|
|
|
|
|
|
|
|
|
"Governments are good at cutting off the heads of a centrally
controlled
networks like Napster, but pure P2P networks like Gnutella and Tor seem
to be holding their own." -- Satoshi
|
|
|
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
|
|
|
|
|
|
|
|
airdata
|
 |
July 06, 2011, 08:43:45 PM |
|
who said it was going down?
|
|
|
|
|
Mousepotato
|
|
July 06, 2011, 08:45:56 PM |
|
who said it was going down? The people who were saying that difficulty follows price. |
Mousepotato
|
|
|
SeriousWorm (OP)
Newbie
 Offline
Activity: 54
Merit: 0
|
|
July 06, 2011, 08:46:09 PM |
|
who said it was going down?
Some were speculating it could go down. |
|
|
|
|
|
elggawf
|
|
July 06, 2011, 08:47:43 PM |
|
who said it was going down?
The estimated difficulty was tanking over the last few days, presumably because of miners pulling their hardware and selling it, and I'm sure the larger pools getting DDoSed didn't help. I'm guessing some people extrapolated that and combined it with their own desires to thinkthat the difficulty ought to drop, but they failed to take into account that in the first half of this recalculation period, we had huge growth of hashing power. I'm not sure if we've been in the new period long enough, but BitcoinCharts is forecasting a growth in difficulty of only ~2.4k right now. |
^_^
|
|
|
|
tomcollins
|
|
July 06, 2011, 08:47:58 PM |
|
who said it was going down? The people who were saying that difficulty follows price. It hasn't caught up to the price yet. |
|
|
|
|
coinvestor
Newbie
Offline
Activity: 42
Merit: 0
|
|
July 06, 2011, 08:51:17 PM |
|
We shouldn't ignore that the percent difference between this difficulty and the last has decreased by over half in comparison to the previous percent difference. the difficulty is definitely going to plateau in the coming weeks.
|
|
|
|
|
|
sadpandatech
|
|
July 06, 2011, 08:53:32 PM
Last edit: July 06, 2011, 09:12:05 PM by sadpandatech |
|
who said it was going down? The people who were saying that difficulty follows price. It hasn't caught up to the price yet. ^^ this. Right now next dif estimate is at about another 10% increase, or ~1.727mil This does not account for the large amount of hardware still being bought that is not online yet and the lag behind price which has recouped some today. edited; for crap typing skillz |
If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system.
- GA
It is being worked on by smart people. -DamienBlack
|
|
|
|
Mousepotato
|
|
July 06, 2011, 08:56:47 PM |
|
who said it was going down? The people who were saying that difficulty follows price. It hasn't caught up to the price yet. ^^ this. Right now next dif extimate is at about another 10% increase, or ~1.727mil This does not account for the large amount of hardware still being bought that is not online yet and the lag behind price which has recouped some today. Makes sense, yet at the same time it's an arguable subject. Who's to say that price doesn't actually follow difficulty? But the price just "hasn't caught up yet" either. Chicken or the egg, you pick.  |
Mousepotato
|
|
|
|
kgo
|
|
July 06, 2011, 09:01:38 PM |
|
Correlation != causation, but the sipa charts show growth trailing off or even possibly going negative: http://bitcoin.sipa.be/ |
|
|
|
|
ampkZjWDQcqT
Member
Offline
Activity: 70
Merit: 10
GNU is not UNIX
|
|
July 06, 2011, 09:11:53 PM |
|
who said it was going down? The people who were saying that difficulty follows price. I think it rather follows value. Value is not always the same as price. For instance, as I think Bitcoins are going to rise by several factors in the next years and I think long term their value for me is much higher than it's current price. Makes sense, yet at the same time it's an arguable subject. Who's to say that price doesn't actually follow difficulty? But the price just "hasn't caught up yet" either. Chicken or the egg, you pick.
Difficulty affects price and vice versa, but there are other factors to consider as well. Usually when I see something be referred to as a Chicken or the egg problem it's simply a misunderstanding of logic or the nature of the specific underlying problem. This is no exception, what you're talking about is a feedback loop, there is nothing weird about it and is omnipresent in everyday systems, including our body. The "Chicken or the egg problem" itself arises from inconsistent definitions, it's the same as asking whether a fixed object would move when pushed by an irresistible force. Revised 2011-07-06 21:13 UTC: formatting & wording. |
If you found my comment useful please express your gratitude by doing an action of similar magnitude towards a better society. Thanks you!.
|
|
|
|
Mousepotato
|
|
July 06, 2011, 09:18:15 PM |
|
Difficulty affects price and vice versa, but there are other factors to consider as well.
Usually when I see something be referred to as a Chicken or the egg problem it's simply a misunderstanding of logic or the nature of the specific underlying problem. This is no exception, what you're talking about is a feedback loop, there is nothing weird about it and is omnipresent in everyday systems, including our body. The "Chicken or the egg problem" itself arises from inconsistent definitions, it's the same as asking whether a fixed object would move when pushed by an irresistible force.
Well, difficulty rose even before Bitcoins had a $ amount affixed to them. So literally speaking, difficulty came first, followed by price. Somewhere along the line though, you're right that the argument became more of a feedback loop. And that's probably a better analogy to use at this point in the game. |
Mousepotato
|
|
|
|
sadpandatech
|
|
July 06, 2011, 09:22:26 PM
Last edit: July 06, 2011, 09:33:41 PM by sadpandatech |
|
Difficulty affects price and vice versa, but there are other factors to consider as well.
Usually when I see something be referred to as a Chicken or the egg problem it's simply a misunderstanding of logic or the nature of the specific underlying problem. This is no exception, what you're talking about is a feedback loop, there is nothing weird about it and is omnipresent in everyday systems, including our body. The "Chicken or the egg problem" itself arises from inconsistent definitions, it's the same as asking whether a fixed object would move when pushed by an irresistible force.
Well, difficulty rose even before Bitcoins had a $ amount affixed to them. So literally speaking, difficulty came first, followed by price. Somewhere along the line though, you're right that the argument became more of a feedback loop. And that's probably a better analogy to use at this point in the game. Definetly agree but not nearly as fun. I vote chicken. Wait no, I vote egg.. Does a partially devoloped embryo count as both? ;p |
If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system.
- GA
It is being worked on by smart people. -DamienBlack
|
|
|
DamienBlack
Jr. Member
Offline
Activity: 56
Merit: 1
|
|
July 06, 2011, 09:32:11 PM |
|
The network did shrink a little for the first time. But because difficulty is often delayed (it averaged the entire last two weeks, which it not where the network currently is), the difficulty didn't go down. It might go down next time if there isn't a big rally between now and then, but I'd give 3:1 odds that there will be.  Notice it poking under 0 recently in the 3-day growth rate. Although, that might have something to do with the recent DDOS'es. In any case, I'm happy, good mining. |
|
|
|
|
|
sadpandatech
|
|
July 06, 2011, 09:39:11 PM |
|
The network did shrink a little for the first time. But because difficulty is often delayed (it averaged the entire last two weeks, which it not where the network currently is), the difficulty didn't go down. It might go down next time if there isn't a big rally between now and then, but I'd give 3:1 odds that there will be.
Notice it poking under 0 recently in the 3-day growth rate. I'm happy, good mining.
A good portion of the down poking of the past few days can likely be attributed to the Ddosing of some of the larger pools and the ~60Ghash that switched to mining namecoins for a few days. And a small percentage of those 'at-home' types flipping the miners off. Albeit that last one is likely very small in light of the whole, as is the 60Ghash estimate, it all adds up. I'd take a good look at it again in another 7-10 days, giving time for new recently acquired hardware to come online and other factors(price increase again) etc. My vote is it going up enough to drive the next difficulty estimate up to about 1.8mil by then from the current 1.727 estimate. |
If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system.
- GA
It is being worked on by smart people. -DamienBlack
|
|
|
MikesMechanix
Member
Offline
Activity: 70
Merit: 10
|
|
July 06, 2011, 09:46:37 PM |
|
At the current ~240 % profitability (typical profit/cost of electricity), I wouldn't expect any long term decreases anytime soon.
At 1 BTC = ~$15, I'd expect it to increase up to roughly 5,000,000 before plateauing.
|
|
|
|
DamienBlack
Jr. Member
Offline
Activity: 56
Merit: 1
|
|
July 06, 2011, 09:50:26 PM |
|
At the current ~240 % profitability (typical profit/cost of electricity), I wouldn't expect any long term decreases anytime soon.
At 1 BTC = ~$15, I'd expect it to increase up to roughly 4,900,000 - 5,000,000 before plateauing.
You have to factor in equipment and space too. Electricity isn't the only cost to mining. I would think it lower, 3.5 mil, perhaps. And most big mining operation are counting on the continued success of bitcoin to justify initial costs. I think the past months troubles have made some question that. |
|
|
|
|
|
Man From The Future
|
|
July 06, 2011, 09:56:25 PM |
|
The network did shrink a little for the first time. But because difficulty is often delayed (it averaged the entire last two weeks, which it not where the network currently is), the difficulty didn't go down. It might go down next time if there isn't a big rally between now and then, but I'd give 3:1 odds that there will be.
Notice it poking under 0 recently in the 3-day growth rate. I'm happy, good mining.
A good portion of the down poking of the past few days can likely be attributed to the Ddosing of some of the larger pools and the ~60Ghash that switched to mining namecoins for a few days. And a small percentage of those 'at-home' types flipping the miners off. Albeit that last one is likely very small in light of the whole, as is the 60Ghash estimate, it all adds up. I'd take a good look at it again in another 7-10 days, giving time for new recently acquired hardware to come online and other factors(price increase again) etc. My vote is it going up enough to drive the next difficulty estimate up to about 1.8mil by then from the current 1.727 estimate. And it's the summer holidays for school children now - so more tiem taking over home computers to play video games. Yet another small factor? |
|
|
|
MikesMechanix
Member
Offline
Activity: 70
Merit: 10
|
|
July 06, 2011, 10:25:45 PM |
|
You have to factor in equipment and space too. Electricity isn't the only cost to mining. I would think it lower, 3.5 mil, perhaps. And most big mining operation are counting on the continued success of bitcoin to justify initial costs. I think the past months troubles have made some question that.
5,000,000 difficulty @ $15 per Bitcoin would give you a little over 10 % markup, which is still somewhat above where most highly competitive markets settle. Initial costs are only a barrier to entry (tying up capital), and operating costs are typically tackled with economies of scale. Obviously, at less than $.30 profit per day per gigahash, you'd need a giant operation for mining to make any sense, anyway. The numbers are very rough estimates, of course. For instance, I'd expect serious mining operations to by power in bulk or do something more creative such as start their own windfarms in order to get some cheap electricity... |
|
|
|
|
gw4tt
|
|
July 07, 2011, 12:39:03 AM |
|
You also have to factor in hardware depreciation costs.. New video cards come out all the time, usually once a year but can be sooner... and also the fact that other technology could come out and disrupt your entire "large scale" operation (ASICs etc). Technology moves very fast - it's going to have to be higher than $.30 per gigahash. At that rate you'll almost certainly go negative, unless you play the markets and make sure to sell your hardware at the right time.
|
|
|
|
|
|
