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Author Topic: Anyone have a per unit cost estimate for mining bitcoins?  (Read 652 times)
Rockford99
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November 09, 2011, 12:41:23 PM
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Granted, electricity prices are different in different areas, but has anyone done any rough math on the expectation of getting a block awarded?
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November 09, 2011, 12:57:46 PM
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Granted, electricity prices are different in different areas, but has anyone done any rough math on the expectation of getting a block awarded?

Sounds like you are asking two different questions:

1. What is profitability of mining? -> Bitcoinx.com has charts how much you can make per day with 100Mh/s. -> http://bitcoinx.com/charts/

2. What is the likelyhood of finding a block? -> Here is a calculator to see statistics around how long it will take you to find a block -> http://www.alloscomp.com/bitcoin/old_calculator.php
Rockford99
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November 09, 2011, 02:56:34 PM
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Is the probability of finding a block dependent on how many people are mining/searching for blocks?

I'm just trying to make sure that the validation system remains economically viable.  If some people get discouraged and drop out, I don't have a problem with that as long as enough people continue mining/validating to keep the authentication process reasonably fast.

Am I correct in assuming the significant mining occurred at much lower bitcoin prices (<$1 last year), so mining should persist even at much lower bitcoin prices.
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November 09, 2011, 03:06:44 PM
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No.  You can't look at just price.  Bitcoin compensated for difficulty.  More people mining = higher difficulty = harder to find a block for a given amount of hashing power.  Difficulty ensures that the average time for entire network to find a block is ~10 minutes.

Difficulty now is 1.2 million so it is 1.2 million times more difficult to find a block than the first block however it is roughly 50% easier than at the peak difficulty.

On average the number of hashes required to find a block is (difficulty)*(2^32).
So currently is ~5 quadrillion hashes (5154 trillion).

How much you can generate (gross revenue before cost) in fiat also varies with exchange rate.  The link above has a nice graph which takes into account both PRICE & DIFFICULTY to give you the expected daily revenue per 100MH/s.
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November 09, 2011, 05:30:59 PM
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Thanks.  So to paraphrase your response.  The payoff to mining is somewhat related to the number of people mining.

My contention is that one of prerequisites of bitcoin viability is a robust transaction validation system that clears transactions in a timely/low cost fashion.  It sounds as though this element won't be in jeopardy even at much lower bitcoin prices.  I'm not focusing on bitcoins from a trading profitability standpoint.  I just want the system to persist and to continue to clear in a viable manner.  As long as that continues, I maintain my confidence in bitcoins.
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