Thanks. So to paraphrase your response. The payoff to mining is somewhat related to the number of people mining.
My contention is that one of prerequisites of bitcoin viability is a robust transaction validation system that clears transactions in a timely/low cost fashion. It sounds as though this element won't be in jeopardy even at much lower bitcoin prices. I'm not focusing on bitcoins from a trading profitability standpoint. I just want the system to persist and to continue to clear in a viable manner. As long as that continues, I maintain my confidence in bitcoins.
Topic: Anyone have a per unit cost estimate for mining bitcoins? (Read 835 times)
No. You can't look at just price. Bitcoin compensated for difficulty. More people mining = higher difficulty = harder to find a block for a given amount of hashing power. Difficulty ensures that the average time for entire network to find a block is ~10 minutes.
Difficulty now is 1.2 million so it is 1.2 million times more difficult to find a block than the first block however it is roughly 50% easier than at the peak difficulty.
On average the number of hashes required to find a block is (difficulty)*(2^32).
So currently is ~5 quadrillion hashes (5154 trillion).
How much you can generate (gross revenue before cost) in fiat also varies with exchange rate. The link above has a nice graph which takes into account both PRICE & DIFFICULTY to give you the expected daily revenue per 100MH/s.
Difficulty now is 1.2 million so it is 1.2 million times more difficult to find a block than the first block however it is roughly 50% easier than at the peak difficulty.
On average the number of hashes required to find a block is (difficulty)*(2^32).
So currently is ~5 quadrillion hashes (5154 trillion).
How much you can generate (gross revenue before cost) in fiat also varies with exchange rate. The link above has a nice graph which takes into account both PRICE & DIFFICULTY to give you the expected daily revenue per 100MH/s.
Is the probability of finding a block dependent on how many people are mining/searching for blocks?
I'm just trying to make sure that the validation system remains economically viable. If some people get discouraged and drop out, I don't have a problem with that as long as enough people continue mining/validating to keep the authentication process reasonably fast.
Am I correct in assuming the significant mining occurred at much lower bitcoin prices (<$1 last year), so mining should persist even at much lower bitcoin prices.
I'm just trying to make sure that the validation system remains economically viable. If some people get discouraged and drop out, I don't have a problem with that as long as enough people continue mining/validating to keep the authentication process reasonably fast.
Am I correct in assuming the significant mining occurred at much lower bitcoin prices (<$1 last year), so mining should persist even at much lower bitcoin prices.
Granted, electricity prices are different in different areas, but has anyone done any rough math on the expectation of getting a block awarded?
Sounds like you are asking two different questions:
1. What is profitability of mining? -> Bitcoinx.com has charts how much you can make per day with 100Mh/s. -> http://bitcoinx.com/charts/
2. What is the likelyhood of finding a block? -> Here is a calculator to see statistics around how long it will take you to find a block -> http://www.alloscomp.com/bitcoin/old_calculator.php
Granted, electricity prices are different in different areas, but has anyone done any rough math on the expectation of getting a block awarded?
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