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Author Topic: Thoughts on the future of mining?  (Read 6371 times)
nameface
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August 20, 2013, 04:56:42 AM
 #1

Difficulty is rising sharply as price stagnates, so I can't help but worry that as small-time miners are squeezed out of the game there will be more and more opportunities for other alt-coins/payment systems to steal Bitcoin's market share. I say this because I have always felt that a driving force of the Bitcoin economy was the fact that a large subset of users were profiting from mining, and when and if this opportunity erodes for the casual bitcoiner, the entire economy will be put at risk by the threat of new systems offering better incentives (or at least the chance of an incentive). Is Bitcoin still fine just as it is?
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timk225
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August 20, 2013, 05:25:22 AM
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Isn't that the whole point of mining coins?  To make a personal profit?  I didn't spend about $1000 on mining PCs and GPUs to help OTHER people, I can guarantee you that! Grin
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August 20, 2013, 06:18:50 AM
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its simple,

Mining it self its DEAD!

You could mine other coins, but they aren't worth that much.

Bitcoin is dead, its takes allot of power to get a single BTC.

Yes you could get New Gen ASIC that will give 50+Ghps, but even so that will take you a year to get your ROI back.

The only people making money here NOW is companies selling ASIC Miners to newbie who are thinking that if they invest  $500, $2,000, $10,000 or more they could get their money back in half a year or even in a year.

But if you calculate how much those    ASIC are + power consumption + time/date when will you get the ASIC unit.


Yes its was great for those in the beginning when it was easier to mine.


So if you just join the Bitcoin Rush, its to late, that mountain is empty....

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August 20, 2013, 12:07:23 PM
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Bitcoin is dead

Thanks for letting us know.  I completely missed that memo.

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nameface
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August 20, 2013, 03:08:21 PM
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Isn't that the whole point of mining coins?  To make a personal profit?  I didn't spend about $1000 on mining PCs and GPUs to help OTHER people, I can guarantee you that! Grin

What we really have is question about Bitcoin price. If the price continued to rise like the good old days, then everybody mining with decent equipment would be making a great ROI. A stagnant or dropping price presents a problem. Increases in adoption rates spark the price, and pay off the miners. In a direct way, a miner is self-interested in seeing adoption rates rise.

You may not have spent money on mining to "help others", but the point is that if you are mining coins today, you want them to be worth more tomorrow. Indeed it may not even be possible to turn a profit unless Bitcoin prices rises.

I'm betting that those who make the money in the future will be those who have their interests well balanced between mining, and the marketing and development of new products and services. Without question, miners and early adopters should be funding Bitcoin startups en masse.
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August 20, 2013, 03:29:09 PM
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Isn't that the whole point of mining coins?  To make a personal profit?  I didn't spend about $1000 on mining PCs and GPUs to help OTHER people, I can guarantee you that! Grin

What we really have is question about Bitcoin price. If the price continued to rise like the good old days, then everybody mining with decent equipment would be making a great ROI. A stagnant or dropping price presents a problem. Increases in adoption rates spark the price, and pay off the miners. In a direct way, a miner is self-interested in seeing adoption rates rise.

You may not have spent money on mining to "help others", but the point is that if you are mining coins today, you want them to be worth more tomorrow. Indeed it may not even be possible to turn a profit unless Bitcoin prices rises.

I'm betting that those who make the money in the future will be those who have their interests well balanced between mining, and the marketing and development of new products and services. Without question, miners and early adopters should be funding Bitcoin startups en masse.

I'm sorry, but your confusing me.  First your worried about Bitcoin future then you saying the future looks great.  Have you changed your outlook since you started this thread?

I think Bitcoin future looks great as the increase in difficulty and the rise in Bitcoin price seem to be coinciding quite nicely.
Sam

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August 20, 2013, 03:47:37 PM
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I'm sorry, but your confusing me. 
Sam

I'm wondering how the issue of average users no longer being able to mine profitably will affect growth, and whether this presents a significant threat to Bitcoin. I don't know what the future looks like.

One thing to consider is how there are already at least 11m+ coins "in circulation". So, if Bitcoin is going to continue to grow, it's not really about mining at all anymore. I'm just wondering if the community can ever truly decide to fork Bitcoin. Will we ever see a Bitcoin 2 with a market cap larger than Bitcoin 1. Thinking about it more, unless a "big fork" like this was a factor of massive growth and more clones were truly needed for a logistical reason, then it would probably just decimate the crypto eco-system. I think Bitcoin has more than just a first-mover advantage. It has an existential grip on this whole class of technology at this point.
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August 20, 2013, 04:18:00 PM
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I should have mentioned it before, but I mine LiteCoin.  The BitCoin ship sailed when the ASICs started showing up in people's mailboxes.
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August 20, 2013, 04:20:03 PM
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I should have mentioned it before, but I mine LiteCoin.  The BitCoin ship sailed when the ASICs started showing up in people's mailboxes.
I hear that. But do you sell your LTC for BTC and use BTC, or do you sell you LTC for fiat and use fiat, or are you finding uses for LTC? What's the point of BTC for a dude like you? Are you holding because you think LTC is on the rise?
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August 20, 2013, 04:39:37 PM
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I trade my LTC for US Dollars.  I'm holding the LTC I have now to see if the price rises and I get MORE US Dollars for my LTC!  I am not concerned about the BTC / USD ratio.

What do you mean by fiat?  Fiat = USD?
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August 20, 2013, 06:29:45 PM
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What do you mean by fiat?  Fiat = USD?

Yeah, fiat currency like USD, EUR, CAD, RMB, etc..

So you are operating somewhat outside of the Bitcoin economy. This is what I was getting at in my original post. The more people 'switch to LTC' in general, could mean more of a threat to Bitcoin, and consequentially the entire current cryptocurrency eco-system. I'm a hopeful yet paranoid. I do think LTC and BTC inter-operate nicely because they are the same tech with a similar community, etc.
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August 20, 2013, 07:51:54 PM
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I should have mentioned it before, but I mine LiteCoin.  The BitCoin ship sailed when the ASICs started showing up in people's mailboxes.
I hear that. But do you sell your LTC for BTC and use BTC, or do you sell you LTC for fiat and use fiat, or are you finding uses for LTC? What's the point of BTC for a dude like you? Are you holding because you think LTC is on the rise?
Litecoins appear to be useless except for their value in bitcoins.  The amount they can be cashed out for is tied to their value in bitcoins (bots on btc-e and wherever else do a really good job at this)...  though it's beyond me who would actually place 'buy' orders for litecoins, let alone all the other crap that is listed on places like vircurex.

I never would have gotten into bitcoins if I hadn't been able to participate in the mining process when I first heard about them (march 11 or so?).  I suspect I'll gradually lose interest, maybe checking in once a month or something half a year from now.

I'm not a hobbyist (or ignorant), so I'm not going to waste my money on ASICs that won't turn a profit...

Dacentec, best deals for US dedicated servers. They regularly restock $20-$25 Opterons with 8-16GB RAM & 2x1-2TB HDD's (ofc, usually lots of other good stuff to choose from).  I did a Serverbear benchmark of one of my $20/mo Opteron (June last year), it's here.  Have had about a half dozen different servers with Dacentec, & none have failed to sustain at least 40MB/s (burst higher). My favorite is a 12-month rent-to-own ZT Systems 2XL5520 16GB 2x2TB SATA for $40/month (got lucky with the 'off-brand', haven't seen a RTO 2xL5520 for under $50/mo since -- at least for monthly contracts).  wholesaleinternet.com has some ancient 2-core intel CPUs @ $10/mo sometimes (I got an Intel Core 2 6300 @ 1.86GHz, with a 250GB HDD with 46000 hours on it, LOL. $20 @ Dacentec is much better, if you can grab one). joesdatacenter.com (same location as Wholesale Internet) also occasionally has specials (or if you don't want to wait, it has an AMD Opteron 170 @ $16/mo).
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August 20, 2013, 08:03:21 PM
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The future of Bitcoin is in taking fiat (USD, EUR, JPY, RMB, ...) out of the loop. This can be future for Litecoin too. But I feel that in Litecoin comunity the opinion: "Litecoins are just a means to get rich(er) in fiat" is more prevalent than in Bitcoin comunity.
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August 20, 2013, 08:03:50 PM
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I'm not a hobbyist (or ignorant), so I'm not going to waste my money on ASICs that won't turn a profit...

I was thinking that despite changes in the mining economy, Bitcoin can continue to engage members of the community with profitable and/or innovative investment opportunities relating to mining and mining companies. With mining out of the scope of the people's interest, Bitcoin would rely solely on it's application as a payment rail and store of value. As I come full circle I start to think that Bitcoin itself is just the beginning of a money revolution. Regardless, I definitely think a lot of money can be made mining with ASICs, it's just about getting a good price on hardware, and a good price on your bitcoins.
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August 20, 2013, 08:06:19 PM
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I'm not a hobbyist (or ignorant), so I'm not going to waste my money on ASICs that won't turn a profit...

I was thinking that despite changes in the mining economy, Bitcoin can continue to engage members of the community with profitable and/or innovative investment opportunities relating to mining and mining companies. With mining out of the scope of the people's interest, Bitcoin would rely solely on it's application as a payment rail and store of value. As I come full circle I start to think that Bitcoin itself is just the beginning of a money revolution. Regardless, I definitely think a lot of money can be made mining with ASICs, it's just about getting a good price on hardware, and a good price on your bitcoins.

Well, sure, I agree with your last statement... but right now there are too many enthusiasts, hobbyists, people with too much money to spend and lack of knowledge/ignorance about the impact of the rising difficulty levels.  Maybe in a few months an ASIC might be worth buying.

ed:  similar to my dart throwing at nasdaq back in the late 90s, then losing 30% of my assets over the course of a week.  i guess some people had it worse,  those that stuck it out until it finally stopped bleeding in 3q of 2002.

'Nothing important has ever been built without irrational exuberance'

Dacentec, best deals for US dedicated servers. They regularly restock $20-$25 Opterons with 8-16GB RAM & 2x1-2TB HDD's (ofc, usually lots of other good stuff to choose from).  I did a Serverbear benchmark of one of my $20/mo Opteron (June last year), it's here.  Have had about a half dozen different servers with Dacentec, & none have failed to sustain at least 40MB/s (burst higher). My favorite is a 12-month rent-to-own ZT Systems 2XL5520 16GB 2x2TB SATA for $40/month (got lucky with the 'off-brand', haven't seen a RTO 2xL5520 for under $50/mo since -- at least for monthly contracts).  wholesaleinternet.com has some ancient 2-core intel CPUs @ $10/mo sometimes (I got an Intel Core 2 6300 @ 1.86GHz, with a 250GB HDD with 46000 hours on it, LOL. $20 @ Dacentec is much better, if you can grab one). joesdatacenter.com (same location as Wholesale Internet) also occasionally has specials (or if you don't want to wait, it has an AMD Opteron 170 @ $16/mo).
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August 20, 2013, 08:19:19 PM
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The future of Bitcoin is in taking fiat (USD, EUR, JPY, RMB, ...) out of the loop. This can be future for Litecoin too. But I feel that in Litecoin comunity the opinion: "Litecoins are just a means to get rich(er) in fiat" is more prevalent than in Bitcoin comunity.
There's certainly ideology to Bitcoin. And there's an almost conflicting ideology to any new currencies that grow out of Bitcoin. I think the fusion of classical economics with modern technology with Bitcoin is interesting. It's like we are going back to old principles that may have finally been made good again. Creating new currencies based on Bitcoin is more of a neo-classical economics concept. We can create more and more currencies, but what are we really trying to do? Print money to stimulate our wallets?

Bitcoin is an experiment in economic theory, and its almost like in the long run its survival depends as much on its academic merit as its technological relevance. It kinda sucks how so many people in the Bitcoin space resort to building entirely independent systems. This may not have been the case if early adopters were more generous with their coins. For example, if Satoshi has 1m coins in a wallet, why doesn't he award 100BTC per month to 'the most innovative new idea/s'? The inflow of new capital will need to increase for a long time, or things may collapse inward. Bitcoin needs better marketing and tech ideas.
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August 20, 2013, 08:24:33 PM
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http://www.cnet.com/1990-11136_1-6278387-1.html

 Grin  #4

Dacentec, best deals for US dedicated servers. They regularly restock $20-$25 Opterons with 8-16GB RAM & 2x1-2TB HDD's (ofc, usually lots of other good stuff to choose from).  I did a Serverbear benchmark of one of my $20/mo Opteron (June last year), it's here.  Have had about a half dozen different servers with Dacentec, & none have failed to sustain at least 40MB/s (burst higher). My favorite is a 12-month rent-to-own ZT Systems 2XL5520 16GB 2x2TB SATA for $40/month (got lucky with the 'off-brand', haven't seen a RTO 2xL5520 for under $50/mo since -- at least for monthly contracts).  wholesaleinternet.com has some ancient 2-core intel CPUs @ $10/mo sometimes (I got an Intel Core 2 6300 @ 1.86GHz, with a 250GB HDD with 46000 hours on it, LOL. $20 @ Dacentec is much better, if you can grab one). joesdatacenter.com (same location as Wholesale Internet) also occasionally has specials (or if you don't want to wait, it has an AMD Opteron 170 @ $16/mo).
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August 20, 2013, 08:32:46 PM
 #18

its simple,

Mining it self its DEAD!

So if you just join the Bitcoin Rush, its to late, that mountain is empty....

The "mountain" isn't estimated to be empty until the year 2140 or 21 Million BTC has been mined... i still see mining as an option.

I am one of those hoping to get our Avalon chips so we can burn to our homemade and K16 boards... keeping the initial costs down to help return "ROI" which for me is all about stacking as much BTC as I can..

If Avalon does not ship and companies that develop next gen ASICs do not allow the open source community to work from their specs.. then yes we may never be able to mine again and the greed of a few will continue to hammer the "mountain"
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August 20, 2013, 08:48:41 PM
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Small miners will be marginalized more. You will see the 'prosumer' mining at around 2 TH/S sometime next year. All those folks with sub TH/S systems will start to disappear.

You will see bigger crews mining at 200 + TH/S. Maybe 20 PH/S total hashing by the end of next year?
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August 20, 2013, 09:09:05 PM
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Difficulty is rising sharply as price stagnates, so I can't help but worry that as small-time miners are squeezed out of the game there will be more and more opportunities for other alt-coins/payment systems to steal Bitcoin's market share. I say this because I have always felt that a driving force of the Bitcoin economy was the fact that a large subset of users were profiting from mining, and when and if this opportunity erodes for the casual bitcoiner, the entire economy will be put at risk by the threat of new systems offering better incentives (or at least the chance of an incentive). Is Bitcoin still fine just as it is?

Why would a bunch of miners going to alt-coins make them valuable?  Bitcoin has already been bootstrapped, there is no need to provide a free lunch anymore to get people to use it.
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