Why is difficulty still very high

[rdluffy]

It doesn't make sense to mine at a loss. If you want to accumulate coins you can just buy them directly without mining. If you are mining at break-even you are pretty much losing money since you are wearing out your gear.

Every hour your gear runs it increases the chances of something getting burn't out such as a fan bearing going back. If you want to invest in crypto, just buy it directly. Only people who mine at a loss are maybe those that have difficulites buying crypto due to regulations, in that case its worth mining at a loss. However that doesn't apply to most.

I know adaseb, believe me, I know what are you saying, but each case is a different case.
It's easy to say: buy coins instead of mining, but when you are in such situation you have to think better

Sometimes you don't want to deal with selling your gear, if you have only 1 GPU ok, but try to sell 20 GPUs, 4 CPUs, 4 Motherboards etc, and them 1 year after, mining can become profitable again 
It's a huge amount of time and effort to me
Some people like to mine, some want to support the network, some like you said have problems with buying directly due to restrictions etc

And in the end you still have your hardware, most warranties are 3 years.

[wheelz1200]

It's too late to sell some graphic cards now I believe, when are these miners going to leave the game for us that still believe? Lower difficulty should be in play by now but some are just too stubborn it seems    leave the game for us that don't care about profit today, we just want more coins.

There are plenty of people who mine at a loss in hopes that the coins they are mining will raise in price.  There are also still plenty of hobbyists that aren't completely in it for straight profit.  Amd than lastly most of the hash power comes from places who pay little to no electric fees so they can afford to mine no matter the difficulty and profitability.

[badbart]

I have 150 gpus turned them off and switched to DCA.  Bear market plus no coin near the marketcap of eth I don't see gpu mining being close to profitable for a good while.  Probably going to start  slowly selling gpus and see what things are like in a few months.  I'm always searching for opportunity and don't see any, even BTC difficulty went up 10% last adjustment.

[grendel25]

Stubborn or already had cheap electricity.  We may see the difficulty dip depending on how long crypto winter lasts but some TA are already saying the bottom is in for bitcoin. If that's so and we see a steady march up for crypto prices then difficulty won't get any lower and profits might actually get better and make even more miners come back.

That looks like the miners are not giving up and that is why we have this high difficulty.They learned their lesson in 2018,those miners who liquidated their gear by then and after seeing what happened in late 2020 and early 2021 they saw that they did a huge mistake by doing so but that was also a lesson that even more miners that come here after 2018 learned and thus that is the reason why the difficulty is staying high and it won't look like it is going down anytime soon because the miners are still active mining despite at a loss.

In order for difficulty to come down we need a price of Bitcoin of less than 10.000 and all other cryptos to come down significantly and that is the only time I believe many miners will quit or shut down their rigs.

It has been three weeks. Difficulty has done nothing but go up. Many factors, but two I see 1) people's willingness to mine speculatively and/or 2) people having cheap electricity

I learned my lesson from liquidating gear in 2014. I enjoyed selling $175 motherboards from 2019 for $500 in 2021.  The community of miners are getting more experienced and won't make the same mistakes.

[rdluffy]

I have 150 gpus turned them off and switched to DCA.  Bear market plus no coin near the marketcap of eth I don't see gpu mining being close to profitable for a good while.  Probably going to start  slowly selling gpus and see what things are like in a few months.  I'm always searching for opportunity and don't see any, even BTC difficulty went up 10% last adjustment.

Do you have any estimated time about dealing with selling 150 GPUs? 

Like I said before:

Sometimes you don't want to deal with selling your gear, if you have only 1 GPU ok, but try to sell 20 GPUs, 4 CPUs, 4 Motherboards etc, and them 1 year after, mining can become profitable again  Sad
It's a huge amount of time and effort to me

If I had 150 GPUs, I probably would pay some person to test, clean, put in a box and take pics to sell 
Sometimes the buyer asks for me to make a video with the gpu working 

[badbart]

I have 150 gpus turned them off and switched to DCA.  Bear market plus no coin near the marketcap of eth I don't see gpu mining being close to profitable for a good while.  Probably going to start  slowly selling gpus and see what things are like in a few months.  I'm always searching for opportunity and don't see any, even BTC difficulty went up 10% last adjustment.

Do you have any estimated time about dealing with selling 150 GPUs? 

Lol no idea but I still haven't made up my mind, if I sell it will be over time may be a a couple gpus a week.

[FP91G]

I have 150 gpus turned them off and switched to DCA.  Bear market plus no coin near the marketcap of eth I don't see gpu mining being close to profitable for a good while.  Probably going to start  slowly selling gpus and see what things are like in a few months.  I'm always searching for opportunity and don't see any, even BTC difficulty went up 10% last adjustment.

Who will you sell it to, if now most video cards for mining do not even pay off the cost of electricity?
I disabled most video cards, but some mine with very small profit of a few cents per day, because it is very difficult to sell video cards now even at a price that is slightly below the market.

[devil2man]

The difficulty remains high because all those who mined eth have flocked to the other minable altcoins and therefore the hash rate has increased as well as the request this has meant that the difficulty does not go down as one would have expected

[Za1n]

Many factors feed into this and some have already been mentioned.

Large farm (warehouse) type operations that have a lot of sunk costs and already paid for leases will still keep mining for some time before turning off. Many of these also have negotiated low industrial electric rates so are only paying 2-3 cents per kWh and can keep up longer than most home miners or small farm types.

There is a rather large portion of small miners, that each run maybe 1-3 rigs with perhaps 2-20 GPU's total, that have access to free electricity. These can be students in dorm rooms, renters with heat included in rent, people on some kind of government subsidy program, etc. So any miners in this category that already own the equipment really have no disincentive to quit mining, especially if they don't need to sell coins right away. For this group mining is actually cheaper than buying coins as they are essentially free due to no electric bills.

Then their are the people who are mining at a loss, but continue on for some reasons. While it is true they could just buy the coins cheaper, as already mentioned in this thread, some seem to prefer mining over direct buying of coins. In colder climates mining can offset heating costs somewhat, assuming you are paying the bills anyway, so that can help offset a little, but not all of the current losses. There are also some from this group who mine to keep their coin accumulations anonymous, especially if solo mining to a clean (unused) wallet.

Its only been roughly 2 months now since ETH went POS, so I think many are still toughing it out hoping for a short bear market. As was mentioned by someone earlier, the last bear marker miners held strong for about 4-6 months before significant reductions of hash rates started to become clearly visible. This would put us in the January to March time frame before miners start "giving up" so to speak. Curiously, this is also roughly the same time frame some are predicting the crypto market bottoms start setting in.

[FP91G]

If you look at the graphs, then the hash rate has fallen for many coins. Industrial mining on video cards cannot be profitable now due to the many additional costs, but small miners who have no expenses other than paying for electricity continue their favorite pastime.

[swogerino]

If you look at the graphs, then the hash rate has fallen for many coins. Industrial mining on video cards cannot be profitable now due to the many additional costs, but small miners who have no expenses other than paying for electricity continue their favorite pastime.

I don't think that difficulty is high for example for ETHW which is the coin by some unknown miners who decided to keep mining the Ethereum when it moved to PoS.It is just less than 300 T which can make you nice amount of this coin daily,almost half of these coin in two days when you have a near 400 Mhsh rig.For now may not be profitable but who knows at which levels this end in the future,so mining it for the longer term is easily doable for people who mine at home like me and many others.

[FP91G]

If you look at the graphs, then the hash rate has fallen for many coins. Industrial mining on video cards cannot be profitable now due to the many additional costs, but small miners who have no expenses other than paying for electricity continue their favorite pastime.

I don't think that difficulty is high for example for ETHW which is the coin by some unknown miners who decided to keep mining the Ethereum when it moved to PoS.It is just less than 300 T which can make you nice amount of this coin daily,almost half of these coin in two days when you have a near 400 Mhsh rig.For now may not be profitable but who knows at which levels this end in the future,so mining it for the longer term is easily doable for people who mine at home like me and many others.

Mining the ETHW coin is not profitable on most video cards, and on expensive video cards the payback is so long that such investments are not interesting for many miners. Today it is more profitable and easier to buy these coins for 500-1000 dollars than to pay for electricity in the next 2 years.

[FP91G]

Difficulty measures chain security, the higher the safer and better.

I'm not sure about this.
If 10 million video cards participate in the mining of a coin, and 55% of the hashrate belongs to one miner. Is this safe for you?
Difficulty shows only the arrival or departure of miners, and miners are interested in profit.

[adaseb]

Difficulty measures chain security, the higher the safer and better.

I'm not sure about this.
If 10 million video cards participate in the mining of a coin, and 55% of the hashrate belongs to one miner. Is this safe for you?
Difficulty shows only the arrival or departure of miners, and miners are interested in profit.

Yes but any coin is subject to this risk. However as the hashrate is much much higher it’s more expensive to attack and less common to happen.

It’s possible for someone to have 51% power but that is like what? 5 million GPUs? It would be very expensive to achieve this. So in general the higher the hashrate the better.

[FP91G]

Difficulty measures chain security, the higher the safer and better.

I'm not sure about this.
If 10 million video cards participate in the mining of a coin, and 55% of the hashrate belongs to one miner. Is this safe for you?
Difficulty shows only the arrival or departure of miners, and miners are interested in profit.

Yes but any coin is subject to this risk. However as the hashrate is much much higher it’s more expensive to attack and less common to happen.

It’s possible for someone to have 51% power but that is like what? 5 million GPUs? It would be very expensive to achieve this. So in general the higher the hashrate the better.

The purchase will be very expensive, and renting a hashrate for 1 hour is quite possible.

[adaseb]

Could you even rent hashpower for only 1 hour? Consider SHA256
Looking at Nicehash which is the largest place to rent hashpower

https://www.nicehash.com/my/marketplace/SHA256

You got 2 servers which have up to 0.1205 + 0.0785 EH/s.

What is the total hashrate for bitcoin?

https://www.blockchain.com/explorer/charts/hash-rate

Looks like 250,000,000 TH/s. So about 250 EH/s. So you can rent max 0.7% of the total bitcoin hashrate.

[FloppyPurpleGherkin]

Could you even rent hashpower for only 1 hour? Consider SHA256
Looking at Nicehash which is the largest place to rent hashpower

https://www.nicehash.com/my/marketplace/SHA256

You got 2 servers which have up to 0.1205 + 0.0785 EH/s.

What is the total hashrate for bitcoin?

https://www.blockchain.com/explorer/charts/hash-rate

Looks like 250,000,000 TH/s. So about 250 EH/s. So you can rent max 0.7% of the total bitcoin hashrate.

https://www.crypto51.app/

[FP91G]

Could you even rent hashpower for only 1 hour? Consider SHA256
Looking at Nicehash which is the largest place to rent hashpower

https://www.nicehash.com/my/marketplace/SHA256

You got 2 servers which have up to 0.1205 + 0.0785 EH/s.

What is the total hashrate for bitcoin?

https://www.blockchain.com/explorer/charts/hash-rate

Looks like 250,000,000 TH/s. So about 250 EH/s. So you can rent max 0.7% of the total bitcoin hashrate.

We are talking about other coins that are mined on video cards and they have a small hashrate. Large bitcoin mining pools will not transfer their power to other users if they themselves do not want to do this. But renting video cards for mining is much easier.

[fmz89]

Fpga getting bigger and many miner adopt this very quickly, and they ruined gpu&cpu mining, there is lot of miner using free electricity and some of big farm had water turbin generators so they only focused about maintenance fee, sad but true you cant compete with them in bear market, some miner just mined at loss to support the network as hobbiest

[swogerino]

Fpga getting bigger and many miner adopt this very quickly, and they ruined gpu&cpu mining, there is lot of miner using free electricity and some of big farm had water turbin generators so they only focused about maintenance fee, sad but true you cant compete with them in bear market, some miner just mined at loss to support the network as hobbiest

I am also mining at a loss but of course not as a hobby,with a long term vision that this amount generated during this time after many months or after a couple of years can be very well x10 to x500 of the price of these coins I am mining.

As a hobby I am only mining ZIL and staking it in Atomic wallet which hopefully by the end of this year should have given me a minimum of 1500 dollars as pure profit,15% APY for staking if the price is like near 0.03,if it happens that ZIL goes again to all time high it had at 0.27 then it will be near 15.000 dollars of profit so this hobby can turn in something uniquely beautiful.