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Author Topic: Will btc difficulty go sideways for rest of the year?  (Read 4704 times)
MagicByt3
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December 05, 2018, 04:31:51 PM
Last edit: December 05, 2018, 11:56:36 PM by frodocooper
 #161

Not sure he does but mining at a loss on an affordable scale is not so dumb

Ie loss of a few hunderd usd  a month for a year.  lets say  you spent 4800 this year mining and have 1 btc.

It can be in a wallet  that no one knows about but yourself  so paying  4800 for a 3900 asset is not so dumb  if it goes up to 20000 in a few years.

and you could sell the coin for 19000 cash  to a guy that has a fresh core wallet  and he now has a hidden asset.

This is 100% correct.
I also don't like I have to KYC to buy bitcoin here from most places and I refuse to deal on Local bitcoins.

So mining even for a while at a loss I really don't think of it as a loss right now more of a investment for the future with potential of x5-x10-x?? gains.

Basically swapping something that is very abundant (FIAT) for something that is limited and rare (BTC)

and I sub to the Hal finny way of thinking.. 10 Million per bitcoin.  

http://www.metzdowd.com/pipermail/cryptography/2009-January/015004.html

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December 05, 2018, 06:17:50 PM
Merited by frodocooper (5)
 #162

I have run into three separate situations where I was buying gear from " Hosting " facilities and or Colo set ups. Each time I was shocked at how little these operations knew about basic cooling and infrastructure. Their "floor costs" or infrastructure costs were astronomical. I believe a lot of these miners that are for sale on the secondary market in US and Canada are coming from these poorly planned build outs, that just threw large amounts of capital at them without understanding the metrics of the operations. Even at the most basic level. I believe there are still many more to follow. Not only did "fast money" over speculate BTC itself, it went "All In " on Colo, Reselling of Gear and every other facet of this business. I suspect the shake out will continue until all the Wheat is separated from the Chaff.

You hit the nail on the head here. As someone who has been doing this at an industrial level longer than most I have seen soooo many poorly designed and poorly ran datacenters pop up and die a horrible death shortly after. The only way to survive in this industry is to run very lean in all phases of operation at all times regardless of profits or how well the market is doing. What i have always done is ride the waves up by reinvesting and expanding when times are good so that when things are on the downturn you can survive by the sheer size of your operation. Most people getting into this game make a few major mistakes. Mistake 1 is build costs, the way to build is leaning on the secondary market. Electrical infrastructure has not changed much in the last 50 years, a transformer is a transformer. As an example, I picked up used 480/208 step down transformers for pennies on the dollar used while I watched other places pay tens of thousands of dollars for brand new equipment where im paying maybe 10% of what they are for used equipment that functions just as well. With over 20mw of power in use I have not had a single used transformer fail. Another thing I consider a mistake is buying PDUs new. These can easily run into the high hundreds per piece new, whereas I have over 3000 active PDUs and none of them cost over $100 thanks to the secondary market.

The second big mistake is in operational costs.

I know of 5mw datacenters with 20 technicians on staff and even with all that they still are lucky to keep a 90% uptime. I have done the exact opposite, I have a small team for a very large space but we have created efficient processes and monitoring tools in house to greatly augment the efficiency of our team. With an average of 12000 machines online I can claim (with proof) we keep an over 99% uptime with a staff of less than half a dozen. Only by keeping operational costs as low as possible and reinvesting as much as possible on the upswings can you survive here stateside. When you factor in insurance and taxes and tariffs and everything else, overall costs can stack up quickly and most people starting these datacenters with the dream of lining their own pockets will never have a sustainable business model. You survive by stacking and saving and being prepared for the volatile market conditions that are guaranteed to happen.
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December 05, 2018, 10:03:41 PM
Last edit: December 05, 2018, 11:59:40 PM by frodocooper
 #163

You must love this shit, because it would be much easier to just buy bitcoin and HODL.
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December 05, 2018, 11:09:52 PM
Last edit: December 06, 2018, 12:01:42 AM by frodocooper
 #164

You hit the nail on the head here. As someone who has been doing this at an industrial level longer than most I have seen soooo many poorly designed and poorly ran datacenters pop up and die a horrible death shortly after. The only way to survive in this industry is to run very lean in all phases of operation at all times regardless of profits or how well the market is doing. What i have always done is ride the waves up by reinvesting and expanding when times are good so that when things are on the downturn you can survive by the sheer size of your operation. Most people getting into this game make a few major mistakes. Mistake 1 is build costs, the way to build is leaning on the secondary market. Electrical infrastructure has not changed much in the last 50 years, a transformer is a transformer. As an example, I picked up used 480/208 step down transformers for pennies on the dollar used while I watched other places pay tens of thousands of dollars for brand new equipment where im paying maybe 10% of what they are for used equipment that functions just as well. With over 20mw of power in use I have not had a single used transformer fail. Another thing I consider a mistake is buying PDUs new. These can easily run into the high hundreds per piece new, whereas I have over 3000 active PDUs and none of them cost over $100 thanks to the secondary market.

The second big mistake is in operational costs.

I know of 5mw datacenters with 20 technicians on staff and even with all that they still are lucky to keep a 90% uptime. I have done the exact opposite, I have a small team for a very large space but we have created efficient processes and monitoring tools in house to greatly augment the efficiency of our team. With an average of 12000 machines online I can claim (with proof) we keep an over 99% uptime with a staff of less than half a dozen. Only by keeping operational costs as low as possible and reinvesting as much as possible on the upswings can you survive here stateside. When you factor in insurance and taxes and tariffs and everything else, overall costs can stack up quickly and most people starting these datacenters with the dream of lining their own pockets will never have a sustainable business model. You survive by stacking and saving and being prepared for the volatile market conditions that are guaranteed to happen.

A...Freaking...MEN!! I am much smaller than that but I do ALL my own work. I sure as Hell don't Air Condition my units! I'm only 3MW but I have one employee and I don't hire anyone for anything that I can do myself and I can do most of it. Couldn't agree more. Lean and Mean and down and dirty. Who knows, even that may not be enough when it's all said and done but it at least gives you a fighting chance. Nice post. Thanks.



You must love this shit, because it would be much easier to just buy bitcoin and HODL.

How can you say that after what has just happened. There is a sea of people that do this that are wiped out, or down 80%. Miners have the option to hold, sell, hedge...trade. The flexibility is invaluable. This "HODL" thing needs to be put to rest. It's not viable in a Bear market.
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December 05, 2018, 11:27:53 PM
Last edit: December 06, 2018, 12:03:53 AM by frodocooper
 #165

Stay on topic guys. Grin

Bitcoin Difficulty:   5,646,403,851,534
Estimated Next Difficulty:   5,375,391,652,765 (-4.80%)
Adjust time:   After 1698 Blocks, About 12.7 days
Hashrate(?):   37,293,789,435 GH/s
Block Generation Time(?):   
1 block: 10.8 minutes
3 blocks: 32.4 minutes
6 blocks: 1.1 hours

Current Pace:   88.8959%  (319 / 358.85 expected, 39.85 behind)
Current Difficulty:   5646403851534.721XXXXXXXXXXXXXXXXXXXXXXXXXXXX
Next Difficulty:   between 5037694488808 and 5454336024783
Next Difficulty Change:   between -10.7805% and -3.4016%
Previous Retarget:   last Monday at 6:46 AM
Next Retarget (earliest):   December 17, 2018 at 7:00 PM  (in 12d 0h 25m 24s)
Next Retarget (latest):   December 19, 2018 at 12:44 AM  (in 13d 6h 9m 44s)
Projected Epoch Length:   between 14d 12h 13m 53s and 15d 17h 58m 12s

-10%  to -8% seems pretty likely.

But on any given day the missing 16,000,000,000gh could come back online  as it is out there somewhere

The diff day adjustment high for hash was 53,000,000,000gh or about 3,785,714 s9's if network was all s9's

The real high for has was around 56,000,000,000 or about 4,000,000 s9's

so the current number now is 37,500,000,000

that is a drop of 18,500,000,000 gh or 1,321,400 s9's are off line

I mine alt coins with https://simplemining.net...
I see BTC as the super highway and alt coins as taxis and trucks needed to move transactions.
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December 06, 2018, 12:39:58 AM
Last edit: December 06, 2018, 12:57:35 AM by frodocooper
 #166

I don't mean to take the thread off topic. Its just that watching the mining carnage and the zero sum mining game in action, it seems like an incredible amount of financial outlay and upkeep and risk vs. just buying bitcoin.

I know you are on freeish solar so that's a different ballgame. But the upside to mining is "discounted" coins. The downside is loss. Buying bitcoin anytime since 2009 except for a handful of months in 2017 is now incredible gains, with zero maintenance or overhead.

I find these mining threads very educational as I try to understand the mentality behind them.
philipma1957
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December 06, 2018, 01:12:15 AM
 #167

I don't mean to take the thread off topic. Its just that watching the mining carnage and the zero sum mining game in action, it seems like an incredible amount of financial outlay and upkeep and risk vs. just buying bitcoin.

I know you are on freeish solar so that's a different ballgame. But the upside to mining is "discounted" coins. The downside is loss. Buying bitcoin anytime since 2009 except for a handful of months in 2017 is now incredible gains, with zero maintenance or overhead.

I find these mining threads very educational as I try to understand the mentality behind them.

Well I can earn a certain profit at mining.

Anyone with low power cost can do it.

hodl has no guarantee.

Risk is lower to mine if your power cost is dirt cheap.

hodl a coin has high risk.

So do I make a certain  10 to 20%  year after year  and once in a while  have a 90% year  2013 and 2018  were 90% years for me.

this year is about 3-5% year the worst I have had.

I mine alt coins with https://simplemining.net...
I see BTC as the super highway and alt coins as taxis and trucks needed to move transactions.
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December 06, 2018, 01:31:58 AM
Last edit: December 07, 2018, 04:24:24 AM by frodocooper
 #168

I gotta say I love these calculations. hats down !

but there are 2 points that might play a big role in affecting the predictions.

1- the S11/S15/T15 .
these machines run about 40% to 70% more efficient than the S9s. indeed they will not make a 70% change in the calculation but soon enough tons of them will be up and running.

2- I have some good contacts with some bulk asic suppliers in China mainland, there are S9s by the tons that have been shut down, packed and waiting for a buyer. they are selling as low as 125$ with PSU ! .

one of the suppliers i know sold well over 7000*s9s a few days ago "Free On Board". ! which makes me think , somebody somewhere who is not in china have access to cheaper power and is about to start plugging back those S9s !.

now of course this could be a group of stupid rich kids who just heard about mining and are entering a business that will make 0 profit for them as many others do. but the scrary part of point 2 is the price ! a second hand s9 with PSU for 125$ is tempting! it can attract many investors to buy and keep the difficulty up.

again they could be buying them only because they are cheap and they waiting for a bounce in BTC price to start mining, but what are the odds than anybody would do this?

I know 7000 s9s are not a big deal, but the overall second hand market for asics in china will do just fine, they will keep dropping the price until they get rid of them, regardless of whether the buyer's business plan is successful or not. many if not most of the almost 1 million s9s that have been shut down can possibility return to service.

I do hope i am wrong and whatever thoughts i am having now are nothing but the result of eating to much lamb earlier. Grin

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December 06, 2018, 02:24:27 AM
Last edit: December 07, 2018, 04:25:04 AM by frodocooper
 #169

Well I can earn a certain profit at mining.

Anyone with low power cost can do it.

hodl has no guarantee.

Risk is lower to mine if your power cost is dirt cheap.

hodl a coin has high risk.

So do I make a certain  10 to 20%  year after year  and once in a while  have a 90% year  2013 and 2018  were 90% years for me.

this year is about 3-5% year the worst I have had.

Yes, except if you were entering the mining game today you have long term risk of recovering your outlay that is predicated on price just like "hodlers" and on top of that you have risk of hash rate exponentially becoming harder.

So thats a second layer of risk.

Your bet paid off with returns as high as 90%. My risk paid off with returns in the 10 of thousands %.

Mining was brilliant once upon a time. But to enter mining today, you have to be someone who just loves the business and gets a kick out of machines, wires, power grids and cooling systems, etc.

I was in the music business for years. Likewise, I would tell someone who wanted to enter it, to only enter it if you HAVE to do it. If it makes you whole and happy. Because its a terrible terrible business.
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December 06, 2018, 03:52:12 AM
 #170

Yes....terrible...to be sure. Don't do it!! Shocked
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December 06, 2018, 08:09:58 AM
Last edit: December 07, 2018, 04:25:26 AM by frodocooper
 #171

It can be in a wallet  that no one knows about but yourself  so paying  4800 for a 3900 asset is not so dumb  if it goes up to 20000 in a few years.

and you could sell the coin for 19000 cash  to a guy that has a fresh core wallet  and he now has a hidden asset.

Why not paying 4800 for a 4800 asset in that wallet?
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December 06, 2018, 01:39:53 PM
Last edit: December 07, 2018, 04:25:47 AM by frodocooper
 #172

Why not paying 4800 for a 4800 asset in that wallet?

Hey I don't want secret assets and I won't pay a premium to get them.

But some people want to do it.

So the answer is  yes  pay 4800 and keep it on the up and up.

I mine alt coins with https://simplemining.net...
I see BTC as the super highway and alt coins as taxis and trucks needed to move transactions.
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December 07, 2018, 12:34:53 AM
Last edit: December 07, 2018, 04:26:10 AM by frodocooper
 #173

BTC @ 3.5K$
BTC Mining stable at 37Exo hash.
Another diff drop of 5% in sight.

Guess it will be it until late Dec then up again.

Chain profitability war it is

OP well explained mining floor cost
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December 07, 2018, 03:19:31 AM
 #174

I agree on this. The diff and prices right now are heavily manipulated by someone (not pointing fingers here). But evidence does suggest that. Strap in boys, we're going in for  several months of turmoil. Hope you got your Fiat stocks ready!
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December 07, 2018, 04:14:06 AM
 #175

I agree on this. The diff and prices right now are heavily manipulated by someone (not pointing fingers here). But evidence does suggest that. Strap in boys, we're going in for  several months of turmoil. Hope you got your Fiat stocks ready!

Bitmain via hashnest  there I pointed a finger or 2.

I mine alt coins with https://simplemining.net...
I see BTC as the super highway and alt coins as taxis and trucks needed to move transactions.
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December 07, 2018, 07:02:41 PM
 #176

Well whoever's doing it needs to take a break. Another thousand dollar dump in a week making a 50% drop in four weeks, sales evaporating, hosting customers turning off - I'm really not looking forward to going bankrupt and shutting down my business right after Christmas.

Cool, quiet and up to 1TH pod miner, on sale now!
Currently in development - 200+GH USB stick; 6TH volt-adjustable S1/3/5 upgrade kit
Server PSU interface boards and cables. USB and small-scale miners. Hardware hosting, advice and odd-jobs. Supporting the home miner community since 2013 - http://www.gekkoscience.com
philipma1957
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December 07, 2018, 08:26:53 PM
 #177

Well whoever's doing it needs to take a break. Another thousand dollar dump in a week making a 50% drop in four weeks, sales evaporating, hosting customers turning off - I'm really not looking forward to going bankrupt and shutting down my business right after Christmas.

yeah it has to be very hard on your business model.

I am down  from 400-600 a day last Nov-Dec-Jan  to 150 a month.

big drop for me.

I mine alt coins with https://simplemining.net...
I see BTC as the super highway and alt coins as taxis and trucks needed to move transactions.
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December 07, 2018, 08:46:28 PM
 #178

I dropped hosting price to power cost to keep people from shutting down immediately because I need heat for winter. I was at 65% capacity by then already. I'm rolling out a USB hub that should kit nicely with NewPacs but it'll also be a good standalone product whose sales will be insulated from Bitcoin whims, but I'm getting a late start and having half my savings disappear in the span of a few weeks sure doesn't help. It also doesn't help that a lot of my parts now cost more than they used to, thanks Trump.

Phil, if you'd like a sample hub to play with and give me an opinion I can send you one.

I haven't done much mining myself in at least a year but even with the diff dropping, even if I could afford miners I wouldn't buy any.

Cool, quiet and up to 1TH pod miner, on sale now!
Currently in development - 200+GH USB stick; 6TH volt-adjustable S1/3/5 upgrade kit
Server PSU interface boards and cables. USB and small-scale miners. Hardware hosting, advice and odd-jobs. Supporting the home miner community since 2013 - http://www.gekkoscience.com
philipma1957
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December 08, 2018, 12:33:07 AM
 #179

I dropped hosting price to power cost to keep people from shutting down immediately because I need heat for winter. I was at 65% capacity by then already. I'm rolling out a USB hub that should kit nicely with NewPacs but it'll also be a good standalone product whose sales will be insulated from Bitcoin whims, but I'm getting a late start and having half my savings disappear in the span of a few weeks sure doesn't help. It also doesn't help that a lot of my parts now cost more than they used to, thanks Trump.

Phil, if you'd like a sample hub to play with and give me an opinion I can send you one.

I haven't done much mining myself in at least a year but even with the diff dropping, even if I could afford miners I wouldn't buy any.

Sent a pm.

I mine alt coins with https://simplemining.net...
I see BTC as the super highway and alt coins as taxis and trucks needed to move transactions.
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December 08, 2018, 05:04:21 PM
 #180

I dropped hosting price to power cost to keep people from shutting down immediately because I need heat for winter. I was at 65% capacity by then already. I'm rolling out a USB hub that should kit nicely with NewPacs but it'll also be a good standalone product whose sales will be insulated from Bitcoin whims, but I'm getting a late start and having half my savings disappear in the span of a few weeks sure doesn't help. It also doesn't help that a lot of my parts now cost more than they used to, thanks Trump.

Phil, if you'd like a sample hub to play with and give me an opinion I can send you one.

I haven't done much mining myself in at least a year but even with the diff dropping, even if I could afford miners I wouldn't buy any.

will sent a pm shortly.
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