Difficulty drop | Bitcointalksearch.org

Syke

legendary

Activity: 3878

Merit: 1193

Quote from: joshv06 on October 30, 2012, 03:54:12 PM

What do you guys think is up with the Bitcoin rise? We just hit 25,000 Ghash, up from 20,000 Ghash just 2 months ago. I'm not making as much coins now Sad

Looks like nice steady growth. Mining is profitable, so miners are increasing capacity and new miners are coming on board.

rupy

hero member

Activity: 725

Merit: 500

I think that's FPGAs, but the gold rush of bitcoin is soon to be over. I will miss the crazy rigs and shared experience of something truly innovative. Now it's proving times for BTC; either it goes into stable growth (=only investors use it), skyhigh (=it reaches the sheeple and usage explodes, this would of course really be a problem because of diskspace (atleast for me I'm on SSD)) or bitcoin will be seen as a blip on the history of currencies as prices collapse and only a few ASIC fanboys keep mining.

I'm just not convinced (difficulty = price) is 100% solid.

The only buyers today are speculators, as time go dire they will need to selloff (like everyone will sell everything) to pay for rent and food. Only those that survive without selling might see BTCs true value at the end of the current civilizations currencies.

But back on subject; I think we will indeed experience the difficulty drop I was talking about in the first post. ASIC won't be delivered before block reward halving, and prices are going down... So all those GPUs falling off must show, only ~4000 blocks left now, or what do you think?

joshv06

hero member

Activity: 991

Merit: 500

What do you guys think is up with the Bitcoin rise? We just hit 25,000 Ghash, up from 20,000 Ghash just 2 months ago. I'm not making as much coins now Sad

abeaulieu

sr. member

Activity: 295

Merit: 250

Quote from: mrb on October 23, 2012, 09:54:34 PM

SHA-256 is a one-way hashing algorithm, not encryption algorithm.

If you encrypt N bytes, you get N bytes out. And it is possible to decrypt these bytes back to the original value.
If you hash N bytes, you always get a fixed-size hash as output. And it is not possible to compute the original value from the hash (well, unless you bruteforce), hence the name "one-way hash".

Good point. Thanks for clarifying mrb.

mrb

legendary

Activity: 1512

Merit: 1027

SHA-256 is a one-way hashing algorithm, not encryption algorithm.

If you encrypt N bytes, you get N bytes out. And it is possible to decrypt these bytes back to the original value.
If you hash N bytes, you always get a fixed-size hash as output. And it is not possible to compute the original value from the hash (well, unless you bruteforce), hence the name "one-way hash".

abeaulieu

sr. member

Activity: 295

Merit: 250

Quote from: dserrano5 on October 23, 2012, 04:39:38 PM

Quote from: abeaulieu on October 23, 2012, 03:48:49 PM

SHA-256 encrypted data

Care to elaborate on this?

I'm not sure what you would like me to elaborate on. Bitcoin block generation is based upon the SHA-256 encryption algorithm. The ASICs and any mining equipment is performing this same function to produce hashes and check to see if it is a winning hash. SHA-256 is also used to encrypt data and passwords...

dserrano5

legendary

Activity: 1974

Merit: 1029

Quote from: abeaulieu on October 23, 2012, 03:48:49 PM

SHA-256 encrypted data

Care to elaborate on this?

abeaulieu

sr. member

Activity: 295

Merit: 250

Quote from: Meatball on October 18, 2012, 11:30:56 PM

Quote from: Keefe on October 18, 2012, 10:41:03 PM

I saw mining with GPUs as a safer bet than buying and holding bitcoins, even if it often didn't make much more profit than holding bitcoins. Because even during the crash from $32 to $2, difficulty dropped so I was able to profitably mine most of the time, and for a short time when I couldn't, I simply shut off the GPUs and didn't lose. And if the price had kept plummeting, I'd have sold the GPUs to gamers without losing nearly as much as an investment in the currency would have. In other words, while the price was going up, mining was profitable, and while the price was going down, mining was either profitable or neutral.

Of course ASICs will change that, and miners will be more exposed to the risk of currency failure.

Yeah, that's for sure. Back when I was big into GPU mining I made about half my initial investment back through selling BTC and got back about 60% of my original cost on gear reselling everything, so I made out ahead a bit.

Now with ASIC's, there's basically little resale value unless you can find another miner willing to take your gear. I'm sure it'll be a lot harder to resell the specialized ASIC's than the general GPU/motherboards.

Yup most of these ASICs will have a close to zero resale value if the BTC market crashes. I think BFL mentioned that they had to lock down the chip so it cannot perform generic brute-force on SHA-256 encrypted data (because of export limitations).

Epicblood

full member

Activity: 126

Merit: 100

I don't really mine for the money, so I will just keep on mining :p
then again, I cant mine atm as I fried my mobo... :/

Meatball

sr. member

Activity: 378

Merit: 250

Quote from: Keefe on October 18, 2012, 10:41:03 PM

I saw mining with GPUs as a safer bet than buying and holding bitcoins, even if it often didn't make much more profit than holding bitcoins. Because even during the crash from $32 to $2, difficulty dropped so I was able to profitably mine most of the time, and for a short time when I couldn't, I simply shut off the GPUs and didn't lose. And if the price had kept plummeting, I'd have sold the GPUs to gamers without losing nearly as much as an investment in the currency would have. In other words, while the price was going up, mining was profitable, and while the price was going down, mining was either profitable or neutral.

Of course ASICs will change that, and miners will be more exposed to the risk of currency failure.

Yeah, that's for sure. Back when I was big into GPU mining I made about half my initial investment back through selling BTC and got back about 60% of my original cost on gear reselling everything, so I made out ahead a bit.

Now with ASIC's, there's basically little resale value unless you can find another miner willing to take your gear. I'm sure it'll be a lot harder to resell the specialized ASIC's than the general GPU/motherboards.

Keefe

hero member

Activity: 681

Merit: 500

I saw mining with GPUs as a safer bet than buying and holding bitcoins, even if it often didn't make much more profit than holding bitcoins. Because even during the crash from $32 to $2, difficulty dropped so I was able to profitably mine most of the time, and for a short time when I couldn't, I simply shut off the GPUs and didn't lose. And if the price had kept plummeting, I'd have sold the GPUs to gamers without losing nearly as much as an investment in the currency would have. In other words, while the price was going up, mining was profitable, and while the price was going down, mining was either profitable or neutral.

Of course ASICs will change that, and miners will be more exposed to the risk of currency failure.

regular

sr. member

Activity: 297

Merit: 250

We should do a poll to see what percentage actually buy BTC and hold for value. Mining makes more sense initially to me since you have actual hardware.

Keefe

hero member

Activity: 681

Merit: 500

Currently, it seems network hashrate stabilizes around 2 TH per $1 market price, for example currently 22 TH and $12/BTC. When the market was around $5 for a while, hashrate stabilized around 12 TH. After the new hardware is out in mass and the block reward is halved, I expect the new normal to be 40 TH per $1 market price. At $12, that's ~500 TH. If the market goes up to $20, expect hashing to increase to ~800 TH within a couple months. Hashing increases do seem to lag price increases though, so while the market is going up, mining is more profitable (if you don't compare to the profit of simply buying and holding the currency).

sharky112065

sr. member

Activity: 383

Merit: 250

What most people here are forgetting is that the price of Bitcoins will probably go up due to supply and demand. Less supply with same demand = Higher price. Now a lot of people will sell some of their coins to pay for ASIC's which will probably keep the price down for a while, but as soon as people start hording again the price should go up. I could be wrong, but that's my opinion.

kano

legendary

Activity: 4466

Merit: 1798

Linux since 1997 RedHat 4

Quote from: ?? on ??

...
Yes, that's the real problem of having system dependant on profit oriented people - once profit is gonne, system goes down as well.

A monetary system that's affected by profit.
Wow that's gotta be so fucking unexpected ...

Keefe

hero member

Activity: 681

Merit: 500

I think the X6500 is the most power efficient miner on the market today, at 16.4W for 400 MH/s. But when the block reward is 25 BTC and the network hashrate is 500 TH, which may happen by the end of this year, you'll need to be paying less than $0.09/kwh to break even. I'm assuming $12/BTC. And even if your power is free, you'll be making a piddly $1/month. Is it worth the time to keep it running? And what's the value of a mining device that makes you $1/month? $10? Maybe $20? The device may be worth more for scrap or recycling at that point. I believe most rational GPU and FPGA owners will quit by then.

Meatball

sr. member

Activity: 378

Merit: 250

Quote from: Keefe on October 17, 2012, 04:22:12 AM

Why are you guys still wildly guessing? Josh already said indirectly that they'd sold ~200 TH as of a few days ago. And if anything, I'd expect him to understate that figure, as a higher number discourages additional sales. I believe that by the end of the year, the network will be composed 90% of ASICs.

90%? Ah, if they actually start shipping in volume, I bet it's closer to 100%. The difficulty is going to skyrocket and within a month or two anyone doing anything other than ASIC will probably find out they're spending a dollar to make a nickel.

molecular

donator

Activity: 2772

Merit: 1019

Quote from: Keefe on October 17, 2012, 04:22:12 AM

Why are you guys still wildly guessing? Josh already said indirectly that they'd sold ~200 TH as of a few days ago. And if anything, I'd expect him to understate that figure, as a higher number discourages additional sales. I believe that by the end of the year, the network will be composed 90% of ASICs.

Maybe we're not as up-to-date as you are. Thanks for the info.

molecular

donator

Activity: 2772

Merit: 1019

Quote from: organofcorti on October 17, 2012, 05:23:20 AM

Quote from: molecular on October 17, 2012, 04:03:15 AM

Quote from: ?? on ??

Quote from: organofcorti on October 10, 2012, 01:47:30 AM

During that time, the folks with asics will take the majority of the coin generated... that's what 6048 blocks? that's 302400 btc going mostly to the people with the new asics. or aprox. 3.6 million USD.

You can't claim something like that since you don't know how much THash will ASICs add to network, per batch. It's not like current
hashrate share situation is 50% GPUs + 50% FPGA and it will change to 25% FPGA + 75% ASIC in under few months, or even years.

I beg to differ. If BFL delivers, that's exactly what will happen.

There's a thread where people publish the orders they placed with bfl. These amount to 37TH. This would account for 61% of total network hashing power already if added to the network right now. Of course that list is incomplete, so you can probably at least triple that to 111 TH (82%).

Careful how you quote molecular. That's not me you quoted, that's firefop. Mind editing your post?

yep, I should be more careful. Sorry 'bout that. Edited.

organofcorti

donator

Activity: 2058

Merit: 1007

Poor impulse control.

Quote from: molecular on October 17, 2012, 04:03:15 AM

Quote from: ?? on ??

Quote from: organofcorti on October 10, 2012, 01:47:30 AM

During that time, the folks with asics will take the majority of the coin generated... that's what 6048 blocks? that's 302400 btc going mostly to the people with the new asics. or aprox. 3.6 million USD.

You can't claim something like that since you don't know how much THash will ASICs add to network, per batch. It's not like current
hashrate share situation is 50% GPUs + 50% FPGA and it will change to 25% FPGA + 75% ASIC in under few months, or even years.

I beg to differ. If BFL delivers, that's exactly what will happen.

There's a thread where people publish the orders they placed with bfl. These amount to 37TH. This would account for 61% of total network hashing power already if added to the network right now. Of course that list is incomplete, so you can probably at least triple that to 111 TH (82%).

Careful how you quote molecular. That's not me you quoted, that's firefop. Mind editing your post?

Topic: Difficulty drop (Read 6317 times)