Topic: Next difficulty ~4,000,000,000? Tracking difficulty since 145,000,000. - page 18. (Read 32518 times)

Well, based on assumptions like you just wrote you can calculate where its headed,  just not how fast it will head there. Your guess is as good as mine.
But yes, I do expect the majority of mining (and all of profitable mining)  to eventuallyt move where electricity is cheapest.

And there are some pretty extreme low (subsidized)  prices to be found. In Kuwait the price is fixed at $0.01 per KhW:
http://www.bbc.co.uk/news/world-middle-east-20644964

In russia apparently you can buy electricity for $0.025 per KwH

Those tariffs cant  last forever, as that is well below cost but even if its only for a few more years, its not unreasonable to assume someone will set up shop there and Kuwait would effectively subsidize bitcoin security

I missed your thread and was operating on bad guesses. Sorry.

Though - if 1TH/s = ~$140 retail after chip, PSU, shipping, cables, and whatever else - and it consumes, say 500W (this assumes it's significantly more efficient than babyjet2s, which I don't think an unreasonable assumption. It'll probably be much more efficient than my grim guess) - 6-12 months out (6-8 months out might be okay), and it's hard to justify the cost even if electricity's dirt-cheap (say, $.05/KWh after taxes/fees) - especially if everyone else is going to be mass-ordering these chips, too. At the end of the day, we're all chasing a piece of a 3.6kBTC/day pie (+~100BTC in fees) until the next halving, which is probably significantly less than three years away with the rapid increase of hashpower put on the network. We may not even have much more than two years if upfront costs drop dramatically and the pre-order hysteria keeps up.

-So what do you see in, say, 18 months? Near-complete mining centralization in a small handful of geographic locations with sub-$.05/KWh electricity?

Good job of totally missing the obvious. They will lower prices. A 400GH/s hashfast asic costs ~$30 to produce in volume.  Of course at some point mining profitability and production cost will meet and we will get stagnation, but we are at the very least 50PH away from that, and if mining shift to low electrcity cost countries like Russia or some states in the US, possibly more than 500PH.

https://bitcointalksearch.org/topic/finally-a-correct-endgame-difficulty-calculator-295270

I have no idea how long it will take manufacturers to ship that kind of volume, but its likely gonna be more than 6 or 12 months.


And they never will. If it were truly safe, hardware vendors wouldnt sell, they would mine.



This is true, but you grossly underestimate how low prices can and will go. And once they reach marginal profitability in a few years, well who really cares what they do next,  none of these guys will ever need to work again.

Remain dormant, dissolve, or make something else - maybe hardware wallets or possibly even altcoin ASICs. They're not going to operate at a loss, though - same as miners. Hardware prices, so far, haven't been able to come down to a price where it is at all safe to purchase (everything on the market right now, will, if lucky, come a bit below breaking even on investment by the time they arrive at your doorstep), and maybe that's because others are way more risk-tolerant - or just stupid, because now, there isn't a high reward potential unless you decide that factoring in a bullish BTC position is legitimate when you could just buy BTC and enjoy the same rise without the extra risk. When I was still doing larger-scale loans, GPU mining loans were no problem - but even then when FPGAs were still considered a reasonable investment - when the situation looked more rosy, I wouldn't touch anything ASIC. It's always been extremely high-risk, but now the reward potential is consistently, and rapidly, dropping.

ASIC manufacturers don't have a sustainable business model if they're just planning on producing Bitcoin ASICs for years. Unless ASIC prices can come down by 50-75%, or BTC rises 150-250% (or some equalizing combination of the two), ASIC manufacturers are dead in the water unless they have good contingency plans to deal with an over-saturated mining market. I remember - I think it was BitFury or KNC - something like that (RedFury? I can't keep track of all the goofy names) -- they released a USB ASIC at the lowest price-point they could manage while breaking even, and there was very little interest (they claimed they had orders to fill out the first batch, but that just made me assume it was a scammy operation). -Now a smaller-scale USB miner's of course going to have a much lower cost-efficiency than some of these larger, clunky-looking ASICs which're produced in relatively large volume - but I don't think it paints a very favorable picture, as far as ASIC prices being able to come down to a place where it's reasonable to purchase them as an investment without dramatic BTC price appreciation.

Hu?
The little flaw in your reasoning is that you think hardware prices will remain stable. It makes no sense to buy mining hardware at the current price per GH, but vendor cost per GH, particular variable cost, is more than an order of magnitude lower. What do you think they will do once sales dry up?

Mining as a profitable venture you can get into now is dead. There's no justification for the mining network to add new participants right now. If BTC price soars in the future, maybe this will change, but if it doesn't increase to, say, $250 by the time of the next halving, the ASICs pre-ordered now may be the same ASICs making up the majority of the hashrate share five years down the road. It's a very possible situation to have no ASIC manufacturers still outputting in a year or two. It'd be like the Cuban automobile situation.

dead for us, not for who produce the miners.

So how are transactions still being processed?

If mining is dead Btc is dead. Mining is no longer a get rich quick scheme, doesn't mean it's dead.

mining is dead get over it, by btc directly

fixed

Next   25/09/2013 11:03   260064   150 571 756   x1.34
http://dot-bit.org/tools/nextDifficulty.php

Im guessing it will be a tad more than that, since the trend is clearly up and dot-bit doesnt do any trending.

Last 120 blocks may have been statistically lucky, but with the increased hashrate that may end up being more representative:

Last 120   19/09/2013 20:44   258889-259009   164 194 855   x1.46

Just want to point out that number 1 has some latency because factory ordered chips will be deployed no matter how many people end up paying for the final product. 



 

There is a better way, use contracts before develop more.

My guess still is 138,000,000

Playing SatoshiDICE is more profitable than buying mining rigs now IMHO!

Assuming one believes that BTC will go up in value, I think the best option at this point is to buy BTC directly.

In my opinion, the small potential returns for buying mining hardware right now aren't a good move when adjusted for risk.

Yes. The choices are:

• You buy mining equipment and nobody else buys mining equipment (difficulty stops increasing, you win)
• You buy mining equipment and many others also buy mining equipment (difficulty goes up, you lose -ROI)
• You don't buy mining equipment and nobody else buys mining equipment (no income from mining, you lose 0 ROI)
• You don't buy mining equipment and many others buy mining equipment (no income from mining, you lose 0 ROI)

Sound familiar? http://en.wikipedia.org/wiki/Prisoner%27s_dilemma

While it's theoretically possible to win (option 1), if all players act in (what they think is) their own interest and buy mining equipment, the more likely outcome and what we are seeing now is everyone loses (option 2). Thus, the best option is not to play = 0 ROI.

That's crazy.

Buying new mining hardware right now certainly looks like a fools game.

 +/- 15%