Topic: Gigantic difficulty jump of the last few days (speculation) (Read 4640 times)

The supply will be lowered after the halving, but will the demand rises at that time? The bitcoin network cannot cope with 7 transactions per second.

Prices are getting lower and that is because people are getting out of the mining industry. But despite of this, Bitmain/ASICS still keep on selling new hardware. Which will keep on increasing the difficulty as we head towards the bitcoin halving. Less demands and high supply brings the prices further down.

so the average must be 15% then, miners will not add more unit if they see the price tanking, that's is sure

More like 20% increase a month. Although the current cycle indicates less than 10% increase, prolly due to Bitmain shipping delayed until Jan 20th.

there was another increase of around 10%, it was 103B now 113B, i would say that an average of 10% per month, is what is expected until the next value increase

Seems like there's a drop for about a week right around the time Bitmain starts shipping a batch of S7s.....

.... then it goes back up again and then some.

Not true anymore. Brutal growth in last 24 hours again. As if another 50 PHs have been added on top of previous record peaks...

S5 will be unprofitable BEFORE the halfing unless you have VERY VERY cheap or free electric, or are treating it as a space heater (effectively free electric).
SP20 will last a LITTLE longer than the S5 due to it's undervolt capabilities.

Both S5 and S7 hashes are very cheap nowadays, but despite the higher monthly ROI NOW investors should think about what will happen after a few months. Will it be profitable still or what. I'm seeing S4 to be unprofitable putting S5 to the edge (probably on a tipping point) come halving time.

The hashing power has dropped a lot since the price drop. It is very elastic to the bitcoin price.

i doubt, there is plenty of margin for the diff to increase again

not sure why many thing that miners have reached their profit, they still have plenty of room with the S7 is not even funny, diff can almost double before the halving, 200B is not so off from reality..

What is scary is if someone big decides that Cryptocoin has become a big enough niche to get involved.

 Can you picture an AMD cpu line with a small ASIC miner imbedded, instead of or perhaps in addition to the GPU from the A-series?

 They keep having more transistors available, and not a lot of options on what to DO with them.....

Difficulty is doing it's last ramp up before the halving.  Anything new that hasn't made it's ROI by then will most likely fail so it's a final push before 50% less income (gross).

With the bitcoin price staying above the $400 mark, older miners are operating which increases the hashpower which in turn increases the difficulties. The only ones who will have a profit in the mining industries are the vendors themselves.

Ah...but don't discount 'reality' in this equation.......silly hairless primate monkey that we humans are we like to throw 'poo' virtual or otherwise

For example

Could be from these links

https://www.google.com/search?q=cryptsy+office&ie=utf-8&oe=utf-8

http://bitcoinnewschannel.com/2016/01/09/paul-vern-cryptsys-ceo-seems-to-have-flown-to-china/

That the head of Cryptsy is in China and the main office is kaput...this could end badly Thus wait for the FUD/press will be thrilled/drama to unfold

add to that the btc core devs and such getting into another spat....and say china 'trying' at least to impose ''reforms" on BTC regulation etc again

to control the flow of $$$ shooting out of the country and we could be looking at 'cheap coin' again ...ie 250 usd

and of course in this thread...the rise further.... massively lets say..... in BTC difficulty continues to grow and to accelerate



bitcoin:  The wheel of FUD goes round and round

If the price keeps increasing and increasing then we will continue to see the difficulty break record after record.

I do however agree with you that it will not rise with big (+10%) steps each adjustment period.

Seeing the difficulty go higher and higher means that miners are making some decent profits at the current price or they are just hoarding coins to sell at a later moment. That is also possible.

My thinking is that difficulty will continue to increase until the halving at least. We may not see +15% every time, but I think the days of difficulty decrease are over for a few months. I say this because I think the major ASIC vendors want to sell everything they can. They are worried about the impact that the halving will have on hardware prices, and they want to "sell while the selling is good". I think with their current Batch 8/9 design, Bitmain has whittled the cost down, and they'll continue to push hardware, adjusting the price down as they need to keep folks buying. When the demand for an $1100 4.6 TH miner dwindles, they'll find out who will pay $1000 for that same miner.  Rinse and repeat until it doesn't work anymore. This hardware they sell WILL get deployed and turned on. In some cases it will replace existing less efficient gear, but the net effect will be an ongoing increase in network hash rate. As long as the price of BTC doesn't stall (for too long), they can keep the game going. Difficulty is irrelevant to them, it's all about the price of the hardware, and how much they can push out the door in the next few months.

Come May/June/July, we'll see what happens, but until then, it's "sell baby sell" for any and all of the ASIC vendors.

It's not clear what the benefits are for any of their customers, certainly NOT the home/hobby miner. This feels distinctly different from a year ago, when there wasn't a mad rush to sell everything possible.  I think it is driven by the price of BTC. As BTC price rises, that pushes network hash rate, which then spurs difficulty increases.

The difficulty has jumped 40% over the last 40 days. The hash rate is 780P at the moment. That is a jump from a big base.

The below link may help those mining in the winter to reduce rates..maybe its a fluke but knocked down my electric rate about 4.43c kwh from 13.7c kwh to 9.27 kwh ..probably good for the
next 4-5 months ..so a big savings for me!

anyway for those interested....in that this is NOT difficulty...but damn the $115 buck savings a month in electric for 'winter' mining from my 2 KNC Titans sure makes

difficulty less an issue!


https://bitcointalksearch.org/topic/m.13304401


Anyway hopefully this helps someone else pull this off as well and it was not just a 'fluke' for me! Home Mining with Difficulty going up sucks for every ASIC machines

BTC/LTC or whatever....the above works for any ASIC setup. Be sure to post if it worked or not and please take the poll..

good luck!

Prices undoubtedly influencing the demand for miners
I would not be surprised to hear about manufacturers turning on reserve units to be sent out for sale and making them operational instead. Or using more of their warehouse space to mine.
He-he and 4) 5) na those would be fun times though lol.

it's actually the opposite, increase in price = increase in diff

we have a better profit with today diff than what it was a 230 per btc, 93B diffculty is better with 460 in value, than 230 inv alue and 60B diff(the previous stable diff)

the current value also, will permit a good margin of profit even after the halving and even without the new efficient machine, currenty efficiency is very good, only a consumption of $45 per month with a single s7

Dilute, hide, and broadly unfairly distribute costs.  Sounds like everyday business to me.

I disagree.  Quite a bit....  you can never remove the person that has cheap or close to zero cost power.

What you can do is lower  his hash to network hash percentage but if he has really cheap power you can not beat him.

My friend leases a floor in a building and he then sublets he keeps 20% of the floor and pays 20% of the power bill.   Normal rates are 10cents  but he is paying 20% of that or 2 cents.  he can give me 2 s-7's
So I will mine s-7's for years there.  A second benefit is his place is cold in the winter as he does not control heat he used to use 2 1500 watt heaters for 5 months  a year.  he won't be using them.

So basically he has perfect mining setup for 2 s-7's  no one can beat him  he is cheaper then free power as 5 months a year he is gettng better then free power and the other 7 months he gets 2 cent power.

Granted he is limited but he is not the only person  with these conditions.
You will have small mining as they are the only miners  that can have 'free' power setups.

How many of these are sold every year?
Sooner or later  this will come about  that a company like Delonghi will cut a deal with a company link bitfury

are you implying that difficulty and price have forever been synchronized even if not in immediate fashion, ergo increasing difficulty will yield increasing price?

secondly, and possibly a crude iteration of what you said,  I think that mining will essentially cease at the halving because only those with 16 or whatever nm architecture will even attempt to survive and technology won't meet demand for 4 or 8nm...at least nowhere near the halving time.

As it largely now is,  two or three companies will control everything after the halving and even they will be forced to 'pan' for their pay. If correct, will the diff after halving maintain the synchronization with price that I interpret you've suggested?

i don't know why people are worried about diff increase all the time, the ratio between the profit and the diff will always be the same, so if many will join and it will be not-profitable, other will simply leave

it's not like everyone out there has free electricity, that would be scary, because they will dump until btc is zero in value, but even then there is the halving...

Not really.... 21 said they were very into this.  And what did they give us? A custom RPI board... they say the above but they yet to do it. 

I would still buy a bitfury lightbulb for fun if they ever do sell them.

I love the light bulb idea but was wondering how they might get it connected. wifi? usb doggle?

1 is possible. It is mainly caused by S7 coming to the market. Bitmain is going to build more s7. So the difficulty will rise again.

Think of people with old school light bulbs burning 60, 75 or 100 watts a blub.  An led bulb burning 12 watts with a chip mining 5 watts same light at 17 watts and  some coin back.  I could see this happening.

This is the vision of 21 Inc. ^

I see some interesting things happening:

1. If Bitfury will be selling chips to anyone, then they are positioning themselves to be a.k.a Intel of bitcoin, then someone (maybe 21 inc) will be a software (mostly) arm-with their emphasis on programming solutions; Coinbase will be a bank, etc, etc.
Sooner or later a whole ecosystem will be fully fleshed out.

2. with 0.05 J/Gh, some dual use devices actually make more sense. For example, a dual use lamp w/mining chip.
Light ON-40W to light, 20 W to hashing, light switched off-all 60w to hashing.
Light on-hashing 400Gh (20W), lights off-up to 1200Gh-basically an S5 in a lamp!
How many lamps do you have? A few dozens easily.

as to your below quote copied from above



--------

 Sfards had that SF100 unit, but it appears to have been a very poor board-level design AS USUAL from the successor to Gridseed.

 Innosilicon A4 - sometime next year likely first half.
 Alcheminer is also working on a next-gen Scrypt chip, but doesn't seem nearly as well funded.


--------


they both are gonna be like 500mh or so units ...ASSUMING you can actually get some of them in 1 unit batches from somebody ...in a approprate amount of time (dubious)

The alcheminer II in 4-6 months if I remember right it 510mh 1150 watts at $4950 usd

I have Titan(s) that have ROI'd so I'm hoping these folk know something I don't on expected BTC/LTC prices etc

because 1 Titan is 350mh 1250 wats and again ROI'd so I can run with this pack in 6 months...depending on how data hall nuts they go on these

so yeah..only real option if you are CRAZY (I don't recommend it buy crypto in BTC/LTC instead) is buy used scrypt ...but essentially the prices are TOO high on ebay etc imho
and not only that you probably could only pull this off with the Alcheminer 256 (with new firmware 3rd party patch fixes on litecointalk.org) or Titans at 350 mh. Would have to be used equip OVER 200mh as a unit to pull this OFF and remember Alchimer 256 1st batch use (i think) 2x the watts of a Titan 350mh...so that also plays into all this...at least at my 13c kwh rates or more thereof.....anything below would kill you on ROI at these used prices...only the BIG ass beasts would pay (used) but they are SOOOOO high priced imho...but what the hell you could get lucky or have cheap ass under 5c kwh electric...just a note with 2 titans I make at 645mh ave speed about 450 net after elec so 1 Titan is 1/2 that ....so these units in 6 motnhs are NOT impressive at my elec rate indeed

me at 13c kwh just can run the Titan's out....it especially (likely) will not be worth me chucking out say $4950 usd for a 510mh unit in 4-6 months when you on ebay NOW can get a 350mh Titan (used) for around 3,250 usd or so ....and with new equip in these asic units both btc and scrypt with only 90 day warranties ...your odds are not too bad on a used unit via say a paypal purchase on ebay (45 days) so wtf ..if you are that nuts...just grab a used Titan now and mine like hell imho why wait for these newer units vs difficulty now vs then and price now vs then it looks at worse a wash at best you are ahead with used equip NOW

but again I like the mnfg optimism that they can sell alcheminer II's at 501mh for 1150 watts 4-6 months from now (and they are always 1 month or two late imho) and you have a shot at ROI....or so the mnfg must be thinking to push these at that mh and price range...if they are correct then we will be looking at 7 buck LTC imho to pull that off!

anyway don't like the odds/ the somewhat modest increase on MH / the price / nor the 4-6 month *supposed* delivery time ....add to that a big 90 day warranty and it just plain don't make a lot of sense..

now 1 year warranty on parts/labor etc .....510mh for say 3,250 usd ...can buy 1 unit at at time for that price and speed ....well that would correspond AT THAT POINT IN TIME 6 MONTHS FROM NOW SAY nicely with what you can get on ebay now for big assed miners..but again 90 day warranty for 5k or so of equip at these speeds /watts ...its a 'lead duck' imho


   

 Sfards had that SF100 unit, but it appears to have been a very poor board-level design AS USUAL from the successor to Gridseed.

 Innosilicon A4 - sometime next year likely first half.
 Alcheminer is also working on a next-gen Scrypt chip, but doesn't seem nearly as well funded.


 
 I've been saying all along that probability of RoI on the S7 was pretty much zero unless your electric was VERY VERY cheap.
 Bad timing on the release and WAY too high of a price.

 Avalon 6, even worse - lower performance for MORE money.

 B-Eleven - going to have to be VERY cheap to have a prayer.

 There is hope on the horizon though.....

 Well KNC it is looking like 20mw is going up soon?

http://bitcoinist.net/new-kncminer-data-center-will-running-within-four-weeks/


 Also bitfury 40mw up this coming week?

 http://www.businesswire.com/news/home/20151211005837/en/BitFury-Launch-Energy-Efficient-Immersion-Cooling-Data


 Someone should have come out with bigger units in scrypt imho before this ..they would have killed.....as an exmple difficulty of the network is up like 21% or some
such from when I started with Titan (2nd titan march 2015) orig anyway nov 8th 2014.....

 BTC difficulty on the network has gone up 23% or some such since Oct 1st ....(did this this the other day these are ballpark) for the btc network

So man me choosing (lucky) to switch my Neptune btc miner this last spring to a knc titan scrypt miner (and march used one) paid off and continues to do so

but BTC difficulty wise......imho ...it would still be 'chancy' but get a used scrypt unit even at ebay prices..mine LTC convert when the ratio to btc is around 0.01 ltc to btc
as I've done...the odds are damn long with that now trying to get over priced scrypt equipment..but the odds are better (as a home miner for sure or even a small data hall operation of btc etc) then when these data halls hit (the ones we know about ...god knows what is going on in china data halls)

Just saying.....when the Elephants decide to get on the dance floor and do the Polka ..its time for us Mice to frigging scatter away and get some fruit punch!

I see no way to get a home or even modest A7 10 pack for BTC miners with frigging almost FREE electric keeping up with these data halls (the ones we know about above and probably the ones we don't China) all hitting within the next 3 months...looks like a perfect storm imho...gonna be very very ugly...the only thing the could (I hope) make me eat my words would be a MASSIVE BTC  price spike say up to $600 bucks due to adoption/china etc...then maybe ..just maybe ......

anyway hope I'm wrong but if I won the lottery and had the itch to get a data hall type asic operation going..it would not be in BTC at this time nor even looking at 6 month time line

well we will see ...just saying (not that I know squat at one time drank the bfl kool aid..got my refund 1 yr 20 days later due to luck...but consider that as the author of the msg posted here)

Just in time when the new batches of S7s shipped. Too bad, this is gonna take longer to ROI.

IMHO, we are riding in a car (at 0.25J/Gh) while an airplane just flew over.
Someone is deploying tremendous amounts and we (amateur miners) are falling by the wayside at 20% an adjustment period.
Nobody sells us a competitive product, unfortunately. There is no Intel equivalent in bitcoin.
If Bitfury is anywhere close to deploying up to 100mW at 0.06 or even 0.08J/Gh, it means about 1exahash (1000 petahashes) just from one company.
http://insidebitcoins.com/news/bitfury-ceo-talks-bip-100-and-announces-16nm-bitcoin-mining-asic-chip-tapeout/34664

I think that i bought my last largish miner.
It is kind of sad to realize that the era is almost over, apart from fun mining with sticks, pods, etc.

EDIT: yep, it is coming..
https://twitter.com/bitfurygeorge/status/677132522074017794

Some comments.  

1) The 50 Megawatts is presumably the amount of power available to the Bitfury site. In practice electrical systems are almost never run more than 80% loaded. There also need to be power available for fans, lights and so on.  So I suspect a 50 Megawatts site would be able to run say 30 Megawatts of active miners max.

2) The network hash rate over short periods, saw one day or two, can only be very approximately estimated.  The estimation is just based on the block solve rate.  There can be statistically variation swings of 10-20% in hash rates over one day and even the 2016 block adjustment each fortnight is only accurate to a couple of percent.

For the technically mined Bitcoin blocks are found every 600 second on average with a poisson distribution. The Standard Deviation over N blocks in seconds is 600/Sqrt(N).  The greater the number of blocks used the more accurate the network hash estimate.

3)  KNC and Bitfury 16nm chips running under 0.1 J/GH seems totally believable. I am surprised it is questioned. It is the sort of improvement you should expect with the move from 28nm (or 20nm) to 16nm chips.  The companies have no reason to lie about their chip power consumption as it is very easy for potential bulk purchasers or investors to check.

Another example, the 28nm Pickaxe ASICs chips used in the SP50 claim 0.15W/GH/s.  So I would be very surprised if 16nm cannot do considerably better.

The mystery spike was about 200 ph if your numbers are try they did not use all they can do.

So we will soon know if we do 200 or 300 ph

OK, so I get the "BitFury testing" hypothesis. But then why did it "go away"? Unless there was some kind of huge failure, wouldn't you let it run for the most part and fix what was broken? Even if things came in too high in terms of J/GH, or maybe the immersion cooling really won't do what's expected, why not "throttle back"  in terms of frequency or whatever and still hash with what you have? I could understand testing prior to shipment of a product, but it's all internal to BitFury isn't it? It's not like ByFury has to collect a 100PH monster order and test it prior to shipment, do they?

I also take the coindesk articles with a grain of salt. They are derived entirely by what KNC or BitFury tell them. They have no way way to independently verify anything they write about KNC or BitFury, do they? We've all seen ASIC manufactures come up short on their efficiency estimates before. I see no reason to think that KNC and BitFury are immune to that possibility.

It is likely new Bitfury chips run well below .1 watt a gh (or Joules/Gigahash).

Their press release and site claims "16nm chip that is expected to achieve 0.06 J/GH this year.".  See http://www.coindesk.com/bitfury-completion-16nm-bitcoin-mining-asic/

KNC claim 0.07 J/GH. See http://www.coindesk.com/kncminer-deploys-next-generation-16nm-bitcoin-asic/

So it is safe to assume the latest miners run below 0.1 J/GH.   Or 2 or 3 times more energy efficiently that an S7.

the monster spike was a bitfury test:


https://bitcointalksearch.org/topic/m.13233458


This one will be gentle compared to next one. ~400PH almost ready to go online...
http://www.ibtimes.co.uk/bitfury-opening-third-carbon-neutral-bitcoin-mining-operation-georgia-1532998

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https://bitcointalksearch.org/topic/m.13234689



 Guys remember the 212 block day  it came and it went well it must have been bitfury testing see below

http://www.ibtimes.co.uk/bitfury-opening-third-carbon-neutral-bitcoin-mining-operation-georgia-1532998


 No one know how good they are powerwise , but

 50 mw x 3 =  150 ph  is .33 watt a gh
 50 mw x 4  = 200 ph  is .25 watt a gh
 50 mw x 5 =  250 ph  is .20 watt a gh

we did 212 vs a norm of 144  but all the other days we are doing close to 160

so we did 212 vs 160   which is 52/160 = 32.5%  so .325 x 566ph = 183ph

So if it works and does not explode (we can hope for that)  and based on the monster 1 day spike    they are going to add 150 to 200 ph. 

 This is good new not bad news.  we are doing about 650ph this period add 200 = 850 ph lastly next month some more will  be added.

So by my birthday (Jan 27)  we will be touching 999ph   or 1eh   I think  eh   comes after ph.

Now go back to sept we were 404 so 404 to 999 = a factor of 2.5 price was   230 now 430 a factor of  1.87

so if you did not upgrade your gear   2.5 is higher then 1.87

but if you switched out to s-7's  you power is 2x better.

so 2.5 diff jump  would not be so bad since  with 1.87 price jump and 2x power improvement  the good factor is 3.74

What is better is if you have long held s-5's from last jan's price war  you can still mine them and finally order your new s-7's today.

We will then go flat like last year

My speculation is :
Bitmain has a new generation miner that they turned on, something like S8 or S9, this is why the huge increase of network hash rate, and this is why now they are selling S7 from stock - no more pre-orders, because they already replaced all of them with the new generation miners and they need to get rid of S7

What do you think about my ideea ?

I couldn't get that. How is mining the new way of laundering money? I could assume that buying bitcoin anonymously is new way of laundering. Recent difficulty increase probably is caused by the suddenly skyrocketing bitcoin price, which attract more ppl to get into mining industry.

Number 5 is a definite no. Mining is inherently quantum resistant.

However digital signing via ECC is not. If there ever is a quantum computing attack on Bitcoin, it will be to steal private keys, not cracking blocks.

Yes, there is quantum resistance in Bitcoin receive addresses due to how they are derived from public keys. But if ECC eventually falls to a quantum attack, effectively no one can spend without without signing and therefore exposing their coins to theft.

For now quantum computing is still in its infancy. There is no immediate threat.

That said, the bitcoin devs should walk, not run, towards quantum resistant signing technologies. I have to assume that this can and will happen well before quantum computing poses any real threat.

All the same. If a "private pool" suddenly pop up with 10% of the network hash, then we know. From there we can probably figure where the mine is in the world.

Considering the unknown block % is under 1%, this is not the case;
https://blockchain.info/pools

And thus by simply comparing which pool has the hashrate now vs 1 month ago, we can instantly know where the hashrate went. Although its hard to tell where it came from.

It seems that big mining companies are not using public mining pools to mine. They have their own private pool or are solo mining.

The highest possibility is that they own a private pool.

We've "tracked" the S7 being bought by guessing based on how much BTC was sent to Bitmain. At worse its only a portion of the hashrate. There's other factors, other companies onlining a whole lot of hashrate. The next thing we could do to get a better idea is look at which pool got the hashrate gain. BitcoinCZ only went up 4PH/s in the last month.

We can guess all day long.  But wer really don't know what it is.  That is part of having a industry where most companies are private.

There is open as far as blockchain.  But what companies have or are doing in most cases is not a open book, they want to be ahead of competition.

Maybe it could be possible that BITMAIN has increased the shipping rate of the Antminer S7's.

Any source for the above claims?  Did anything ever happen with the Magnus Daar court case from the Titan/Neptune days?

Two news items from the last couple of days on what the big miners are doing. One on KNC, one on Bitfury

http://www.pcworld.com/article/3014471/bitcoin-miner-knc-is-planning-another-four-week-datacenter-build-out.html

http://www.ibtimes.co.uk/bitfury-opening-third-carbon-neutral-bitcoin-mining-operation-georgia-1532998

Both KNC and Bitfury have said they now have 16nm chips running with power efficiency better than 0.1J/Gh.

It would be surprising if the miners in China are also not moving to the new generation of mining hardware.

I think that could influence of a lot of new hardware coming out and being put to work.At least it is very similar to what happened before when nem miners got in.

On the KnC thing, more likely part of the leadup to a forced bankrupcy. KnC has a BUNCH of debts outstanding, and a TON of legal issues.

 On the recent hashrate climb, I'd guess a combination of folks getting production ramped up - Bitmain and Avalon for sure, possibly BitFury, unlikely but possible BW.com/Lketc (they're not really expected for a month or so, but they've been keeping things sorts close lately), possibly Spondoolies, very long shot Innosilicon (not really due for a couple more months).

 Quantum computers are HORRIBLE at straight-line type calculations like cryptocurrentcy uses.
 NOT an option.
 They only perform well compared to conventional computing gear on stuff with a TON of variables that interact with each other.


 Any government that decided to start mining Bitcoin (pretty close to ZERO probability) would be limited by the available hardware makers available production.
 NOT a factor.

The latest news is that kncminer's account has been shut down by their bank, why? Might because of large amount of suspicious funds entering their account

Mining has become the new way to launder money totally clean, that's the reason difficulty just keeps rising

wrong estimation as usual, you may add that, i remember the first time it went to 400, there was a nice % of error

i would not be surprised if this is true again

1-3 I see are likely
4. Who knows, if they did most likely the NSA would have it at their new Utah datacenter (is it a datacenter? or is it disguised as a datacenter mining bitcoins?)
5. Google is barely testing their Quantum Computer. The only companies I can imagine doing quantum computing mining are Bitmain and Spondoolies, but this is still at least (imo) 2 years+ down the road.

Possibilities:

1. Bitfury filled up their 100mW center?
2. Spondoolies started deploying their SP50?
3. BW deployed their 14/16 nm machine in house?
4. Some government decided to mine bitcoin en masse (for the heck of it)-could be in combination with #1-3
5. Someone deployed a bitcoin mining quantum computer?