Topic: PREDICTION: A SHA256 ALT coin will become as big a success as Litecoin (1-2Yrs) - page 2. (Read 7792 times)

People seem to base the price on the current market supply/demand and completely gloss over the rest of the market that its actually aimed at disrupting. (the transaction market)

If bitcoin succeeds in taking over 1% of the transaction market, they will be worth $100,000 per coin. Basis for that statement can be found here:

http://falkvinge.net/2013/03/06/the-target-value-for-bitcoin-is-not-some-50-or-100-it-is-100000-to-1000000/


I thought it was a cracking read and made me think, wow my 1.5 btc might be able to buy my house in the future

hope you enjoy it :-)

I think Sunny King is opposed to having merged mining for (SHA-256) PPC. See
https://bitcointalksearch.org/topic/m.1346382
and
http://www.ppcointalk.org/index.php?PHPSESSID=2ehjsvpmr404htpljqfgaedg37&topic=265.msg1371#msg1371

So this is an example of the kind of coin you're foreseeing.

Your reasoning seems to make sense and that's exactly why it will not happen, IMHO.  Because we're privy to the trend.  If this speculation of yours were to come to fruition it would not happen in a stealthy manner.  And the difficulty will adjust much, much quicker than it did for LTC.  So perhaps there are returns to be made, but they won't be 2500% returns--no where close to it actually (again, IMHO).  In fact, it'll be coins with tight supply to see absurd returns, either from their specs or because diff is way up there (BTC).  No, I think the same way people are regretting not buying up BTC when it was a few dollars will be regretting they didn't buy it up when it was 100, because I honestly think it'll be north of a thousand in 1-2 years.  And the tighter supply coins will see comparable returns.  YOU mark my words.  

I've been doing a little thinking about this as well.  Will be following along to hear what others think.

I don't think I explained myself thoroughly in the OP.

When gen1 ASICs become unprofitable, people will be looking for a way to make them profitable again. There will be a huge incentive for someone that wants to create a truly innovative SHA-256 coin. I will lay out the basic business plan here:

1. Buy unprofitable ASICs for pennies on the dollar.
2. Design and develop a ground breaking SHA-256 coin. Better than all ALTs existing and better than Bitcoin itself.
3. Hash power will be split between Bitcoin and this new better alternative by speculators and people that believe in this new coin being better than Bitcoin. The split in hash power will allow the overlay to make gen1 ASICs profitable because hashing power is split in between Bitcoin and this new alternative coin.

For instance, assuming a 66% monthly increase in difficulty, an Avalon will be unprofitable on May 14th when the network difficulty is 4863 million. If half the hash power switches to a new innovative SHA-256 coin, that would effectively bring Bitcoin difficulty down 50% to 2431.5 Million and you're back to making money again. Plus, maybe this new ALT coins is so much better than Bitcoin, that it is more valuable to mine than Bitcoin itself to due to high exchange prices from speculators. So, it could be a greater than 50% reduction in hash power in that case.

I have been right about a few things since I came on these forums and started posting. 1. Litecoin, 2. BFL being shady, I hope these won't be the last either. It is somewhat of a wild prediction, but I like throwing as many conspiracy theories out there and seeing which ones stick. Then I can bump this thread in a year and bump my chest if I'm right.   jk (or... not).

Also, it doesn't even have to be a new SHA256 ALT coin. Perhaps a lot of development is done to an existing one to where it is more valuable to the community. Huge market shifts (UP!) in the value of SHA256 ALT coins could dramatically change the profitability of SHA256 mining.

My point is that if a coin is profitable to mine with gen1 ASIC then gen2 ASIC can merge mine it for no additional cost thus making it unprofitable for gen1. Not like Litecoin that can't be mined with SHA256 ASIC.

Maybe I'm misunderstanding your post.

I wasn't referring to merge mined coins when saying "SHA256 Alt Coins." Although, I wouldn't be surprised if one is as successful as Litecoin as well. I think Namecoin is a wonderful idea if fully implemented, also ZeroCoin looks very promising if it can come to fruition.

I get what you are saying, and perhaps for the reasons you mentioned, this will not have as substantial affect on SHA256 ALT coins as GPUs had for Litecoin. You make a good point that they will have to compete with gen2 ASICs and will never be as efficient or powerful as them. Whereas, Bitcoin ASICs can't be used to mine Litecoin so it is a bit of a safe haven for them for now, but Bitcoin ASICs gen2 can do everything gen1 could do. I agree those situations are completely different and perhaps I overstated the effect that unprofitable ASICs will have on SHA256 ALTS for this reason.

However, I'm not convinced that everyone will just throw their equipment in the trash after it is unprofitable. You think the people that are left with the fancy paper weights are just going to admit defeat and throw their ASICs in the trash? I think that they will look for some way to use these machines, and this use will be mining SHA256 ALTs. Sure, there will not be as much profit in it as mining Bitcoins, but there will be a small profit there. Also, if the influx of new users has the same effect on SHA256 ALT's prices, then there could be a huge potential profit.

Don't forget that a simple SHA256 Bitcoin clone can be merge mined alongside Bitcoin like it's the case with Namecoin or Terracoin.

Sorry but your analogy doesn't really hold: The reason Litecoin took off, is, as you pointed out, people could use former-bitcoin-hardware to mine them, while the bitcoin mining ASIC's couldn't be used.  2nd generation ASICs, on the other hand, can mine sha256 alt-coins just as well as 1st gen, so there's no reason to expect people with 2nd gen's not to mine them if they are more profitable at the time than Bitcoin.  Thus those with 1st gen ASICs will have no advantage at mining anything, and will basically have fancy paperweights.

I would like to preface this with the fact that I was one of the few people that saw the potential in Litecoin back in 2012. When everyone was busy selling their old GPUs and mining hardware due to the upcoming Bitcoin reward halving, I was instead busy buying the cheap hardware to mine Litecoins. Unfortunately, I went through some hard times late 2012 and early 2013, where I was unemployed and had to live off of my stash of crypto coins. Otherwise, I would be a millionaire right now (I was mining 500-1000+ LTC/day back then.) I kind of look at the Litecoin boat as having already passed. I still think it is a good investment, but it will not provide you the crazy returns that investing into Litecoin at $0.10 would have brought considering the current value is $2.34.

My original line of thinking when speculating on Litecoin was that soon GPU mining was going to become unprofitable on Bitcoin and there would be many new people switching over to Litecoin. New miners means the network is more secure, it adds people into the Litecoin economy, and provides more people that would want to see/help Litecoin be further developed (due to their new ownership of some Litecoins.) Thus, increasing the value of Litecoin (or speculated value), because of these factors and probably many more that I can't think of off the top of my head... any benefit of adding new people to the community could bring.

I see this same situation forming in Bitcoinland again and I expect the result to play out similarly, although there are a couple differences this time. The Bitcoin network difficulty is going up so fast so quick, that soon ASICs made on larger process nodes (60-100+nm) will become unprofitable in 2014 due to the amount of power they consume versus ASICs built on smaller process nodes (<60nm). This will leave many Bitcoin ASIC owners owning a paper weight. ASICs can only do what they are made to do, spit out SHA256 hashes- there is no other use for these ASICs.

Just like the GPU miners making lemonade out of lemons by mining Scrypt coins once their GPUs were unprofitable on Bitcoin, large process node ASIC users will do the same with SHA256 ALT coins. This large influx of new miners and users of SHA256 ALT coins will have a similar affect to what the new GPU miners did for Litecoin.

Keep in mind most of this post is speculation. I'm not sure which SHA256 coin is going to win the lottery, if any of them out of the ones that currently exist. Perhaps there will be a new one that comes out inbetween now and then that actually has some innovation and advantages to Bitcoin. All I am saying is the next coin to be entering massive hyper adoption will be a SHA256 coin, mark my words.

Thoughts/opinions welcome. Tell me I'm wrong, tell me I'm right. I love to speculate and discuss potential life changing investment strategies. I'm not in this to make chump change.. I want to buy an island after I cash out all my coins, not just a fancy dinner.