Historical Difficulty Increase last 90 days. 248%

[jhansen858]

Historical Difficulty Increase last 90 days.

30 Day @ 62 % / month
60 Day @ 179% (89.5% per month)
90 Day @ 248 %(82% per month)

- discuss

[Kluge]

It has a long way to go before adjusted for all the pre-orders.

Also, prompt sucks.

[jhansen858]

It has a long way to go before adjusted for all the pre-orders.

Also, prompt sucks.

Not sure I understand.  prompt? 

If we have another run like the last 90 days, we are headed for i predict between 60M and 72M in 90 days(oct 15th). 

[Dagger75]

Yup, with these "Business's" like ASICMiner and 50TH/s+ IPO's going out there won't be much of a "De-centralized  Network" anymore if all us Average joes can't even pay back our equipment we've bought.  With all the Crazy amount of ASIC pre-orders thats are coming out at snails pace and the silly noobs still placing orders everyday no one will make money in the next year except the ASIC sellers.  Does not bode well for Bitcoin if this crap keeps up! 

Us Miners have to standup for Bitcoin and stop the Business Centralization of the Network...don't know how to do it but I really believe things need to go another direction or Bitcoin will have Alot of trouble in the near future.  Any average person can just look at the Pre-order numbers from all the companies as well as the Chips buys...add in the ASICMiners and it equals wayyyy more Network Diff then we can make any profit with.

Sucks, but I swear BFL is purposely sending units at the Snails pace they are, just to Suck more money out of the New "miners" who don't realize what'll happen to the difficulty and their future returns coming up in a few months.  Just my thoughts but feel they are relevant.

[DeathAndTaxes]

"Any average person can just look at the Pre-order numbers from all the companies as well as the Chips buys...add in the ASICMiners and it equals wayyyy more Network Diff then we can make any profit with."

Then don't buy or wait and buy them for pennies on the dollar from discouraged miners who are really bad at math.  I mean people kept buying even knowning that tens (hundreds) of TH/s were ordered ahead of them.  People kept pre-ordering even when the companies fell further and further behind.

In the long run the market will reach equilibrium.  The reality is many who bought ASICs foolishly are never going to make back the cost of their hardware.   The have already lost 30% to 60% of their purchase price they just don't know it yet.

[gdpone]

If nothing else everyone will blow their load on all these first gen ASICs.  Once next gen rolls around and are even more powerful, there wont be as big a buying frenzy I think and they will be able to mine above the difficulty level to make profit.

But I think this was definitely a game where only the original adopters will win.

[Dagger75]

Death&Taxes, what are your thoughts on ASICMiner having 25% of the network ATM and there are sure to be plenty of other Multi-million dollar companies looking to see what they can suck out of the now "Hip" Bitcoin and overload the Network w/ 100's TH/s each?  There won't be the 20K-30K of individual miners making up a diverse network in that atmosphere.  Would cost too much money to mine.

Maybe I'm just feeling discouraged by all this but I sure don't think it looks good for Bitcoin over the next couple of years....very long time for Bitcoin.  Again, these thoughts are Just my Opinions and Concerns...

[DeathAndTaxes]

Death&Taxes, what are your thoughts on ASICMiner having 25% of the network ATM and there are sure to be plenty of other Multi-million dollar companies looking to see what they can suck out of the now "Hip" Bitcoin and overload the Network w/ 100's TH/s each?  There won't be the 20K-30K of individual miners making up a diverse network in that atmosphere.  Would cost too much money to mine.

Maybe I'm just feeling discouraged by all this but I sure don't think it looks good for Bitcoin over the next couple of years....very long time for Bitcoin.  Again, these thoughts are Just my Opinions and Concerns...

I never got this "it costs to much to mine" concept.  It reeks of those bad at math.  Take BFL lineup a Jalapeno is almost as efficient.  If it "cost to much to mine" with a Jalapeno then it "costs to much to mine with a private 100TH/s company as well.  If by "costs to much to mine" you mean "I can't spend $1K in hardware and making $100K a year in profit forever" well your right but those that believed that were just dumb.

ASICMiner only has 25% of marketshare because BFL and Avalon have failed to delivery in volume.  If even half of BFL pre-orders had shipped then ASCIMiner's share would be more like 10% to 15%.

[kevinnem]

I think part of the discussion missing here, is the assumptions of current, historical, and future exchange rate of bitcoin and usd(or what ever fiat)

you see if price goes up to 1 btc = 300usd, that is a different situation then if 1 btc goes down to 50 .....

I would think in the long term the suck-fixed cost of aquireing bit coin will pale in compareision to the exchange rate change, . be it up or down.

[DeathAndTaxes]

I think part of the discussion missing here, is the assumptions of current, historical, and future exchange rate of bitcoin and usd(or what ever fiat)

you see if price goes up to 1 btc = 300usd, that is a different situation then if 1 btc goes down to 50 .....

I would think in the long term the suck-fixed cost of aquireing bit coin will pale in compareision to the exchange rate change, . be it up or down.

The future exchange rate is irrelevent from the standpoint of "should I buy new hardware" because you always have the choice of simply buying Bitcoins instead.

Some made up numbers to illustrate the point.

Say you could buy a "x brand" ASIC today it would cost 100 BTC.  However due to rising difficulty it will only produce 90 BTC over the next two years before it is obsolete.  Now lets also say the current exchange rate is $100 and two years from now it is $500.  You likely are thinking "but wait I paid 100 * $100 = $10,000 and will get 90 * 500 = $45,000 so I come out head".  While true in dollar terms you don't know the exchange rate *will* rise to $500, it could instead drop to $50.  Your gain isn't from mining but merely speculation.  To speculate on future exchange rates one could generate a larger gain with lower risk by simply buying and holding BTC instead of buying hardware. Buying 100 BTC will be worth 100 BTC in two years.  This is better than paying 100 BTC for hardware that will produce 90 BTC into two years. 

[jhansen858]

So if the asics are getting released at a steady pace, shouldn't the difficulty increase each retarget go down?  if I introduce 10 more hashing power bringing the total to 100 for an increase of 10%, next week i introduce 10 more hashing power for a total of 110 and an increase of 9%.  Shouldn't we be seeing reducing increases each retarget unless the amount of released hash power increases each retarget?  Point is, the difficulty increases we have seen simply cant continue to be this high unless the rate of new hash releases is increasing??

[DeathAndTaxes]

So if the asics are getting released at a steady pace, shouldn't the difficulty increase each retarget go down?  if I introduce 10 more hashing power bringing the total to 100 for an increase of 10%, next week i introduce 10 more hashing power for a total of 110 and an increase of 9%.  Shouldn't we be seeing reducing increases each retarget unless the amount of released hash power increases each retarget?  Point is, the difficulty increases we have seen simply cant continue to be this high unless the rate of new hash releases is increasing??

If steady pace yes but there is a massive amount of pre-orders something on the order of 4,000 TH/s.  So if all of that was released today we would expect difficulty to spike up to 600M or so (within the limits of max 4x per difficulty adjustment).  There is no guarantee that the rise will be slow and decreasing.  It might come is some giant waves.  For example if you are to believe BFL they have some supply chain issues, say they resolve it and their delivery rate (which is abysmally slow) jumps by a factor of 10 and then within a few months by a factor of 50.  It will still takes months (maybe a year) to deliver all those pre-orders (the vast majority are already "dead money" regardless) so you would see the trend upward accelerate not decelerate.

[Operatr]

Bitcoin needs to have some fat rallies to support the rapid climb in hashpower/difficulty, or ROI will suffer until it does.

It seems dire, but remember that Bitcoin's value increased 722% in the first half of the year, right as ASICs started to hit the network, and GOX decided to freeze USD withdrawls that stifled trading (also a good thing so people start using other exchanges). Ben Bernake's announcements a few days ago also caused a slide in USD/BTC as this pair actually has a freakishly close relationship.

I am siding on the idea that the state of the world at the moment will push Bitcoin again to new highs soon enough and miners won't see their investments evaporating any longer.


I try not to look at the hashpower increase like a bad thing. What this means is that the Bitcoin network is rapidly becoming more distributed and secured with professional grade hardware, which is needed if this is to be the banking system of the future. We can't rely on cobbled together rigs on basement floors that look like a fire in the making forever. Every drop of ASIC power makes the whole network stronger. Pro-miners dropping large investments will keep them invested long term, which means the network becomes more stable and solidified as well long term.

On this level, the rise in hashpower is phenomenal and really speaks on how much support and interest there is behind this technology. Mining ROI is taking it in the pants at the moment, but won't be forever. This is the time for patience, Bitcoin has some surprises in store I think