ASICS killing BTC ?

[Rinorbirch]

The difficulty will increase also if hash power increase. So, I don't think ASICS will be able to kill BTC.

[Littleshop]

I don't see ASICs killing BTC.  There's a growth problem right now.  ASICs start expensive and get cheaper.  As a result, you see an early concentration.  This is why I'm very happy with ASICMINER's cheaper price point for the USB Erupters.

They are not a great investment.  There's still a reasonable chance that even at 1 BTC they will not make a full return on the investment.  But there is a chance.  Meanwhile, they're an extremely low barrier to entry mining device.  330 MH/s isn't a lot in the scheme of things...until you have tens of thousands of them distributed all over like we do today.  BTC Guild alone has sold over 2,000 in 5 days.

Once you have one, you never have a reason to turn it off.  It's extremely unlikely that they will hit a point where they cost more to run than they generate at 2.5w each.  They're a small step towards decentralization, and you can expect as ASICs mature there will continue to be more low level offerings.  They won't have the RoI of the bigger units, but they will help keep the hash rate from being fully concentrated in massive mining farms.

This. Those USB thingies are the real deal in terms of BTC decentralization. Plus, they are absolutely the best way to "spread the Bitcoin word".

Nope.  If ASICminer was not mining they would be, but for each USB stick you buy from them, they can add many times that in hashing power to their own farm.  At BEST you are just allowing them to place more hashing power online without taking 51%, at worst the majority of the network.

[bigdata]

Everyone buy an ASIC - so it won't break Bitcoin - same way as GPU/FPGA-Hashing appeared...

[sidhujag]

Like i said before asics will be available at 1/10th the original retail price... that is the point at which asic ppl will give up and the long term visionaries who are not there to make a quick buck stick around and wreap the real profits as btc will become viable as a long term investment. At that point im not sure what the ground will be on btc could be $10 or $50.. but looking at the asic community for the fear index denoted in cost to buy an asic.

[Impaler]

I think Mr Kaminsky really screwed up in this prediction. Miners have way too much invested to switch from the current function, it will be nearly impossible to build up an alternative mining infrastructure that can be as secure as the current one quickly enough to just switch to it, and besides, Gavin has absolutely no interest in switching the algorithm, either. He specifically said so when asked about that article.

Kaminsky's prediction can come to pass by LTC simply superseding BTC as the dominant coin, and that is in fact the most likely scenario for that to happen due to resistance of BTC developers and BTC miners to consider any change in hash protocol.

Personally I believe the current dynamic we are seeing in the BTC price decline has nothing to do with government regulation, Gox or ASICs, its just the final stage of the deflation of the bubble and it will bottom out in the $10 to $30 range following a curve much like that after July 2011.  But unlike 2011 BTC now has a competitor that is showing independent and stable valuation, that presents a huge risk that BTC won't rebound in value as people have other coins to put their money in.

Now you might argue that their are all these SHA dedicated ASICs in existence now that can't move into LTC so they will just keep mining BTC and all those ASICS have sooooo many more hashes and are more 'secure' then LTC.  This is correct on the surface but irrelevant, coins derive their exchange value from the number of USD that people are offering for the coins divided by the number of coins offered for sale, past expenditure of 'Work' are irrelevant.  If the number of dollars that want LTC exceeds the dollars that want BTC then LTC will be worth more and will be the 'growth' coin.

Already total LTC mining revenue is 27% of BTCs, and if LTC maintains it's current price and BTC declines to the $20 point then the two coins would be at equal mining revenue.  If we see any kind of significant increase in LTC value following the highly anticipated (and hyped) inclusion of it on Gox then the cross over can occur with very little further decline in BTC valuation.  Their is also likely a zero-sum game here too, the customer base for BTC and LTC are nearly identical and it's likely that their is a limited pool of dollars and that a boom in one coin will always result in a slump in others.  A very large boom in LTC could cause such a drying up of dollars offered for BTC that it collapses down to levels that are effectively fatal as they will permanently remove the perception of BTC as a viable long term investment.

[d'aniel]

Every time the price dips on the exchanges, a new batch of boogeyman-seeking posts escape the speculation board and end up here.

Not long ago, the preferred boogeyman was "the manipulator".  This week, looks like ASICs are taking the heat.  Next week, it'll be the Winkelvoss twins, or the NSA, or the flying spaghetti monster.

Einstein was wrong, compound interest isn't the most powerful force in the universe.  That crown belongs to the insatiable hunger of the human mind for finding false causes for chaos.

I really appreciate you being here

[Rassah]

the customer base for BTC and LTC are nearly identical

How do you figure? Bitcoin customers include those who use BitPay with all their businesses, and Gyft with all their businesses, among others. I don't know of many Litecoin customers aside from Thepiratebay and their donors.

[Impaler]

the customer base for BTC and LTC are nearly identical

How do you figure? Bitcoin customers include those who use BitPay with all their businesses, and Gyft with all their businesses, among others. I don't know of many Litecoin customers aside from Thepiratebay and their donors.

Sorry I should have been more precise and said speculators rather then customers, I call people who spend coins users and BTC indeed still has a larger user base, but because prices in the BTC economy are in USD the user base has no net effect on valuation.  The pool of people who buy coins from exchanges for purposes of speculation (allong with miners) are the ones that set a coins valuation and they can very easily move to a different coin, just about anyone who speculates in BTC would be willing and able to buy LTC as they already have all the skills & knowledge necessary to do so, much like a customer for one car is potentially a customer for any other.  Because ALL coins value is almost entirely speculative right now the degree of penetration with merchants is not really relevant to valuation in my view.

[stdset]

fatal as they will permanently remove the perception of BTC as a viable long term investment.

Do you think, in that case, LTC could be percieved as a viable long term investment?

[Albert Speer]

No we are all fine.

[PrintMule]

These asics are not interested in breaking bitcoin themselves, so if they mine, they will try to distribute their hashing speed on ifferent pools and etc. Otherwise they will LOSE IT ALL too.

Bitcoin will survive and have stable network doing those calculations. It's only that mining for simple basement dwellers becomes dead. And opportunistic fiat flowing into bitcoin slows down, lowering the price at that.

Only thing I would like to see - lesser reward for block in next 4 months, so those asics don't get to print too much money daily. They should be awarded with ~25% over their electricity and maintenance costs, not more.

[Littleshop]

These asics are not interested in breaking bitcoin themselves, so if they mine, they will try to distribute their hashing speed on ifferent pools and etc. Otherwise they will LOSE IT ALL too.

Bitcoin will survive and have stable network doing those calculations. It's only that mining for simple basement dwellers becomes dead. And opportunistic fiat flowing into bitcoin slows down, lowering the price at that.

Only thing I would like to see - lesser reward for block in next 4 months, so those asics don't get to print too much money daily. They should be awarded with ~25% over their electricity and maintenance costs, not more.

The golden rule of Bitcoin is do not change the block reward structure Satoshi originally setup.   Changes in protocol,upgrades and tweeks are fine but not to deviate from the original Satoshi money supply. 

[NWO]

The companies which build the ASIC's are killing bitcoin. Look at BFL for example. They are using everyone's 'pre-order' money to build their own machines and then rape bitcoin themselves, only shipping when the difficulty goes too high.

[PrintMule]

The companies which build the ASIC's are killing bitcoin. Look at BFL for example. They are using everyone's 'pre-order' money to build their own machines and then rape bitcoin themselves, only shipping when the difficulty goes too high.

but they do not rape bitcoin bitcoin still works

[hate_the_face]

they're raping the original intentions behind it

[DeathAndTaxes]

Only thing I would like to see - lesser reward for block in next 4 months, so those asics don't get to print too much money daily. They should be awarded with ~25% over their electricity and maintenance costs, not more.

They will.  Difficulty will keep rising until the ROI% over capital and electricity is low.  The block subsidy will not change until block 420,000 when it drops to 12.5 BTC.

[Hippie Tech]

they're raping the original intentions behind it

So how do we take our Decentralized Revolution back ?

Want to slow these asics down ? SOLO MINE.

If just 25% of the sha-256 and scrypt hashpower was to suddenly switch to soloing BTC or one giant GPU only pool, what would that do to the asic hoarder's getwork/s rate ?

Like a swarm of locusts..

HT xD

[Littleshop]

they're raping the original intentions behind it

So how do we take our Decentralized Revolution back ?

Want to slow these asics down ? SOLO MINE.

If just 25% of the sha-256 and scrypt hashpower was to suddenly switch to soloing BTC or one giant GPU only pool, what would that do to the asic hoarder's getwork/s rate ?

Like a swarm of locusts..

HT xD

Not much and that is the point of ASICs.  They so totally eclipse the power of GPU's that GPU's become irreverent.  This would be OK if ASICs were evenly distributed but they are not. 

We gain very little in security with a high hash rate if it is all controlled by one or two entities.  Security is a high enough hash rate that it is hard to mount a 51% attack AND that hash rate being distributed across many different unconnected people and groups.  I do not think litecoin is better then bitcoin, but right now litecoin would be harder to do a 51% attack on then BTC.  This is because one way to do a 51% attack is to compromise existing (concentrated) hashing power, not just adding new hashing power to compete. 

The second issue of course is that many small GPU and CPU miners were interested in bitcoins.  They are the ones that purchased stuff through me and others and spent BTC vs just cashing it out.  Large consolidated miners cash out, and do so in volume as they get coins.  We can all see what this does to the price. 

[teflone]

Asics will continue to devalue bitcoin, plain and simple..

People did not buy asics to secure network, they bought it to make money..

Asics owners are selling their coin to recoup the cost of the asic themselves..   

More and more asic owners will continue to put downward pressure on the market..
Not to mention BFL selling all the coins they have been mining with the asics they are selling as "NEW"



This is not hard to understand people.. 

[bitcoinator]

It is just a bubble burst. That would have happened even if there were no ASICs at all. People are spending money on their vacations now. I expect speculative pumps and dumps during summer. Then people will come back with their money and start buying again thus stabilizing the price. I hope so