did ASIC ruin bitcoin ?

[The 4ner]

It only ruined Bitcoin for those that were looking to make money off minting the currency. Everyone else just either gets paid in BTC or provides a service or good for sale in exchange for BTC.

[smscotten]

Does it really matter though? The difficulty was bound to rise either way the more coins were produced. The only inconvenience ASICs caused was not being able to make the late comers rich.

Well, the same number of coins would be produced either way. That's why the difficulty went up. But yeah.

And I think that's the frustration. Mining is a zero-sum game. You can't get in on it without diluting everyone else's share. I'm not saying there's anything wrong with that, but miners have to understand that (after the first few) we are not producing something that wouldn't exist without us; we are taking a slice of a set amount of wealth that is being created.

And again, the point of Bitcoin is not to make people rich, but to create the medium in which people can become rich through their non-Bitcoin-related efforts.

It's one thing to say, "woo! The more the merrier!" but the more people that are involved in mining, the smaller each of our shares will be. As Bitcoin grows, you have to put more and more hashing power in just to keep the same proportion. That is a given and a constant: the diff will (almost) always increase, especially when Bitcoin gains traction with wider numbers of people.

It's awesome that "anyone can do it" when not very many people are doing it. When more people do what "anyone can do" that's when it gets ruined by all those messy people that are doing it. But ultimately you cannot have it both ways. Either anyone can do it and your efforts are not special, or else only a few can and it will be profitable to each of those few.

[atomium]

a plus is that confirmations will be in seconds now with miners running on asics

[mrdavis]

Bitcoin was not invented to give us a free lunch, it was invented to give us a free economy.

Well said.

[westkybitcoins]

It's awesome that "anyone can do it" when not very many people are doing it. When more people do what "anyone can do" that's when it gets ruined by all those messy people that are doing it. But ultimately you cannot have it both ways. Either anyone can do it and your efforts are not special, or else only a few can and it will be profitable to each of those few.

Well said. More people need to understand this.

[westkybitcoins]

a plus is that confirmations will be in seconds now with miners running on asics

Well, that would have benefits. But it's not how it works; the whole point of the difficulty adjustments is to ensure that new blocks (confirmations) are generated at a rate of one every 10 minutes, no more, no less, regardless of total network hash rate.

[WastedLTC]

you can already start to see the changes.  If someone releases an ASIC on preorder, it no longer sells out immediately (or sells at all).   Things will level out.  Now we don't need to give all money to a single company (AMD graphic chips) but to many companies.  Don't forget when Avalon first made the chips, they could have taken over the entire network immediately.  That is no longer the case.  Soon buying a miner will become one of those things you can order and have the next day and maybe you will make your money back in 4 months, but that will be the choice when you order. 

All is well.

[600watt]

bitcoin might die because of ASIC and be replaced by bitcoin 2.0 or some new P2P digital currency. the first of anything never lasts it either dies and goes away for good or it evolves and gets replaced by something better. either way i think the future of bitcoin as it works today looks questionable. the good ol days of GPU mining are over. hopefully the next round they figure out a way to deal with people controlling the market and having the difficulty shit on ROI.

that´s not exactly true with technologies like the internet. the internet protocol for example which is still used today was developed in 1974. there have been several attempts by companies like microsoft, ibm, apple to start new protocols, but they did not succeed.

bitcoin is a protocol. if it lasts as long as the internet protocol there is nothing to worry about.

http://en.wikipedia.org/wiki/Internet_Protocol

[millsdmb]

a plus is that confirmations will be in seconds now with miners running on asics

the whole point of the difficulty adjustments is to ensure that new blocks (confirmations) are generated at a rate of one every 10 minutes, no more, no less, regardless of total network hash rate.

Was there not a point when the hashrate actually caused the block rewards to come quicker than was anticipated by the network? I had found an article a few days ago but cant relocate it. Must not have been signed into my google account at the time or they'd have archived my history.

[WastedLTC]

a plus is that confirmations will be in seconds now with miners running on asics

the whole point of the difficulty adjustments is to ensure that new blocks (confirmations) are generated at a rate of one every 10 minutes, no more, no less, regardless of total network hash rate.

Was there not a point when the hashrate actually caused the block rewards to come quicker than was anticipated by the network? I had found an article a few days ago but cant relocate it. Must not have been signed into my google account at the time or they'd have archived my history.

yup. two of them
http://thegenesisblock.com/bitcoin-block-time-halved-to-five-minutes-amid-exponential-network-growth/
http://thegenesisblock.com/at-this-rate-the-last-new-btc-will-be-issued-55-years-ahead-of-schedule/

[DeathAndTaxes]

a plus is that confirmations will be in seconds now with miners running on asics

the whole point of the difficulty adjustments is to ensure that new blocks (confirmations) are generated at a rate of one every 10 minutes, no more, no less, regardless of total network hash rate.

Was there not a point when the hashrate actually caused the block rewards to come quicker than was anticipated by the network? I had found an article a few days ago but cant relocate it. Must not have been signed into my google account at the time or they'd have archived my history.

If hashing power rises rapidly within one adjustment period (2016 blocks ~14 days) then the time between blocks can temporarily be shorter however it is that shorter interval which causes the difficulty to rise.  Yes for a short time the time between blocks can be <10 minutes (and in a falling hashpower environment it can be>10 minutes) however the network readjusts difficulty every 2016 blocks.   Hashpower can't keep growing at 20%+ per adjustment forever and when it slows the time between blocks will normalize at ~10 minutes regardless of if we have 1 MH/s or 1,000,0000 PH/s.

[MagicBit15]

i think so.

This and bitcoin was designed for anything that comes its way from now until 21 million coins. ASIC and other competition is what bitcoin is all about!!

[astutiumRob]

If hashing power rises rapidly within one adjustment period (2016 blocks ~14 days) then the time between blocks can temporarily be shorter however it is that shorter interval which causes the difficulty to rise.  Yes for a short time the time between blocks can be <10 minutes (and in a falling hashpower environment it can be>10 minutes) however the network readjusts difficulty every 2016 blocks

Between difficulty adjustment, overall, it's _never_ been an average of 10 minutes.

The current adjustment calculation is flawed in several ways.
One of which is not retargetting the difficulty based on the historical average time between blocks, to bring it back to an overall average of 10 mins.

This is why http://thegenesisblock.com/at-this-rate-the-last-new-btc-will-be-issued-55-years-ahead-of-schedule/

[alp]

If hashing power rises rapidly within one adjustment period (2016 blocks ~14 days) then the time between blocks can temporarily be shorter however it is that shorter interval which causes the difficulty to rise.  Yes for a short time the time between blocks can be <10 minutes (and in a falling hashpower environment it can be>10 minutes) however the network readjusts difficulty every 2016 blocks

Between difficulty adjustment, overall, it's _never_ been an average of 10 minutes.

The current adjustment calculation is flawed in several ways.
One of which is not retargetting the difficulty based on the historical average time between blocks, to bring it back to an overall average of 10 mins.

This is why http://thegenesisblock.com/at-this-rate-the-last-new-btc-will-be-issued-55-years-ahead-of-schedule/

This assumes having a block time of 10 minutes is really important.  And you may end up with a more flawed mechanism if try to set future difficulty based on expected growth, where you end up setting the difficulty far to high and end up with one really, really long period of a too high difficulty.

[millsdmb]

Will this affect deflation? I wonder if USD Fiat price and block reward are inversely correlated? (so long as demand exceeds supply)

[og kush420]

well i never mined bitcoins unfortunately, so yeah i wish i could have back then just for fun. too bad i got in late. i think its a little discouraging to n00bs when people who arent already in the game have few options. but not everyone can make money.

[Carlton Banks]

This is ASIC wave 1, and the hype is multi-faceted and pervasive. Those who feel they missed the boat: GPU miners felt the same way about CPU mining, as did the FPGA miners over GPU mining, as did ASIC miners about FPGA era. Hell, even Avalon batch 2 customers felt the same about Avalon batch 1.

[astutiumRob]

This assumes having a block time of 10 minutes is really important

Having a 'final' and known amount of BTC in circulation and a _relatively_ constant block creation rate is very very important - it's what makes BTC more-attractive traditional Fiat's

And you may end up with a more flawed mechanism if try to set future difficulty based on expected growth

Historical growth not future growth

where you end up setting the difficulty far to high and end up with one really, really long period of a too high difficulty.

You will get 1 or more periods of that when lots of hobby-miners (assuming they're the ones responsible for the electric bills) eventually realise they're losing large amounts of money running their miners ...

[David Rabahy]

A miner makes an investment in equipment and electricity, etc., and in return they get Bitcoins.  The amount of their investment is then compared to the value of the their production.  *But*, the potential future value of their production should be taken into account too.

[shields]

A miner makes an investment in equipment and electricity, etc., and in return they get Bitcoins.  The amount of their investment is then compared to the value of the their production.  *But*, the potential future value of their production should be taken into account to.

Why do people keep thinking this?
The miner could have bought  BTC directly with the capital investment (or maybe the initial investment was BTC anyway) so the future value of bitcoin doesn't matter. The investment is good if it makes more BTC than the capital would have bought, it's bad if it doesn't - the price of BTC does not factor into this.