For how long can we actually mine ?

[mikeywith]

I was reading through this topic , checked the excel sheet and I was inspired to make something similar and to take the "speculation" a little bit further, and I came up with this.



-Since I have no data of future difficulty ( for obvious reasons ) that factor has been totally ignored.
-I also think that mining gears efficiency improvement will cover up for hashrate decrease that is caused by future halving.

The most important column would be the most right (Price Required) , which stands for the price bitcoin has to be in order for

1- Mining to be as profitable as it is today.
2- The incentives for mining remains the same.
3- Mining decentralization does not fade away.
4- 51% attack cost / difficulty does not decrease.

At which point do you think that all the above will be extremely hard to keep ?

I personally think that before 2045's halving whereby price only needs to be at around half a million $ per coin is somehow safe, after that things will start to get really difficult for miners and for bitcoin as a whole ,assuming price does not go pass 100,000$ by 2040 bitcoin mining will be 80% less profitable and less decentralized.

While the next a few years or decades seem to be pretty promising, things become complicated as we move on, i will most likely be dead by then, but I love to speculate how will mining be like by then??

[DaveF]

It's all really going to depend on the price. This will determine WHO is mining not if we can still mine. Nothing more, nothing less.
If the price is high enough then big mining farms will continue to dominate. Make no mistake about it. If having 1 miner makes you $1 a day then having 1,000,000 miners will make you $1,000,000 a day so if you have the money you buy as many as you can.

If you cannot make money then the larger miners are going to go away and mining will come back to the home.
If I loose $1 a day but I enjoy mining bitcoin then guess what I am going to keep mining it with something sitting in the back room [So long as I can run it on 110v and it's quiet]

So, it's not "For how long can we actually mine ?" it's how long can big miners keep mining. For people mining as a hobby or for fun, making or loosing money is a secondary consideration.

Just my view.

-Dave

[philipma1957]

It's all really going to depend on the price. This will determine WHO is mining not if we can still mine. Nothing more, nothing less.
If the price is high enough then big mining farms will continue to dominate. Make no mistake about it. If having 1 miner makes you $1 a day then having 1,000,000 miners will make you $1,000,000 a day so if you have the money you buy as many as you can.

If you cannot make money then the larger miners are going to go away and mining will come back to the home.
If I loose $1 a day but I enjoy mining bitcoin then guess what I am going to keep mining it with something sitting in the back room [So long as I can run it on 110v and it's quiet]

So, it's not "For how long can we actually mine ?" it's how long can big miners keep mining. For people mining as a hobby or for fun, making or loosing money is a secondary consideration.

Just my view.

-Dave

I will always mine. but your point here is very valid.

my estimates are 2025 or 2029 and big mining ⛏ ends.

transactions fees do not scale past those years.  I personally don’t see btc at 50,000 levels for lots of reasons.  basically any clone of it will do as long as the clone uses sha-256 since this is the most common gear.

[mikeywith]

So we all agree on the main points here, except that i think mining farms will still do just fine till 2029-2033 because i don't see why wouldn't bitcoin hit 50k in 10 years, the way i look at it is if btc can't do that, it might as well just die and disappear.

Now since we agree to the fact the home miners will dominate at certain point, how reliable will bitcoin be then when 1 large farm can switch their gears back on and easily attack the network or force new rules / hardfork or whatever shit anyone would do? The blockchain size by then will also be very large,nodes number might as well drop significantly , making every kind of attack much more easier than it is now.

I know that isn't 100% mining related, but what plans do we have for those "dark days" ? How can we maintain the same level of mining incentives to keep the blockchain secured without totally depending on price?

[DaveF]

Now since we agree to the fact the home miners will dominate at certain point, how reliable will bitcoin be then when 1 large farm can switch their gears back on and easily attack the network or force new rules / hardfork or whatever shit anyone would do? The blockchain size by then will also be very large,nodes number might as well drop significantly , making every kind of attack much more easier than it is now.

Probably not as easy as it sounds. You are still going to need the gear and the power. No big miner is going to just shut down and go away. They are going to sell the buildings / get out of the leases they are in and sell off the gear. Sitting on the gear to attack later is just not good business. Newer, gear more efficient will still come out since there will be a profit in designing and building miners so even if they kept it they might be behind the curve .

The biggest issue would be a pool or group of pools that gains enough hash. But I would think the same backlash that hit ghash.io back in the day would happen again.

And as Phil said it's probably not going to happen for at least 10 years so there could be some other changes in mining that we are not even thinking about.

Edit: As for the blockchain size, I really think that is a non issue. I just got a 1TB SSD for under $100 at Amazon. I could have gotten it for less but I was in a hurry and just wanted to get it ordered, did not want to stop and shop to save $10.00.

-Dave

[mikeywith]

Sitting on the gear to attack later is just not good business.

That makes sense, however the incentives may still be there, some might want to increase the 21 million cap so they can still mine, some might do it for the sake of it, we don't know what reasons anyone will have, we just know that attacks on the blockchain might be fairly easy and don't cost much, and that itself is an issue.

however , as far is economic is concerned, your theory is valid , if bitcoin is worth so little that it becomes easy to attack , it won't be worth the attack in the first place, economically it makes no sense.

The biggest issue would be a pool or group of pools that gains enough hash. But I would think the same backlash that hit ghash.io back in the day would happen again.

That's another major concern as well, very well addressed by you.

Edit: As for the blockchain size, I really think that is a non issue. I just got a 1TB SSD for under $100 at Amazon. I could have gotten it for less but I was in a hurry and just wanted to get it ordered, did not want to stop and shop to save $10.00.

100$ is a lot of money to most people , as far as using it to store a blockhain that doesn't pay you anything, those who would always need to run nodes regardless of the cost would be mining pools and businesses receiving payments on the blockchain, at that point , most pools will close down , if price doesn't "moon" many individuals will lose hope and simply shutdown their nodes , this takes us back to your statement:

It's all really going to depend on the price...

everything goes down to that, decentralization of nodes , decentralization of mining , security and adoption will always depend on bitcoin to be worth a minimum price of x number, this puts us in a very difficult race against time.

But as I said earlier ;

I personally think that before 2045's halving whereby price only needs to be at around half a million $ per coin is somehow safe, after that things will start to get really difficult...

if the fiat system collapses by then and bitcoin does become a real mean of payment which is attached to no fiat value, we won't have to worry about any of this.

[mikeywith]

[...]

I think i have failed in addressing the main concern here, maybe this is the wrong section for the topic anyway  

if you forget the title for a while, and just focus on the sheet, can't you see a potential issue coming in the next decade or two ? or even a bit closer like how phill thinks ?

to make it a little bit clearer, if bitcoin's existence depends 100% on price, at which point will this become a real threat, and what solutions do you propose to overcome such a potential issue?

this is what  daveF, phill and I are actually discussing anyway.

[philipma1957]

There are some solutions :

1) price simply rises and rises and rises.  Not so sure about this one.

2) fuck lightning fuck segwit increase block size from 2 to 4 to 8 to 16 to 32  transaction volume can scale from  250k to 500k to 1000k to 2000k a day  and fees do get bigger

I don't know how feasible  1 or 2 are.

I finally got to a point where I can see 300 to 400kwatts of competitive power. That I will manage and invest in getting gear for it..  My share is    75kwatt to 100kwatts.

I am up to 160kwatts now with 40kwatts as my share.  So I will be like a small businessman  for the next 10 years.

So pretend  I do  35 s17 pros as my share by 2021 it is only 1.75 ph  for me. I won't push hard until I see  real price movement..   Ie 10-14k sustained due to this ½ ing is what I need to feel I should add gear to what I have now.

I have 1.3 ph  BTC and 11 gh LTC   25%  of the coins  are all mine  and the gear is almost all paid off.  Threads like this determine what I will do .

Getting the paypal deal I got  9500 gear with six months to pay  got a nice expansion for me..

I also managed close to perfection for the warehouse hoster  as he got 10 s17 pros for 22000 with six months to pay.  that gear gets him  0.01 btc a day.

[mikeywith]

2) fuck lightning fuck segwit increase block size from 2 to 4 to 8 to 16 to 32  transaction volume can scale from  250k to 500k to 1000k to 2000k a day  and fees do get bigger

Larger blocks might ensure more transactions but not more fees, the bigger the block the cheaper the transactions becomes.

By the end of the day, receiving one sat for 100 transactions is nothing better than receiving two sats for 50 transactions, unless of course, bitcoin becomes mainstream that big blocks do actually get fill, and then we get to make a lot of profit from the large number of "cheap" transactions.

However, that will hurt decentralization, thus causing some investors to run away from BTC, which then might cause price to fall, it is just impossible to guess if bigger blocks are better for miners.

I am up to 160kwatts now with 40kwatts as my share.  So I will be like a small businessman  for the next 10 years.

You already are a businessman phill, by the way, do you have any particular target for the total amount of hashrate you aim to own in say two to three years from now? Alternatively, do you plan to keep on growing as long as opportunity presents itself?

[philipma1957]

as to whether more blocksize with more transaction is good as i may think ,your flip side has value.

i personally don’t know if increasing block size would increase adaption and the amount of transactions would be 1,000,000 per block if block size was 16 vs the 2 it is now.

that is a complex economic model and it may never be real world tested.

hmmm growing the mine past the 160-180kwatts.

the clifton area if fully maxxed out has multiple buildings we could go beyond the hoped for jump to 400kwatts in 2020.

i think the clifton spot could push 600kwatts.

that is 480 24/7/365 it would be 200 s17 pro with custom firmware we could do 60th a unit.
and 2000 watts a unit.

that would be 12ph.  i cant see more then this. and lots of factors must happen for us to go that big.

[zoomhashofficial]

I think the overall costs of mining and running a mining operation will continue to drop as well, which might greatly increase the timeline of mining being as profitable if not more-so than today.

Bitcoin mining will benefit greatly from the energy innovations and solutions we're currently creating to move away from fossil fuels. You already see it today with operations like ours. When you couple that with technology innovations and ASIC miners becoming much more efficient I can see the overall costs of running miners dropping off significantly.

I hear speakers like Andreas often talk about how even with enough hashing power the community wouldn't "allow" a 51% attack to happen. Whether that means creating some sort of fork, I don't see it becoming an issue for bitcoin at least.

[d5000]

my estimates are 2025 or 2029 and big mining ⛏ ends.

transactions fees do not scale past those years.  I personally don’t see btc at 50,000 levels for lots of reasons.

I disagree a bit here, and not because of the price estimation, but because I think there is some space for higher transaction fees than today.

In 2017 the average transaction fee miner income was well above 1 BTC/block and Bitcoin continued to work without flaws for most of the year. In December it reached 10 BTC/block at one point.

I think 10 BTC/block (that was about 30 USD for a standard transaction of ~200 bytes back then) wasn't sustainable before Segwit. 30 USD for a standard transaction is clearly too high, it would allow Bitcoin to work only as a settlement layer, and thus I don't believe this level can be held because of altcoin competition. But after Segwit - where capacity has approximately doubled - I consider the 10 BTC/block value a realistic upper boundary. At today's prices, 10 BTC/block means an average transaction price (for the 180 byte standard transaction) of 6 USD. This is high but for Bitcoin's killer feature - international transactions - it's still low. It would also allow the creation of LN channels for less than 20 USD and possibly less with channel factories.

For the long term I think, if we stay with approximately the current price (let's say between $3000 and $10000) a miners' fee income of 1 BTC/block (like in mid-2019) is very realistic and 3 to 5 BTC/block (which already would be more than the reward after 2025) not unlikely. That means that we basically don't need to care about the reward as long as blocks are well filled (>80-90% of capacity). If price increases, then the numbers will obviously even be better for the miners.

[TheYankeesWin!]

In 2029  a block is  going to be 1.625 btc toss in 1 btc for  tx fees  a block = 2.625 coins   right now a block is  12.5 + .5 = 13 coins.

either the diff tanks like mad or coins go to 32k  30 x 2.6 = 83,200        12.5 x 7 = 87,500

So in 2029  diff  will need to drop  by a factor of  4-5 to about 3.5  or price will need to rise by a factor of 4-5x to about 32k  to make mining work.

[Artemis3]

If China's fusion reactor becomes a success, they will kick everyone else doing it for profit.

I don't think Bitcoin price will increase enough to compensate for the diff rate increases, historically it is the opposite. As time passes mining becomes less and less profitable. The large price increase only delayed the inevitable a bit more.

If your power is cheap/free then sure. But if you are already close to the border, forget it. Time to shrink or leave.

Home mining can be doable if you use an abundant cheap power source, such as the Sun, a river, wind (or sand in a mountain).

[mikeywith]

So in 2029  diff  will need to drop  by a factor of  4-5 to about 3.5  or price will need to rise by a factor of 4-5x to about 32k  to make mining work.

This is based on the fact the mining profitably now is at the edge, which is not the case, there is still a bit of room for profit squeeze, we just don't know how much (less) miners are willing to settle for.

but if we look at it from a general point of view, price will need to be above 50k in 2029 and difficulty won't have to go any lower than it is today, and of course not go any higher for mining to be as profitable as is today.

[philipma1957]

The issue is scaling fees and transactions.

2025  block of 3.125

2029  block of 1.5625

If transaction never rise much past  450,000 a day https://www.blockchain.com/charts/n-transactions

which happened on  May 1 2019

what  will fees be.

if  450,000 x 0.0000100 =  4.5 btc    this will not work well in 2025   since that 4.5 is spread over 450 blocks or fees of   0.01btc per block
if  450,000 x 0.0001000 = 45.0 btc    this will not work well in 2025  since  that 45 is spread over 450 blocks or fees of   0.10btc per block
if  450,000 x 0.0010000 = 450 btc     this gets closer   since that  450 in fees is spread over 450 blocks  or fees of          1.00 btc a block

at 20,000 a coin     a 2025 block  is  3.125 + 1 = 4.125 coins or 82,500     and a standard transaction will be about 2 dollars.

I don't think 2 dollar transactions will sit well  as the low end transaction number.

we need to be able to have  2,000,000 transactions  daily for the 2029 block size of 1.5625 coins.

People will leave btc and move to ltc   as fees are cheap and network is secure.

Well  I don't worry for 2020  , but for 2025 or 2024  then 2028 or 2029  I see problems.

I tell you what bitmain  and canaan are worried for 2020  since they are rushing 5nm out so they see a blood bath coming at the ½ ing.

Why would you improve the s17 pro  which simply kills everything there is?

You fear the ½ ing  and want to keep far and above everyone in the game.

The ½ ing and the 5nm announcement   has influenced me to not buy any gear until February or March.

[Searing]

Yes, I must 'always' remember Bitmain is 'evil'

It is a trap. I suppose IF they got the 5nm out to themselves FIRST they could be like KNC Miner was in I think it was 2014 and control the majority of BTC mining or at least if I remember right and went big money investors private on equipment and chips just for themselves and investors and not others. I suppose if the bet does not work for halving being anything more than flat they can compensate by getting large amounts of Bitcoin mining hash back in that the 5nm chips will go to there own data halls first. I guess if the bet is wrong, they could simply get 'clueless newbie big money investors' like KNC Mining did and go fully private. Also, if it all goes south like happened with KNC Mining..those same clueless big money kool-aid drinking investors are left holding the bag on the bankruptcy. Remember Bitmain can do a lot yet to rig the deck in their favor...IF as most of us believe BTC may survive and grow if not thrive in the next year or so. Bitmain IMHO is playing a long game of go big or go bust!

Bitmain: Evil hands are the devil's playground....is pretty much a positive motto with those guys.

[philipma1957]

@ searing bitmain has shown they can sell so much gear super cheap and kill off a coins price.

It is a routine procedure that they do.

Its why I am being cautious right now.

Long term mining for btc does not work past the 2028/2029 1/2 ing

due to transaction limatation.

why use btc to move value and pay big money in fees.

the ltc / doge networks are very cheap and safe to move value around.

they also have tons of asic gear to back the two coins.

look at the product rationally  in terms of moving value what makes btc better then ltc or doge?

frankly if you are moving 1000 usd  or less worth of coin ltc and or doge are both better  btc.

doge will move 1, 000,000 coins in under 20 minutes and cost is really cheap.

I think 1000 usd is around 1,000,000 doge maybe more like 1,400,000 doge

[Searing]

Yeah, I agree, was not detailed enough, shooting from the hip and guessing on Bitmain and stuff. It is frigging obvious they have more than one angle in all this, confused though I may be the manipulation and huge money is obvious something is up.

As to the LTC scrypt-pow machine, the last  I looked LTC network was down more than 70% and the only real scrypt-pow miner(s) I know of are the Innosilicon ones  2 versions the lower version https://www.innosilicon.com/html/a6-miner/index.html they want $2k for....and according to this site:

https://www.asicminervalue.com/miners/innosilicon/a6-ltcmaster-1

at my 10c kWh, it loses $2.52 per day. Again, the only NEW units for scrypt-pow I know of. This was looking at this today 12/31/19. So unless BTC is gonna double or something and take LTC along with it, I'm not sure that LTC will actually make any progress in the next year on price or as usual 'iffy' development (except to follow bitcoin core). At this point, I doubt even Mimblewimble can do more than a sideways or modest increase in price and/or mining profits.

But I take your point on transaction fees not cutting it in the future and needing the price for BTC much higher even to work in the manner you state. But the last time I saw this much kool-aid drinking buying of equipment of dubious quality was when I was a newbie in 2013 and paid about 1/4 of my take home pay in 2013. I paid $5,131.80 for a KNC Jupiter Miner arrived on Oct 18th, 2013 and made I think ONE BTC a day at that date, sometime that date BTC was $150. I can only/hope/pray/guess that this is the same newbie kook-aid money that is NOT big guys on top, like Bitmain and others, but just newbie big money investors that were like home miners in 2013 and not knowing any better and  of them getting equipment, but of folk also newbies but with a lot more money than sense like the home miners of 2013. Man I hope their newbie faith is correct, or it will be quite the letdown for anyone getting equipment of dubious value in 2020. But you'd think that at this point in time, with halving coming up, there would be more BTC/Crypto buys instead of dubious mining. But then again, folk tried to tell me that in 2013 (and were likely right) so maybe this is just something you have to traverse as a miner of any size as you get into BTC/Crypto?

As usual with BTC/Crypto just flip a coin on what you want to do on any particular topic, be it HODL, or Trade or Mining, etc. Hell, I bet your odds are the same in most guesses, just using chance above instead of trying to figure out what is what!

Brad

[mikeywith]

Would like to add a few points

- LTC had it's halving recently, all it needs now is rise a little in price, every 1% increase in price will bring in more security by bringing in more hash power, BTC on the other hand is yet to have it's halving, price seems to be going down, transactions aren't increasing.

-LTC mining gears still have a ton of room for improvement, unlike BTC gears, if you take S9 and S17 it is just about double the efficiency after about 4 years, the S19 which will be built on 5nm is only 15-20% more efficient and probably is way more expensive.

-BTC has lighting network and it is basically it's best if not only option for mainstream, block size increment is not even being considered, it is highly unlikely that btc can sustain expensive transaction fees for too long and with lightning which i personally think that is going to succeed, miners should really stop counting too much on block fees for profit, its peanuts, only block rewards actually matter.

-Industrial mining cost a lot more than the numbers you see on Whattomine.com , adding pool fees, rent, services, salaries, risk factor, tax and (bribes for most countries with cheap power) and the list goes on.

Things are actually a lot less profitable than they seem, unless bitcoin price breaks all expectations to the upside - industrial mining may end way sooner than we think.