Topic: What would happen with mining profitability if the difficulty didn&#039;t change? (Read 1445 times)

Quote from: navigator on July 09, 2015, 11:45:40 AM

Quote from: navigator on July 08, 2015, 07:59:23 PM

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible. It is a very very very small chance it ever happens. It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back. This proves there can be the conditions there, but the community does actively stop it in the past.

But it's risky to have the top 3 pools accounting for 51% of the total hashrate, right? And why EXACTLY 51%? Just a coincidence?

I sleep nice with it split 3 way's. That actually is not a bad split. No way 3 mining pools get together and destory bitcoin. Just will not happen.

If it was 1 pool with 50 percent or high 40's yes I would be worried. Just like with Ghash back in the day. But we have moved a lot and not one pool has the 51 currently.

How can you be so confident that the three pool operators wouldn't decide to attack together? They may have some secret relationship. I will ask again: Why do the three top pools account for EXACTLY 51% of the total hashrate?

notlist3d

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Quote from: acaciosc on July 09, 2015, 05:22:47 PM

Quote from: notlist3d on July 09, 2015, 05:18:49 PM

Quote from: navigator on July 09, 2015, 11:45:40 AM

Quote from: navigator on July 08, 2015, 07:59:23 PM

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible. It is a very very very small chance it ever happens. It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back. This proves there can be the conditions there, but the community does actively stop it in the past.

But it's risky to have the top 3 pools accounting for 51% of the total hashrate, right? And why EXACTLY 51%? Just a coincidence?

I sleep nice with it split 3 way's. That actually is not a bad split. No way 3 mining pools get together and destory bitcoin. Just will not happen.

If it was 1 pool with 50 percent or high 40's yes I would be worried. Just like with Ghash back in the day. But we have moved a lot and not one pool has the 51 currently.

acaciosc

full member

Activity: 325

Merit: 100

Quote from: notlist3d on July 09, 2015, 05:18:49 PM

Quote from: navigator on July 09, 2015, 11:45:40 AM

Quote from: navigator on July 08, 2015, 07:59:23 PM

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible. It is a very very very small chance it ever happens. It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back. This proves there can be the conditions there, but the community does actively stop it in the past.

But it's risky to have the top 3 pools accounting for 51% of the total hashrate, right? And why EXACTLY 51%? Just a coincidence?

notlist3d

legendary

Activity: 1456

Merit: 1000

Quote from: navigator on July 09, 2015, 11:45:40 AM

Quote from: navigator on July 08, 2015, 07:59:23 PM

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

I would say currently practically impossible. It is a very very very small chance it ever happens. It would take someone in a main pool/pools wanting to hurt bitcoin which normally does not help them long run.

Look at ghash they had the amount of hash a while back. This proves there can be the conditions there, but the community does actively stop it in the past.

acaciosc

full member

Activity: 325

Merit: 100

Quote from: navigator on July 09, 2015, 11:45:40 AM

Quote from: navigator on July 08, 2015, 07:59:23 PM

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

Well, but a 51% attack is practically impossible... Unless a malicious person takes control of the top three pools... Which are EXACTLY at 51% of Hashrate distribution!

navigator

sr. member

Activity: 362

Merit: 250

Quote from: navigator on July 08, 2015, 07:59:23 PM

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

It's usually said to be the opposite, that difficulty follows price. I think it's more convoluted than that. If price shoots up then more miners are added to compensate. But if price falls then miners will leave. But if too many miners leave then this leaves a lot of unused hardware that someone could scoop up and use to destroy bitcoin by 51% attack. So I think if price falls too much and some miners leave, then remaining miners will want to save bitcoin from attack and will either mine at a loss or stop selling mined coins so low causing price to go back to an equilibrium.

So price can shoot up and difficulty can easily follow to very high numbers. But if price falls enough to cause 50% of miners to turn off then we have a problem. I hope that we wont let that happen which also seems to create a price floor that gradually moves up.

acaciosc

full member

Activity: 325

Merit: 100

Quote from: Amph on July 09, 2015, 03:14:34 AM

Quote from: acaciosc on July 08, 2015, 01:03:03 PM

Quote from: Amph on July 08, 2015, 01:27:39 AM

Quote from: acaciosc on July 08, 2015, 01:03:03 PM

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually?

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

Seriously? Of course there are physical limits to place miners. Regardless, even if a really huge amount of PH/s came to the Bitcoin network, we would still have numerous SHA256 cryptocurrencies. Therefore, there is no need to worry in the long term, right?

yeah but the limit is far away that no one will ever reach it, come on.. you can't even dream of occupy the entire accessibility of the planet with asic..,.

not sure about numerous crypto, because every other sha256 is dead now, there were some good one in the past but it's not the case anymore

also don't forget about miner efficiency, will be improved in the future

Yeah, but saying that "there is no real limit vertically" sounds too wrong. What about peercoin? It's a POS/POW with also a great name AND sha256. I don't know what you meant with miner efficiency being improved in the future. If you mean in a sense that power consumption will be even lower, of course it is going to happen, but as I said before: Not as much as today. But since the price follows the mining difficulty, I conclude that mining will always be profitable, regardless of being Bitcoin or altcoins (except shitcoins, obviously).

GotaPauj

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i think if the difficulty didn't change, then time by time the mining hardware is going to be stronger/faster and the profit will increase

Amph

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Quote from: Amph on July 08, 2015, 01:27:39 AM

Quote from: navigator on July 08, 2015, 07:59:23 PM

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually?

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

Seriously? Of course there are physical limits to place miners. Regardless, even if a really huge amount of PH/s came to the Bitcoin network, we would still have numerous SHA256 cryptocurrencies. Therefore, there is no need to worry in the long term, right?

yeah but the limit is far away that no one will ever reach it, come on.. you can't even dream of occupy the entire accessibility of the planet with asic..,.

not sure about numerous crypto, because every other sha256 is dead now, there were some good one in the past but it's not the case anymore

also don't forget about miner efficiency, will be improved in the future

acaciosc

full member

Activity: 325

Merit: 100

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

Thank you very much for that graph. From what I understood now, the Bitcoin price will always follow the difficulty? If so, Bitcoin looks a great and practically safe investment.

navigator

sr. member

Activity: 362

Merit: 250

I've posted this elsewhere before, I think this chart shows a sort of equilibrium now
https://bitinfocharts.com/comparison/difficulty-price-btc.html#log

acaciosc

full member

Activity: 325

Merit: 100

Quote from: Amph on July 08, 2015, 01:27:39 AM

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually?

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

Seriously? Of course there are physical limits to place miners. Regardless, even if a really huge amount of PH/s came to the Bitcoin network, we would still have numerous SHA256 cryptocurrencies. Therefore, there is no need to worry in the long term, right?

Amph

legendary

Activity: 3248

Merit: 1070

if the difficulty is stable it mean that the price isn't going up, so that would be their limiting factor, if you add the other limiting factor which can be "space", then their profit would remain stable, assuming that everyone is limited

if the price keep increase they will earn more that's obvious...also their efficiency will be greater in the future, so it's possible for them to replace their old miners and dumping less coins for electricity, which is equal to an additional profit

But there will be a time where miners won't have all that much room to improve. It's what happening right now, by the way: Few years ago, Bitcoin ASICs used to waste WAY more than 2W per Gh/s and now it usually wastes less than 1W, but actually it's decreasing slightly (0.6W, 0.5W and so on). A Bitcoin ASIC wasting less than 0.0000000001W? No way.

In a scenario where Bitcoin ASICs wouldn't improve anymore, would mining continue to be still as profitable as it is actually?

assuming that they would run out of space is a bit still, you can fit trillion of asic in this world, there is no real limit vertically, and despite this it would still be profitable, if none of the farms will be bigger in the future, why it shouldn't be profitable if the price remain there?

as long as the price remain there or will be higher there will be always profit to be made

acaciosc

full member

Activity: 325

Merit: 100