bitpump (OP)
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September 20, 2014, 06:23:50 AM Last edit: September 25, 2014, 10:29:02 AM by bitpump |
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============================================================================== ORIGINAL CHART WAS NOT CORRECT - HERE IS CORRECT CHART ============================================================================== Cost of mining 1 Bitcoin hits market price in Nov... What will happen? ![](https://ip.bitcointalk.org/?u=https%3A%2F%2Fi.imgur.com%2FIfcEAv7.png&t=665&c=UeWHJdpPRkELJA) Source: https://twitter.com/bitpump/status/508179636816478208
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botany
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September 20, 2014, 10:48:35 AM |
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There will be no further investments in bitcoin mining equipment. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
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Unbelive
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September 20, 2014, 12:53:49 PM |
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There will be no further investments in bitcoin mining equipment. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) They invested to much already. Is time for them to look at other opportunities. There are plenty.
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Searing
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Clueless!
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September 20, 2014, 01:13:18 PM |
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There will be no further investments in bitcoin mining equipment. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) They invested to much already. Is time for them to look at other opportunities. There are plenty. trying to convice home miners that can't get that to work to cloud mining comes to mind as their plan
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Old Style Legacy Plug & Play BBS System. Get it from www.synchro.net. Updated 1/1/2021. It also works with Windows 10 and likely 11 and allows 16 bit DOS game doors on the same Win 10 Machine in Multi-Node! Five Minute Install! Look it over it uninstalls just as fast, if you simply want to look it over. Freeware! Full BBS System! It is a frigging hoot!:)
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odolvlobo
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September 20, 2014, 01:15:47 PM |
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Your graph has absolutely nothing to do with bitcoin. Cost of mining 1 Bitcoin hits market price... What will happen?
When the cost of mining rises, the less profitable miners stop mining. Less miners means lower difficulty, and that lowers the cost of mining. The result is an equilibrium in which the cost of mining stays around the value of the mined bitcoins.
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Fabrizio89
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September 20, 2014, 03:10:09 PM |
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Old gen mining equipment will be put to rest and many people who came late to the game will lose their investment.
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zimmah
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September 20, 2014, 03:17:22 PM |
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The cost of mining one bitcoin is different for everyone, It depends on their cost of electricity and the efficiency of their mining equipment. Those who make a loss while mining (their electricity cost is higher than the value they get from selling their mined bitcoin) will usually just sell their miners to people who have cheaper electricity. Some invest in more modern hardware. If many miners become unprofitable, the hashrate will go down, making some miners profitable again.
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BeeTeeSea
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September 20, 2014, 03:47:44 PM |
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THere will always be someone that wants to do the mining.
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painlord2k
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September 20, 2014, 04:00:42 PM |
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If many miners become unprofitable, the hashrate will go down, making some miners profitable again.
Not only, but the retargeting will need more time reducing the coin mined every day. If the hash rate dropped 10%, the retargeting would happen one and half day later and there would be 3240 coin mined per day against the 4200 mined today with an increasing hashrate (14K less coins in two weeks). If the hash rate dropped 50%, there would be 52.200 BTC mined in 29 days instead of 104.400 (the network would not suffer a lot, because there is free room enough for double the transactions in a single block). Take out 52.200 BTC from the market for a month and I think the price will rebound nicely. This would lower the inflation rate to 9.7% annualized immediately, at the level of the current M1 rate. Then (at a stable hash rate) you would have two currency inflating at the same rate, but one (BTC) with increasing adoption and the other with decreasing adoption.
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leannemckim46
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September 20, 2014, 10:15:21 PM |
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The "cost" of mining is only an average and is not the same for everyone. If the cost of mining 1 bitcoin is above the price of bitcoin for a long enough time period for a specific miner then the miner will likely be taken offline and potentially sold (if possible). As a result the hashrate will decrease a little bit (or increase less by a little bit). This process will continue until the price of bitcoin is above the highest cost of mining on the network is below the market price of bitcoin.
The only exception to this rule is when the cost of mining is prepaid (usually via cloud mining contracts), and these miners will stay online regardless of the price of bitcoin
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bitpump (OP)
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September 21, 2014, 12:30:48 PM |
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My understanding:
Up untill now: If mining cost < market price, miners will turn on machines, increase difficulty and sell at market price
Future: If mining cost > market price, miners will turn off machines, lowering difficulty and try to sell at mining cost (where ask price may be higher than current market price!)
The last scenario could INCREASE MARKET PRICE
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arbitrage001
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September 21, 2014, 12:38:00 PM |
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Each new generation of ASIC takes around 9 months of planning and development.
Meaning much money already invested in this cycle and reduction of hash rate won't happen until at least 9 months down the road.
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odolvlobo
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September 21, 2014, 04:53:08 PM |
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My understanding: Up untill now: If mining cost < market price, miners will turn on machines, increase difficulty and sell at market price Future: If mining cost > market price, miners will turn off machines, lowering difficulty and try to sell at mining cost (where ask price may be higher than current market price!) The last scenario could INCREASE MARKET PRICE
The amount of bitcoins held by miners waiting for a higher price because they mined at a loss is not likely to be enough to make a detectable difference in the price.
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zimmah
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September 21, 2014, 05:34:41 PM |
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My understanding: Up untill now: If mining cost < market price, miners will turn on machines, increase difficulty and sell at market price Future: If mining cost > market price, miners will turn off machines, lowering difficulty and try to sell at mining cost (where ask price may be higher than current market price!) The last scenario could INCREASE MARKET PRICE
The amount of bitcoins held by miners waiting for a higher price because they mined at a loss is not likely to be enough to make a detectable difference in the price. depends on two factors: 1) How many % of miners mines at a loss at any given time. (I assume right now more miners mine at a loss, because the difficulty skyrocketed, but the price dropped, so that must mean many miners who once were profitable, no longer are). So, this one is looking good. 2) How many miners have the cash reserves to pay their expenses without having to cash out bitcoin? Because if they can't just wait for a higher price they will have to sell, regardless of price.
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waterpile
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September 22, 2014, 05:58:38 AM |
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late miners are already selling their equipment coz they cant make profit out of it and unfortunately for them its also a negative income
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sandykho47
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September 22, 2014, 11:25:58 AM |
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Yeah, and most people is already late to mining bitcoin. Becuase the diff. is too high, less people want to mine bitcoin Expect bitcoin price raise up to the moon ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) The cost of mining one bitcoin is different for everyone, It depends on their cost of electricity and the efficiency of their mining equipment. Those who make a loss while mining (their electricity cost is higher than the value they get from selling their mined bitcoin) will usually just sell their miners to people who have cheaper electricity. Some invest in more modern hardware. If many miners become unprofitable, the hashrate will go down, making some miners profitable again. Yeah, when the diff. low many miner comes, and when the diff. high many miner gone. And come back again to when diff. low happen ![Sad](https://bitcointalk.org/Smileys/default/sad.gif)
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Kemampuanku Tidak semua orang memiliki dan dapat melakukannya . Tidak memakan kaum sendiri . dan mempunyai kode etik yang tidak masuk akal.
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botany
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September 22, 2014, 04:40:17 PM |
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late miners are already selling their equipment coz they cant make profit out of it and unfortunately for them its also a negative income
At least they are able to salvage some money from it.
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OptimusPrime7
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September 23, 2014, 03:53:44 AM |
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Well, when cost of mining is higher then the bitcoin they made, difficulty drop.. easy as that..
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Searing
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September 23, 2014, 08:28:29 AM |
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well so far my 1 BTC buy of $380.01 is holding...come on baby be the low rise rise rise (No it won't work..but neither will my dreams of dating a super model unless bitcoin comes thru in 5-10 years .. that makes one highly motivated to HODL let me tell you and still better odds the winning the lottery my other long term investment shortcut ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) )
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Old Style Legacy Plug & Play BBS System. Get it from www.synchro.net. Updated 1/1/2021. It also works with Windows 10 and likely 11 and allows 16 bit DOS game doors on the same Win 10 Machine in Multi-Node! Five Minute Install! Look it over it uninstalls just as fast, if you simply want to look it over. Freeware! Full BBS System! It is a frigging hoot!:)
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Timetwister
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September 23, 2014, 01:30:47 PM |
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How are production costs calculated? Don't you realize that production costs aren't the same for everyone? As mining become less profitable, the marginal winners (now losers), quit. So in the long run, just the most efficient miners will keep mining.
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