[prediction] Next spike $560,000 14 {<-oops!} months from now (2017 Update!)

[sgbett]

Also continuing to mischarecterise my posts as advice to buy, reveals the shallowness of your thiught process.

Well, i would guess there are only so many interpretations for a topic called "[prediction] Next spike $560,000 14 months from now".
I mean, what is the topic supposed to imply?

Why goat my dear fellow, it's wild speculation, implication is in the eye of the beholder. (Not to mention its just the click bait to get people to read the post! You know how it works)

It does represent my belief, that buying and or holding is a good plan (it's what I'm actually doing) but as to whether that is appropriate that's up to the individual reading it.

Now if someone's goal is to make short term profit then this is not the post for them. That's not my goal and I do consistently reiterate that. My goal is to invest a reasonable amount of cash (that I can well afford to lose) in a risky asset class that I happen to think is a game changer. When it looks "cheap" to me I pick up a bit more.

Now, that's a totally digferent agenda to that the chorus of sellers is pushing, but I think it's agood agenda. It's also transparent and honest. I will weather the diatribe all the way to $30 if I have to.

[1714312812]

1714312812

[An amorous cow-herder]

Why goat my dear fellow, it's wild speculation, implication is in the eye of the beholder.

Well, the chart does imply a couple of things, amoth others the following.
The mining network will consume more power than a medium sized country.
The technology will still not be widely used, even at those price levels, otherwise it would have stabilzed with a high volume.
So, thats what you believe?

[inca]

Why goat my dear fellow, it's wild speculation, implication is in the eye of the beholder.

Well, the chart does imply a couple of things, amoth others the following.
The mining network will consume more power than a medium sized country.
The technology will still not be widely used, even at those price levels, otherwise it would have stabilzed with a high volume.
So, thats what you believe?

Why on earth does the mining have to use more power than a medium size country as the price rises?

[farfiman]

Why goat my dear fellow, it's wild speculation, implication is in the eye of the beholder.

Well, the chart does imply a couple of things, amoth others the following.
The mining network will consume more power than a medium sized country.
The technology will still not be widely used, even at those price levels, otherwise it would have stabilzed with a high volume.
So, thats what you believe?

Why on earth does the mining have to use more power than a medium size country as the price rises?

According to this post by  BurtW it is illogical to get to those prices in this "era" unless electricity becomes mega abundant or mining much more efficient.

A price of $252,000 in era 0 (50 BTC/block) would have caused the Bitcoin network to attempt to consume about 30% of all the electrical power produced on the planet.

A price of $252,000 in this era, era 1 (25 BTC/block) would cause the Bitcoin network to attempt to consume about 15% of all the electrical power produced on the planet.

So, in order to keep the Bitcoin network from attempting to consume more than 1% of all the power produced we should all hope that the price does not reach that level until at least era 5 - about 2029 or so.

Of course all of these numbers are rough "back of the envelope" estimates:

Code:

    Original target     Subsidy   Est Fees  Power % of total world
Era   starting year   BTC/block   BTC/hour     GW power production
--- --------------- ----------- ---------- ------ ----------------
  0            2009 50.00000000 0.00000000 680.40           29.44%
  1            2013 25.00000000 0.00000000 340.20           14.72%
  2            2017 12.50000000 0.00000000 170.10            7.36%
  3            2021  6.25000000 0.00000000  85.05            3.68%
  4            2025  3.12500000 0.00000000  42.53            1.84%
  5            2029  1.56250000 0.00000000  21.26            0.92%
  6            2033  0.78125000 1.31250000  13.61            0.59%
  7            2037  0.39062500 3.65625000  13.61            0.59%
  8            2041  0.19531250 4.82812500  13.61            0.59%
  9            2045  0.09765625 5.41406250  13.61            0.59%

[An amorous cow-herder]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

[sgbett]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

This is actually a really interesting point. I wonder then if the adoption curve is retarded by the block reward. I guess then any order of magnitude moves (such as i speculated) are some 10-20 years off.

Thats going to test some patience!

[inca]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

You make an excellent point and in the long run perhaps the mining system may prove flawed.

But I must have missed where in the near term the cost of a bitcoin is anyway related its mining cost?

[Ibian]

The price of bitcoin merely has to be at least the cost of electriticy to produce it. There is nothing preventing it from being higher. Or much higher.

[brg444]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

Actually it could be that a only a very small fraction of that would be going into paying the electricity bill.

Case in point : I don't have any numbers to back this up but the cost of mining a Bitcoin at the last ATH was certainly less than a 1/10th of the price.

[An amorous cow-herder]

The price of bitcoin merely has to be at least the cost of electriticy to produce it. There is nothing preventing it from being higher. Or much higher.

Nothing. Except rational behavior.
If mining is is highly profitable more people (or farms) will do it and expand capacities. I mean, seriously, who wouldnt want to buy a "money printing" machine?
Mining capacity (and power requirements) will allways follow price.

[xDan]

BTC doesn't solve a problem, just makes certain monetary transactions slightly easier (once you know what your doing).  I really dont think the comparison between the early internet and btc right now are valid.  BTC is not doing something new and different like the internet was doing.

ahahahahaha

The www was invented in what, 1993? 1994? Within a couple years, I was online with an Internet portal, and I was just a snot nosed kid who watched Nickelodeon all day. If I knew about it and was using it within such a short span of time, then obviously it had a significant impact on society.

ohohohohohoho

Bitcoin doesn't solve any problems for average people

huehuehuehuehue

Sweeping statements, mass generalisations, and lack of any kind of vision.
I'm afraid this is all the response you deserve.

[brg444]

The price of bitcoin merely has to be at least the cost of electriticy to produce it. There is nothing preventing it from being higher. Or much higher.

Nothing. Except rational behavior.
If mining is is highly profitable more people (or farms) will do it and expand capacities. I mean, seriously, who wouldnt want to buy a "money printing" machine?
Mining capacity (and power requirements) will allways follow price.

I don't think this is true.

The ability to set up miners and add hashing power to the network can easily lag behind the price in a bull market.

[An amorous cow-herder]

Case in point : I don't have any numbers to back this up but the cost of mining a Bitcoin at the last ATH was certainly less than a 1/10th of the price.

I know for sure. I had a rig mining back then (and a couple of gfx cards for scrypt coins).
But that doesnt change anything. Mining capacity follows price. With Asics there is allways a delay, due to the long times between (pre-)ordering and shipping. The hashing power has kept rising at unsustainable rates since last ATH (actually next difficulty change might be first drop since around the time of the first reward reduction). Mining cards like the BFL monarchs which were ordered during the ATH still havent been shipped (and its very well possible they never will...).

[sgbett]

The www was invented in what, 1993? 1994? Within a couple years, I was online with an Internet portal, and I was just a snot nosed kid who watched Nickelodeon all day. If I knew about it and was using it within such a short span of time, then obviously it had a significant impact on society.

ohohohohohoho

this was my favourite, "because I was using the internet after a couple years, so was everyone" such worldview. so insight.

[Odalv]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

You make an excellent point and in the long run perhaps the mining system may prove flawed.

But I must have missed where in the near term the cost of a bitcoin is anyway related its mining cost?

I'm sorry, but you are wrong.
If bitcoin price is 10x higher than mining costs then a lot of new miners will emerge ... simply because they can make some profit.

[brg444]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

You make an excellent point and in the long run perhaps the mining system may prove flawed.

But I must have missed where in the near term the cost of a bitcoin is anyway related its mining cost?

I'm sorry, but you are wrong.
If bitcoin price is 10x higher than mining costs then a lot of new miners will emerge ... simply because they can make some profit.

Sure, but they ALWAYS lag behind.

Consider that some suggest it currently costs about 300$ or so to mine a coin at today's hash rate.

This means even with continuous exponential growth the miners are still far behind last year's ATH.

[inca]

Why on earth does the mining have to use more power than a medium size country as the price rises?

Because the miners get paid with block rewards in bitcoin. As the price of bitcoin rises so does the block reward.
And as long the mining gear produces more rewards than the power to run it costs, it will stay online. And at, say $500K per coin and 12.5BTC/block that would be like $900M rewards/day or ~$330B/year. A large amount of that would be going into paying the electricity bills.

You make an excellent point and in the long run perhaps the mining system may prove flawed.

But I must have missed where in the near term the cost of a bitcoin is anyway related its mining cost?

I'm sorry, but you are wrong.
If bitcoin price is 10x higher than mining costs then a lot of new miners will emerge ... simply because they can make some profit.

If the price of bitcoin rises 100x tomorrow the mining cost of a bitcoin in the near term does not. The mining cost will rise as demand for miners rises to capture profit from the block reward minus cost of production, but this is a delayed response, with a definite lag period.

My point was simply that in for example november/december last year the price shot up 10x in very short order. Mining has since surged to capture that demand and the hash rate has gone ballistic.

In this example with a bitcoin valued at 500,000 dollars, however unlikely it seems, such a price could arise in a bubble situation where the price rises many fold over a short period of time, far exceeding the pre bubble mining cost of securing the network. So although I doubt we will ever see such high prices they do not necessarily require the hundreds of billions of dollars in electricity costs that goat has inferred earlier. Sustaining such a price is a different matter entirely..

[wachtwoord]

The www was invented in what, 1993? 1994? Within a couple years, I was online with an Internet portal, and I was just a snot nosed kid who watched Nickelodeon all day. If I knew about it and was using it within such a short span of time, then obviously it had a significant impact on society.

ohohohohohoho

this was my favourite, "because I was using the internet after a couple years, so was everyone" such worldview. so insight.

He thought the internet was developed in 1993. Did you even read further after that statement? 

[An amorous cow-herder]

I'm sorry, but you are wrong.
If bitcoin price is 10x higher than mining costs then a lot of new miners will emerge ... simply because they can make some profit.

Sure, but they ALWAYS lag behind.

Consider that some suggest it currently costs about 300$ or so to mine a coin at today's hash rate.

This means even with continuous exponential growth the miners are still far behind last year's ATH.

Why go for a suggestion? Just plug the numbers into any damn mining calculator.
E.g. a brand new Antminer S4 will break even after 5 months. Assuming you pay 5 c/kWh and the difficulty will NOT increase any further. Even assuming a mere 15% difficulty increase per month it will never break even (current 30 day average is 26%).
Either you can get something like a 50% discount of retail prices or you can forget turning a profit from mining currently.

[An amorous cow-herder]

He thought the internet was developed in 1993. Did you even read further after that statement? 

In his defence he wrote www, not internet.
Mosaic was pretty much the first "widely" used browser, and that was 93.