Topic: Mining difficulty slowing down over the next 3 months? - page 3. (Read 7750 times)

[ takes out crystal ball and places on table - stares deeply into the globe ]

I am a firm believer that it will keep going up in leaps and bounds until the big players 'blink'.

For now they are just staring at each other, going tit for tat, matching hashrates to the difficulty changes. Meanwhile the cost to mine edges closer to the bitcoin rewards mined.

When the cost to mine reaches the point that there is not enough cash left over to upgrade and match the rise in difficulty, and pay bills and workers, then the difficulty rises will drop to a few percent every 14 day revolution and may even stablise.

But the new order of things will be something like the running costs being at about 85% to 90% of total mined bitcoins.

When it gets to that level, it won't change without something catastrophic happening politically, or to the tech or the network itself or the algorithm.

So if you have an Antminer S2 lets say the diff is at 65,000,000,000, BTC at $600, and its costing you about $4 USD per day to run, then you will be mining about $4.70 USD a day with your S2.

This is because the big players, eventually with their 1 PH/s racks would also be paying about $4000 USD a day ( at a guess ) to host those miners while earning a guesstimation of about $4700 USD in BTC per day.

If the value of BTC rises then large miners will afford to acquire even more miners pushing the hashrate and difficulty up and the $$$ gap between cost to mine and reward remaining about the same.

This is pretty much how the game is played everywhere else, in mining BTC it is no different. In particular its the way that China competes in business because many of their businesses can operate at thin profit margins, much thinner than anywhere else.

Eventually manufacturers in China will be the primary producers of miners, and most bitcoin will be mined there, and much of the BTC supply to the market will come out of China.

Around the world, many businesses could still run mining operations as a means of writing off profits, running their businesses at a loss and pocketing the Bitcoins themselves, however dubious that may be, that would be the only way to eventually compete, or at least, stay in the game and make something from it.

Any cartel of large mining operations in China could possibly do some damage to the world bitcoin economy if that all eventuates.

A quick look back at how OAPEC wielded supply during the Yom Kippur War is a good indicator of how supply can be used politically.

Mining difficulty has been slowing down but i think it might ramp up to just under 20% with all the new miners coming out. I dont think we will see the huge 30% increases anymore until some brand new revolutionary design comes out.

It is going to *squeak* under there...

C

sure aint looking that way

https://bitcoinwisdom.com/bitcoin/difficulty

You may just get your huge jump yet. 14.3% and rising.

Who buys hardware these days?

I last bought Antminer S1s a couple of weeks ago. Now I expect them to break even ... barely. And at some point I must undervolt. A lot of work for a few bucks.

S2 is ~$2100 and takes three months to pay back assuming no electric cost, no difficulty increase and stable BTC price. I cannot understand why anyone would buy. You may make it back only if the BTC price increases but then you'd anyway be better off buying BTC in the first place.

Relevant proposition someone just submitted for your consideration:

___________

Bitcoin difficulty will drop more than 10% in 2014 Options: Yes | No

Such as established businesses, for example a web hosting company or similar, that buy and run miners as a way of writing off some of their profits, even to the point of running their businesses at a loss. They can afford to continue adding large piles of miners to data centers even though it costs them a pile of real cash for the equipment and power.

At the end of the day they run the books at a loss, very little if any tax to pay, even run their miners at unprofitable levels, because at the same time, there is no comeback on them as to where the BTC would go to...

such as....?

There will always be people with free electricity that can compete with the datacenters, and enthusiasts and supporters.

why dont we steal the electricity...
its 0/kwh  

Heard all this before with the change from GPU > FPGA > ASIC 1st gen >ASIC rd gen (now)

I am still chugging away profitably using captial invested at the GPU stage. You just need to have a profitcable business plan and stick to it. I may not be getting 1000% ROI p.a. but 200% is still pretty damn good.

lets hope together 

Sad to say but I consider anything under 15% not a huge jump. I noticed the network hash rate was going up and down a lot the past few days I was hoping for only 11% but I think I am going to be disappointed.

Steve

But manufacturers are way off your estimates.  By the time they reduce to that diff will be 20 B

So lets assume .16 to .20 electricity.

I agree above .20 electricity is almost done.

not true.

For hardware that you could have in-hand by the end of this week, fair price per terahash IMO would be:

2w/GH:  $0.70/GH - $0.90/GH
1.5w/GH:  $0.80/GH - $1.10/GH
1.2w/GH:  $0.85/GH - $1.30/GH
1w/GH:  $1.10/GH - $1.60/GH
0.75w/GH:  $1.50/GH - $2.25/GH

The range sybolizes the premium paid for models with better build quality or included power supplies. (for example the SP10 at 1w/GH is a better product than the Bitmain S2 kit at 1w/GH, and worth ~$200 dollars more)

Mining will soon happen primarily in areas where electricity is cheap. Those paying >$0.20/kWh will see little or no profit compared to those mining at <$0.10/kWh - perhaps as much as 20% of the hardware price

Because its an investment, I am assuming most people want not to lose money.

It is a losing investment until it breaks even at least.  Thus the roi really stands for "positive".

Perhaps a better way to phrase it is positive roi.  proi?

You mean "break even". ROI stands for "return on investment". If you earn one satoshi (or $0.01, if you prefer) over your electricity costs, you will have a return, but you will not break even.

Sorry to be "that guy", but that's a pet peeve.

At the diff levels and current btc price now Asic equipment needs to be priced $1000 per TH to have any Roi for miners.

Appears to be another 14% coming up. Crystal ball says 13.99% and rising slightly
https://bitcoinwisdom.com/bitcoin/difficulty