An interesting question is what happens to the buying and selling of Bitcoins. How long will transaction confirmations take then? If traders are forced to pay large transaction fees just to get a reasonable confirmation period, Bitcoin will be less attractive to use.
It would take one diff adjustment where transaction processing took longer, then after the adjustment it would be back to normal. The whole idea of the diff is to maintain a 10-minute block rate, right? If that's true, then if the diff drops big it should re-adjust downward enough to be able to return to a 10-minute block finding rate, thus transactions go back to normal. 
Topic: When payout per block halves, how will that effect difficulty? - page 2. (Read 3309 times)
So, miner manufacturers are making their most efficient miners unavailable except as bare ICs with which to design and build one's own miner or available as a 'buy a share of my farm running these efficient ASICs.'
Like Bitmain. Many of us expected to buy an S5 post-Chinese New Year. _Not available_, _Sold_Out_. Now I'm wondering if it would be worth it at all! I'm at a state of cashing in my mined bitcoins to pay the electric bill. Profit is a slim margin helped by the non-burning of propane for heat this last winter. Now I'm wondering if payoff of a new miner, after deducting electric costs and taxes, can ever be achieved! Bitmain still offers C1's for sale but my C1 uses more power than I'd like.
Like Bitmain. Many of us expected to buy an S5 post-Chinese New Year. _Not available_, _Sold_Out_. Now I'm wondering if it would be worth it at all! I'm at a state of cashing in my mined bitcoins to pay the electric bill. Profit is a slim margin helped by the non-burning of propane for heat this last winter. Now I'm wondering if payoff of a new miner, after deducting electric costs and taxes, can ever be achieved! Bitmain still offers C1's for sale but my C1 uses more power than I'd like.
I think the bigger risk is that they already have come up with the next best tech in mining and might already be mining on that.
By the time it hits the customer, it is too late.
So, miner manufacturers are making their most efficient miners unavailable except as bare ICs with which to design and build one's own miner or available as a 'buy a share of my farm running these efficient ASICs.'
Like Bitmain. Many of us expected to buy an S5 post-Chinese New Year. _Not available_, _Sold_Out_. Now I'm wondering if it would be worth it at all! I'm at a state of cashing in my mined bitcoins to pay the electric bill. Profit is a slim margin helped by the non-burning of propane for heat this last winter. Now I'm wondering if payoff of a new miner, after deducting electric costs and taxes, can ever be achieved! Bitmain still offers C1's for sale but my C1 uses more power than I'd like.
Like Bitmain. Many of us expected to buy an S5 post-Chinese New Year. _Not available_, _Sold_Out_. Now I'm wondering if it would be worth it at all! I'm at a state of cashing in my mined bitcoins to pay the electric bill. Profit is a slim margin helped by the non-burning of propane for heat this last winter. Now I'm wondering if payoff of a new miner, after deducting electric costs and taxes, can ever be achieved! Bitmain still offers C1's for sale but my C1 uses more power than I'd like.
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
Using the same argument, why don't you think that most of the miners are alreayd giving up(looking at the low prices ) ?
Shouldn't we also expect a drop in difficulty right now ?
https://blockchain.info/charts/hash-rate This doesn't seem to indicate that.
Shouldn't the hash rate actually go down knowing the sites like C_Cex shut down mining.
I expected to see a drop in hash power as well.
Yes. My point of showing the graph was that not many miners are quitting due to the low prices.
But, that won't be the case on the day reward halves - perhaps as early as Jan. 2, 2016. That day it won't be a case of the home miner wondering 'Well maybe the price has dropped a little below the cost of mining but the price could go up and then I'll be kicking myself for not mining bitcoins that now would have a value greater than their mining cost'. No. The off switches will be flipped and home miners will wait for the value to rise to profitability. Same with large commercial farms that are operating in a hotter climate with somewhat better electric costs.
An interesting question is what happens to the buying and selling of Bitcoins. How long will transaction confirmations take then? If traders are forced to pay large transaction fees just to get a reasonable confirmation period, Bitcoin will be less attractive to use.
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
Using the same argument, why don't you think that most of the miners are alreayd giving up(looking at the low prices ) ?
Shouldn't we also expect a drop in difficulty right now ?
https://blockchain.info/charts/hash-rate This doesn't seem to indicate that.
Shouldn't the hash rate actually go down knowing the sites like C_Cex shut down mining.
I expected to see a drop in hash power as well.
Shouldn't the hash rate actually go down knowing the sites like C_Cex shut down mining.
I expected to see a drop in hash power as well.
I expected to see a drop in hash power as well.
If they sold off their gear to recoup expenses, there'd be a slight dip between when they shut down and when buyers turned those machines back on. Overall hashrate is affected by retired gear, not relocated gear.
Difficulty is almost always rising. Profit has gone to a low level compared to last year. Miners get more efficient. To stay profitable one must have an efficient miner. How many early ASIC miners have already been retired for lack of efficiency.
So, when payout per block halves, if profit has been cut to a more fine margin at the current rate of 25btc/block, what happens? Will difficulty change allowing power for solving a block to be halved? Or will we all need to either stop mining or mine at a loss?
It's all guesswork. The block reward has only been halved once so far, in the run-up to that we saw the price of Bitcoin increase. What will happen next time is anyones guess.
That's a good point. I wasn't around for the last block halving so I don't really know what folks were doing then. It'd sure be nice if the coin price went up this time, though really I wouldn't be too upset if a lot of big farms had to shut down. It's fun when high rollers lose to the house.
Difficulty is almost always rising. Profit has gone to a low level compared to last year. Miners get more efficient. To stay profitable one must have an efficient miner. How many early ASIC miners have already been retired for lack of efficiency.
So, when payout per block halves, if profit has been cut to a more fine margin at the current rate of 25btc/block, what happens? Will difficulty change allowing power for solving a block to be halved? Or will we all need to either stop mining or mine at a loss?
It's all guesswork. The block reward has only been halved once so far, in the run-up to that we saw the price of Bitcoin increase. What will happen next time is anyones guess.
Maybe the invisible hand of the market place will make the value of BTC reflect cost of production versus reward.
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
Using the same argument, why don't you think that most of the miners are alreayd giving up(looking at the low prices ) ?
Shouldn't we also expect a drop in difficulty right now ?
https://blockchain.info/charts/hash-rate This doesn't seem to indicate that.
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
Using the same argument, why don't you think that most of the miners are alreayd giving up(looking at the low prices ) ?
Shouldn't we also expect a drop in difficulty right now ?
Why don't I think that? Because the price right now is better than it's been in months and there's still profit to be made. Once the block reward halves, the payout from mining will be cut in half while the costs will remain about the same, but the production cost of those 12.5 bitcoins won't have much effect on the perceived value of the other 16 million bitcoins already available. So no, we don't expect a drop in difficulty right now because approximately everyone is still actually making money from mining. "Using the same argument" doesn't apply to anything that happens before the halving unless the price of BTC were to halve overnight. When that did occur (or nearly so, second week of January) what happened to the diff? Pretty sure it was negative two changes in a row while people turned off gear that wasn't profitable anymore. And then the price went back up, and so did the diff. The diff increases on average if mining bitcoins is profitable on average. The diff decreases on average when profitability decreases. When the block halving occurs, the total supply of coins won't be changed substantially but the dollar value of solving a block will be halved so profitability will take a huge hit, masses of gear will be turned off and the diff will drop. Unless somehow the price also goes up quite a bit, which is not likely since, as mentioned, the total supply of coins won't be changed substantially so the supply/demand curves won't move very far. Unless bitcoin's perceived utility increases, the price will not.
after block halving the price of bitcoin will go to moon and more people will be interested in mining that will increase the difficulty also
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
Using the same argument, why don't you think that most of the miners are alreayd giving up(looking at the low prices ) ?
Shouldn't we also expect a drop in difficulty right now ?
Very rough math after looking at the Wiki (https://en.bitcoin.it/wiki/Controlled_supply) working with same expected rate of change (almost certainly wrong given that difficulty slope has changed so much this year) the fourth reward era of 25btc/block might occur on May 31 this year. Then the first reward era of 12.5btc/block might be Jan. 2, 2016. Again, the slope has gotten closer to level while it had been so very steep in earlier years so that 1/2/16 is probably much later, perhaps the spring? The wiki page showing start of the last reward era of 25btc per will tell the tale and give a look at what we can expect regarding when that next era starts.
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
So, the immediate effect is return halves for the same work. Miners are turned off. Blocks are found much less frequently but the day to day cost of power remains the same and not only is the payoff per block halved to 12.5btc but the payouts are less frequent. Sounds like a disaster. The next difficulty then will be an quick drop. Some miners are powered up again. Blocks are found more quickly than expected and difficulty goes up after a short duration?
Difficulty will only drop if a lot of farms turn off their gear. It's likely that most folks will be mining at a loss for the first period after the halving. What sucks is, since mining only alters the total supply by a fraction at a time, the supply/demand curve won't be moved very much at all by the halving so it won't have much effect on the exchange rate.
Difficulty is almost always rising. Profit has gone to a low level compared to last year. Miners get more efficient. To stay profitable one must have an efficient miner. How many early ASIC miners have already been retired for lack of efficiency.
So, when payout per block halves, if profit has been cut to a more fine margin at the current rate of 25btc/block, what happens? Will difficulty change allowing power for solving a block to be halved? Or will we all need to either stop mining or mine at a loss?
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