Odalv
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September 28, 2014, 10:35:32 PM |
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Inflationary spiral ? If cost of electricity is bigger than price of bitcoin and miners turn off their asics then nobody is unable to mine. It will take years until difficulty dropped. (it will take months to mine 2016 blocks by hobby miners to adjust difficulty (instead of 14 days) )
it won't happen that way. you won't get a huge dropoff in hashing rate to cause such an air gap. if we do, that would be a huge security risk for the network. more likely though, if it has to happen at all, is that large mines go out and get USD loans to pay their variable costs to get them thru what will hopefully be from here a short term drop in the price. that is, if they've managed their costs properly for a rainy day like we have now. sure we could see a drop but it won't be dramatic. they have to keep those asics running while they're still top of the line tech. guys like me will also mine out of public duty, even if at a loss, so as to protect my overall investment in the space. which is also why i run a bunch of full nodes. Yes, you will mine, because you want to protect your investment (as hobby miner), but what about mining farm(10,000,000 Ghash ..10%) will they pay millions of dollars for electricity. as i said in my post, i think they will go out and get loans or offer equity financing if necessary to keep themselves running. sure, its possible that a few players get shaken out but we are not going to see a precipitous drop in hashing rate. I think it will be same ... but this implies, price of bitcoin cannot drop under mining costs. ... and this implies (if you look at hashrate) that price must be growing by 1 order of magnitude every 8 months. ... or some disaster will come ... I do not know the result, but it will be BIG next year (cannot wait) :-)
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cypherdoc (OP)
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September 28, 2014, 10:45:08 PM |
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Inflationary spiral ? If cost of electricity is bigger than price of bitcoin and miners turn off their asics then nobody is unable to mine. It will take years until difficulty dropped. (it will take months to mine 2016 blocks by hobby miners to adjust difficulty (instead of 14 days) )
it won't happen that way. you won't get a huge dropoff in hashing rate to cause such an air gap. if we do, that would be a huge security risk for the network. more likely though, if it has to happen at all, is that large mines go out and get USD loans to pay their variable costs to get them thru what will hopefully be from here a short term drop in the price. that is, if they've managed their costs properly for a rainy day like we have now. sure we could see a drop but it won't be dramatic. they have to keep those asics running while they're still top of the line tech. guys like me will also mine out of public duty, even if at a loss, so as to protect my overall investment in the space. which is also why i run a bunch of full nodes. Yes, you will mine, because you want to protect your investment (as hobby miner), but what about mining farm(10,000,000 Ghash ..10%) will they pay millions of dollars for electricity. as i said in my post, i think they will go out and get loans or offer equity financing if necessary to keep themselves running. sure, its possible that a few players get shaken out but we are not going to see a precipitous drop in hashing rate. I think it will be same ... but this implies, price of bitcoin cannot drop under mining costs. ... and this implies (if you look at hashrate) that price must be growing by 1 order of magnitude every 8 months. ... or some disaster will come ... I do not know the result, but it will be BIG next year (cannot wait) :-) whoever these guys are that are throwing so much fiat into mining eventually will realize it's just cheaper and easier to buy coins directly.
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cypherdoc (OP)
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September 28, 2014, 10:48:09 PM |
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Inflationary spiral ? If cost of electricity is bigger than price of bitcoin and miners turn off their asics then nobody is unable to mine. It will take years until difficulty dropped. (it will take months to mine 2016 blocks by hobby miners to adjust difficulty (instead of 14 days) )
it won't happen that way. you won't get a huge dropoff in hashing rate to cause such an air gap. if we do, that would be a huge security risk for the network. more likely though, if it has to happen at all, is that large mines go out and get USD loans to pay their variable costs to get them thru what will hopefully be from here a short term drop in the price. that is, if they've managed their costs properly for a rainy day like we have now. sure we could see a drop but it won't be dramatic. they have to keep those asics running while they're still top of the line tech. guys like me will also mine out of public duty, even if at a loss, so as to protect my overall investment in the space. which is also why i run a bunch of full nodes. Yes, you will mine, because you want to protect your investment (as hobby miner), but what about mining farm(10,000,000 Ghash ..10%) will they pay millions of dollars for electricity. as i said in my post, i think they will go out and get loans or offer equity financing if necessary to keep themselves running. sure, its possible that a few players get shaken out but we are not going to see a precipitous drop in hashing rate. what i suspect will happen is a shake out of some of the smaller miners once they reach the point that they cant afford to mine anymore leaving a further monopoly of big time miners. whether you like it or not, this is leading to further centralization. the big guys can last longer at a loss than the small guys. i'm still waiting
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cypherdoc (OP)
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September 28, 2014, 11:04:13 PM |
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from the top at 1163 on Bitstamp, we are only down 67-68%. that's not bad, nor unusual, for Bitcoin pullbacks.
try 32 --> 1.98.
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CMMPro
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September 28, 2014, 11:21:59 PM |
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I've said it ten times the past month....this "situation" in mining does not lead to centralization, exactly the opposite.
You know when you guys keep harping about "economy of scale" well that doesn't always mean what you obviously think it means.
You need to rethink the difference between a hobbyist miner with a couple of TH running in their basement vs a commercial building being supplied with a 0.5MW supply and transformer, and wiring performed by electricians, and CSA/UL/CE inspections, and liability insurance, and cooling the building doubling your electrical draw....and a myriad of other expenses that little children like yourselves have never encountered because you have never leased a commercial building to set up a business and you have no idea of the intricacies of business dealings at that scale.
I can't see how they are doing it when I consider the logistics and costs....certainly not with the efficiencies we have today at sub $400 prices.
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cypherdoc (OP)
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September 28, 2014, 11:25:18 PM |
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$DXY opens up; this is still causing a problem for all risk assets:
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Melbustus
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September 28, 2014, 11:41:00 PM |
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from the top at 1163 on Bitstamp, we are only down 67-68%. that's not bad, nor unusual, for Bitcoin pullbacks.
try 32 --> 1.98.
Yup. 2011 pullback was: -94% 2013 (April) drop was: -81% Wouldn't be unreasonable to max out in the -70% range on this one.
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Bitcoin is the first monetary system to credibly offer perfect information to all economic participants.
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Pruden
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September 29, 2014, 12:00:27 AM |
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Is it just me or every time you post this chart the "Unknown" slice is bigger? i'm still waiting
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cypherdoc (OP)
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September 29, 2014, 12:10:00 AM |
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I've said it ten times the past month....this "situation" in mining does not lead to centralization, exactly the opposite.
You know when you guys keep harping about "economy of scale" well that doesn't always mean what you obviously think it means.
You need to rethink the difference between a hobbyist miner with a couple of TH running in their basement vs a commercial building being supplied with a 0.5MW supply and transformer, and wiring performed by electricians, and CSA/UL/CE inspections, and liability insurance, and cooling the building doubling your electrical draw....and a myriad of other expenses that little children like yourselves have never encountered because you have never leased a commercial building to set up a business and you have no idea of the intricacies of business dealings at that scale.
I can't see how they are doing it when I consider the logistics and costs....certainly not with the efficiencies we have today at sub $400 prices.
are you speaking from experience? i can relate as a 2TH hobbyist. i traded simple services for my electrician to wire in eight special 240W outlets (i'm oversupplied) with its own subpanel to the 2nd flr room of a building i already own. i put the miners up next to an open sliding door with a balcony and lined up fans pointing outwards up against the screen door. i had one of my workers install a $200 external barred gate like this for security. no other cooling: the room is exposed to the open air 24/7 all year long. no licenses, insurance or any other special expenses except for electricity. i had additional Cat5/6 wiring run thru the walls to an external closet connecting the server with the asics to an existing internet connection used for other purposes. throw in a large roller rack. total cost of setup and other ancillary materials, maybe $400. it pays to be small and nimble.
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NotLambchop
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September 29, 2014, 12:28:17 AM |
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...it pays to be small and nimble.
Pays even better when you're a HashFast shill, no?
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BlindMayorBitcorn
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September 29, 2014, 12:54:33 AM |
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...it pays to be small and nimble.
Pays even better when you're a HashFast shill, no? It is a bit cultish in here, no?
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Forgive my petulance and oft-times, I fear, ill-founded criticisms, and forgive me that I have, by this time, made your eyes and head ache with my long letter. But I cannot forgo hastily the pleasure and pride of thus conversing with you.
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cypherdoc (OP)
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September 29, 2014, 01:04:43 AM |
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...it pays to be small and nimble.
Pays even better when you're a HashFast shill, no? at least you were warned, no?
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Peter R
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September 29, 2014, 01:08:39 AM |
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The elephant in the room: consumers have almost no incentive to use bitcoin. The common talking points are: Low fees - The consumers pay no fees while using a credit card. They actually get rewards points back. Privacy - As evidenced by a recent post, bitcoin offers little privacy out of the box. You need to go through hoops to achieve privacy. People who care enough to go through these hoops have better alternatives (like cash!), which are more foolproof. Being your own bank - Few people want to take the risks associated with being a bank. It is more of a headache than a plus. No consumer protection - No need to elaborate. Distrust of the monetary policy - The volatility of bitcoin makes it useless as a store of value, and there are better and more reliable options to store your wealth. Few people buy into the tinfoil-hattery that the USD is about to crash. There is simply no pragmatic answer to "Why should I buy bitcoin?"
Cite your sources.
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cypherdoc (OP)
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September 29, 2014, 01:22:54 AM |
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The elephant in the room: consumers have almost no incentive to use bitcoin. The common talking points are: Low fees - The consumers pay no fees while using a credit card. They actually get rewards points back. Privacy - As evidenced by a recent post, bitcoin offers little privacy out of the box. You need to go through hoops to achieve privacy. People who care enough to go through these hoops have better alternatives (like cash!), which are more foolproof. Being your own bank - Few people want to take the risks associated with being a bank. It is more of a headache than a plus. No consumer protection - No need to elaborate. Distrust of the monetary policy - The volatility of bitcoin makes it useless as a store of value, and there are better and more reliable options to store your wealth. Few people buy into the tinfoil-hattery that the USD is about to crash. There is simply no pragmatic answer to "Why should I buy bitcoin?"
Cite your sources. What are we at Yale? well, yeah. many of us went to the best schools in the nation so who the hell do you think you are simply copying and pasting someone else's post? unless you really are part of a concerted effort to troll the price down today.
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CMMPro
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September 29, 2014, 01:25:28 AM |
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I've said it ten times the past month....this "situation" in mining does not lead to centralization, exactly the opposite.
You know when you guys keep harping about "economy of scale" well that doesn't always mean what you obviously think it means.
You need to rethink the difference between a hobbyist miner with a couple of TH running in their basement vs a commercial building being supplied with a 0.5MW supply and transformer, and wiring performed by electricians, and CSA/UL/CE inspections, and liability insurance, and cooling the building doubling your electrical draw....and a myriad of other expenses that little children like yourselves have never encountered because you have never leased a commercial building to set up a business and you have no idea of the intricacies of business dealings at that scale.
I can't see how they are doing it when I consider the logistics and costs....certainly not with the efficiencies we have today at sub $400 prices.
are you speaking from experience? i can relate as a 2TH hobbyist. i traded simple services for my electrician to wire in eight special 240W outlets (i'm oversupplied) with its own subpanel to the 2nd flr room of a building i already own. i put the miners up next to an open sliding door with a balcony and lined up fans pointing outwards up against the screen door. i had one of my workers install a $200 external barred gate like this for security. no other cooling: the room is exposed to the open air 24/7 all year long. no licenses, insurance or any other special expenses except for electricity. i had additional Cat5/6 wiring run thru the walls to an external closet connecting the server with the asics to an existing internet connection used for other purposes. throw in a large roller rack. total cost of setup and other ancillary materials, maybe $400. it pays to be small and nimble. Yes, exactly...your costs benefit from the economy of scale I'm talking about. Small and nimble is what works in these days of high mining diff. Now consider if you want to lease a commercial building of 50-100k sq ft. It costs $3-5 per square foot for that alone....on a minimum one year term. To lease the building you need to tell the landlord and the municpality has to approve what the use will be...as soon as you tell them a half dozen riders get dropped onto the lease. Liability insurance in the millions...usually 10 million for a building like that Transformer installation....ask yourself what a transformer capable of 0.5MW costs to install Electrical approvals, all electricals installed by licensed electricians, and the panels signed off by same Here's the kicker....in order to install electronics such as these in an industrial setting you are never going to get away with plugging in equipment that has no CSA/UL/CE approval. Certainly not 1000 units of electronic equipment that is not approved for your country...now you are into electrical approvals/hipot tests at a minimum...better hope the company you bought them from designed these properly Do it illegally? No insurance will cover you. And your local hydro department will never turn on the mains without it. Now think about racking Now think about networking costs and cabling costs for the units when the runs are 10x longer power supplies....most mining hardware requires your own fire prevention/suppression? How are you going to handle that? cooling? How many tons of AC? Does it have to be installed? internet bandwidth? You are not running this off a single DSL/Cable modem connection Already own a 2-3 million dollar building you want to use for mining?...great, you can strip away a few of those requirements but most are still applicable. And now you have a 2-3 million dollar asset not generating leasing revenue...
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BlindMayorBitcorn
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September 29, 2014, 01:38:24 AM |
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If you really think one guy can troll down the price of bitcoin when 70% of trades are in Yuan and nobody reads trollboxes...then I'm starting to think Buttcoin may have been on to something. You are delusional. Sorry
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Forgive my petulance and oft-times, I fear, ill-founded criticisms, and forgive me that I have, by this time, made your eyes and head ache with my long letter. But I cannot forgo hastily the pleasure and pride of thus conversing with you.
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NotLambchop
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September 29, 2014, 01:39:17 AM Last edit: September 29, 2014, 01:55:57 AM by NotLambchop |
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...it pays to be small and nimble.
Pays even better when you're a HashFast shill, no? It is a bit cultish in here, no? A bit loony in here. I've said it ten times the past month....this "situation" in mining does not lead to centralization, exactly the opposite.
You know when you guys keep harping about "economy of scale" well that doesn't always mean what you obviously think it means.
You need to rethink the difference between a hobbyist miner with a couple of TH running in their basement vs a commercial building being supplied with a 0.5MW supply and transformer, and wiring performed by electricians, and CSA/UL/CE inspections, and liability insurance, and cooling the building doubling your electrical draw....and a myriad of other expenses that little children like yourselves have never encountered because you have never leased a commercial building to set up a business and you have no idea of the intricacies of business dealings at that scale...
Yeah, these d00ds pay for "wiring performed by electricians, and CSA/UL/CE inspections, and liability insurance, and cooling the building doubling your electrical draw." Story ans more pics: http://bitcoinagile.com/81AF6/inside-a-chinese-bitcoin-mine-the-coinsman_streamThat's a typical Chinese commercial mine. Another one: Story and more pics: http://izismile.com/2014/09/08/the_largest_bitcoin_farm_in_the_world_17_pics.htmlDon't even need to mention the KNC hangar proliferation. Here's just a part of ONE of their farms: An average hobby miner mines at a loss. Go to any manufacturer's thread to taste their tears. The best way to make money in mining is (not necessarily in that order): 1. Sell pre-orders you'll never deliver. 2. Sell pre-orders you'll deliver once they're no longer profitable. 3. Sell stock in your nonexistent ASIC company/mining co. 4. Sell "mining bonds/contracts" to idiots who can't math. Commercial farms are either manufacturers themselves, e.g. KNC, or get their gear at tremendous discounts/electricity at industrial rates. No hobbyist can compete with that, even if power is free because mom's basement. Cypherdoc is an admitted paid shill of HashFast. The people who listened to him in the HasFast thread lost serious coin. The people who listen to him now should stop immediately and seek institutionalization. A safe, controlled setting where they will no longer be a danger to themselves or society, to be studied by dedicated psychiatric professionals. Perhaps even partially cured with the aid of powerful modern psychotropics and/or daring and innovative surgical procedures.
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Peter R
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September 29, 2014, 01:42:36 AM |
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What are we at Yale? I'd really like a well reasoned answer to this:-\
No, you don't want a well-reasoned answer. A person that genuinely wanted a response to those points would have started by reading the 100+ responses that that comment got when it was posted on Reddit 8 hours ago. If none of the 100+ responses on Reddit really answered things for you, and you then wanted to get the opinion of some of the thoughtful minds in this thread, you'd have made it clear that those weren't your words (by citing the source) and you would have explained how the various nuanced arguments already posted on Reddit were not "well reasoned" in your opinion. If you had done this, I'm sure you would have received thoughtful responses in return. Instead you spammed that obviously-plagiarized comment here and on the Wall Observer thread, without giving any contextual information, making it clear that you're not interested in genuinely learning.
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cypherdoc (OP)
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September 29, 2014, 01:42:45 AM |
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I've said it ten times the past month....this "situation" in mining does not lead to centralization, exactly the opposite.
You know when you guys keep harping about "economy of scale" well that doesn't always mean what you obviously think it means.
You need to rethink the difference between a hobbyist miner with a couple of TH running in their basement vs a commercial building being supplied with a 0.5MW supply and transformer, and wiring performed by electricians, and CSA/UL/CE inspections, and liability insurance, and cooling the building doubling your electrical draw....and a myriad of other expenses that little children like yourselves have never encountered because you have never leased a commercial building to set up a business and you have no idea of the intricacies of business dealings at that scale.
I can't see how they are doing it when I consider the logistics and costs....certainly not with the efficiencies we have today at sub $400 prices.
are you speaking from experience? i can relate as a 2TH hobbyist. i traded simple services for my electrician to wire in eight special 240W outlets (i'm oversupplied) with its own subpanel to the 2nd flr room of a building i already own. i put the miners up next to an open sliding door with a balcony and lined up fans pointing outwards up against the screen door. i had one of my workers install a $200 external barred gate like this for security. no other cooling: the room is exposed to the open air 24/7 all year long. no licenses, insurance or any other special expenses except for electricity. i had additional Cat5/6 wiring run thru the walls to an external closet connecting the server with the asics to an existing internet connection used for other purposes. throw in a large roller rack. total cost of setup and other ancillary materials, maybe $400. it pays to be small and nimble. Yes, exactly...your costs benefit from the economy of scale I'm talking about. Small and nimble is what works in these days of high mining diff. Now consider if you want to lease a commercial building of 50-100k sq ft. It costs $3-5 per square foot for that alone....on a minimum one year term. To lease the building you need to tell the landlord and the municpality has to approve what the use will be...as soon as you tell them a half dozen riders get dropped onto the lease. Liability insurance in the millions...usually 10 million for a building like that Transformer installation....ask yourself what a transformer capable of 0.5MW costs to install Electrical approvals, all electricals installed by licensed electricians, and the panels signed off by same Here's the kicker....in order to install electronics such as these in an industrial setting you are never going to get away with plugging in equipment that has no CSA/UL/CE approval. Certainly not 1000 units of electronic equipment that is not approved for your country...now you are into electrical approvals/hipot tests at a minimum...better hope the company you bought them from designed these properly Do it illegally? No insurance will cover you. And your local hydro department will never turn on the mains without it. Now think about racking Now think about networking costs and cabling costs for the units when the runs are 10x longer power supplies....most mining hardware requires your own fire prevention/suppression? How are you going to handle that? cooling? How many tons of AC? Does it have to be installed? internet bandwidth? You are not running this off a single DSL/Cable modem connection Already own a 2-3 million dollar building you want to use for mining?...great, you can strip away a few of those requirements but most are still applicable. And now you have a 2-3 million dollar asset not generating leasing revenue... this is actually a very important point you're bringing up, especially now with difficulty so high. early on back in 2011, i could see from my limited GPU mining that anything on scale would come at an enormous cost of money and time. i made the choice back then to hoover up coins on all dips as it seemed the simplest, cheapest, and easiest way to accumulate. mining is just another way of accumulating; but way more labor intensive. as a fixed supply currency, i figured the price could only go up, as long as their was no security or source code bug. i figured out myself that the economics were sound based on my investing history in the stock mkt and with pm's. riding gold up from 550 to 1923 gave me a good perspective on what a sound form of money can do given our inflationary Fed and the politics of a over leveraged economy. investing thru the crashes of the 2000 & 2008 bubble/crash helped as well. bottom line is my perspective has not changed one bit. imo, we're just experiencing another major dip. in fact, this one might be manipulated, as much as i've resisted saying that in the past. it's now very possible with the new derivatives exchanges we have. so yes, i'm buying this dip too and i think those who were considering getting into mining, and probably even those into mining currently, are doing the math and will decide it's simply much cheaper and easier to buy the coins directly.
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cypherdoc (OP)
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September 29, 2014, 01:50:06 AM |
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Cypherdoc is an admitted paid shill of HashFast. The people who listened to him in the HasFast thread lost serious coin. The people who listen to him now should stop immediately and seek institutionalization. A safe, controlled setting where they will no longer be a danger to themselves or society, to be studied by dedicated psychiatric professionals. Perhaps even partially cured with the aid of powerful modern psychotropics and/or daring and innovative surgical procedures.
and more ppl who listened to me since 2011 to buy Bitcoin have made serious money. old news dude. i've already said many times the HF endorsement was a bad one. it was for Batch #1 only and i've not been involved for over 10 mo now. none of their poor decisions involved me and i had no control over their internal actions. nice try on attempting to make it seem like it's all my fault while tying that debacle to Bitcoin. but given your lack of intellectual arguments about why ppl should avoid Bitcoin, you're not really interested in the truth, are you?
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