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Author Topic: Why will this ½ ing be different that all the older ones for the miners of btc?  (Read 265 times)
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philipma1957
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April 01, 2019, 04:24:13 PM
Last edit: April 02, 2019, 12:46:27 AM by frodocooper
 #1

anyway @phillipma
I didn't know where to ask, since i thought it should be public anyway, but can you start a thread on speculating what you expect the halvening to do? People i know in the industry are confident. "we've been here before and it went well". I only started following Bitcoin like this recently, I'd love some thoughts from you and others that have ridden out the past halvenings versus what you think will happen this time similarly/dissimilarly

I am quoting this from another thread.  I gave the guy a merit as it was a good idea for a new spec thread.

I do believe this ½ ing of btc will be different then any other one.

I will list reasons in a few days.  But for all others and their ideas please fell free to guess along with me.

I self mod mostly for people to act nicely more than anything else.

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April 01, 2019, 04:25:01 PM
Last edit: April 02, 2019, 12:47:30 AM by frodocooper
 #2

countdown clock link

https://www.bitcoinblockhalf.com/

List of my guesses on this to come very soon.

1) 6.25 reward   tx fees stay flat they are 2x the % of a block .

 Ie.  12.5 + .1 = .1/12.6=   0.793%
to become
Ie.    6.25 + .1 = .1/6.35 = 1.574%

I believe this will cause more pressure for this to happen

https://bitcointalk.org/index.php?topic=2634505.0

I think the market can be manipulated since rewards are going to be far more valuable then ever. They were able to make money as I described in that thread. With the reward ½ it will be easier to do.

2)
3)
4)
5)

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April 01, 2019, 05:33:09 PM
Merited by Foxpup (4)
 #3

It's weird for me this is my first halving as an active participant. I made my mind up on what I am expecting, it's an incredibly narrow look at things overall. Thinking about these things is why I have decided to get myself to capacity sooner rather than later for my personal mining. This way by the halving my machines won't owe me anything

I expect the block reward to be cut in half. I know very bold statement but I think I can stick by that.  Wink

Seriously though,

I think pricewise is is going to look like September to December 2017, before the halving. Not necessarily the same ATH, but maybe around 13 000$.
I believe we will see a large increase in hashrate leading up to the halving, from people throwing not necessarily profitable machines online to earn as many coins as possible. They will be banking on a price spike after the halving.
Immediately after the halving we are likely to see a pretty good drop in hashrate; more than the increase leading into it. I think that many people are going to become non-profitable shortly after the halving. Unless there is a large sustained rise in price to offset the lower mining rewards.

My biggest hope, is that with the block reward cut. Certain pools will stop mining empty blocks, or their miners realize how stupid it is to mine at these pools.

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April 01, 2019, 05:58:34 PM
 #4

It's weird for me this is my first halving as an active participant. I made my mind up on what I am expecting, it's an incredibly narrow look at things overall. Thinking about these things is why I have decided to get myself to capacity sooner rather than later for my personal mining. This way by the halving my machines won't owe me anything

I expect the block reward to be cut in half. I know very bold statement but I think I can stick by that.  Wink

Seriously though,

I think pricewise is is going to look like September to December 2017, before the halving. Not necessarily the same ATH, but maybe around 13 000$.
I believe we will see a large increase in hashrate leading up to the halving, from people throwing not necessarily profitable machines online to earn as many coins as possible. They will be banking on a price spike after the halving.
Immediately after the halving we are likely to see a pretty good drop in hashrate; more than the increase leading into it. I think that many people are going to become non-profitable shortly after the halving. Unless there is a large sustained rise in price to offset the lower mining rewards.

My biggest hope, is that with the block reward cut. Certain pools will stop mining empty blocks, or their miners realize how stupid it is to mine at these pools.

Haha, i was thinking 'yes, first guy on the hook to share thoughts' and then... (in bold)... I was thinking just about this is all i can predict too!

I hear a lot of confidence about the price going up, i) its happened before previously ii) the coin supply halves therefore we need to have people selling only at double their previous biting point in production... but... why? Why can't it just be they go out of business at that point? Why can't leading up to it can it not lead to depression of confidence as miners know they need to halve their production costs or have the price double..

Surely confidence is down and I see the halvening as mysterious and an amplifier of whatever sentiment there is at the time, i am typically skeptical person (read: pessimist?) but I can't see how with limited change in utility [tick!], limited change in adoption [tick!], and overall negative/bearish sentiment [tick!] how the fact that half as many coins will be issued can be a good thing, I would like to be shown both here in arguments and later in reality that I was wrong Smiley

My overall feeling is: its a shock and its curious and so it will just double down on whatever the market sentiment is overall.
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April 01, 2019, 11:58:26 PM
Last edit: April 02, 2019, 04:08:39 AM by Biodom
 #5

This halving would be different because profitability (at least in btc) is harder and harder to imagine.
I grant you that in $$ profitability might be there (especially at 5c and below) if you count only in $$ and assuming a possibly upcoming bull market in bitcoin.

In btc terms, S9 barely made it (or with a slight profit when counting mined btc minus paid btc minus electricity cost).
With each cycle profitability stretches more and more.
I expect s17 to need a full 1.5-2 year run to fully recoup the cost, especially since the reward would be cut in half after about 12 mo or even less.
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April 02, 2019, 02:14:01 AM
 #6

This halving would be different because profitability (at least in btc) is harder and harder to imagine.
I grant you that in $$ profitability might be there (especially at 5c and below) if you count only in $$ and assuming a possibly upcoming bull market in bitcoin.

In btc terms, S9 barely made it (or with a slight profit when counting mined btc minus paid btc minus electricity cost).
With each cycle profitability strtches more and more.
I expect s17 to need a full 1.5-2 year run to fully recoup the cost, especially since the reward would be cut in half after about 12 mo or even less.

Strange thing is i clearly remember the previous halving having the same thought. One bitcoin was like 600$, the S9 was the new super efficient asic miner, others were happy with their S7s and couldn't justify spending 2k~3k USD for the S9. 2016 was a good year, would bitcoin ever breach that mythical 1.2K barrier prior to the Mt.Gox demise? ah those were the days....

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April 02, 2019, 01:24:12 PM
 #7

Some whale read this ?  Btc is close to 5k

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April 03, 2019, 05:47:32 PM
 #8

I was honestly loling at the thought myself ^
5,2 enroute
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April 03, 2019, 06:23:02 PM
Last edit: April 04, 2019, 12:07:17 AM by frodocooper
 #9

I was honestly loling at the thought myself ^
5,2 enroute

Well looks like some group did a 20000 btc coin purchase across 3 or 4 exchanges.  Off to the races. look at some jumps here

btc 4200 to 5133
bch  180 to 327

eth  152 to  173
ltc     60 to    94

https://coinmarketcap.com/charts/

all coins in coin market cap

april   1     146 billion

april   3     181 billion

The market wants  to move up.  0.1 billion bomb dropped  and yield was  35 billion  that is 350 to 1.  I would think  market could explode here with a few more big purchases.

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April 03, 2019, 10:16:37 PM
 #10

@philipma1957, may I nudge you to reveal your ideas why this halving would be different or were these thoughts circumvented by the recent rise and the apparent ease of it (only 100mil spent)?
Thanks.
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April 03, 2019, 10:26:38 PM
Last edit: April 04, 2019, 12:07:52 AM by frodocooper
 #11

@philipma1957, may I nudge you to reveal your ideas why this halving would be different or were these thoughts circumvented by the recent rise and the apparent ease of it (only 100mil spent)?
Thanks.

If you read

#1 my first pick was done  via an edit  before price injection happened.

#2 is to be revealed here and is very obvious pick.  The market is wanting  to rise up so the injection of funds 100M got a 350 to 1 boost. For the market cap.  So it reinforces number 1 pick we will see funds injected one way or the other.  this was a precursor testing  to the pumping.

countdown clock link

https://www.bitcoinblockhalf.com/

List of my guesses on this to come very soon.

1) 6.25 reward   tx fees stay flat they are 2x the % of a block .

 Ie.  12.5 + .1 = .1/12.6=   0.793%
to become
Ie.    6.25 + .1 = .1/6.35 = 1.574%

I believe this will cause more pressure for this to happen

https://bitcointalk.org/index.php?topic=2634505.0

I think the market can be manipulated since rewards are going to be far more valuable then ever. They were able to make money as I described in that thread. With the reward ½ it will be easier to do.

2)
3)
4)
5)

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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April 03, 2019, 11:47:04 PM
Merited by vapourminer (1), frodocooper (1)
 #12

I think it could be possible that people begin to anticipate halvings and fill their bags sooner. But I'm not sure if it will affect the price in noticeable way because there will be always new users buying BTC and some of them don't know much about "halvings".

And as already mentioned in OP it will be much more important for the miners to get the tx fees after the next halvings. Long-term the halvings will have always a lower impact on BTC-price and difficulty changes related to the halving because the tx fees will make up a bigger percentage out of the rewards. Maybe not much this halving but it also depends if the tx fees will be higher due to a new bullrun. In 2017 the rewards from tx fees were almost half of the block rewards even if it was only for a very limited time:



Source: https://www.bis.org/publ/work765.pdf

It's the nature of Bitcoin to have the rewards from tx fees long-term as main source for miners when the blockrewards go down.

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April 04, 2019, 01:14:04 PM
Last edit: April 04, 2019, 11:17:07 PM by frodocooper
Merited by frodocooper (1)
 #13

Yes, but now there are counter measures in place, namely: Segwit, and LN. Dec 2017 was quite exceptional, if things remained the same (no segwit, as a group wanted) you could probably predict the exact same thing occurring again. But now, even if tx fees rise up a little, i don't think it will be as dramatic as those 3 months.

Mining profits are destined to go down regardless. Coin price has delayed this somewhat, but in the long run is a lost battle. The last miners will be those with free electricity, such as those that invested in solar back when they could have spent it all in more Asic miners. I cannot stress this enough: Buying only asics and no renewables means you won't stay for long. Incidentally too large operations will go as well, smaler more efficient farms using renewable energy will outlast the giants using the grid. Some people without discipline expand beyond their capacity because they don't think long term. Even with higher bitcoin prices, mining will become more and more unprofitable, as designed.

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April 04, 2019, 01:21:15 PM
Last edit: April 04, 2019, 11:18:06 PM by frodocooper
 #14

Mining profits are destined to go down regardless. Coin price has delayed this somewhat, but in the long run is a lost battle. The last miners will be those with free electricity, such as those that invested in solar back when they could have spent it all in more Asic miners.

A well set up solar array  will work for 20 to 30 years.  It will always earn money at mining.  If you are correct  then buysolar and I will be okay for multiple ½ ings  

I have concluded that  hashrate growth is more my enemy since solar will not grow to 100 megawatts in our case.  10 megawatts is feasible and 10/7 = 1.428 megawatts 24/7/365 . If we are at that in 5 years  I prefer a stable price and hash much like it has been  since Oct of 2018.

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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April 04, 2019, 08:54:57 PM
Last edit: April 04, 2019, 11:19:46 PM by frodocooper
Merited by Foxpup (4)
 #15

Yes, but now there are counter measures in place, namely: Segwit, and LN. Dec 2017 was quite exceptional, if things remained the same (no segwit, as a group wanted) you could probably predict the exact same thing occurring again. But now, even if tx fees rise up a little, i don't think it will be as dramatic as those 3 months.

I agree and the implemention of LN will also be very interesting to see how tx fees are affected. Currently, the trend could be that the percentage of transaction fees per block will go down short-term and just be extended to keep slower increasing for future halvings.

But finally in LN there will always be on-chain transactions (tx fees go to miners) and as conclusion the following results can be possible:
- much higher number of transactions are done off-chain (multiple off-chain transactions are funding the final on-chain transaction)
- long-term on chain-transactions could be more expensive
- single transactions on LN will be much cheaper

But that could be another thread about LN affecting tx-fees. Of course, that's not a final solution.

In addition, small tx fees will be another advantage for BTC and make a higher price for BTC more likely. The argument that BTC transactions are too expensive would be flawed.

Mining profits are destined to go down regardless. Coin price has delayed this somewhat, but in the long run is a lost battle. The last miners will be those with free electricity, such as those that invested in solar back when they could have spent it all in more Asic miners. I cannot stress this enough: Buying only asics and no renewables means you won't stay for long. Incidentally too large operations will go as well, smaler more efficient farms using renewable energy will outlast the giants using the grid. Some people without discipline expand beyond their capacity because they don't think long term. Even with higher bitcoin prices, mining will become more and more unprofitable, as designed.

For now I don't see a problem for most miners to get unprofitable. The difficulty is still 3 times higher than December 2017 when BTC had the last ATH. There is still a lot of time left until the block rewards will decrease to a significant low level. If we assume that the BTC price will be much higher, the price will also be higher per block reward. Of course that's not waterproof for now.  Wink

We should remember that we are currently at a very low level of tx fees:



https://btc.com/stats/fee

Long-term your assumptions are indeed justified but there is still time to improve things and I'm sure there will be good solutions.   Smiley

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