Topic: Three Men Mine $200,000 In Bitcoin Every Month - page 7. (Read 11968 times)

Yes, it is a flaw when compared to something like Bitshare's delegated proof of stake, which has fixed the "nothing at stake" issue with other PoS coins.. among other things. Seeing as though DPoS uses a fraction of the energy to protect the BitsharesX block chain just as securely, this is a vast improvement in and of itself. Furthermore, using dPoS you can increase block speeds to 10 to 30 seconds without seeing the problems that you would see using PoW (stales, forks, etcetra.) http://bitshares.org/delegated-proof-of-stake/

You actually can get discounts on electricity if you use a lot of it from certain companies, but there are other ways they can gain advantage.

Obviously someone setting up a large farm such as this has pretty deep pockets. Someone with deep pockets can order many more mining rigs than joe blow, which reduces his percentage of the network, which reduces joe blow's profits. This could be done (as we are seeing) to an extent that joe blow will never break even (in BTC... that's all we care about). Do you think joe blow will continue buying mining rigs if he can't break even? They can push him out of the market. The fact that most mining manufacturers offer bulk pricing only exemplifies this.

Another way they could gain an advantage is by investing money in manufacturing their own ASIC mining chips, PCBs, and assembly lines. In that scenario they would be paying a fraction of the price for a mining rig that runs at the same speed as joe blow (even more so than bulk discounts). Which allows them to purchase more mining rigs, further reducing the cost of the mining rigs, and therefore further reduce joe blow's portion of the network.

That is true, but if they can achieve a certain percentage of the network they will easily operate at a profit. Especially when they are getting the mining rigs much cheaper than average consumers via bulk discounts or manufacturing their own. If it wasn't wildly profitable, why would large manufacturers like KNC, Avalon, Bitfury be making these massive farms in the first place? I know how much of a headache a large farm is to setup and run.. I find it hard to believe they would do it if it wasn't highly profitable.

Because of the reasons I've stated above. Sure, the little guys have access to the most recent hardware, but they are paying much more for that same hardware than the large farms and manufacturers are paying. They are at a disadvantage from the get go. To make things worse, a lot of the little guys are closing up shop and moving on. I mean.. if you bought mining hardware and you lost a lot of Bitcoins doing so (IE. did not break even), would you keep buying mining hardware? It is still profitable for large farms and manufacturers, but not so much for the little guys. In my ASIC investments, NONE of them have broken even, and I know I'm not alone. I will never buy a Bitcoin ASIC again in my life.

Yes, I would consider both of those processes wasteful of natural resources, and potentially the downfall of humanity living on planet earth at some unknown point of time in the future. If gasoline engines weren't such a bad thing for the environment and wasteful of natural resources, then why is there so much effort being made to move beyond gasoline with the use of alternative fuels? Do you not understand how many natural resources are wasted during the process of generating electricity, how the environment is negatively impacted while doing so, and why using less electricity is beneficial to that problem?


There haven't really been any good solutions to PoW until very recently. There have been different variants of PoS that all suffer from various flaws. Only until recently have most of those flaws been fixed. A change like this (from Bitcoin to something else) will take time. The use of gasoline is actually a great analogy, I am glad you brought it up.

There are issues with the use of Gasoline just like there are issues with Bitcoin, both are not perfect for a few similar reasons (harmful to the environment and waste of natural resources.) Yet, Gasoline and Bitcoin will be around for a long time because of the infrastructure that has been built by both of them. In gasoline's case there are billions of vehicles, power tools, planes, etcetra that use it... to switch to an alternative we would need to rebuild these or design and build new ones. In Bitcoin's case the exchanges, ATMs, payment processors, etcetra are already setup to work with Bitcoin... to work with another crypto currency would require reprogramming just about every core service involved in the Bitcoin ecosystem. Costs are another thing holding gasoline and Bitcoin alternatives.. it is expensive to develop alternative technologies.

The advancement in technology is still being improved upon, but better technological alternatives certainly already exist for both gasoline and Bitcoin. It will take time, how long is anyone's guess, but I am certain that both will be uprooted as the king of fuel (gasoline) and the king of crypto currencies (Bitcoin) at some point in the future. Gasoline is definitely not the only example, all technologies come and go as better technologies replace the less adequate technologies. The transitions from VHS to DVD to Blu-ray took a lot of time. Along with the transition from Records to Tapes to CDs to MP3s to FLACs took a lot of time. I could go on and on with these examples..

Notice the more technological advancements happen at a quicker pace.. I don't see why this couldn't be applicable to Bitcoin as well. It is after all much cheaper to reprogram something than to rebuild all the vehicles, power tools, etcetra in the world. Furthermore, gasoline has many other factors why it is probably the best option for the foreseeable future, but Bitcoin has less so.


I just assumed by your reply that you could think through the above reasoning yourself and understand it, yet still chose to call me out for being wrong because you own a lot of Bitcoins and want to protect your nest egg. Many people (individuals, companies, and corporations) are heavily invested in the current system (gasoline and Bitcoin), and profit from it. They are hesitant to allow change and will spend any amount of time, effort, and money that it takes to thwart the opposition because it is how they sustain their lifestyles and provide for their families. I apologize if my assumption was incorrect. If my reasoning is wrong, then please explain how I am wrong. Sometimes I do a horrible job of conveying exactly what I am trying to say, even though it makes perfect sense in my head.

Those three guys got it good. I wish I was an early adopter.

PSUs burn like bitches in a desert hotty summer.

Good analysis.

None of the ASIC bitcoin miners are profitable. Should btc price keep dropping, they will not only lose out on ROI but also taking hit on price dropped also.

#3 - The huge ammount of silicium and metals wasted with the hardware:




That is, waste of limited resources that might be scarce in the future.

Also the mining operations will be centralized also among countries, since only first world countries can afford such race. Usually 3th world countries don't have access to up to date hardware stuff, and mining stuff is not an exception

Hot damn wish I could do that as well have a few miners around and play games all day
That would be awesome stuff.

“It becomes louder and louder the closer you get to the building, and as you step through the doors it becomes a deafening and steady roar,” he says, then offers this soundbite:

A truly soothing sound ^_^

Then comes the wind from giant cooling fans, and despite their efforts, heat. Smith says the inside of the farm still manages to hold “steady at 40° Celsius (105° f) the entire time”.

(^_^ a true greenhouse) In the sense of this versus printing fiat still the profitability ROI may take a while with the difficulty always increasing neat though. Currently, you can buy a rig that returns a single bitcoin every nine days for around $2500.

KnC has three mega data centers with 7,000+ miners each on the same property own by Europe Facebook at the Node Pole.

I am surprised that people think that any coin can overtake Bitcoin. Everyone should be aware that it is practicaly impossible. Most of those altcoins are just pump and dump thing an if Bitcoin ever fails only coin that could take its place is Litecoin. But that is just not gonna happen!

damn. I wanted to download that soundcloud of the mining drone. goes nicely with my Atrax Morgue and Brighter Death Now mp3s.

Exactly. This type of thing is the major threat to Bitcoin and I would not be surprised if long term, another coin takes over (NXT; ETH?). Centralization is dangerous and the waste of energy makes BTC vulnerable because it can be used to attack BTC ("too much CO2")

I would love it to be this way for myself. But I am quite sure there is lot of work with maintaining their farm. But still I am also sure they are enjoying every minute of it.

Wow that is awesome..playing games while making tons of money....dream job

At least I'm not a fanboi that only cares about his special interests and can admit Bitcoin has flaws.  

That looks like a super impressive operation.  60k per month electric bill...that is like a hotel..

But this is small compared with the one in Washington D.C. mentioned in the article. And there's a video of it too.

https://www.youtube.com/watch?v=5CjldZLXiAU

After looking at the calc in franky1's post at https://bitcointalksearch.org/topic/m.8370294, I'd say these guys could make their big $BUCKS refurbishing these outdated computers, and selling them through Tiger Direct or something.

they are not wage slaves, they can quit if they want to, the fact that they work at this job means its the best opportunity they have, without it they would be worse off.
the capitalist does no work, but he takes all the risk, the workers get paid no matter what, the capitalist could take heavy losses and lose everything.

Firstly, this points out two of the biggest negatives of PoW.

#1 - The centralization of PoW mining will become more and more centralized over time, because big operations such as this will make the little guys unprofitable and therefore push them out of the market.
#2 - The huge amount of electricity that is wasted needlessly with PoW.

Secondly, it's nice to see where our "June 2013" Avalon deliveries went and the reason for the 2 month delay.. these guys have some balls allowing a news story about this.

Thirdly, again these guys have big balls... if I was operating such a large mining farm I would tell no one. Otherwise, I wouldn't be able to sleep at night thinking someone may break in at any moment or hold me hostage to get the location of the equipment. All they did was black out their eyes...

they should have tried to remain anonymous.

Just as well they covered the eyes of those guys otherwise they could be recognised!