2021, time for a new general & diff speculation thread...

[PrimeNumber7]

It is hard to know the legitimacy of cloud mining operations. Any one of those cloud mining operations could potentially be selling (or have sold) shares of miners that do not exist, even if they have actual miners from bitmain. For example, they could have sold 120% of their actual mining capacity. It is also possible that bitdeer was shut down, but will continue to sell cloud mining contracts to minimize the losses to the owners of bitdeer.

Viabtc will fare the best, as they can sell the miners that were just shut down by the Chinese government.

Would be interesting to know if the new locations are space constrained or power constrained.

I would piggyback off what mikeywith above.

A miner is essentially an ATM machine that prints cash to anyone in physical possession of the miner. If you ship a miner overseas, you need to have an employee that you trust set it up in a new datacenter. If the employee is not trustworthy, he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner. If someone owns thousands or tens of thousands of miners, they would have to send millions of dollars to what amounts to be a stranger in order to keep using their equipment, and there is the risk that an untrustworthy employee would repurpose a percentage of the miners to mine on another pool account, and the owner may not even be able to detect this.

[kano]

...
you need to have an employee that you trust set it up in a new datacenter. If the employee is not trustworthy, he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner.
...

While what you suggest may well happen or may even be common, it's not hard at all to completely lock down the miner sub-network in a data centre, to avoid this, and to increase network performance at the same time ...

[PrimeNumber7]

...
you need to have an employee that you trust set it up in a new datacenter. If the employee is not trustworthy, he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner.
...

While what you suggest may well happen or may even be common, it's not hard at all to completely lock down the miner sub-network in a data centre, to avoid this, and to increase network performance at the same time ...

If a datacenter customer is using the btc.com pool (for example), an untrustworthy employee could create his own btc.com pool account and have the miner mine on his pool account.

If for whatever reason, the above would not be an option, a corrupt employee could physically move a portion of miners to vacant space within the datacenter and bill the customer for electric usage. Or, he could run ethernet wiring from a network not associated with the customer into the location where the miners are stored.

[stompix]

It's easy to google countries with cheap power rates but moving there is not, even the so-called crypto-mining-friendly countries will not be as friendly when thousands of gears move there, more regulations will hit every country that has a large share of mining, mining will be a lot more difficult next year than it's now, the Chinese know that and they are being very skeptical, so when I see someone say "oh it's only 3GW worth of power, any small country can host those gears - it will happen next month", I can't help but laugh.

Feeling the same, 3GW might now be much, but there is more than just capacity.
You need 3GW of production, not capacity, you need an extra 3GW even at peak hours and you need 3GW of damn cheap energy.
Even for a large country, all those will not fall in places that easily.

I don't like to be that guy but all that news about Salvador pushing 90MW online and using it for mining is just hype, when you start looking why were they building that well you'll see it the reasons were far more severe:

In 2019, El Salvador’s electricity generation traded in the wholesale energy market was 6,481.7 GWh while demand was 6361.4 GWh. Total exports to other markets in Central America were 64.83 GWh and imports were 1,449.7 GWh, mainly from Guatemala.  Electrification is above 99% of the population in urban areas and 100% in rural areas. 

Even as we speak 20% of the energy is imported. Who thinks they will allow miners to use all that when they don't have enough for themselves?

So, who has enough 2-3 cents power to host 80exa of gear? We will see, but I doubt it will be next week or next month.

Meanwhile, the pace is still well below the adjustment, 133 blocks in the last 24h.
We might still see more than -5%.

[philipma1957]

It's easy to google countries with cheap power rates but moving there is not, even the so-called crypto-mining-friendly countries will not be as friendly when thousands of gears move there, more regulations will hit every country that has a large share of mining, mining will be a lot more difficult next year than it's now, the Chinese know that and they are being very skeptical, so when I see someone say "oh it's only 3GW worth of power, any small country can host those gears - it will happen next month", I can't help but laugh.

Feeling the same, 3GW might now be much, but there is more than just capacity.
You need 3GW of production, not capacity, you need an extra 3GW even at peak hours and you need 3GW of damn cheap energy.
Even for a large country, all those will not fall in places that easily.

I don't like to be that guy but all that news about Salvador pushing 90MW online and using it for mining is just hype, when you start looking why were they building that well you'll see it the reasons were far more severe:

In 2019, El Salvador’s electricity generation traded in the wholesale energy market was 6,481.7 GWh while demand was 6361.4 GWh. Total exports to other markets in Central America were 64.83 GWh and imports were 1,449.7 GWh, mainly from Guatemala.  Electrification is above 99% of the population in urban areas and 100% in rural areas. 

Even as we speak 20% of the energy is imported. Who thinks they will allow miners to use all that when they don't have enough for themselves?

So, who has enough 2-3 cents power to host 80exa of gear? We will see, but I doubt it will be next week or next month.

Meanwhile, the pace is still well below the adjustment, 133 blocks in the last 24h.
We might still see more than -5%.

We are drifting towards -5%.  It is hard to say what will happen> I have seen some larger amounts of used miners for sale .

Sellers that are likely real

Miner expert  has been selling for years and now has a lot of used gear.

[mikeywith]

he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner.

They might as well just ask you to get lost and say you do not own any miners, thus, operating without being under a "legal umbrella" outside of your country is a huge risk, think about all the bad things that happened to those greedy folks who sent their miners thousands of miles away for cheap hosting, while many hosts were straight out scammers, some others were "smart" scammers, they would let your gear mine for say a month, and then tell you "The PSU was broken, you need to send a replacement or we can buy it for you locally to save you shipping time and cost", what choice do you have? pay them for the PSU, a few weeks later, the control board is dead, rinse and repeat.

It's completely impossible to conduct such business without

1- Being at the site physically

or

2- Trusting the other person 100%

Maintaining a large mining farm takes some serious manpower, do not listen to those who tell you it's just "plug n play" and you can just sit at home and earn BTC, there will always be issues that you need to attend to, the more miners you have the more likely you face issues, so are the Chinese going to send workers over to some other country? how about the Visa and all the legal documents? does Iran or Khazatitan or whatever potential country have enough people who know to maintain large mining farms? are they trustworthy? if not - back to square zero.

Mining in China was like heaven on earth, the Chinese will never find a better place, they had access to cheap gear, almost zero transportation cost, you just reverse the truck in one of the warehouses in Shenzen, load it up and drive for a few minutes or hours to your farm, as easy as it gets, how does that compare to transporting it to the port, getting all the customs clearing shit done in China, paying a large amount of money for shipping and insurance, going through the same custom clearing, import duties shit and then sending the gears to the farm!

In China, you could hire 50-100 experienced people to set up the farm in no time at a very low cost, elsewhere, you will pay a lot more to hire less experienced people to do that, or of course, you can send your own people from China which will come at another cost.

Another issue is the repair services, large miners in China were offered on-site repair services by Bitmain and other major mining gear manufacturers, your gear stops mining? call Bitmain and they will send someone to fix it at the site, what do you do when you have 1000 gears that need fixing in El Salvador?

All the above issues can be solved if enough money is thrown at them, but mining profitability is somehow tiny compared to the cost, every expense matters, all of these factors and more will slow down the reallocation of those gears.

[philipma1957]

he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner.

They might as well just ask you to get lost and say you do not own any miners, thus, operating without being under a "legal umbrella" outside of your country is a huge risk, think about all the bad things that happened to those greedy folks who sent their miners thousands of miles away for cheap hosting, while many hosts were straight out scammers, some others were "smart" scammers, they would let your gear mine for say a month, and then tell you "The PSU was broken, you need to send a replacement or we can buy it for you locally to save you shipping time and cost", what choice do you have? pay them for the PSU, a few weeks later, the control board is dead, rinse and repeat.

It's completely impossible to conduct such business without

1- Being at the site physically

or

2- Trusting the other person 100%

Maintaining a large mining farm takes some serious manpower, do not listen to those who tell you it's just "plug n play" and you can just sit at home and earn BTC, there will always be issues that you need to attend to, the more miners you have the more likely you face issues, so are the Chinese going to send workers over to some other country? how about the Visa and all the legal documents? does Iran or Khazatitan or whatever potential country have enough people who know to maintain large mining farms? are they trustworthy? if not - back to square zero.

Mining in China was like heaven on earth, the Chinese will never find a better place, they had access to cheap gear, almost zero transportation cost, you just reverse the truck in one of the warehouses in Shenzen, load it up and drive for a few minutes or hours to your farm, as easy as it gets, how does that compare to transporting it to the port, getting all the customs clearing shit done in China, paying a large amount of money for shipping and insurance, going through the same custom clearing, import duties shit and then sending the gears to the farm!

In China, you could hire 50-100 experienced people to set up the farm in no time at a very low cost, elsewhere, you will pay a lot more to hire less experienced people to do that, or of course, you can send your own people from China which will come at another cost.

Another issue is the repair services, large miners in China were offered on-site repair services by Bitmain and other major mining gear manufacturers, your gear stops mining? call Bitmain and they will send someone to fix it at the site, what do you do when you have 1000 gears that need fixing in El Salvador?

All the above issues can be solved if enough money is thrown at them, but mining profitability is somehow tiny compared to the cost, every expense matters, all of these factors and more will slow down the reallocation of those gears.

.

That is a flat out score for out of China miners.

https://diff.cryptothis.com/

Latest Block:   689958  (16 minutes ago)
Current Pace:   90.4026%  (487 / 538.70 expected, 51.7 behind)
Previous Difficulty:   19932791027262.74                           
Current Difficulty:   14363025673659.96                           
Next Difficulty:   between 13006477047510 and 13753686696474
Next Difficulty Change:   between -9.4447% and -4.2424%
Previous Retarget:   last Saturday at 2:25 AM  (-27.9427%)
Next Retarget (earliest):   July 17, 2021 at 5:34 PM  (in 10d 21h 22m 7s)
Next Retarget (latest):   July 18, 2021 at 2:05 PM  (in 11d 17h 53m 14s)
Projected Epoch Length:   between 14d 15h 9m 8s and 15d 11h 40m 14s

...

Even if we do a -5%. we drop from 14.36 to  13.64 the real key is the rise back up. It could take a year to get back to 25> personally I think we get back to 25 in Feb or March.

A stable price in the 30-40k area is still very good for any established miner.

[PrimeNumber7]

he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner.

They might as well just ask you to get lost and say you do not own any miners, thus, operating without being under a "legal umbrella" outside of your country is a huge risk, think about all the bad things that happened to those greedy folks who sent their miners thousands of miles away for cheap hosting, while many hosts were straight out scammers, some others were "smart" scammers, they would let your gear mine for say a month, and then tell you "The PSU was broken, you need to send a replacement or we can buy it for you locally to save you shipping time and cost", what choice do you have? pay them for the PSU, a few weeks later, the control board is dead, rinse and repeat.

Many countries have robust court systems, rule of law, and property rights. Ideally, Chinese miners would move their equipment to a country in which the owners could call the local police if millions of dollars worth of equipment were stolen from them.

If I were a Chinese miner with a farm with 20k miners, I might send enough supplies such as PSUs to support 20.5k miners and have failed equipment be sent back as it dies.

It's completely impossible to conduct such business without

1- Being at the site physically

or

2- Trusting the other person 100%

If you assume there is no risk of criminal prosecution for someone who steals your equipment, you are trusting the entity providing hosting unless you have exclusive access to the site. If the host employees can access the site, they could steal your equipment when you are not there. This is why it is ideal to have your equipment located in a country in which there are real risks to brazenly stealing expensive property.

Another issue is the repair services, large miners in China were offered on-site repair services by Bitmain and other major mining gear manufacturers, your gear stops mining? call Bitmain and they will send someone to fix it at the site, what do you do when you have 1000 gears that need fixing in El Salvador?

I think this was a major reason why so many mining farms were located in China. If the Chinese miners move their equipment to a similar location in a high enough concentration, companies like Bitmain may send support staff to that general area to help with things such as on-site repairs. Depending on the labor market, they may even move some of their manufacturing to that area.

I would point out that if a farm was moved to some country in which theft of the miners was not a concern, without the ability to quickly repair miners or replace PSUs, the utilization of the miners might fall to 80% or 90%, or maybe a little lower if broken equipment is held locally for longer than it might otherwise be. This might be compared to 95% or 98% that Chinese farms could get in the past, but it would also be compared to 0% that farms are getting now. If a farm can send 20k miners to a secure location, and over several months 5k of the miners go offline due to various issues, the owner still has revenue from 15k miners they would not otherwise have.

[kano]

...
you need to have an employee that you trust set it up in a new datacenter. If the employee is not trustworthy, he can repurpose the miner to mine on a pool account that does not belong to the owner of the miner.
...

While what you suggest may well happen or may even be common, it's not hard at all to completely lock down the miner sub-network in a data centre, to avoid this, and to increase network performance at the same time ...

If a datacenter customer is using the btc.com pool (for example), an untrustworthy employee could create his own btc.com pool account and have the miner mine on his pool account.

New fangled idea that's only been around for ... years and years ...
It's called a proxy.
(my network performance comment was the hint ...)
You don't allow miners to talk to the internet, they're only allowed to talk to proxies, that you obvious determine who has access to them, or even just yourself

If for whatever reason, the above would not be an option, a corrupt employee could physically move a portion of miners to vacant space within the datacenter and bill the customer for electric usage. Or, he could run ethernet wiring from a network not associated with the customer into the location where the miners are stored.

Well yeah if you are silly enough to have a datacentre where people can run wires all over the place and hide you miners in your datacenter somewhere where you can't see them, well you have problems.

Heck they could even dig a tunnel under the ground and out to a datracentre 10 miles away and run power leads through this underground hidden tunnel behind a secret door in the library ...
Or you could manage your datacentre properly

[philipma1957]

Well we are dropping once again so far -10% I predicted a -5% drop.

I am hoping that we cease the dropping and slowly rise up next jump which should be in 10 days or so.

[alh]

Well we are dropping once again so far -10% I predicted a -5% drop.

I am hoping that we cease the dropping and slowly rise up next jump which should be in 10 days or so.

Why the desire for a difficulty increase? Seems counter-intuitive to me (from a miner point of view).

[mikeywith]

Why the desire for a difficulty increase? Seems counter-intuitive to me (from a miner point of view).

Key word is "slow", hopping for difficulty to keep going down forever is wishful thinking, by default, it only goes up in the long run despite what the price does, based on that fact it would be great if difficulty goes up slowly and doesn't jump up by 50 or 100% in a few months.

[NotATether]

It is hard to know the legitimacy of cloud mining operations. Any one of those cloud mining operations could potentially be selling (or have sold) shares of miners that do not exist, even if they have actual miners from bitmain. For example, they could have sold 120% of their actual mining capacity. It is also possible that bitdeer was shut down, but will continue to sell cloud mining contracts to minimize the losses to the owners of bitdeer.

Viabtc will fare the best, as they can sell the miners that were just shut down by the Chinese government.

Doesn't look like Bitdeer was shut down, their twitter account is quite busy the past few days.

"Minimizing the losses" to me appears to be restricted to blocking Chinese IP addresses for now, at their own accord.

So they still have to see out their contracts, meanwhile ViaBTC bows out of all contracts but then only makes short-term income from selling their miners so the loss of potential revenue could be large if they do that instead of just repurposing them for their BTC mining pool.


On the other hand, under what circumstances would renting the rigs from Hashnest be profitable?

[philipma1957]

Well we are dropping once again so far -10% I predicted a -5% drop.

I am hoping that we cease the dropping and slowly rise up next jump which should be in 10 days or so.

Why the desire for a difficulty increase? Seems counter-intuitive to me (from a miner point of view).

sure it does but price can chase after the diff.

So a -10% may get us under 30k

And another -10% may get us back to 25k

Now If you look at the drop from 64k to 32k and 25.04 to 14.3.     I as an out of china miner have close to no negative effects with those numbers.

Slowly going back to a diff of 16t then 18t would hopefully raise price over 40k.

And dropping more to 12 diff and then 10 diff would likely panic more.

Than rising slowly to  15t -16t -17t -18t-19t


The public's perception of the game has meaning .

I think drops to 12-10-8 = fud and large price drops

I think jumps to 15-16-17-19 = less fun and price lifting


Mind you I never would have thought we would see drops to 14t

But moron musk an his twitter rants damaged public perception and now mining uses far far far less power so he look more like the moron he is.

[stompix]

Doesn't look like Bitdeer was shut down, their twitter account is quite busy the past few days.

Bitdeer is still mining, don't know if they have got their hashrate from somewhere else or it's actually their gear but they do mine blocks:

https://blockchair.com/bitcoin/block/690253
https://blockchair.com/bitcoin/block/690241
https://blockchair.com/bitcoin/block/690231
https://blockchair.com/bitcoin/block/690208

It could be that BTC.com is lending a part of their hash rate as the coins to a btc.com address or there is some kind of other deal behind it but they at least have something that's not only on paper. One thing, did they always had those 720 Days packages or it's my memory too fuzzy at the end of the week?

As for the difficulty, I think we have finally hit the bottom at the start of the week, it's starting to go slowly back up, and there is an influx of S19j Pro available right now with prices well below what we had for a few months.

[philipma1957]

Yeah only viabtc seems fully shut down.

And the diff has shifted just a bit towards -8 or -9 vs -9 or -10%

[NotFuzzyWarm]

<snip>
No real joy on the BTC price front: $32,945. Unless Mr. Fuzzy went big on his last BTC purchase he is probably "underwater" for his last pair of announced trades.  
<snip>

Regarding having bought coin at a higher price than now, just came across this in the Kanopool discord room https://www.cnbc.com/2021/05/25/bitcoin-crash-opens-door-to-a-tax-loophole-for-investors.html

Seems that for now at least, the IRS lets you sell crypto you bought at a high(er) price and take it as a Capital Gains tax loss, and then re-buy it at the lower price. Can't do that with stocks but you CAN with crypto. To more or less quote the end of the article, the IRS might raise an eyebrow at you doing the sell and then quickly afterwards doing the buy BUT wait say, 1 day to do the buy and you should be defensible if the IRS inquires about it.

I'm fine with the buy I did @ 30k but for the bit I bought at 43k, hmmm...

[philipma1957]

Nice shift in diff

https://diff.cryptothis.com/

Latest Block:   690443  (a minute ago)

Current Pace:   93.0287%  (972 / 1044.84 expected, 72.84 behind)

Previous Difficulty:   19932791027262.74                            
Current Difficulty:   14363025673659.96                            
Next Difficulty:   between 13373361601409 and 13625130736239
Next Difficulty Change:   between -6.8904% and -5.1375%
Previous Retarget:   July 3, 2021 at 2:25 AM  (-27.9427%)
Next Retarget (earliest):   July 17, 2021 at 8:50 PM  (in 7d 12h 17m 12s)
Next Retarget (latest):   July 18, 2021 at 3:35 AM  (in 7d 19h 2m 20s)
Projected Epoch Length:   between 14d 18h 25m 35s and 15d 1h 10m 43s
...

Miners are getting relocated someplace.

If we end around -4% to -5% this period

and follow with +2% to +4% next period.

I would think we would start price rally.

[alh]

Nice shift in diff

........

Miners are getting relocated someplace.

If we end around -4% to -5% this period

and follow with +2% to +4% next period.

I would think we would start price rally.

I am really mot seeing the correlation between difficulty and BTC price that the above suggests. It seems to me that the roughly 45% decline in BTC price was well before (in time) the most recent large drop in difficulty. The big decrease in difficulty seems attributable to a bunch of mining hardware in China being switched off.

Why will that restart of mining hardware then spur an uplift in BTC price?

I will freely admit I have no idea what drives BTC price. Please just explain how difficulty changes influence BTC price, and in what directions.

[philipma1957]

Nice shift in diff

........

Miners are getting relocated someplace.

If we end around -4% to -5% this period

and follow with +2% to +4% next period.

I would think we would start price rally.

I am really mot seeing the correlation between difficulty and BTC price that the above suggests. It seems to me that the roughly 45% decline in BTC price was well before (in time) the most recent large drop in difficulty. The big decrease in difficulty seems attributable to a bunch of mining hardware in China being switched off.

Why will that restart of mining hardware then spur an uplift in BTC price?

I will freely admit I have no idea what drives BTC price. Please just explain how difficulty changes influence BTC price, and in what directions.

Because you need to understand what really happened from the viewpoints of whales not small fry like myself.

I am not sure of anything at all. I am simply project what I would do as a huge whale.

I am Bitmain (biggest whale in mining)

I have stated I own 10% of the worlds hash = Fact
I have created 3 huge cloud deals with viabtc, bitdeer  and hash nest = fact as of Jan 1 2021
I can't get chips to make gear to sell gear = fact
Coins are 64k = fact back a while .

What can I do to get more = what I think bitmain said to itself.

hmm how many mines to I have outside of china?  well I have 17eh world wide. I have x outside of china.

all cloud contracts are written with the I can fuck you anytime I want clause. = fact

Okay I shut down mining in China mostly cloud contracts to non Chinese people fuck them

I reduce difficulty 45-50%

My out of china mines get 2x the hash. I turn lots of profit.

This is my guess as to what really happened.

If so we want those mines in china to sell off gear to outside world and hash to go back up. that trend means my guess is close to true.

My guess could be fully wrong. which means we won't see much if any hash rate increases.

The bad cases are many,

but my guess still fits and means the large builders get profits without selling gear.
the trading whales get more coin cheaply.

My guess is very bullish.

If correct hash will slowly rise next few jumps and coins will go up and over 100k.

trading whales will whale
and asic builders will whale  without selling gear in a chip shortage.

lucky people such as myself with a decent mine out of china will do well.

who gets fucked: traders that go short will be crushed.  traders that are not buying and holding for next 90 days.
who else a miner like my size in china that had a nice income = crushed.

So from big player viewpoint this is ideal way to gather in coins for future profit.

If you want my guess to be your bet simply buy some coin every day day 0.001 btc a day. or what you can afford.