CoinTerra announces its first ASIC - Hash-Rate greater than 500 GH/s

[CoinHoarder]

Yes, it seems reasonable considering this: http://bitcoin.sipa.be

There are so many companies and securities releasing hash power in Q4 this year. I would not be surprised if the network continues its current growth rate through the end of the year. Also, I think a large percentage of manufacturers will setup large mining farms using their own equipment at cost. Notice how none of the newer companies have stated they will not mine on the Bitcoin network. This will push difficulty up much higher & much faster than anyone anticipated.

This is not me hating on just Cointerra by the way. I think almost all current consumer mining hardware equipment is overpriced. They are not the only ones by far... I just would like to see them succeed because they are from my home state of Texas, so I am giving them constructive criticism.

[Stinky_Pete]

This seems a good point to bring up something that has been puzzling me for some time.

In the manufacture of CPUs and GPUs there are always chips which don't quite make the grade, and so are binned and used to make products with lower specs (frequency, number of cores etc.), which leads to families of products with different price points. But none of the Bitcoin ASIC manufacturers are following this business model. Why do they expect to get close to 100% yields with their chip manufacture? Is there something about SHA-256 hashing that means the chip design to manufacture is more robust? or are the companies wasting the lower quality chips? I think there are plenty of people who would consider buying a less productive ASIC if the price was right, regardless of the manufacturer.

[DeathAndTaxes]

Yes, it seems reasonable considering this: http://bitcoin.sipa.be

There are so many companies and securities releasing hash power in Q4 this year. I would not be surprised if the network continues its current growth rate through the end of the year. Also, I think a large percentage of manufacturers will setup large mining farms using their own equipment at cost. Notice how none of the newer companies have stated they will not mine on the Bitcoin network. This will push difficulty up much higher & much faster than anyone anticipated.

This is not me hating on just Cointerra by the way. I think almost all current consumer mining hardware equipment is overpriced. They are not the only ones by far... I just would like to see them succeed because they are from my home state of Texas, so I am giving them constructive criticism.

No it isn't realistic in any fashion.  236 PH/s would mean that every single miner in the world would be operating at a loss.  So even when miners have a 100% negative ROI from day one people will keep deploying tens of thousands of more units.  Why?   They have to much money and want to turn $1000 in electricity into $50 in BTC?

[cryptojoe]

cointerra reduces it's prices on the 2th/s miner to 13,999.  According to the mining dashboard, you'll earn a negative $1,060 on that deal if you start mining on december 1. if you start january 1, owing to late december arrival (and they aint promising better), then you're totally jacked at negative $7,000.  Common guys throw us bone. We really do want in on second generation asic but we ain't that crazy.  Maybe they're banking on the fact that some of us are actually pretty crazy.

[CoinHoarder]

No it isn't realistic in any fashion.  236 PH/s would mean that every single miner in the world would be operating at a loss.  So even when miners have a 100% negative ROI from day one people will keep deploying tens of thousands of more units.  Why?   They have to much money and want to turn $1000 in electricity into $50 in BTC?

I agree perhaps 236 Ph is a large estimate for the network speed in December 2013, but I think with all of the new companies coming onto the scene it is not impossible. Cointerra, Labcoin, KNC, HashFast, BFL, Avalon, VMC, ASICMINER... all designing and producing their own chips and all scheduled for Q3-Q4 shipping dates. There will be other companies that spring up that buy chips from these companies and produce their own equipment as well.

I also agree with you in that no one will buy mining equipment if it is unprofitable to do so. However, until that point is reached I feel like people will continue to throw money at hardware investments and pre-orders until then. Mining manufacturers will lower their prices over time until that point is reached (rather quickly) where it is unprofitable to buy consumer mining equipment. Difficulty increases will not stop then, there will be many backdoor mining operations setup by these companies as long as it is profitable for them to do so. It will be profitable for them to do so long after the point it is unprofitable for the consumers.

We're already seeing that with 130nm Bitcoin ASICs. A company in China can't make any profit selling the equipment to international customers because the ROI for the customer would be horrible when you include shipping costs: https://bitcointalk.org/index.php?topic=281866.0

However, just because it is unprofitable to sell them internationally, it doesn't mean it is unprofitable for them to make a large batch for themselves and mine at exact manufacturing costs of the equipment. It will take a much larger difficulty increase for this to happen. This is an unforeseen factor that I think most miners are not accounting for in the increase of hash power. The manufacturers will be competing with their customers. I don't care how honest/ethical you are, if you have an opportunity to make Billions/Millions of dollars by doing something that it slightly unethical... as they say, money makes the world go round.

[Syke]

I agree perhaps 236 Ph is a large estimate for the network speed in December 2013

"Perhaps"? No way! There's no way the bitcoin network is going to approach that kind of performance by the end of this year.

[CoinHoarder]

I agree perhaps 236 Ph is a large estimate for the network speed in December 2013

"Perhaps"? No way! There's no way the bitcoin network is going to approach that kind of performance by the end of this year.

Sorry.. I didn't mean December, I meant July 2014... http://mining.thegenesisblock.com/a/7a0c452d0f

I have been thinking one thing and typing another, sorry for the confusion.

[DeathAndTaxes]

It is not largish it is just beyond silly.   It think you are misunderstanding.  236 PH/s is so large even if the hardware was free you would mine at a loss because even with @ 2J/GH and $0.10 per kWh it would cost ~$300 per Bitcoin just in electricity.  So if someone gave you a free miner you would lose money by using it.  When you consider that even @ Cointerra prices (lowest price per GH) we are talking nearly a $1B in pre-orders (or 8 years of gross mining revenue excluding electricity) it just gets even more silly.

Difficulty is going up but saying 236 PH/s is plausible well you might as well say difficulty of eleventy quadrillion septillion is also possible.

[eve]

I'm glad they have taken my advice & advice from the community on lowering prices.

However, it's still not a good investment. It seems they're trying to find the highest price that the market will bear. I don't think they're there yet, but certainly some people that don't understand the economics of Bitcoin mining will still order from them.

Even if delivered on time you're likely to lose $1,200... not exactly my idea of a good investment. http://mining.thegenesisblock.com/a/85e10d5a76

They don't seem to understand the risk/reward ratio needs to be just right for people to risk this much money on pre-orders. If there is no possible reward even if they deliver on time, I don't know how they expect to sell their products (unless they are just planning on mining with the equipment themselves at cost).

Yes way to expensive considering the difficulty at year end, they need to offer $3 per gh/s or less to be profitable and worth buying.

[CYPER]

Yes, it seems reasonable considering this: http://bitcoin.sipa.be

There are so many companies and securities releasing hash power in Q4 this year. I would not be surprised if the network continues its current growth rate through the end of the year. Also, I think a large percentage of manufacturers will setup large mining farms using their own equipment at cost. Notice how none of the newer companies have stated they will not mine on the Bitcoin network. This will push difficulty up much higher & much faster than anyone anticipated.

This is not me hating on just Cointerra by the way. I think almost all current consumer mining hardware equipment is overpriced. They are not the only ones by far... I just would like to see them succeed because they are from my home state of Texas, so I am giving them constructive criticism.

No it isn't realistic in any fashion.  236 PH/s would mean that every single miner in the world would be operating at a loss.  So even when miners have a 100% negative ROI from day one people will keep deploying tens of thousands of more units.  Why?   They have to much money and want to turn $1000 in electricity into $50 in BTC?

My calculations say otherwise, unless they are wrong, so please correct me

So 3600 coins a day, which might increase up to 5000 coins daily with the always increasing difficulty and less than 2 weeks finding of 2016 blocks.
So 5000 coins = 650000USD daily at current market rate.

If we take a very conservative rate of 0.15USD per kWh, then 650000USD equals 27083.33USD per hour divided 0.15USD per kWh = 180555.5555555556kWh * 1000 = 180555555.55 Watts per hour

If we take an average consumption of 0.55 watt/GH/s then 180555555.55 Watts per hour = 328282828.27GH/s = 328.28PH/s

Or the other way around:

236PH/s = 236000000GH/s * 0.55 watt/h = 129800000W/h = 129800 kW/h * 0.15USD per kWh = 19470USD per hour * 24 hours = 467280USD daily.

So basically the total limit of BTC that can be mined in 24 hours is enough to cover the power costs of 328.28PH/s miners if electricity costs 0.15USD per kWh.

Hopefully that is correct.

[DeathAndTaxes]

0.55W/GH?   What using magical unicorn miners? 

Here are "at the wall" efficiencies of various devices and proposed devices. 
https://bitcointalk.org/index.php?topic=281279

Nobody, not even cointerra is predicting half a watt per GH/s at the wall.

[CYPER]

0.55W/GH?   What using magical unicorn miners?  

Here are "at the wall" efficiencies of various devices and proposed devices.  
https://bitcointalk.org/index.php?topic=281279

Nobody, not even cointerra is predicting half a watt per GH/s at the wall.

Obviously that is not the case now, but I would expected efficiencies to improve quite a lot up to that point.
And yes exactly Cointerra are saying that on their website:

What are the specs of your 28nm chip?
GoldStrike1 (GS1) is a 28nm chip with a 0.5TH  rate and power consumption of 0.55 watt/GH.

But you are correct for "at the wall" consumption. I have forgotten to include the efficiency of the PSUs, where an additional ~ 10% more electricity will be used.

But even so 650000USD would be enough for around 200PH/s I believe, which again would be futile, because BTC production will only cover electricity costs.

[DeathAndTaxes]

It isn't just the ATX PSU.  If a chip operates at 0.55 J/GH how are you going to power it?  Plug 12V connector from power supply to it and blow it up?  Most ASICs run at 1V.  ATX doesn't supply 1V.  So you need a DC to DC PSU to convert 12V to 1V.  Good ones are roughly 90% efficient.  So the wattage for the ASIC boards are going to be >0.55 J/GH even if the chip is 0.55 J/GH.  Now how are you going to cool up to 1400W of heat? Fans consume wattage, as does the system controller.  So the overall DC system wattage is higher than the board wattage which is higher than the chip wattage.  Now to convert AC to DC you are talking another ~10% inefficiency so the AC wattage is even higher.

Still it looks like you just assumed everything is operating at 0.7 J/GH.  That ignores the petahashes of existing hardware which is much less efficiency. Long before you get to 200 PH/s for example every 55nm or higher chip will be operating with negative gross margin.  Why would they continue to mine to turn $100 in electricity into $50 in Bitcoins?  Simple they won't and when they go idle it will slow the growth of the network.

200 PH/s isn't any more realistic.  It assumes that all existing hardware goes into the trashcan and despite hashrate already being so high that the break even point (even assumming no more hashrate growth) is years in the future people keep buying more and more rigs month after month until they are negative ROI% from day 1. 

[CYPER]

That assumes everything is operated at 0.7J/W.  It isn't there is a lot of less efficient gear out there.  Long before you get to 200 PH/s for example every 55nm or higher chip will be operating with negative ROI.  They will go idle.  Plus when hashrate is already say 30 PH/s and even with NO difficulty increased the margin over electrical cost is next to nothing and the break even point stretched out into years into the future hardware sales are going to slow down.  When you start subtracting inefficient hardware going offline well it isn't likely at all.

However you seem to have your mind made up so 200 PH/s +

Don't get me wrong - I somewhat believe 200 or 300 PH/s is science fiction, unless a very large percent of miners are not paying for electricity, which I doubt.

But don't forget 2 very important factors:
1 - BTC price can skyrocket. $1000 BTC price changes the landscape dramatically: with 1USD per GH/s efficiency it equals 1388.88 PH/s network speed for electricity only break even.

2 - People are greedy in nature and a lot of them will keep mining long after it is unprofitable, hoping for an increase in BTC price.

[monkee]

http://www.anandtech.com/show/7246/the-rush-to-bitcoin-asics-ravi-iyengar-launches-cointerra

above article has lots of info


"Q: What level of pre-orders are estimated before CoinTerra is able to ramp up production?  It has been listed in the media that a number of pre-orders are needed before final manufacturing can take place.

A: When we started looking for investment, it took two months to raise $1.5m from both Bitcoin users and the tech industry – at this point in time there is no need to ask for more investment.  In terms of pre-orders, within 24hrs of our website going live we had 150 pre-orders.  Our production is not hampered by sales in any way."

anyone been checking order numbers?  I'm assuming those are not PAID orders.  

[relm9]

That assumes everything is operated at 0.7J/W.  It isn't there is a lot of less efficient gear out there.  Long before you get to 200 PH/s for example every 55nm or higher chip will be operating with negative ROI.  They will go idle.  Plus when hashrate is already say 30 PH/s and even with NO difficulty increased the margin over electrical cost is next to nothing and the break even point stretched out into years into the future hardware sales are going to slow down.  When you start subtracting inefficient hardware going offline well it isn't likely at all.

However you seem to have your mind made up so 200 PH/s +

Don't get me wrong - I somewhat believe 200 or 300 PH/s is science fiction, unless a very large percent of miners are not paying for electricity, which I doubt.

But don't forget 2 very important factors:
1 - BTC price can skyrocket. $1000 BTC price changes the landscape dramatically: with 1USD per GH/s efficiency it equals 1388.88 PH/s network speed for electricity only break even.

2 - People are greedy in nature and a lot of them will keep mining long after it is unprofitable, hoping for an increase in BTC price.

Yeah. People that buy mining equipment that'll  never ROI may continue to mine on the hope that BTC value will skyrocket. It may be worth the extra few hundred dollars of electricity a year for them. Big operations may shut down but I can see average joes continuing to mine, which would help decentralize hashing power anyway.

[DeathAndTaxes]

That assumes everything is operated at 0.7J/W.  It isn't there is a lot of less efficient gear out there.  Long before you get to 200 PH/s for example every 55nm or higher chip will be operating with negative ROI.  They will go idle.  Plus when hashrate is already say 30 PH/s and even with NO difficulty increased the margin over electrical cost is next to nothing and the break even point stretched out into years into the future hardware sales are going to slow down.  When you start subtracting inefficient hardware going offline well it isn't likely at all.

However you seem to have your mind made up so 200 PH/s +

Don't get me wrong - I somewhat believe 200 or 300 PH/s is science fiction, unless a very large percent of miners are not paying for electricity, which I doubt.

But don't forget 2 very important factors:
1 - BTC price can skyrocket. $1000 BTC price changes the landscape dramatically: with 1USD per GH/s efficiency it equals 1388.88 PH/s network speed for electricity only break even.

2 - People are greedy in nature and a lot of them will keep mining long after it is unprofitable, hoping for an increase in BTC price.

Yeah. People that buy mining equipment that'll  never ROI may continue to mine on the hope that BTC value will skyrocket. It may be worth the extra few hundred dollars of electricity a year for them. Big operations may shut down but I can see average joes continuing to mine, which would help decentralize hashing power anyway.

To a certain extent but everyone has a pain point.  Are you still CPU mining Bitcoin?  Why not?  You already own a CPU.  It will only cost you $2,000 or so in electricity to mine 1 BTC.  If BTC exchange rate goes up to $3,000 you will profit.  So why aren't you mining on a CPU right now? (You already know the answer)

236 PH/s would mean an Avalon or Block eruptor would require $660 in just electricity to mine one BTC.   Sure at close to the break even point many miners will hang on but mining at a guaranteed 50%, 70%, 90%, 99% negative margin for week after week, month after month.  Nobody is going to do that.  Just like nobody (or at least not enough to be more than a rounding error) is CPU mining Bitcoin today. 

[Syke]

Still it looks like you just assumed everything is operating at 0.7 J/GH.

Meanwhile full sized miner is falling quite a bit short (10-20%) on hashrate, but the powerconsumption is.... 250W AT THE WALL.

That would be between 320 and 360 GH/s at 250W = between .7 and .8 J/GH on a 55 nm product. I seriously hope the 28nm products can beat Bitfury's 55nm by a significant margin.

[DeathAndTaxes]

Still it looks like you just assumed everything is operating at 0.7 J/GH.

Meanwhile full sized miner is falling quite a bit short (10-20%) on hashrate, but the powerconsumption is.... 250W AT THE WALL.

That would be between 320 and 360 GH/s at 250W = between .7 and .8 J/GH on a 55 nm product. I seriously hope the 28nm products can beat Bitfury's 55nm by a significant margin.

Bitfury's developer is an amazing ASIC developer.  He also had efficiency unmatched by anyone else on FPGA and really only lacked a commercial success because of the false promises of BFL (both on FPGA side and early announcement of ASICs in a few months).   I would also point out that the rigs are essentially unavoidable underclocking.  They don't want to underclock but the chips are running slower than spec and that is going to improve the efficiency.  I am sure if you underclock or undervolt 28nm devices you will get improved efficiency (at the expense of less hashpower per $).

Still at stock clocks I don't think anyone is going to massively (<0.4 J/GH) outperform.  All the 28nm builders are taking pre-orders.  It is a competition for pre-orders and funding.  If they felt they could with high confidence say they can deliver <0.5 J/GH at the wall they say so because it would boost sales. 

Process node is only part of the equation.  KNC (28nm) is only guaranteeing 2.5 J/GH which is 4x worse than Bitfury despite being on a smaller process and BFL (65nm) is on a process very close to Bitfury but needs 5 J/GH which is 8x worse.  We can only go by what they unreleased specs and they are likely hedging their numbers to avoid an embarrassing miss but if KNC simulations were showing them 0.5 J/GH they wouldn't be building boards capable of 320W max for a 100 GH chip and only advertising better than 2.5 J/GH.  Still if Bitfury design can be shrunk to 28nm with similar efficiency it could be the most efficient chip yet.

[geofflosophy]

That assumes everything is operated at 0.7J/W.  It isn't there is a lot of less efficient gear out there.  Long before you get to 200 PH/s for example every 55nm or higher chip will be operating with negative ROI.  They will go idle.  Plus when hashrate is already say 30 PH/s and even with NO difficulty increased the margin over electrical cost is next to nothing and the break even point stretched out into years into the future hardware sales are going to slow down.  When you start subtracting inefficient hardware going offline well it isn't likely at all.

However you seem to have your mind made up so 200 PH/s +

Don't get me wrong - I somewhat believe 200 or 300 PH/s is science fiction, unless a very large percent of miners are not paying for electricity, which I doubt.

But don't forget 2 very important factors:
1 - BTC price can skyrocket. $1000 BTC price changes the landscape dramatically: with 1USD per GH/s efficiency it equals 1388.88 PH/s network speed for electricity only break even.

2 - People are greedy in nature and a lot of them will keep mining long after it is unprofitable, hoping for an increase in BTC price.

Yeah. People that buy mining equipment that'll  never ROI may continue to mine on the hope that BTC value will skyrocket. It may be worth the extra few hundred dollars of electricity a year for them. Big operations may shut down but I can see average joes continuing to mine, which would help decentralize hashing power anyway.

To a certain extent but everyone has a pain point.  Are you still CPU mining Bitcoin?  Why not?  You already own a CPU.  It will only cost you $2,000 or so in electricity to mine 1 BTC.  If BTC exchange rate goes up to $3,000 you will profit.  So why aren't you mining on a CPU right now? (You already know the answer)

236 PH/s would mean an Avalon or Block eruptor would require $660 in just electricity to mine one BTC.   Sure at close to the break even point many miners will hang on but mining at a guaranteed 50%, 70%, 90%, 99% negative margin for week after week, month after month.  Nobody is going to do that.  Just like nobody (or at least not enough to be more than a rounding error) is CPU mining Bitcoin today. 

I think that your point about CPU and FPGA actually folds on itself to some degree, because when CPUs and GPUs and FPGAs come offline, it's like a tree falling in the woods that no one hears. By the time they're so unprofitable that they stop getting used, they are already too small a portion of the network to be missed. I think that Avalon is relatively near succumbing to this fate based on what I know about preorders of 28nm chips.