Date for 25 BTC per Block

[antirack]

This has probably been discussed a lot of times, but I just can't find the right answer.

What is the estimated date that the block reward changes to 25 BTC?

From the Wiki:

The coin value of a block is 50 BTC for each of the first 210,000 blocks, 25 BTC for the next 210,000 blocks, then 12.5 BTC, 6.25 BTC and so on.

[vuce]

40515 blocks to go at 6 block per hour makes it 281.4 days, so on 9th of december 2012.

[antirack]

Thanks guys.

[enquirer]

I too want date for 25 btc

[DeathAndTaxes]

I too want date for 25 btc

You too can read this thread.

There is no exact date because it is based on # of blocks and while on average blocks will take 10 minutes each there is no exact correlation between blocks and time.

It is roughly Dec 9th as indicated above.  As we get closer to December the date will have less variance.

[Stephen Gornick]

Place your bets:

December 9th or earlier the bitcoin block reward will drop to 25 BTC
 - http://betsofbitco.in/item?id=312

Personally, I'm stumped.  I do think the marginal GPU miners (e.g., where electricity is expensive, or not much capacity) will see the 25 BTC drop coming up and some will sell off their hardware to prior to this date.  (meaning capacity drops and the date comes after December 9th.)  On the other hand, FPGA miners by then could be plentiful (which would cause capacity to increase, and the date come before December 9th).   Also, if the BTC/USD heads higher the date before December 9th becomes more likely as more capacity gets added.   Who knows.

[kjj]

I too want date for 25 btc

Heh.  When I first read this, I thought that you were very lonely, if you were willing to pay 25 BTC for a date.  I didn't grok your question until I read the next reply.

[realnowhereman]

Here's a guess:

9th Dec assumes current rate continues.

I expect bitcoin price to increase (on average) throughout the year.  Higher price equals more miners.  A steadily increasing number of miners means that each block is found slightly faster than anticipated, and that continues for 2016 blocks before the difficulty compensates.  Except that the next 2016 blocks have the same: an increasing number of miners.

In short: block rate will average faster than one every ten minutes.  Let's guess at 9 minutes between blocks.  That's 10% faster.  Instead of 281 days, it'll be 252 days ish.

In other words: about a month earlier.

My guess would therefore be 10th November.  But on the chance of there being historical coincidence I'd like to choose...

"remember, remember, the 5th of November."

 

[jago25_98]

 The Mayan's estimated the date correctly

Der de dum dum

[Sannyasi]

blocks produce at the same rate with difficulty adjustments. It will vary a little because of the lag behind each adjustment so it will vary a little bit but probably not alot. The mayans did get it right....... lord help us all......

[molecular]

Here's a guess:

9th Dec assumes current rate continues.

I expect bitcoin price to increase (on average) throughout the year.  Higher price equals more miners.  A steadily increasing number of miners means that each block is found slightly faster than anticipated, and that continues for 2016 blocks before the difficulty compensates.  Except that the next 2016 blocks have the same: an increasing number of miners.

I'm thinking along the same lines, but don't think the impact will be that large. I'm guessing around Dec. 5th, placed my bet accordingly.

I agree with above post that high-electricity-cost miners will anticipate the problem and stop mining, but I think that also traders will anticipate the "drop in supply" as they will call it and that will raise the price in anticipation making mining more profitable again.

This is one example of the feedback loops in this whole shebang. It will be highly interesting to observe and it will likely take effect pretty early, like in late summer.

I think in the end, not much will change, at least not much more than usual

[DeathAndTaxes]

I expect bitcoin price to increase (on average) throughout the year.  Higher price equals more miners.  A steadily increasing number of miners means that each block is found slightly faster than anticipated, and that continues for 2016 blocks before the difficulty compensates.  Except that the next 2016 blocks have the same: an increasing number of miners.

While that is true I think there are two counterpoints.

First is that price to difficulty is relatively low right now.



So while price may rise (say to $6 or even $7) I wouldn't expect to see large increases in hashing power.  We really would only be getting into more sustainable price/difficulty ratios.

The second is timing.  Yeah if BTC went to $10 tomorrow you would see a large increase in hashing power and that trend would continue for 3 or 4 difficulty intervals.  However if BTC hits $10 in say late October any new hashing power has to be thinking of the fact that price/difficulty (the only metric that matters to a smart miner) is going down by 50% in a month or two.  The close we get to the date the more of a factor that will be in NOT deploying new hashing power.  Smart miners will take a "wait and see" attitude.

My guess is we will hit the drop earlier than 9 DEC but I don't think it will be by much (maybe 5-10 days).

[coinft]

Let's bet on this over on

http://betsofbitco.in/item?id=313

Back your statement by money and have some excitement

-coinft

[molecular]

Let's bet on this over on

http://betsofbitco.in/item?id=313

Back your statement by money and have some excitement

-coinft

why not bet on the bet published earlier in this thread: http://betsofbitco.in/item?id=312

[DeathAndTaxes]

I am surprised BofB allowed such a similar bet.  Spreading the action around is never good.

[coinft]

Let's bet on this over on

http://betsofbitco.in/item?id=313

Back your statement by money and have some excitement

-coinft

why not bet on the bet published earlier in this thread: http://betsofbitco.in/item?id=312

Yes someone was faster than me. Notice I have the following id. Bet on the first one, mine was canceled as duplicate.

-coinft

[Stephen Gornick]

My guess is still after Dec 15th but who knows  Anyway we can more or less be sure it is within a few weeks before Dec 9th and a few weeks after.

Update on that calculation since we are exactly nine months from the target date on the bet:
 - http://betsofbitco.in/item?id=312

With block height of 170,390 reached, doing the math that gives us 275 days left, so still on target for December 9th as the day block 210,000 will be reached.

What is certain is that the number of bitcoins issued each day will be cut in half.  Meaning if miners are generating $36K worth of bitcoins on December 8th, then the drop occurs, then starting on December 9th they will generate $18K worth of bitcoins -- though there would be some fluctuations in price that might cause those numbers to vary but essentially it will be a sudden 50%-ish drop in revenue.

We know today within a window of a couple weeks when that event will happen.  We also know miners who pay for electricity won't mine at a loss for very long.   We also know many miners have no other use for the GPUs.

A rational miner might consider selling off those GPUs before there is a glut on the market (though prices have dropped for used GPUs, prices currently are pretty decent -- compared to the discount other electronics see when being sold as used.)  A rational miner might also look at the emergence of FPGAs in mining combined with this 50 BTC -> 25 BTC block reward drop, see the writing on the wall, and start taking action now.

Which would cause a rational speculator (if there are any) to suspect that difficulty will not continue rising and instead will start dropping again as the result of miners shutting down, and thus the date occurring later than December 9th.

But then we have history.  When difficulty goes up, it tends to do so in bursts -- 8%, 15% or higher even.  When it drops, it does so gradually.  Which would mean even if we reach block 210,000 and the difficulty is no higher or lower than the level it is at today, we'll get there sooner than December 9th because the bursts had a bigger impact on calendar time than the drops did.

I still have no leaning as to which outcome is more likely.  Tell me what the exchange rate will be and the number of FPGA units that will be sold over the next half year and the difficulty level at a future date becomes easier to predict.

[coinjedi]

I am surprised BofB allowed such a similar bet.  Spreading the action around is never good.

Sorry about the confusion guys. It was our fault and fixed. #312 is the one to bet. Let me know if you have any issues.

[mb300sd]

I too want date for 25 btc

Heh.  When I first read this, I thought that you were very lonely, if you were willing to pay 25 BTC for a date.  I didn't grok your question until I read the next reply.

You mean your average date costs less than 25BTC? Cheapskate

[molecular]

My guess is still after Dec 15th but who knows  Anyway we can more or less be sure it is within a few weeks before Dec 9th and a few weeks after.

Update on that calculation since we are exactly nine months from the target date on the bet:
 - http://betsofbitco.in/item?id=312

With block height of 170,390 reached, doing the math that gives us 275 days left, so still on target for December 9th as the day block 210,000 will be reached.

What is certain is that the number of bitcoins issued each day will be cut in half.  Meaning if miners are generating $36K worth of bitcoins on December 8th, then the drop occurs, then starting on December 9th they will generate $18K worth of bitcoins -- though there would be some fluctuations in price that might cause those numbers to vary but essentially it will be a sudden 50%-ish drop in revenue.

Assuming all mined coins are immediately sold on the market, there would also be a sudden drop of "supply" on the exchange markets. A sudden 50% drop of supply given constant demand would surely drive the price up quite a bit. Of course the market will react even before the fact in anticipation, driving price up, in turn making mining more profitable again even before the drop.

So my argument is that the 50% drop in mining income (measured in BTC) will not result in a 50% drop in USD-denominated revenue for this reason (higher price)

Also miners are likely to reduce the percentage of BTC they throw directly onto the markets, but hold on to them (or a part of them) in anticipation of being able to sell at a better price after the supply drop. So this is another factor that puts upward pressure on the price before the fact.

I actually think there might not be that much happening on the date. Most of the action and adjustments will be happening beforehand in anticipation, starting in late summer, maybe even earlier. I, for one, am already holding on to my bitcoins a lot harder

I still have no leaning as to which outcome is more likely.  Tell me what the exchange rate will be and the number of FPGA units that will be sold over the next half year and the difficulty level at a future date becomes easier to predict.

Well, the exchange rate is part of the game, so you must include that in your set of values to predict

I'm leaning towards an earlier date because I'm assuming an increasingly bullish market toward block 210000 which will result in mining power increase.

As for miners selling their hardware: I kind of doubt they will do that in the 1-2 months before the drop. They might sell now or in early summer, but after that, it's just too tempting to keep things running at least until the drop. Most rigs are probably payed off anyways and gaming is always an option