Topic: ASICs The Obvious Question (Read 1898 times)
In that case it'd be a good thing that LTC is waiting in the wings.
There is still a scenario possible noone has mentioned. Citibank, jpmorgan paypal, or another large bank pays BFL for their first batch to 50% attack bitcoin.
This thought also crossed my mind
... not that BFL would do such a thing, but the big banks could pull off such a stunt themselves. Investing 10 mio USD is peanuts for them. They could develop ASICs themselves, start a 51% attack - and Bitcoin is history.See here: https://bitcointalksearch.org/topic/m.1134960
Why don't Butterfly Labs etc just use the ASICs themselves to mine for profit while the difficulty is low.
Oh, they will. There is no doubt about that! People that have preordered ASICs under current conditions with BFL are quite irresponsible gamblers. Basically, in one way or another it is a Ponzi scheme. The correct approach is to treat preordering customers as shareholders during the entire period from payment until shipment. Everything else is just a giveaway to BFL.
^^^^^^^^^^^
Why don't Butterfly Labs etc just use the ASICs themselves to mine for profit while the difficulty is low.
Oh, they will. There is no doubt about that! People that have preordered ASICs under current conditions with BFL are quite irresponsible gamblers. Basically, in one way or another it is a Ponzi scheme. The correct approach is to treat preordering customers as shareholders during the entire period from payment until shipment. Everything else is just a giveaway to BFL.
There is still a scenario possible noone has mentioned. Citibank, jpmorgan paypal, or another large bank pays BFL for their first batch to 50% attack bitcoin. How could the tanking of price of bitcoin not be worth more than 10-20 million by a big bank. Surely its worth more than the 10,000 current bitcoin miners are willing to invest. As long as BFL delivers products to consumers eventually I don't see any possible legal issues (regardless of whether people would put the time and effort into a lawsuit) All buisnesses are goimg to try to make the most money possible. If asic cost as much as everyone says i dont see huge amounts of profit to be made by manufacturing mining equipment, at least not yet.
Why don't Butterfly Labs etc just use the ASICs themselves to mine for profit while the difficulty is low.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Because their profit margin on selling ASICs is going to be higher than their profit margin mining (just as those who sold equipment to miners in the gold rush days made more money than the miners).
While we don't know exactly how much money BFL has spent on development, we do know that no matter how much power they throw at the network there's a hard limit on how many BTC they could mine each day. The most they could mine per day is 3600 BTC and that's only in theory because they'd have to control the network to mine each day's total output. Their electricity obviously wouldn't be free so they'd need to recover both their ASIC development costs plus their overheads from the sale of mined BTC. Bear in mind that difficulty will not remain low for very long once BFL's ASIC power is thrown at the network, whether it's by themselves or by their customers.
Whatever problems ASIC customers are going to have would also apply to any ASIC vendor using their own product for mining - to just tread water and maintain the shame share of the network, they're going to have to invest in more equipment as time goes on and basically spend increasing amounts of money to maintain the same return.
Why don't Butterfly Labs etc just use the ASICs themselves to mine for profit while the difficulty is low.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Good job starting yet another thread to ask a question that's been hashed out numerous times already.
Would an answer based on mature libertarian principles (https://www.youtube.com/watch?v=muHg86Mys7I) be OK with you?
Maybe It should be part of a FAQ that every user has to read then preform a short test to see if they have the answers to the FAQ before gaining access to the board ...lol
Why don't Butterfly Labs etc just use the ASICs themselves to mine for profit while the difficulty is low.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Good job starting yet another thread to ask a question that's been hashed out numerous times already.
Would an answer based on mature libertarian principles (https://www.youtube.com/watch?v=muHg86Mys7I) be OK with you?
BFL is claimed to have 150TH/s of pre-orders in their first batch alone. If even a fraction of that came online, and it was realized that BFL was mining before shipping, a few things would happen:
1) Every single BFL order would be canceled. We do know enough about their company that there would be legal action.
2) The entire BTC network would be potentially compromised, as 150TH would easily "51%" a 25TH/s network. Actually, they would be 85% of the network.
2b) If the network was every dominated by a single entity, it would mean that BTC has failed. People would be getting out ASAP, and the price would drop faster than my Irish buddy on St Pattys Day. All those coins that BFL is now mining are suddenly completely worthless.
All of this is also relatively moot, as all 3 major manufacturers (BFL, bASIC, and Avalon) have all made very clear policies that they will not be mining on their hardware before shipping to customers.
1) Every single BFL order would be canceled. We do know enough about their company that there would be legal action.
2) The entire BTC network would be potentially compromised, as 150TH would easily "51%" a 25TH/s network. Actually, they would be 85% of the network.
2b) If the network was every dominated by a single entity, it would mean that BTC has failed. People would be getting out ASAP, and the price would drop faster than my Irish buddy on St Pattys Day. All those coins that BFL is now mining are suddenly completely worthless.
All of this is also relatively moot, as all 3 major manufacturers (BFL, bASIC, and Avalon) have all made very clear policies that they will not be mining on their hardware before shipping to customers.
1) They don't have ASICs to mine with.
2) By the time they do have ASICs to mine with the difficulty will be higher. See recent ASICMiner and Avalon threads.
3) The large scale takeover of the bitcoin network by self mining ASIC manufacturers would cause many to correctly deduce that the network is unsafe and tank the price of BTC.
2) By the time they do have ASICs to mine with the difficulty will be higher. See recent ASICMiner and Avalon threads.
3) The large scale takeover of the bitcoin network by self mining ASIC manufacturers would cause many to correctly deduce that the network is unsafe and tank the price of BTC.
Nice answer, thanks buddy!
1) They don't have ASICs to mine with.
2) By the time they do have ASICs to mine with the difficulty will be higher. See recent ASICMiner and Avalon threads.
3) The large scale takeover of the bitcoin network by self mining ASIC manufacturers would cause many to correctly deduce that the network is unsafe and tank the price of BTC.
2) By the time they do have ASICs to mine with the difficulty will be higher. See recent ASICMiner and Avalon threads.
3) The large scale takeover of the bitcoin network by self mining ASIC manufacturers would cause many to correctly deduce that the network is unsafe and tank the price of BTC.
Thanks, any idea what to type to get a sensible answer? Come on there must be a sensible answer that can fit in one sentence.
Upper right corner, box with a search button on the right and a magnifying glass on the left.
Why don't Butterfly Labs etc just use the ASICs themselves to mine for profit while the difficulty is low.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
Sensible answers only, no painfully naive answers based on childish Libertarian principles please.
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