Biodom (OP)
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November 16, 2014, 05:03:49 PM Last edit: November 17, 2014, 01:20:17 AM by Biodom |
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In january 2013 first ASIC-based miners had arrived. You would be surprised to learn that they were mining 18-20 BTC a day (~$240/day with BTC at $12-14). See http://bitcoinmagazine.com/3231/working-avalon-asic-confirmed/Since then the network hashing speed increased X13180 fold, but bitcoin price recently stagnated or declined. In fact, network speed increased 60-fold while price decreased at least twofold in the last 11-12 mo, putting a huge strain on profitability. Eight months ago a lowly cheap antminer S1 was producing MORE BTC than expensive and efficient (relatively) spondoolies SP-30 machine does right now, but S1 cost ~$700 last March and Sp-30 ~$3800 this summer and early fall. My point is that mining efficiency declined while miner prices stayed very high. Right now, even the most productive and efficient machines DO NOT produce even the amount of bitcoin that is equal to their cost in bitcoins over their expected lifespan. It means, that measured in bitcoin, they are inherently unprofitable to run, even with low electricity cost. I expect that, if stagnation in price continues, many miners who try to run a profitable operation will withdraw, which would make the network much more centralized and vulnerable. Only newcomers and large mines will remain. I wonder if in a couple of years mining will produce just a few bits (literally) per month-who would even do it? The "mining for bitcoin reward" model seems broken to me if rewards are miniscule and getting smaller (in $$) all the time with average miner right now clearly subsidizing both the miner manufacturers and network as a whole. Instead of getting some rewards, miners are currently making a DONATION to multiple parties. I think that this is the opposite of what Satoshi envisioned.
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goozman96
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November 16, 2014, 09:40:36 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
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BTC: 19DKtsdGfQyFzNiEze9KuFQrWGiLDvg6F1 | LTC: LbV6UGyjYbVP49NvQFmuAnkADcaFYvNagK | NMC: NDCdMJmTmGH54Cezmo3CwSxAC7grAoZJbj
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Biodom (OP)
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November 16, 2014, 10:33:22 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
One of my points is for mining to continue at present OR higher difficulty level, price of BTC has to go up, or price can stay the same, but difficulty has to drop~2-fold. Present situation is unsustainable long term. People can tolerate short term, but NOT long term losses.
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dropt
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November 16, 2014, 10:38:43 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
The "early" pioneers weren't making a tonne either. When I started mining with a fairly respectable GPU farm I may have been mining 5 coins a day, but they were only worth $5 each.
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goozman96
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November 16, 2014, 11:10:34 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
One of my points is for mining to continue at present OR higher difficulty level, price of BTC has to go up, or price can stay the same, but difficulty has to drop~2-fold. Present situation is unsustainable long term. People can tolerate short term, but NOT long term losses. I agree. And either one or the other will happen eventually. It just depends on how long the big farms will hold out in hopes of a price increase - which they are also preventing from happening because most of them sell all mined coins quickly, thus not allowing for there to be a higher demand for coins. So by their own actions, they will run themselves out of business.
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BTC: 19DKtsdGfQyFzNiEze9KuFQrWGiLDvg6F1 | LTC: LbV6UGyjYbVP49NvQFmuAnkADcaFYvNagK | NMC: NDCdMJmTmGH54Cezmo3CwSxAC7grAoZJbj
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seriouscoin
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November 16, 2014, 11:32:45 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
Only retards keep comparing bitcoin mining to gold mining. Early miners dont makes that much if you take buying and holding to consideration. Frankly all the bitcoin richest are not miners. ...ie Roger Ver Back in the gold rush days, ppl couldnt just buy gold while taking a dump ..... see the difference?
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philipma1957
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November 16, 2014, 11:47:18 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
Only retards keep comparing bitcoin mining to gold mining. Early miners dont makes that much if you take buying and holding to consideration. Frankly all the bitcoin richest are not miners. ...ie Roger Ver Back in the gold rush days, ppl couldnt just buy gold while taking a dump ..... see the difference? Yes as I type this right now I am on another pc buying a coin from coin base. If it was 1849 buying a gold nugget would take time and effort. BTC has lots of advantages over gold nuggets or bars. Mining crypto coins will stick around for years to come since it offers the ability to stash cash in the cloud. Is an inflation hedge and many other things. I mine for fun since I will never be able to mine in house with big volume ever again. I also buy BTC in order to make money. In order to have an inflationary edge. In order to have more then the clothes on my back if I ever feel I need to run.
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Biodom (OP)
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November 17, 2014, 01:29:16 AM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
One of my points is for mining to continue at present OR higher difficulty level, price of BTC has to go up, or price can stay the same, but difficulty has to drop~2-fold. Present situation is unsustainable long term. People can tolerate short term, but NOT long term losses. It just depends on how long the big farms will hold out in hopes of a price increase - which they are also preventing from happening because most of them sell all mined coins quickly, thus not allowing for there to be a higher demand for coins. So by their own actions, they will run themselves out of business. I agree, in the last couple of weeks, on miltiple occasions, I observed that as soon as hashing speed decreased, price increased and vice versa. It looked almost like someone is testing a model. Since price is rebounding strongly on even a small hashing rate decrease, some investors could buy bitcoins AND a large, but inefficient farm, then take that farm out of production and receive almost immediate 20-30% boost to their bitcoin value, sell bitcoin and switch the farm back on. Rinse and repeat ad nauseum. I wonder if some entity is already pursuing this or similar strategy since we undergo large hashing speed fluctuations in a matter of a couple of days.
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xhomerx10
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November 17, 2014, 05:10:45 AM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
One of my points is for mining to continue at present OR higher difficulty level, price of BTC has to go up, or price can stay the same, but difficulty has to drop~2-fold. Present situation is unsustainable long term. People can tolerate short term, but NOT long term losses. It just depends on how long the big farms will hold out in hopes of a price increase - which they are also preventing from happening because most of them sell all mined coins quickly, thus not allowing for there to be a higher demand for coins. So by their own actions, they will run themselves out of business. I agree, in the last couple of weeks, on miltiple occasions, I observed that as soon as hashing speed decreased, price increased and vice versa. It looked almost like someone is testing a model. Since price is rebounding strongly on even a small hashing rate decrease, some investors could buy bitcoins AND a large, but inefficient farm, then take that farm out of production and receive almost immediate 20-30% boost to their bitcoin value, sell bitcoin and switch the farm back on. Rinse and repeat ad nauseum. I wonder if some entity is already pursuing this or similar strategy since we undergo large hashing speed fluctuations in a matter of a couple of days. The problem with that thinking is that the bitcoin network hashing rate is not "known" per se at any point in time but it is calculated based on the number of blocks being found per unit of time. Finding blocks is probability based and there are inherent swings in the apparent hashing rate because of this fact. It wouldn't make sense to take your miners offline because you don't know exactly when you are going to solve your next block- you might solve three blocks in the next 16 seconds and then wait hours to solve the next even though you haven't altered your hashing rate. I would imagine if you are observing this phenomenon, there is an entirely different explanation for it. Perhaps they don't have any coins to sell because they haven't produced any which would explain why the apparent network hashing rate had also taken a dip and the fact that they aren't selling leaves buyers looking to buy and edging up the price.
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SSSSwinner
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November 18, 2014, 08:09:50 AM |
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Having been involved since the beginning, it sure makes me smile when reminiscing the whole bitcoin rush ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
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philipma1957
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November 24, 2014, 03:33:18 AM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
One of my points is for mining to continue at present OR higher difficulty level, price of BTC has to go up, or price can stay the same, but difficulty has to drop~2-fold. Present situation is unsustainable long term. People can tolerate short term, but NOT long term losses. It just depends on how long the big farms will hold out in hopes of a price increase - which they are also preventing from happening because most of them sell all mined coins quickly, thus not allowing for there to be a higher demand for coins. So by their own actions, they will run themselves out of business. I agree, in the last couple of weeks, on miltiple occasions, I observed that as soon as hashing speed decreased, price increased and vice versa. It looked almost like someone is testing a model. Since price is rebounding strongly on even a small hashing rate decrease, some investors could buy bitcoins AND a large, but inefficient farm, then take that farm out of production and receive almost immediate 20-30% boost to their bitcoin value, sell bitcoin and switch the farm back on. Rinse and repeat ad nauseum. I wonder if some entity is already pursuing this or similar strategy since we undergo large hashing speed fluctuations in a matter of a couple of days. yeah I think we are witnessing DIFF fixing by large companies. I think they realize growth limits may be better for them then unchecked wild growth.
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SMB-2525
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November 24, 2014, 12:01:03 PM |
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yeah I think we are witnessing DIFF fixing by large companies. I think they realize growth limits may be better for them then unchecked wild growth.
Game theory would indicate this is very difficult to pull off. How many parties would be required to make this work?
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galdur
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November 24, 2014, 12:11:44 PM |
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If you go back six months or so you´ll see glowing predictions by leading mining experts and geniuses of BTC $1-2000 by xmas 2014. Result: idiotic overinvestment in mining, irate bankers and coming bankruptcies. Good luck, g
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galdur
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November 24, 2014, 12:14:05 PM |
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2014-05-28 01:35 PM BTC to break $2,000 mark by Christmas – Experts http://cointelegraph.com/news/111597/btc_to_break_2_000_mark_by_christmas_expertsTamas Blummer, Bits of Proof - Don't know
Jesse Powell, Kraken - $1,000,000
Prof Robin Reigland, Stockholm School of Economics - $1,300
Kirill Suslov, Tabtrader - $500
Johann Gevers, Monetas - $5,000
George Frost, Bitstamp - Can’t say
Anthony Gallippi, Bitpay - $1,160
Mary Beth Stanton, Heather Podesta and Partners - Higher than what I paid
Joel Gartner - $2000-$3000
Alakanani Itireleng, Bitcoin Botswana, $10,000
Jinyoung Lee Englund, Bitcoin Foundation - Not relevant
John Karamja, Whive, $2,000
J. Dax Hansen, Perkins Coie - No idea
Brian Klein, Baker Marquart LLP - Higher, but don't know where
Elizabeth Ploshay, Bitcoin Magazine - Doesn't matter
Thomas Voegtlin, Electrum - No comment
Joseph Cutler, Perkins Coie - Beginning to stabilize
Alexey Bragin - I am optimistic
Brian Fabian Crain, Epicenter Bitcoin - $2,000
Brian Armstrong, CoinBase - Going upwards
Lars Christensen, Saxobank - Don't know
Bobby Lee, BTC China - $500
Juan Llanos, Unidos Financial Services Inc - $500
Trace Mayer, Investor - really big
Laura Jeppson, Aoen Risk Solutions - $800
Dr. Marco Krohn, Genesis Mining - $2000-$3000
David Schwartz, Ripple labs - steady rise
Nahid Samsami, CoinBase - No comment
Erik Voorhees, Coinapult - $2,400
Rodrigo Batista, Mercado Bitcoin - $0 - $10000
Gavin Wood, Ethereum - $200-$800 or $900
Peter Todd, Mastercoin - between 0 and infinity
Mark van Cuijk, CoinQY - $2,000
Lasse Birk Olesen, Bitcoin Nordic - $4,000
Brock Pierce, Bitcoin Foundation - $1000-$5000
Gavin Andresen, Bitcoin Foundation - bigger than now
David Irvine, Maidsafe - more interested in what you can do with bitcoin
Ron Gross, Mastercoin - a few thousand dollars
Roger Ver, Memory Dealers - in the long term is going to be higher
Frank Schuil, Safello - $2,000
Marco Santori, Nesenoff and Miltenburg - Bitcoin has the power to change the world
Alan Safahi, Zip Zap - $500
Andreas Petersson, Mycelium - No idea
Jillian Friedman, Bitcoin Legal - $800
John Light, Cambrian - $1,000
Jon Matonis, Bitcoin Foundation - Logarithmic growth
Steve Beauregard, Gocoin - $600-$800
Gregory Simon, Cryptowerks - 2-3 times higher than today
Ravi Iyengar, Cointerra - higher
David Orban, Dotsub - Price to climb
Michael Terpin, Social Radius - $1000-$2400
Ron Gross, Mastercoin - $4,000
Martijn Wismeijr, MrBitcoin - I don't know
Sam Cole, KnCMiner - $2000-$3000
Edward, Cryptonit - $1000 at least
Patric Stiller, Baytrade Group - $1500-$2000
Kevin Beardsley, Bitcoin Foundation - As long as the community keeps growing
Alan Reiner, Armory Technologies - I don't make predictions.
Average price is two thousand and seventy-two dollars.
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raskul
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November 24, 2014, 12:27:13 PM |
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This is why it was advantageous to get in on the rush early on. Similar to the gold rush in the west. People are still making some money now, otherwise they wouldn't be mining. But not nearly as much as the early pioneers.
One of my points is for mining to continue at present OR higher difficulty level, price of BTC has to go up, or price can stay the same, but difficulty has to drop~2-fold. Present situation is unsustainable long term. People can tolerate short term, but NOT long term losses. It just depends on how long the big farms will hold out in hopes of a price increase - which they are also preventing from happening because most of them sell all mined coins quickly, thus not allowing for there to be a higher demand for coins. So by their own actions, they will run themselves out of business. I agree, in the last couple of weeks, on miltiple occasions, I observed that as soon as hashing speed decreased, price increased and vice versa. It looked almost like someone is testing a model. Since price is rebounding strongly on even a small hashing rate decrease, some investors could buy bitcoins AND a large, but inefficient farm, then take that farm out of production and receive almost immediate 20-30% boost to their bitcoin value, sell bitcoin and switch the farm back on. Rinse and repeat ad nauseum. I wonder if some entity is already pursuing this or similar strategy since we undergo large hashing speed fluctuations in a matter of a couple of days. yeah I think we are witnessing DIFF fixing by large companies. I think they realize growth limits may be better for them then unchecked wild growth. I too, have been thinking this for some time now. All it would take is a few skype-calls between a collection of large company farmers and *click* 'lets power down in time for the difficulty increase.' not a difficult feat in any way and likely to be controlled by those who build the hardware, and also mine with it. Continual difficulty increases would simply render both their own farms too inefficient to run, and halt sales of their own product. Correlating price with network hash-rate is also something i've been trying to get my head around, but in truth, there is no logic to it whatsoever, when the market value is solely dependent on market activity, due to the fact that bitcoin has no base tracker function (it's not backed by anything except the price people are willing to buy/sell). regarding bitcoin price? 1BTC=1BTC, anyone who speculates anything other than this is on a hiding to nothing MHO.
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Biodom (OP)
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November 24, 2014, 05:18:44 PM |
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2014-05-28 01:35 PM BTC to break $2,000 mark by Christmas – Experts http://cointelegraph.com/news/111597/btc_to_break_2_000_mark_by_christmas_expertsTamas Blummer, Bits of Proof - Don't know
Kirill Suslov, Tabtrader - $500
George Frost, Bitstamp - Can’t say
J. Dax Hansen, Perkins Coie - No idea
Elizabeth Ploshay, Bitcoin Magazine - Doesn't matter
Thomas Voegtlin, Electrum - No comment
Lars Christensen, Saxobank - Don't know
Bobby Lee, BTC China - $500
Juan Llanos, Unidos Financial Services Inc - $500
Nahid Samsami, CoinBase - No comment
Peter Todd, Mastercoin - between 0 and infinity
Gavin Andresen, Bitcoin Foundation - bigger than now
David Irvine, Maidsafe - more interested in what you can do with bitcoin
Roger Ver, Memory Dealers - in the long term is going to be higher
Marco Santori, Nesenoff and Miltenburg - Bitcoin has the power to change the world
Alan Safahi, Zip Zap - $500
Andreas Petersson, Mycelium - No idea
Ravi Iyengar, Cointerra - higher
Martijn Wismeijr, MrBitcoin - I don't know
Kevin Beardsley, Bitcoin Foundation - As long as the community keeps growing
Alan Reiner, Armory Technologies - I don't make predictions. ^^^^Here, I "fixed" it by removing the most outlandish calls. These are people who were reasonable. Maybe this is a list of folks worth listening to. BTW, $500 is still possible by Christmas, depending on how the auction goes.
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Biodom (OP)
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November 28, 2014, 03:48:55 AM |
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Hey, is it possible for ANY manufacturer to have a machine that can breakeven in BTC in reasonable time (not infinity) or we are post that now and forever?
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raskul
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November 28, 2014, 08:26:56 AM |
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Hey, is it possible for ANY manufacturer to have a machine that can breakeven in BTC in reasonable time (not infinity) or we are post that now and forever?
My new SP20 is arriving today. My s3's have paid back... Watch this space for SP20. However, since i don't buy miners with BTC then my ROI is never stagnant and for me getting my investment back isn't as clear cut as making back the bitcoin i paid for the rig.
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philipma1957
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November 28, 2014, 09:34:36 AM |
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Hey, is it possible for ANY manufacturer to have a machine that can breakeven in BTC in reasonable time (not infinity) or we are post that now and forever?
yes the s-3's have. and I think the sp20's will my batch 1's cost me 1.35 btc they have earned 1.93 BTC and 2.96 NMC before power cost .58 btc profit the nmc is worth a little so .59 btc profit power in my case has been .17 btc so I am up .42btc
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HellDiverUK
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November 28, 2014, 12:52:37 PM |
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Only people who made money in the Gold rush were the shovel manufacturers.
Only people who make money in the Bitcoin mining game are the ASIC manufacturers.
History repeats, greed is timeless.
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