Topic: Selling Shovels In a Gold Rush, morons, lack of logic and more (Read 3976 times)

I don't think the shovel metaphor is that unreasonable - at least not to be told to STFU (I hope )

First there are still some who don't use pools so there is definitely a significant element of luck.

More significantly though, and something meowmeowbrowncow didn't mention is the fact nobody knows how many ASIC are going to hit and when. Even the number of ASIC manufacturers who will actually end up providing the goods is up in the air so even without USD/BTC exchange variance there is I would say a massive element of luck in whether ASICs will be profitable or not and for how long.

If there were just one manufacturer with the capacity to dwarf and drive out a significant proportion of current mining capacity I guess they'd have a reasonable chance of making a good prediction as to how much they're likely to make.  However by taking cash up front (and I'm not talking in the pre-order sense but in the sense of not having to wait for coins to be mined) these risks are mitigated.  The difference in risk might even make the difference between getting VC or not.  I would venture to suggest it would be a lot easier to convince a VC with projected sales on physical units versus 'The hardware will produce so many hashes which, depending on who else is out there will give us so many Bitcoins which, depending on what happens on the exchanges, may give you x return on your investment'.


@myself: I'm not saying I'm right.  Just that I don't think it's as retarded a point of view as you appear to think.

Thinking this should be in mining speculation forum.


My opinion.  It is not fully correct to equate selling pick axes to gold miners to selling btc mining gear.  It is correct that mining subsidy is always present.  What is not always present is a profitable USD/BTC exchange rate.

It is less risky and quite profitable to sell btc mining equipment despite the option of a profitable self mining operation.  Less risky by offloading tail risk/future risk of BTC/USD exchange rate to mining gear consumers rather than self mining.  In order for self mining to be more profitable than selling btc mining equipment such a large capacity of private mining equipment would need to be brought to bear that it risks undermining confidence in Bitcoin itself.  So, it is unfavorable to self mine, at large capacities, due to those two risk factors.

However, there is such a great advantage to deploying at cost ASIC equipment the risk of a self mining operation being unprofitable is very narrow.  So, yes, it's profitable and without serious risk to self mine at moderate levels compared to the overall network capacity.

For thought.

https://bitcointalksearch.org/topic/m.1412144

spot the shovel 

I will  use logic in this thread and i have a bad grammar so have patience and read few times if you need to get my point

Today there are some threads about some ASIC and stuff like that, I always asked why the fuck someone sell a ASIC ? ? ? and I always get a reply like this "selling shovels in a gold rush give you money" now I will explain why this answer is stupid or borderline retarded and anyone who use that answer should STFU

finding gold on the California during gold rush was a based on luck and it did made sense to sell shovels since the the profit for selling shovels is there and if shovels are sold the chance to get profit is 100% but the chance of finding gold is not 100%.

Plz note i used the word FINDING not producing, that means randomness.

This is not the case for bitcoin, the minting of bitcoins is based on production there will be 25 new BTC every 10 min no matter what happens there reward will always be there, most miners do mine on mining pools where the luck tend to 0% so there is a 100% chance of producing bitcoins no matter what, there is some luck variance for each block in particular so the mining pool gets  a block a bit earlier and the total share needed are under current diff and after it takes longer so the total share to get the block goes above current diff, this is the same when you flip a coin 10 times u dont get 50% 50% results but the more times you flip the coin more closer it gets to 50% 50%

Back to production, since the bitcoin is all production the more inputs you have you get more outputs, the more hash power you have more bitcoin you mint, ASIC is the best shovel out there (at least on paper), so anyone who have a ASIC will beat the competitors(other miners), so why should anyone sell them ? I don't know but profits efficiency is not one of them  

why should anyone sell a ASIC is beyond my level of comprehension


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