Topic: All mining might be illegal/parasitic soon - page 2. (Read 6503 times)
I don't think this will hold in a post ASIC era. No one, unknowingly, will allow installation of ASICs on their computers and everyone will notice very slow PCs.
I think you make a good point. Not being a miner though, I couldn't care less. As long as the network is kept online what does it matter if it's run by botnets?
a troll just escaped the newbies section.
Some people have a low threshold of "troll." I thought the OP's post was quite true. The cost of mining bitcoins will surely go below the cost of the electricity required to mine them, because many people can find ways around paying for electricity.
Long term, however, the equipment required to mine will get more and more advanced. It is unlikely that normal company or university computer systems would have the hardware to make mining worthwhile even if the electricity is free - even controlling 100 university computers right now is pretty worthless unless they've got gaming GPUs.
+1
yeah, i guess the best way would be to have access to solar- or wind-energy...
solar / wind have H-U-G-E setup costs to them. In fact solar energy is considered more expensive than traditional forms of energy production for this reason. With government incentives home panels are priced to pay for themselves over the course of ~20 years. If bitcoin mining profitability went to parity with traditional energy costs, that would represent a loss for a solar panel user.
As for illegal activity, I don't really see that being the real takeover step. A cpu miner can get something like 1/100th the hash rate of a similarly priced gpu. So a 100,000 person parasite botnet is the equivalent to about 1000 gpus. It is estimated that there are about 30,000 GPUs mining currently, that would require 3,000,000 compromised computers to reach parity while cpu mining. I'm guessing that 24/7 100% CPU load would attract even the noobiest trojan infected noob to wonder what is up, thus risking the botnet owner lotso f ocmpromised computers. These computers themselves have value (for illegal activities, such as ddos or what have you) and losing them because of mining might be a net loss. Hence I don't really see much incentive for people to take over bitcoin with zombie comps. More profitable to infect people and steal their wallets or ddos rival pools for pay or something.
I think that the OP has a point, but not in the near term. I'm mostly a miner, and my gear should be payed off before the next difficulty increase. I'll keep mining with all my systems (each family member has a dual GPU setup now) until the cost of electricity is greater than the value of the BTC mined. I'm expecting this to be several months off, but will be quite happy if the value goes up to cover difficulty increases.
One thing the OP hasn't taken into account is the ASIC and FPGA mining that can occur at very low electrical use rates. I think before the "legal" miners get squeezed out by the "illegal" miners, that the FPGA and ASIC miners will take over, so all that is left are them and the "illegal" guys.
Lets not forget about the many kids that are using their parents electricity, or college students in a dorm with "free" electricity. These two do't fall under "illegal" in my book, but they also don't have to directly pay for electricity.
One thing the OP hasn't taken into account is the ASIC and FPGA mining that can occur at very low electrical use rates. I think before the "legal" miners get squeezed out by the "illegal" miners, that the FPGA and ASIC miners will take over, so all that is left are them and the "illegal" guys.
Lets not forget about the many kids that are using their parents electricity, or college students in a dorm with "free" electricity. These two do't fall under "illegal" in my book, but they also don't have to directly pay for electricity.
a troll just escaped the newbies section.
Some people have a low threshold of "troll." I thought the OP's post was quite true. The cost of mining bitcoins will surely go below the cost of the electricity required to mine them, because many people can find ways around paying for electricity.
Long term, however, the equipment required to mine will get more and more advanced. It is unlikely that normal company or university computer systems would have the hardware to make mining worthwhile even if the electricity is free - even controlling 100 university computers right now is pretty worthless unless they've got gaming GPUs.
+1
yeah, i guess the best way would be to have access to solar- or wind-energy...
a troll just escaped the newbies section.
Some people have a low threshold of "troll." I thought the OP's post was quite true. The cost of mining bitcoins will surely go below the cost of the electricity required to mine them, because many people can find ways around paying for electricity.
Long term, however, the equipment required to mine will get more and more advanced. It is unlikely that normal company or university computer systems would have the hardware to make mining worthwhile even if the electricity is free - even controlling 100 university computers right now is pretty worthless unless they've got gaming GPUs.
I think OP has a good point actually.
The numbers are so enormous that using 100,000+ cpu's would have massive impact on difficulty, forcing mining costs up. Then there is the small percentage of zombie machines that will have a descent graphics card or two that can be put to use. Mining clients are well suited to the botnet paradigm and can be easily integrated.
I guess the question will be whether botnet owners want to do something quite so brazen.
The numbers are so enormous that using 100,000+ cpu's would have massive impact on difficulty, forcing mining costs up. Then there is the small percentage of zombie machines that will have a descent graphics card or two that can be put to use. Mining clients are well suited to the botnet paradigm and can be easily integrated.
I guess the question will be whether botnet owners want to do something quite so brazen.
Does the cost of gold reflect the amount of money it takes to produce one troy ounce?
Or could it be that it's scarce and has properties that have increased it's value over the centuries?
I have a great business plan for you: Go mine gold at $400 per Kg and sell it at $13,000. Why buy a gold watch or a gold bar when you can go straight to the source.
Or could it be that it's scarce and has properties that have increased it's value over the centuries?
I have a great business plan for you: Go mine gold at $400 per Kg and sell it at $13,000. Why buy a gold watch or a gold bar when you can go straight to the source.
set the newbie barrier to 100 posts and 500 hours
The "illegal" mining you mention isn't terribly profitable. Most university, lab, school, and other large computer "labs" don't have the horsepower and certainly don't have high end graphics performance necessary to mine effectively.
In order to perform "illegal" mining, you're going to need Bot Nets. While CPU isn't good for mining, 100,000 CPUs will mine enough to make it "profitable" for someone to rent bot nets and feed them mining code.
The downside is that the users are probably going to notice their CPUs running at 100%.
This is the proposal that Symantec has already published:
http://www.symantec.com/connect/blogs/bitcoin-botnet-mining
In order to perform "illegal" mining, you're going to need Bot Nets. While CPU isn't good for mining, 100,000 CPUs will mine enough to make it "profitable" for someone to rent bot nets and feed them mining code.
The downside is that the users are probably going to notice their CPUs running at 100%.
This is the proposal that Symantec has already published:
http://www.symantec.com/connect/blogs/bitcoin-botnet-mining
a troll just escaped the newbies section.
I would like to create awareness of an economic effect that will make BTC mining in general an illigal activity. In short: Mining will become too expensive for full-cost paying 'legal' miners (who pay for their power consumption). But this is not going to stop parasite-miners who will crowd them out...
While thinking about rational behavior of BTC users and miners I thought about the fair price of a BTC and how it is tied to the cost of mining a BTC. I realized that the current situation in which it is possible for all enthusiasts to run (seemingly) profitable mining rigs is a short term market abnormality which is inevitably doomed to disappear soon - completely independent of the BTC price level at the exchanges. I predict the price for mining per BTC (i.e. the costs for electricity (kW/h) that has to be afforded) will in the long-term be higher than the exchange market price that can be earned for selling it - thus for 'normal' people mining will become a money-losing endeuvor. Mining will inevitably become a parasitic (mostly illegal) activity.
The reason for this is quite simple: Whenever the market price for one BTC is higher than the mining cost it will motivate people to participate in mining thereby making the mining task more difficult for all miners. At first I thought this would allow profitable mining only up to the point where the running costs for mining stay below the market price. But then I realized that today there are two completely different groups involved in mining: the full-cost paying 'legal' miners and on the other hand the 'illegal' parasitic miners who use secretly computers in public organizations (universities, youth centers etc.) or privat companies. The big difference between those two groups is that the latter does not have to pay for their power consumption what makes mining attractive for them even when the actual costs for the host organisation owning the machines would be prohibitive.
In the BTC mining business the costs for electric power will dominate everything. At first rational miners in regions with the highest energy prices will be squeezed out by miners in regions with lower costs. But finally as the parasite group keeps growing it will eventually make legal mining too expensive .. even for the lowest non-zero energy cost payers.
In the end all mining activity could be performed by illegal/parasitic miners. While the price for one BTC will be higher the price for mining a new one. It is a simple crowding-out effect that places in if the number of parasitic computing power keeps increasing - the parasites are the only ones who keep making profits even when their hosting organization has much higher than break-even expenses.
I wonder whether this has been discussed before and if it could become one of the major points of critique in the public debate (beside the money laundering thing of course). One of the good things about the parasitic BTC mining is that it may act as a support for the BTC value - because everybody then knows that a substantial amount of money had been stolen/sucked out of some business entity for mining the BTCs.
(Due to the high number of posts I am not 100% sure whether this topic has been addressed before - if it has, please let me know the thread uri.)
/blueling
While thinking about rational behavior of BTC users and miners I thought about the fair price of a BTC and how it is tied to the cost of mining a BTC. I realized that the current situation in which it is possible for all enthusiasts to run (seemingly) profitable mining rigs is a short term market abnormality which is inevitably doomed to disappear soon - completely independent of the BTC price level at the exchanges. I predict the price for mining per BTC (i.e. the costs for electricity (kW/h) that has to be afforded) will in the long-term be higher than the exchange market price that can be earned for selling it - thus for 'normal' people mining will become a money-losing endeuvor. Mining will inevitably become a parasitic (mostly illegal) activity.
The reason for this is quite simple: Whenever the market price for one BTC is higher than the mining cost it will motivate people to participate in mining thereby making the mining task more difficult for all miners. At first I thought this would allow profitable mining only up to the point where the running costs for mining stay below the market price. But then I realized that today there are two completely different groups involved in mining: the full-cost paying 'legal' miners and on the other hand the 'illegal' parasitic miners who use secretly computers in public organizations (universities, youth centers etc.) or privat companies. The big difference between those two groups is that the latter does not have to pay for their power consumption what makes mining attractive for them even when the actual costs for the host organisation owning the machines would be prohibitive.
In the BTC mining business the costs for electric power will dominate everything. At first rational miners in regions with the highest energy prices will be squeezed out by miners in regions with lower costs. But finally as the parasite group keeps growing it will eventually make legal mining too expensive .. even for the lowest non-zero energy cost payers.
In the end all mining activity could be performed by illegal/parasitic miners. While the price for one BTC will be higher the price for mining a new one. It is a simple crowding-out effect that places in if the number of parasitic computing power keeps increasing - the parasites are the only ones who keep making profits even when their hosting organization has much higher than break-even expenses.
I wonder whether this has been discussed before and if it could become one of the major points of critique in the public debate (beside the money laundering thing of course). One of the good things about the parasitic BTC mining is that it may act as a support for the BTC value - because everybody then knows that a substantial amount of money had been stolen/sucked out of some business entity for mining the BTCs.
(Due to the high number of posts I am not 100% sure whether this topic has been addressed before - if it has, please let me know the thread uri.)
/blueling
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