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film2240
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July 05, 2011, 04:59:01 PM
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I'm not sure if I'm posting this in the right section (if not then please move it to the proper section) but have you guys noticed how btc is losing it's value in the past week or so.is this normal?Is this by design in btc or something else that's going on?

Because the other day I was set to make £10 from 1BTC mined (about $16.09) I think and then it suddenly dropped,at least that's what I saw on bitcoins.lc frontpage where it tells me the value.

is this site wrong on it's information? If you know of a more reputable and easy to understand source of information on this can you please tell me? As I'm quite worried that I'm mining at the moment,the difficulty is getting harder yet the value doesn't seem to reflect this.Maybe if some miners quit the difficulty will drop,but that only drops the difficulty though,not raise it's value (unless I'm wrong on that one)I think.

can someone who is more experienced with btc tell me what they think is going to happen with btc?can it recover after a dip like this? or will things only go downhill from here based on what they know?

What about the difficulty?as that affects mining.Can the difficulty drop as well as rise? or can it only get harder to mine?


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July 05, 2011, 05:30:14 PM
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The value of the BTC w.r.t. major currencies is completely determined by market mechanisms. If many people want to buy bitcoins, the value rises, if many people want to get rid of them, the drops. So, the value is not determined by any 'design'. Instead, it is mostly determined by people's interests.

If the value of the bitcoin continues to decrease, less people will be interested in mining. As a result, the total mining capacity in the network will descrease, and the difficulty will decrease as well. Because of this, mining will automatically become cheaper. The opposite is also true: with increasing bitcoin value, the mining costs will also increase. As a result, mining will always remain a little bit profitable if you know how to do it efficiently.

Other miners are your competitors, and if they do it smarter than you, then you probably won't be able to make it profitable for yourself.

(I'm a newbie. Please correct the above if I'm wrong.)

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film2240
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July 05, 2011, 05:42:03 PM
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The value of the BTC w.r.t. major currencies is completely determined by market mechanisms. If many people want to buy bitcoins, the value rises, if many people want to get rid of them, the drops. So, the value is not determined by any 'design'. Instead, it is mostly determined by people's interests.

If the value of the bitcoin continues to decrease, less people will be interested in mining. As a result, the total mining capacity in the network will descrease, and the difficulty will decrease as well. Because of this, mining will automatically become cheaper. The opposite is also true: with increasing bitcoin value, the mining costs will also increase. As a result, mining will always remain a little bit profitable if you know how to do it efficiently.

Other miners are your competitors, and if they do it smarter than you, then you probably won't be able to make it profitable for yourself.

(I'm a newbie. Please correct the above if I'm wrong.)

Wow,that was a very good explanation cjp.At least i know why bitcoins lose and gain value as well.
as my way of saying thanx,I'd like to give you a link to my blog :
www.film2240.wordpress.com if you like it ,please spread the world

and I'll PM you something else as well.So make sure to check your PM

UPDATE:offending text removed about the donation request.I apologise as this was written in error.

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FreeMoney
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July 05, 2011, 06:40:57 PM
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Damn, I hope that doesn't become standard. Thanking people with a (broken) link to your blog and a request for donations?  Huh

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July 05, 2011, 06:52:52 PM
 #5

Here's a cartoon showing what is going on:



Just replace "a stock" with "bitcoins".

film2240
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July 05, 2011, 07:01:35 PM
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Damn, I hope that doesn't become standard. Thanking people with a (broken) link to your blog and a request for donations?  Huh


Thank you for pointing that out Freemoney.The request for donations was written in error and am sorry for any offence that this may have caused.The offending text will be removed asap and the broken link corrected.

UPDATE:The offending text has now been removed and the link is now functional (I hope)


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July 05, 2011, 07:13:03 PM
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Damn, I hope that doesn't become standard. Thanking people with a (broken) link to your blog and a request for donations?  Huh


Thank you for pointing that out Freemoney.The request for donations was written in error and am sorry for any offence that this may have caused.The offending text will be removed asap and the broken link corrected.

UPDATE:The offending text has now been removed and the link is now functional (I hope)

I don't care (not that it matters what I think) if you want to promote your blog, but to pretend it's a thank-you gift is weird.

No problem, no offense taken.

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July 05, 2011, 07:13:38 PM
 #8

can someone who is more experienced with btc tell me what they think is going to happen with btc?can it recover after a dip like this? or will things only go downhill from here based on what they know?

What about the difficulty?as that affects mining.Can the difficulty drop as well as rise? or can it only get harder to mine?

Back in April, 2011, one could purchase a bitcoin for $1 or less.  Since then we have experienced a brief but sharp bubble that is in the process of deflating. It has been argued in another thread that the bubble should be deflated by the end of August and that prices should drop to the pre-bubble level.

I am a bitcoin miner, and I expect difficulty to slowly rise and either level off or decline as unprofitable miners stop mining.  As the overall network hash rate declines, remaining individual miners will earn more bitcoins for a given amount of mining activity.  In the scenario I expect, these future revenues will be lower than what miners are earning now.

The design of the bitcoin protocol is such that competitive miners should push the network hash rate to the level where the marginal miner pays their electric and air conditioning bills, depreciates their mining rigs, and make a small profit to justify the venture.  I think that the days of paying off a new mining rig in a month or two with earned bitcoins are gone.
film2240
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July 05, 2011, 07:37:16 PM
 #9

can someone who is more experienced with btc tell me what they think is going to happen with btc?can it recover after a dip like this? or will things only go downhill from here based on what they know?

What about the difficulty?as that affects mining.Can the difficulty drop as well as rise? or can it only get harder to mine?

Back in April, 2011, one could purchase a bitcoin for $1 or less.  Since then we have experienced a brief but sharp bubble that is in the process of deflating. It has been argued in another thread that the bubble should be deflated by the end of August and that prices should drop to the pre-bubble level.

I am a bitcoin miner, and I expect difficulty to slowly rise and either level off or decline as unprofitable miners stop mining.  As the overall network hash rate declines, remaining individual miners will earn more bitcoins for a given amount of mining activity.  In the scenario I expect, these future revenues will be lower than what miners are earning now.

The design of the bitcoin protocol is such that competitive miners should push the network hash rate to the level where the marginal miner pays their electric and air conditioning bills, depreciates their mining rigs, and make a small profit to justify the venture.  I think that the days of paying off a new mining rig in a month or two with earned bitcoins are gone.


Thanx a lot slipperyslope for the in depth info on why things are the way they are.So it looks like that I can either mine more bitoins when the unprofitable miners stop mining but I can expect less income from each btc.It makes me think whether it's really worth doing even with the general boost in mining capability then because that'll keep me thinking in the mid term (up to 6 months at least)

Well I think I'll bite the bullet and keep mining then knowing that my mining abilities will be boosted simply because of the unprofitable miners going off mining,although it wouldn't hurt for me to learn how to mod my Radeon Hd 6950 card by at least unlocking the shaders so I can get even more btc than at the moment. I wonder if the remaining miners will resort to coin hoarding and wait until things get profitable to sell and the whole cycle will repeat itself or the best of the BTC years are truly behind us for good and another currency may take it's place until the same cycle happens again ans so forth.

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July 05, 2011, 08:15:43 PM
 #10


BUY and hold (or use) if the price goes down BUY some more and hold (or use)
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July 05, 2011, 08:26:33 PM
 #11

can someone who is more experienced with btc tell me what they think is going to happen with btc?can it recover after a dip like this? or will things only go downhill from here based on what they know?

What about the difficulty?as that affects mining.Can the difficulty drop as well as rise? or can it only get harder to mine?

Back in April, 2011, one could purchase a bitcoin for $1 or less.  Since then we have experienced a brief but sharp bubble that is in the process of deflating. It has been argued in another thread that the bubble should be deflated by the end of August and that prices should drop to the pre-bubble level.

I am a bitcoin miner, and I expect difficulty to slowly rise and either level off or decline as unprofitable miners stop mining.  As the overall network hash rate declines, remaining individual miners will earn more bitcoins for a given amount of mining activity.  In the scenario I expect, these future revenues will be lower than what miners are earning now.

The design of the bitcoin protocol is such that competitive miners should push the network hash rate to the level where the marginal miner pays their electric and air conditioning bills, depreciates their mining rigs, and make a small profit to justify the venture.  I think that the days of paying off a new mining rig in a month or two with earned bitcoins are gone.


Thanx a lot slipperyslope for the in depth info on why things are the way they are.So it looks like that I can either mine more bitoins when the unprofitable miners stop mining but I can expect less income from each btc.It makes me think whether it's really worth doing even with the general boost in mining capability then because that'll keep me thinking in the mid term (up to 6 months at least)

Well I think I'll bite the bullet and keep mining then knowing that my mining abilities will be boosted simply because of the unprofitable miners going off mining,although it wouldn't hurt for me to learn how to mod my Radeon Hd 6950 card by at least unlocking the shaders so I can get even more btc than at the moment. I wonder if the remaining miners will resort to coin hoarding and wait until things get profitable to sell and the whole cycle will repeat itself or the best of the BTC years are truly behind us for good and another currency may take it's place until the same cycle happens again ans so forth.

Good luck with your existing mining rigs.  I too, plan to continue running mine until such time as my electricity is not covered by the earned coins.  I suppose that I'll get stuck in the end with a highly depreciated set of Radeon 5770 graphics cards - but I can always use one or two in my programming work, and put the others on the Austin craigslist at a giveaway price sometime next year.
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July 05, 2011, 09:16:06 PM
 #12

I really hope that BTc doesn't become worthless as I spent about a month mining on my 2 computers before and after the upgrade of the GPU on my main PC

If they do become worthless at least the card can still work for professional filmmaking as well as my laptop (MBP) which is mainly for pro filmmaking as well.The PC gets involved if the jobs too big for the MBP.

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