Topic: Bitcoin Difficulty Increase what's going on ? - page 2. (Read 1619 times)

This has been gut wrenching to monitor.  Not only are the biggest pools growing in hashrate astronomically, but they are finding blocks well over 100% luck on a large scale for this difficulty adjustment coming up.  Antpool is at 121% luck for the last 3 days!  That is literally insane.  The difficulty projection jumped from 14% to almost 20% just in the last couple hours for the ENTIRE 2016 block period due to how many blocks the network is finding right now.  And ofcourse Bitcoin is tanking as well..........

Not when more and more miners are coming online no.

Next difficulty is going to be around 17% (in 3 days) is it going to ever stop :/

Economics 101: thinking at the margin.  Spend $150, make $300 sounds like a good deal to me.  If I could do this ten times simultaneously, I would.  But my only concern is the sustainability of these profits.  Remember that difficulty is increasing exponentially but so is computing power.  So the next generation equipment will be exponentially stronger than the current generation's.

What bitcoin/usd exchange rate will do is anybodies guess, could be $30k, could be $3k. Impossible to predict.
It's best to just think in BTC only.

Difficulty appears to be growing faster than your estimates above though, and it's better to just look at the total network hashrate, not difficulty if you want to forecast BTC earnings. Difficulty is there to ensure 1 block gets mined on average every 10 minutes, that's it.

How much hashing power you have vs. the total network hashing power is what determines the size of your slice of the pie.
Anyway, it doesn't matter too much as difficulty follows hashrate.

But, regarding your estimate, network hashing power growth is accelerating. It's truly exponential.
the network hashrate is now doubling every 2 months.

We can all agree on one thing, everybody and their mother is talking about mining, and it will only be EXPONENTIALLY increasing from here. Current mining difficulty is 2.2 Trillion, and it went up 1 trillion from exactly 3 months ago. So If I was to predict the difficulty rate by end of 2018, considering the exponential factor. I would do it like this:

Apr 20th - 2.2+1.5=3.7 Trillion
Jul 20th -  3.7+2=5.7 Trillion
Oct 20th - 5.7+2.5=8.2 Trillion
Jan 20th - 8.2+3=11.2 Trillion

This makes the average difficulty for the 12 months at 6.7 Trillion.
Being optimistic about bitcoins price, we can say that it's 12 month average will be $30k. After $150 in electricity costs, that will leave us with with an average monthly profit of $300 per month per S9 from now until January 20th, 2019. That is my prediction. Any thoughts?

Diff schmiff
mine on

Exactly! The old saying goes:
In a gold rush, sell picks and shovels.

And that's why I have just sold my S9 on Ebay, for $2600 more than I bought it :-) !!!
Imagine that, a used antminer selling for double the price of a new one, just because it's available now!
And that $2600 is profit on top of the $2000 it made me while I had it running...

This opportunity is not going to last though, according to the graphs above an S9 will not make $2600 ever again based on the current network hashrate growth.
But no matter how I try to explain this in the S9 thread, people keep coming up with dubious ways to defy the maths as an excuse to jump on the latest Bitmain S9 Batch, that will be delivered months from now.
Talk about a gold rush...


The difficulty automatically adjusts based on the total network hash rate so that on average we keep mining about 1 block every 10 minutes, that's it's sole purpose.
Now the bigger the total hashrate gets, the smaller every miner's individual piece of the pie gets...

Thanks, I did a bit more work on it while discussing this in the S9 thread, here's the latest version.

Image:


Link to the actual spreadsheet (click download, you won't be able to see it properly in the dropbox viewer):
https://www.dropbox.com/s/v1m3xac87ptylj0/hash%20forecast.xlsx?dl=0

Nice chart. Well, the newspapers wont write this as they need to sensationalize stuff.

Yes they compete with each other.  And with $BTC intending to be solved every 10 minutes...more miners = more chances to be solved under 10 minutes = difficulty raising to make it back to 10 minutes.

That's the short answer.

Kind of reminiscent of the gold mining days in California in the 19th century. The people who made the most money were the ones selling mining equipment, mules and horses and wagons, clothing, food, liquor, housing and sex.

On a different note, a newb question: I don't understand why more miners means more difficulty. Do they compete with each other somehow? I thought the difficulty would be just how hard it is to find a block and verify it.

And here's the spreadsheet for those interested, currently the numbers to play with (BTC/Month Jan 18, Power/Month, BTC-USD and Initial Investment) are set for the latest S9 13.5TH, but can be adjusted to specs of any miner(s).

https://www.dropbox.com/s/v1m3xac87ptylj0/hash%20forecast.xlsx?dl=0

I posted this in the S9 thread as a reaction to the craziness surrounding the sales of Bitmain's latest S9 batches,
but someone suggested it belongs in this subtopic so here goes:


I know I’ve said it yesterday but I’ll repeat it again today: Unless I am missing something, this is just crazy!

I really can’t see why you would buy an S9 now, the total bitcoin network hashrate is growing faster than ever, so unless BTC value surges again (massively) this year you just won’t get your money back on your investment.
The only money to be made now is in selling miners, not in mining!
After a few months of mining I just sold my used 13TH S9 on Ebay for $2600 more than I bought it, I will be putting that profit into Bitcoin. There is no way that an S9 will make another $2600 as of this point in time, unless BTC surges as said before

But don’t just take my word for it, please have a look at the numbers below.



What I’ve done is forecast the total network hashrate for 2018 based on 2017 numbers. I’ve used basic Excel forecasting to do this.
As you can see, I’ve created a forecast, an upper bound forecast (pessimistic in this case) and lower bound forecast (optimistic in this case).
Then I’ve created 3 tables predicting how much Bitcoin one S9 will make every month based on this forecast, how much revenue that is un USD based on the current BTC/USD exchange rate and how much profit you would make based on a $150/month power cost for 1 S9.

Now, based on these numbers the only way an S9 that starts mining today will pay back your investment, is if the network hashrate follows the lower bound (optimistic) forecast which ends up flattening out again, looking at the graph alone that just seems very unlikely!

Both the standard and upper bound forecast predict profit to go negative by the end of the year.

I’m happy to share this spreadsheet with anybody who wants to play with the numbers.
Bottom line,
My bet is: sell your S9’s while you can make a good profit on them, hold BTC and wait for the next opportunity when this madness dies down a bit (or perhaps the next generation of miners?)
Of course, to each their own. Who knows what the bitcoin value will be by the end of the year and that said, you might just enjoy mining, I know I did :-).

Giving yourself a wedgie?

<----Pulled that trigger last month.

As I sit here this morning waiting on a shipped email and watching the ticker my butt cheeks have never been clinched so tight....

The profitability is going back to more normal rates. It was abnormal back then.

IF ONLY there was a chart on past profitability, that would make people open their eyes more. Currently, people can only see current spot profitability and so they grab gear and believe that the rate will be at this level or close to it for a long time. Well, not the case.
This is why we see the high ebay prices and mad rush for gear imo.

 There will be another ramp up in difficulty as well since Bitmain, Avalon, Halong, and Ebang all have new miners coming out in the next few months.

That being said, considering the s7 is still profitable even at high power costs, saying that the s9 will not be profitable in a few months seems pretty silly.

And again, you CANNOT forecast profits in this industry so making assumptions about future profitability is a fools game.

Should you buy 1 dozen s-9's  .

Well  you can not project difficulty  beyond  4-6 weeks.

and the diff  can rip 20%  2 in a row  or do a  -1% and then a 2%

It all boils down to  how much risk will you take.  Myself I moved into gpus  much stronger then asics.

I am down to
2 full s-9's 
1 two board s-9 
1 one board s-9

grand total of 3 s-9's

but I have  about 70 gpus  mostly all nvidia 1080tis.  I felt gpus are less risk  then asics.

More miners turning on (we had a period of tiny difficulty increase a bit ago), and miners switching from BCH to BTC as BTC has become more profitable than Cash again. Most people buying miners now are hoping that price will go up and make their purchase of a miner worthwhile. Dangerous game as price stays stable but difficulty continues to skyrocket.