Topic: Bitmain's Released Antminer S9, World's First 16nm Miner Ready to Order - page 339. (Read 531164 times)

Very well said.  I made more BTC than I paid on the S3s and the S5s (and Bitmain still made profit).  It wasn't until the S7 that I lost BTC, and like you, it was because I lost my discipline.  I wanted the big boy and rationalized it any way I could.  Just like folks are doing with the S9.

I do not believe Bitmain is under any obligation to sell miners at cost, but to sell them for at least approximately what they will generate.  I don't want people to confuse manufacture cost with mining revenue value.  Bitmain is essentially building a 2 BTC miner for 1 BTC and then selling it to us for 3 BTC because they can (not because they have to cover some sort of cost).  It blows my mind that people are defending this action and calling the purchase of that 2 BTC miner for 3 BTC a solid investment.  Let's just call it a cool purchase.

That I understood, however that doesn't stop people asking the questions so every so often an old bastard like me has to spell it out as clearly as possible.

CK - my question was mostly rhetorical. I know all the business reasons why people deal with China. I also know (and for the most part represent) all the reasons why some people refuse to deal with China.

Really what this comes down to is that there's multiple ways to justify mining. I originally approached this as a hobby. After playing with Scrypt for fun (not caring about losing money) I used the BTC-in-BTC-out discipline and that worked well for me. I profited in BTC terms with every miner.

Then the S7 came out and I threw that discipline out the window. It was fun to have the latest hardware, but the fact that I could never get the BTC out that I put in bothered me. I ended up selling my S7s early to recoup fiat ROI.

On top of all this was the S7 B1 delivery delays, and corresponding compensation delays, because Bitmain planned badly. Instead of getting my units on time, they missed the shipping deadline and my S7s stayed in their data center hashing for them instead of me while the whole country was getting plastered for a week long festival.

All of this added up to me feeling like an idiot for stepping away from my discipline and yielding all control to Bitmain.

As much as I love the hobby and as much as I miss actively mining (it's addicting), this time with the S9s I'm not buying until it makes sense in BTC investment terms. If that never happens, I'll stick with old miners. Depending on the timing, maybe when you're ready to sell your S7s I'll buy them back from you

Again, this is my preference, not an argument for how everyone should make the decision to buy or not.

Thanks for chiming in ck. I appreciate that you're approaching this pragmatically, although it would be irritating if they force this change on you.

Would their protocol changes also affect proxy software? As a hobbyist miner I have to admit that I'm ignorant of how mining proxies work. But if custom protocol changes might affect larger miners' ability to proxy, that would be a good thing to know about up front.

Since Yoshi has said that the S9 works on Kano's pool, maybe they're dealing with this before shipping and these concerns are moot. It would be nice if they conditionalized their non-standard protocol additions such that it's limited to their own pool.

@hawkfish007
Solid argument! What a great hobby, mining is!
I was not a very technical person beforehand, but now I:
1. learned some Linux
2. can assemble a computer from parts (wifie was genuinely impressed with me "running around" with a screwdriver and fixing things, which pretty much never happened before).
3. diversified my holdings a bit from pure fiat to fiat, btc and eth.
4. had so much fun learning many new things-the single best thing that had happened to me since late 2013, really.

I am not going to quote above thread, getting too big. Now it is either S9 or nothing. Come July all of my S7s will not be almost worthless, once they are retired I would still be able to run my S9, 1 S9 will replace 3 S7s but still consume as much as 1 S7 and continue to contribute to the network. I pay 300x or 400x times more than it costs to make for an iPhone, I don't see it any differently.

Way to stick a ton of words in my mouth.  The statement I was responding to was that you never run ROI in BTC because we operate on fiat and the US government says you calculate ROI in fiat.

I am a hobbyist myself with a few S3s cycled, S5s cycled, and a few S7s running.  I get it, trust me.

Further, holding BTC is still supporting BTC.  Capitalization is a very important component in value.  At this point, I would say that transaction volume and capitalization are far more beneficial to BTC than additional hash power.  If you purchased some BTC as investment, and some BTC to trade you would still be supporting the network.  The notion that miners are somehow more benevolent than investors is a complete fabrication and woeful dishonesty at best.  There are plenty of selfish miners who would be mining worthless coins if it weren't for investors and traders.

Second, if you believe that purchasing overpriced Bitmain gear is furthering decentralization you've fallen off your rocker.  That extra 1-1.5 BTC they charged you is funding additional miners for Bitmain's private farm.  I don't see how giving money to the largest equipment manufacturer operating the largest network pool in any way supports decentralization.

So you don't see or care for fun factor and decentralization consideration in mining BTC or any coins for that matter. Well who cares as long as I make money right? If everybody would have bought BTC since inception, there would only be a handful of centralized players existed by now, but that's not the case is it. Look at Kano.is, 1/5 of total hash power comprised of small miners like me running S7, A6 or older gears. If I am able to make $100 while having an increasingly interesting hobby I am happy. And since Terraminer, S1, Titan era I did just that, made money not to your expected $4622/unit but some decent profit, except for loosing money for investing in some western companies.

I appreciate the thoughtful response.  I would like to say that I too find mining to be fun.  I just don't think it's always a sound investment.

At this point bitcoin is an investment.  Whether you buy and hold or decide to mine you are investing in bitcoin.  In either case you start with fiat currency.  What I am saying is that mining ROI calculations in BTC will tell you whether you should hold the coins you just purchased with fiat, or mine with them.  Or more accurate, which will generate higher profits.

If you run ROI in BTC and see that the miner will not return the same BTC, then you hold.  If BTC goes up, you make more money.  If BTC goes down, you lose less money.  Because in this scenario you will always have less BTC to sell back when you 'exit' your investment if you bought the miner.

The other scenario is that your run ROI in BTC and see that the miner produces more than it costs.  This is the only time things get tricky.  Buy and hold has less taxes, so even if they are equal investment is more profitable (depending on country).  Then you have to consider extra variables like downtime, cost of heat and noise, etc.

We aren't even at the second scenario though.  This miner will not return the BTC that it costs today.  No matter which way you slice it you walk away with more fiat currency if you hold your 3.67 BTC.

Would you purchase 4 gold bars today to trade for digging equipment that will produce 3 gold bars in a year?  Would you justify it as a solid decision by saying, "but the cost of gold went way up! I didn't actually lose any money".  No, no one in their right mind would knowingly purchase 4 gold bars to trade for equipment that generated 3 gold bars in return.  If investment in gold was the goal, they'd hold the 4 bars.  

One might dig for gold at a loss to have fun digging, but they wouldn't try to sell it as more profitable than just holding the 4 gold bars.

Good for it if it hashes on kano.is   I will need to order more.

Yoshi Do you have any from the USA website?

Pretty much, but that's a discussion for another place.

For fun?

More seriously, i see both view points as being valid in some respect.

for example, your argument re current btc price is not 100% kosher either.
First, you typically use $$ to buy that bitcoin to buy a miner, so you start with $$, not btc.
If you started with pre-mined bitcoin, then your argument is more valid.
Second, when you buy miner, you don't know what happens with bitcoin price later on, so you cannot just buy btc and expect returns. You might very well lose money, so it is not 100% safe proposition either. However, if you bought btc, and it went down and you sold at a loss, then you can claim that loss against your capital gains or take a straight loss against your income up to $3000/year in US, so situation is complex.

The same reason the west has always done business with China in increasing volume - they're always the cheapest, always. The race to the bottom in manufacturing of everything has continued in absolutely every other market where the number of people concerned with quality over price has only ever been a small minority. In the bitcoin mining world where bottom dollar is everything, that minority is even smaller to the point of being a virtually irrelevant part of the market.

Be aware that we will almost certainly be obliged to work around this stupid random alteration in their stratum protocol in ckpool if they don't fix their software immediately and make it properly stratum compliant, otherwise we'll be shutting out the bulk of the next generation of miners sold. We're hoping not to need to do this but we're also realistic. This manufacturer has the lion's share of the only two left to choose from, being the cheapest, and we can't change that.

As I've said elsewhere, it's not malice that is making them force people to mine on antpool.  They just changed it to work best with antpool, and have no care factor for checking it works elsewhere.

I inserted "...SNIP" so my reply did not take up additional space for a short reply and feel I quoted the specific lines which addressed the issue and our comments. Anyone interested who missed the original comments in their entirety may go back one page.

Masha Sha I have zero reasons to doubt Kano's statement regarding this issue. This is his statement in full from page 10 of this thread:


To the contrary, I have many reasons to believe Kano's statement. Without going through more than needed please take a moment to consider these points:
1. Kano is the operator of an extremely popular pool here in the US where we enjoy an active, interesting, popular thread discussing the pool and mining activity. Many discussions in this thread are both fact based and speculative which are specific to older generation, current generation, and future / next generation mining equipment. See: https://bitcointalksearch.org/topic/kanopool-kanois-lowest-09-fee-since-2014-worldwide-2432-blocks-789369 Now while I mention US it is popular across the world and there are nodes setup across the world to support miners from all over the world and by mentioning the US in no way do I mean to infer it is not popular everywhere and enjoys a variety of input from a variety of miners who live across many continents.
     Kano and CK are the very people who write the CKpool software, CKpool database software, web front ends, and if anyone cared to dig deeper a variety of other software which is obviously developed with the exact same care, meticulous attention, and rewards from use of the aforementioned software many more are familiar with.
     Along with the ongoing development and support of these types of packages, and this is one of the more important aspects of my reply they write and provide the same level of support and attention to detail of CGminer. CGminer is the preferred mining software you will receive on most (if not all) production miners which ship today and to my knowledge are planned to ship in the immediate future. Even miners which do not ship with a built in type of control system with on board software to handle the software interface for the miner will be delivered with instructions to use CGminer in operation of the miner. A few companies have included instructions for use of a secondary package, but in my experience CGminer is always the preferred and most recommend it over anything else.

***To avoid an off-topic debate regarding miner software I am clearly stating there are alternative mining software packages available for some mining equipment, but nothing which compares to the popularity and in most cases mandatory requirement for the use of CGminer. Please do not allow my comments regarding the popularity of CGminer to distract from the topic. I am using these examples to show how popular and the massive installed user base of CGminer. It is the primary choice for most users of BTC mining equipment across the world.***
 

2. The Kano.is pool is also a pool where I personally witness a significant amount of testing done in development of Avalon miners. There is a significant amount of hashpower (at various times) where CGminer is used in this testing. In my experience any changes (possible official / unofficial) forks relative to CGminer are documented and follow the license requirements. This does not appear to be a hardship in any way, and to the opposite the work with CGminer not done by CK and Kano during development and support of the Avalon miners are clearly shared with the community in a timely manner. CGminer changes / updates to the Avalon miners work with the mainline versions and you can count on the people responsible for the Avalon Miner to include a much more recent if not the most current version of CGminer which in turn has brought many of us a more secure mining experience not to mention the other advantages which come from including this brilliant and focused programming. In my opinion the security additions and corrections is one of if not the most important reasons for the license requirements to use CGminer in a commercial environment.

2A. I have personally experienced several scenarios where I was forced to update CGminer on a piece of mining equipment in order to close / correct a huge security issue because the manufacturer either did not release firmware including this change or if there was a firmware release it not only did not include a CGminer update there was no documentation regarding what was changed / added with the firmware release. Other times a build of CGminer was included in an update but there was again, zero documentation regarding what changes were made in general, but what changes were made to the version of CGminer used in the update. When you have not only heard from many others who have experienced serious issues with the firmware update, or lack thereof, but personally experienced my miners being hijacked via an exploit which existed in a new miner I purchased where there already existed a correction in the main CGminer release.  You must certainly be able to understand where trust becomes an issue and many times these issues arise from a misconfiguration. Not something a simple UI change could correct, but a real issue corrected by a CGminer switch / option set incorrectly in a major release from the factory.

2B. The main CGminer release is not always correcting a security issue, not always correcting a CGminer bug / exploit, but many times correcting an issue caused by a different piece of software being used. In my experience CK and Kano have used their knowledge and worked with manufacturers of both hardware and software to go above and beyond what I have seen from others to provide an overall better and more secure mining experience whenever possible. I have also witnessed changes made by others to CGminer which CK / Kano have appreciably incorporated in the mainline release.

2C. Through no fault of CK / Kano it is not always an easy task for end users to update CGminer in their mining hardware. Not to mention the times where the update cannot be applied in a manner which is retained after a reboot. Many times as end users we have been forced to repeat the procedure after a reboot to simply close a security issue or misconfiguration. I use the term forced because in my opinion the alternative is unthinkable.

Masha Sha I am gaining on a final answer to your question but felt the need to lay out the previous information in support of such. For anyone who missed the original question in summary it is:
"...how do you know they corrupted and violated the license on CGminer if the miner hasn't been released?"

It is through my trust of Kano and my previous experience with Bitmain firmware releases which have left me in a position of zero doubt there exists a situation that Bitmain have "hacked stratum in the S9 miner. Adding their own special command for antpool"

I have zero doubt Kano has confirmed this through his own research and experience. Kano does not make unfounded accusations. Further it is to the detriment of Kano's pool for this to occur. There are MANY people who have posted in the Bitmain S9  announcement thread and / or the Kano CKpool thread who purchased S9 miners and are excited about adding this hashrate to the Kano.Is pool. Kano and CK have worked with Bitmain in the past. I cannot speak to any current arrangements but I do know they have both been involved in previous projects. If there is something in the stratum use of the S9 miner which causes a push for the miner to the Bitmain Antpool mining pool, not to mention changes to CGminer which have not been published who better in this entire industry, who better in this entire community would have the knowledge, contacts, and experience to recognize and confirm such?

To address the portion of your question regarding the miner having not been released: (which to expand on this point for others I will say that your point is they may change something between now and then, right?)
Through more than one generation of miner we have lived through CGminer changes / forks which have included things which some would call shady, but more to the point these items are not published.

I appreciate your question and do heed and appreciate your quote ending your post, but as my final answer I have to simply say it is through my own personal experience with Kano, CK, and Bitmain regarding CGminer which put me in the mindset where I completely believe what Kano stated to be fact, and Bitmain will not change such prior to release. I believe Kano and CK may be put in a position where they could be forced to not allow the S9 miner to mine at their pools. I do not have the details to support the statement by Kano, but I do have the prior experience and common sense to recognize a problem exists.

I most certainly have the respect for Kano and enough information to reach out to Bitmain requesting a reply to the information posted by Kano.

Again, it would be bad if the S9 is somehow pushed to Antpool and obviously Kano has experienced something which causes him concern. We do not need a miner pushing us to a specific pool and we should not be forced to use firmware from someone else (where many people would rightly charge a fee) or SSH into the unit and make changes, etc.

I think the better question is why Bitmain is severely quiet about this and cannot take a brief moment to reassure those of us who have spent hundreds to tens of thousands to hundreds of thousands to millions of dollars with them.

The bolded bit is exactly why you calculate ROI in BTC.  Let's say you only paid 8 BTC for your S7.  That 8 BTC is worth $4,622 USD today.  So you made back your $1,900 per unit and then some; Did you make $4,622 per unit?  That answer is no, as you yourself said you didn't get your BTC back.

Calculating ROI in BTC tells you whether or not it is better to hold the coin, or mine with the coin.  Why would you give someone 3.67 BTC for a machine that returns ~2.5 BTC?  What part of that makes any sense?  Why wouldn't you just hold the 3.67 BTC?

To suggest one should not calculate ROI in BTC because the US government says not to is absolutely crazy.  I am not suggesting you fill out your tax forms in this manner, I am saying you stick to BTC while doing your private "is this worth it" calculations.  Not to mention that capital gains taxes are lower...

Again, I ask why anyone would buy a machine for more BTC than it returns.

Thx for the reply. Just to tell you, I think Bitmain is one the greatest company of China, the S5 proved it, again with the S7 and even more with the S9.

Bitmain: simply building the greatest miner on Earth, I hope for long.

For me bitmain is in the same situation as Intel a while back... You can only compete with yourself... The other aren't yet able to do it. But it's not a reason to let lose, or become weak.

Congrats again Bitmain for this S9 it's seem really great, and as always simply the best!

(Doesn't it looks like an ASIC chip? ;-)

https://upload.wikimedia.org/wikipedia/commons/7/76/Forbidden_city_map_wp_1.png)

in theory, yes, but you may not want to max out the PSU.  Bad PSU or damaged PSU or degraded PSU can cause damages to S7 or S9.  Saving can be smaller than what you may lose if something goes wrong.

we will upload the Kill-A-Watt photo tonight or in the morning.

and Pool wise, it does hash in Kano.is pool.  I'll try to take the screenshot of that in the late morning.

In one equation: (Th/W)/BTC

The question is more why is the "the west" unable to produce a single miners manufacturer? I have some ideas but it's not the appropriate sub. I hope that Bitmain will correct this issue on this CGminer and realize that as a company they represent a large part of the value of Bitcoin. By this I mean that they must be great... And if they start to be greedy, the market will speak... Yes most companies that they have beaten have gone extinct, their owners may have make money or not, but in 10 years what will it be worth?

So why do we continue to do business with them?