).  Set hashrate to advertised 334.  Power Consumption: 2.5 W

Now, let's set profitability decline to 0.05, which is an assumption that we will have a 20x increase in difficulty over the next year.

Hardware break even   1 year, 1 day

Oh, and the ones I have in hand are hashing at 400MH/s, but shhhh.

https://docs.google.com/spreadsheet/ccc?key=0AmXn4BnLUgYsdEF0TUtWUWtUaUUzR1F2aUhEWW9lN2c#gid=0
at 10% every 11days
@ 1btc cost
you break even in a year. -2% for pool fee
keep in mind, last 12 cycles, average 17% increase

10% increase every 11days is optimistic.

[Voodah]

Every single other device out there bought today is already unprofitable and will be so until ASIC makers cut their prices at least in half.

So true...  I feel sorry for peoples who still buy 50GH/s miners at twice the price you could get a 60GH/s miner a few months ago...  I would definitely wait for prices to drop before buying another ASIC now.  Being at the end of the line, when you receive your order, you won't make ROI.

The only one thing is that to still be "part of the game" in a few months, you'll need an ASIC.  All the rest will be like having a very power-hungry CPU today.  And I think it's safe to assume that once the difficulty goes up, and people calculate the ROI, then ASIC will just stop selling at the ridiculous prices they are now.  The prices will drop, and ASIC will get faster too.  Until then, as said, the high prices are sustained only because peoples are bad in math and basing their ROI based on today's difficulty, in an dream world where they would get their ASIC tomorrow, with current difficulty.

Aye. Also, think about the fact that ASICs are mostly (or entirely?) sold in usd, so if and while btc/usd goes down they become even more unprofitable at current prices.

So you got difficulty AND btc/usd both directly affecting ROI: diff quickly going up, and btc/usd trending down.

Looking bleak.

ASICMiner is the only one shipping with reasonable lead times.  They sell for BTC.  Anyone selling for USD is only selling you a preorder.

Yeah but they are not exempt from the crime. Take for example the usb miners they are selling right now. Approximately 1btc according to the groupbuy currently ongoing.

1btc = 330mh

That's absolutely ridiculous. That much hashing power with the current (somewhat slowed down) diff rate growth will never generate 1 btc, never ever.

Let's walk through this: http://www.bitcoinx.com/profit/

Let's do it in BTC terms, so set USD/BTC to 1 and price to 1.  Set electrical rate to 0.0009 (about $0.09/KWh).  Set hashrate to advertised 334.  Power Consumption: 2.5 W

Now, let's set profitability decline to 0.05, which is an assumption that we will have a 20x increase in difficulty over the next year.

Hardware break even   1 year, 1 day

Oh, and the ones I have in hand are hashing at 400MH/s, but shhhh.

http://www.coinish.com/calc/#

This is what I use and consider to be a lot more accurate in terms of predicting diff change.

It uses a formula based on the last 10 changes, so that gives you the lowest possible value of diff growth from today onwards, instead of a random 20x guess (which I think too low).

Your calculator is also not telling you that after that 1 year 1 day you won't generate more than another 0.1-0.2 tops for the rest of eternity. At most with calculator, you will break even.

Using my calculator you won't get ROI even if you were to use lower diff growth rate than the current one !!

Btw, if you already have the units working at home since weeks ago, that's a whole different story.

[Voodah]

10% increase every 11days is optimistic.

It is flat out wrong.

We're currently at 14,36% every 11 days.
 
And once ASIC start shipping by the thousands it will go up up up.. but let's say 18% to be optimistic..

Can you run it with both of those numbers?

[notme]

10% increase every 11days is optimistic.

It is flat out wrong.

We're currently at 14,36% every 11 days.
 
And once ASIC start shipping by the thousands it will go up up up.. but let's say 18% to be optimistic..

Can you run it with both of those numbers?

[Voodah]

10% increase every 11days is optimistic.

It is flat out wrong.

We're currently at 14,36% every 11 days.
 
And once ASIC start shipping by the thousands it will go up up up.. but let's say 18% to be optimistic..

Can you run it with both of those numbers?

Lol, you're being a dumbass.

Read the data. I'm not extrapolating anything.

Using the last 10 diff changes, the daily diff increase is right now of 1.3 %. These are current factual real values !

1.3 x 11 days = 14,36 %

Now go to that spreadsheet, fill in 14,36 instead of the (impossible)10%.

Voila. Unprofitable.

And you would have to be also really stupid to assume diff growth will be reduced by the entry of ASICs... but hey.. w/e go buy some more. I got ASICMiner stock. I profit off people like you.

[notme]

Lol, you're being a dumbass.

Read the data. I'm not extrapolating anything.

Using the last 10 diff changes, the daily diff increase is right now of 1.3 %. These are current factual real values !

1.3 x 11 days = 14,36 %

Now go to that spreadsheet, fill in 14,36 instead of the (impossible)10%.

Voila. Unprofitable.

You clearly don't know what extrapolation is.

In mathematics, extrapolation is the process of estimating, beyond the original observation interval, the value of a variable on the basis of its relationship with another variable.

Extrapolating is exactly what you are doing.

[notme]

And you would have to be also really stupid to assume diff growth will be reduced by the entry of ASICs... but hey.. w/e go buy some more.

And you would have to ignore a lot to come to the conclusion that one company shipping reliably leads to an explosion in hash power while price is falling.  And don't forget they rely on foundries for chips that service customers like Intel, AMD, and Apple.  Good luck getting them to rush your order.

[Voodah]

In mathematics, extrapolation is the process of estimating, beyond the original observation interval, the value of a variable on the basis of its relationship with another variable.

See how dumb you are:

original observation interval =

Using the last 10 diff changes, the daily diff increase is right now of 1.3 %. These are current factual real values !

1.3 x 11 days = 14,36 %

I used the original observation. No estimations here. Try it yourself. Unprofitable.

Now if remember correctly, your calculations are based on: the random assumption on 20x growth in a year. That is an estimate (actually maybe a guess at most..).

[notme]

But, just for kicks, same numbers as before, but instead of 334 (advertised hashrate) and 0.05 (20X increase over a year), I will use 400 (actual hashrate) and 0.025 (a 40X increase).

Hardware break even   1 year, 5 days

[notme]

In mathematics, extrapolation is the process of estimating, beyond the original observation interval, the value of a variable on the basis of its relationship with another variable.

See how dumb you are:

original observation interval =

Using the last 10 diff changes, the daily diff increase is right now of 1.3 %. These are current factual real values !

1.3 x 11 days = 14,36 %

I used the original observation. No estimations here. Try it yourself. Unprofitable.

Now if remember correctly, your calculations are based on: the random assumption on 20x growth in a year. That is an estimate (actually maybe a guess at most..).

Wow.  Where did you get your math training at?  You should ask for a refund.

You are claiming that the past directly predicts the future with a linear relationship.  This will not hold for the reasons I mentioned.

[Voodah]

In mathematics, extrapolation is the process of estimating, beyond the original observation interval, the value of a variable on the basis of its relationship with another variable.

See how dumb you are:

original observation interval =

Using the last 10 diff changes, the daily diff increase is right now of 1.3 %. These are current factual real values !

1.3 x 11 days = 14,36 %

I used the original observation. No estimations here. Try it yourself. Unprofitable.

Now if remember correctly, your calculations are based on: the random assumption on 20x growth in a year. That is an estimate (actually maybe a guess at most..).

Wow.  Where did you get your math training at?  You should ask for a refund.

You are claiming that the past directly predicts the future with a linear relationship.  This will not hold for the reasons I mentioned.

No dumbass. I'm claiming it will (can) not go down below the current level.

Imho it will go up by a lot, but for the sake of optimism I'm assuming it stays the same as today, for a whole year !

If you wanna do your calculations based on the assumption diff growth will reduce, by all means, go ahead.

[notme]

No dumbass. I'm claiming it will (can) not go down below the current level.

Imho it will go up by a lot, but for the sake of optimism I'm assuming it stays the same as today, for a whole year !

If you wanna do your calculations based on the assumption diff growth will reduce, by all means, go ahead.

I see why we are talking past each other.  You are talking about growth rate and I was discussing difficulty level.

I absolutely do want to base my assumptions on difficulty growth not continuing at it's current pace for a full year.  We will see it continue to rise in the short term, but without bitcoin price increases it will taper off.  Yes, if price rises enough to create a new difficulty boom you could indeed lose in bitcoin terms.  Barring that, there should be a gain over just holding tight, IMO.

You are entitled to your opinion, but I would prefer if you stuck to facts and logic instead of ad hominem.

[Voodah]

No dumbass. I'm claiming it will (can) not go down below the current level.

Imho it will go up by a lot, but for the sake of optimism I'm assuming it stays the same as today, for a whole year !

If you wanna do your calculations based on the assumption diff growth will reduce, by all means, go ahead.

I see why we are talking past each other.  You are talking about growth rate and I was discussing difficulty level.

I absolutely do want to base my assumptions on difficulty growth not continuing at it's current pace for a full year.  We will see it continue to rise in the short term, but without bitcoin price increases it will taper off.  Yes, in that situation you could indeed lose in bitcoin terms.  Barring that, there should be a gain over just holding tight, IMO.

You are entitled to your opinion, but I would prefer if you stuck to facts and logic instead of ad hominem.

Facts and logic were thrown your way a plenty, you misread them.

Sorry for going ad hominem on you tho.

[notme]

Facts and logic were thrown your way a plenty, you misread them.

Sorry for going ad hominem on you tho.

Yes I did.  When I get bullied I get defensive and my thoughts aren't as clear.  Now please answer me this:  Who is going to buy all that hardware that is bordering on profitability at current levels?  Certainly people will get stop buying if difficulty continues to rise at the rate you claim.  Won't that slow down growth?

[Voodah]

Facts and logic were thrown your way a plenty, you misread them.

Sorry for going ad hominem on you tho.

Yes I did.  Now please answer me this:  Who is going to buy all that hardware that bordering on profitability at current levels?  Certainly people will get stop buying if difficulty continues to rise at the rate you claim.  Won't that slow down growth?

Well, a few things can happen, but basically ASIC companies have to adapt and respond. They are big market players now, with lots of power.

If people stop buying, ASIC companies have to lower prices (they operate at huge margins when you consider the "burn in's"). Mining profitability increased, people will buy again.

If ASIC companies don't wanna lower their prices, they can put them to mine themselves, we all know they've done it already.. It would be a total mess though..Idk what would happen to btc, prolly not good.

[notme]

Facts and logic were thrown your way a plenty, you misread them.

Sorry for going ad hominem on you tho.

Yes I did.  Now please answer me this:  Who is going to buy all that hardware that bordering on profitability at current levels?  Certainly people will get stop buying if difficulty continues to rise at the rate you claim.  Won't that slow down growth?

Well, a few things can happen, but basically ASIC companies have to adapt and respond. They are big market players now, with lots of power.

If people stop buying, ASIC companies have to lower prices (they operate at huge margins when you consider the "burn in's"). Mining profitability increased, people will buy again.

If ASIC companies don't wanna lower their prices, they can put them to mine themselves, we all know they've done it already.. It would be a total mess though..Idk what would happen to btc, prolly not good.

There are less than 1000 TH combined between all preorders and inventory (in the case of ASICMiner).  Currently the network is hashing at 150 TH/s.  Even if all of it came online, we would be less than 8X current difficulty.  Is there really enough money left to be invested into ASICs to push us past 20X in the next year?  That's another 2000 TH of ASICs that aren't even planned for production yet.

[Voodah]

Facts and logic were thrown your way a plenty, you misread them.

Sorry for going ad hominem on you tho.

Yes I did.  Now please answer me this:  Who is going to buy all that hardware that bordering on profitability at current levels?  Certainly people will get stop buying if difficulty continues to rise at the rate you claim.  Won't that slow down growth?

Well, a few things can happen, but basically ASIC companies have to adapt and respond. They are big market players now, with lots of power.

If people stop buying, ASIC companies have to lower prices (they operate at huge margins when you consider the "burn in's"). Mining profitability increased, people will buy again.

If ASIC companies don't wanna lower their prices, they can put them to mine themselves, we all know they've done it already.. It would be a total mess though..Idk what would happen to btc, prolly not good.

There are less than 1000 TH combined between all preorders and inventory (in the case of ASICMiner).  Currently the network is hashing at 150 TH/s.  Even if all of it came online, we would be less than 8X current difficulty.  Is there really enough money left to be invested into ASICs to push us past 20X in the next year?  That's another 2000 TH of ASICs that aren't even planned for production yet.

1000 TH is way off.

KNCMiner alone has already more than 2600 orders (last time I checked, maybe a week ago, bound to be more now).

The big model has 350 GH/s and the small one 175 GH/s . Lets use that one:

2600 * 0.175TH/s = 455 TH/s

If I do a wild guess and say they sold half and half:

1300 * 0.175 TH/s =  227.5 TH/s
1300 * 0.350 TH/s =  455 TH/s
TOTAL = 682.5 TH/s

That's KNC alone, and they are the newest player, and the ones who've been taking orders for the least time.

[notme]

Facts and logic were thrown your way a plenty, you misread them.

Sorry for going ad hominem on you tho.

Yes I did.  Now please answer me this:  Who is going to buy all that hardware that bordering on profitability at current levels?  Certainly people will get stop buying if difficulty continues to rise at the rate you claim.  Won't that slow down growth?

Well, a few things can happen, but basically ASIC companies have to adapt and respond. They are big market players now, with lots of power.

If people stop buying, ASIC companies have to lower prices (they operate at huge margins when you consider the "burn in's"). Mining profitability increased, people will buy again.

If ASIC companies don't wanna lower their prices, they can put them to mine themselves, we all know they've done it already.. It would be a total mess though..Idk what would happen to btc, prolly not good.

There are less than 1000 TH combined between all preorders and inventory (in the case of ASICMiner).  Currently the network is hashing at 150 TH/s.  Even if all of it came online, we would be less than 8X current difficulty.  Is there really enough money left to be invested into ASICs to push us past 20X in the next year?  That's another 2000 TH of ASICs that aren't even planned for production yet.

1000 TH is way off.

KNCMiner alone has already more than 2600 orders (last time I checked, maybe a week ago, bound to be more now).

The big model has 350 GH/s and the small one 175 GH/s . Lets use that one:

2600 * 0.175TH/s = 455 TH/s

If I do a wild guess and say they sold half and half:

1300 * 0.175 TH/s =  227.5 TH/s
1300 * 0.350 TH/s =  455 TH/s
TOTAL = 682.5 TH/s

That's KNC alone, and they are the newest player, and the ones who've been taking orders for the least time.

Okay
KNC 700
BFL 800 (this lists 408 and some are already deployed, but lets double it for kicks)
AM 200
Avalon 300 (pretty clueless here so I based it on about ~3TH per 10k chip order X 100 orders)

Even if we assume everyone delivers within the next year (Avalon has been iffy lately, and KNC has yet to prove themselves), that is 2000 TH, 1500 of which is already purchased waiting for delivery.  So, we can absorb 500 TH/s of demand before anyone needs to produce another run.  Is there really another 1500 TH worth of demand for miners bordering on profitability?

[Voodah]

Okay
KNC 700
BFL 800 (this lists 408 and some are already deployed, but lets double it for kicks)
AM 200
Avalon 300 (pretty clueless here so I based it on about ~3TH per 10k chip order X 100 orders)

Even if we assume everyone delivers within the next year (Avalon has been iffy lately, and KNC has yet to prove themselves), that is 2000 TH, 1500 of which is already purchased waiting for delivery.  So, we can absorb 500 TH/s of demand before anyone needs to produce another run.  Is there really another 1500 TH worth of demand for miners bordering on profitability?

I get what your saying and if those are the real numbers or even a little below, things may go just a tad smoother.

But still, think about the following. It's not really about any of the companies actually needing to produce another run.

This is a game of profit, for everyone.

As long as there a sliver of profit in mining gear (or even when there is not..), people will buy them.

If buying stalls, ASICs will still want to keep raking profits, so they either lower the price or iterate or both: New Model ! 2x Power, Half Energy Cost, Half Price ! (obviously exaggerating here.)
There's always profit in maximizing efficiency, so there will be demand for that; and remember, we're in version 0.01 of the ASIC era...still lots to learn and improve...

I'd say sooner than later there will definitely be a correction in ASIC prices. These guys profit on sales, not on a stalled market.

That'll keep things moving, and that's really the end scenario imho. As long as there is profit to be made from any party, the market will not stall.