Topic: Who will be mining a year from now? (Read 2496 times)

But today's diesel family hatchback is faster, safer and more comfortable than the supercar of the 80s.

Less than a year ago I was excited about hitting 500MH/s.  Now I've got 30GH/s, with another 10GH/s on it's way (some soon, some BFL slow).  I'm only a hobbyist, and only buy mining hardware paid for by mining.

The chart is less than two months worth, it's almost all ASIC, the entire CPU,GPU,FPGA net hash was like 50TH/s. or less at it's peak.

What do you think difficulty will be at?
35 billion is certainly within the range of possibility

Referencing historical charts is folly. 

The charts represent disruptive leaps from CPU to GPU to FPGA to ASIC technologies.  ASIC is the pinnacle.  Charts from the ASIC period onward will be relevant, but right now the charts show horse and buggy, Model T's, '57 Chevy, and 2013 supercars. 

Wake me when it shows just supercars.

lmao!! I knew I forgot one critical element in my whole ROI calculation with regards to my BFL purchases. I forgot to freakin have kids!! Talk about a serious oversight on my part.

...or maybe there's a whole different situation after all. Anyone sees a pattern here?

35 Billion?  Care to make a bitbet to that effect???

I can use my mining rig to heat my gym room this winter. I don't know if I'll be mining in a year from now. I've been looking at it 60 days at a time. It doesn't seem to make sense to add more mining hardware in my tiny house. If Bitcoin is still something I'm interested in 12 months from now, I'll probably be buying them or earning them rather than mining them.

Bookmark this thread!

Here is what mining will be a year from now:

- All miners will use 28nm technology.
- Miner power consumption will be roughly 0.5w per GH/s
- The speed of a medium-sized mining machine will be 1 TH/s, but there will be 2+ TH/s machines available. There also will be plenty of smaller machines in the 200 GH/s range.
- The medium-sized 1 TH/s machine will cost in the hundred of dollars range. Probably $400 to $750.
- Difficulty will be around 30-35 billion.
- The vast majority of mining will take place in areas of the world with cheap electricity.
- The average Bitcoin enthusiast will fit into one of two categories:
    - Miners who have very cheap or free electricity (perhaps in an apt or dorm room where electricity is include). They will pay off their device in roughly 6 month to a year and make a very small profit.
    - Miners who do not have cheap electricity but choose to mine for fun or simply to secure the bitcoin network.

I'll be mining my gear until I get no coins anymore. The cold months are beginning so for the next few months I view the electricity costs as heating expenses (heater won't have to be turned on as much so I save what it costs me for electricity) and only look at how much coins I get in.

I tend to believe too, that the transaction fees will be the reward of the future. As per mining; most possible I will be mining too forever no matter the electricity bill. My 60GH/s will render itself non profitable within a month (or two) from now according to the genesisblock calc (I was hoping for May-June '14). I got it for 30BTC back then, and most possible it will never manage to make the half of it...  but I don't really mind, as long as I see the stats rising and the fans spinning.

I'm surprised no one has mentioned transaction fee's yet.
As the reward per block goes down over the years, transaction fee's will become the dominate bitcoin return.


As far as mining, or not. If the goal is to end with the most btc in a given period of time, then with these conditions you'd be foolish not to just buy them directly and hold em.
Mining at a loss, is just..... lost. 

I will be mining possibly forever, BTC price is being held down (my opinion only) I am happy for mining to actually cost me a little at the moment (plus it actually saves on heating in the winter) as I believe I will reap the benefits a few years down the line.

One thing I think could really mess up the big data center miners is if Bitcoin-QT was extended to support small scale mining per node with a shared pool across all nodes.  Many people interested in Bitcoin wouldn't mind the cost of a sub $20 Block Erupter USB and the 2.5W of power consumption.  Get a few thousand nodes out there running these, seeing a steady trickle of BTC as a reward, and it keeps the mining level at a degree where it isn't profitable for the data centers while still providing plenty of blocks to secure the network.  My $150 investment (7 x Block Erupter USB + hub + fan) won't ever turn a profit but at least it will keep the network safe and sound.

I am pretty sure eventually ALL ASIC companies will be selling bulk chips.  HF is talking about somewhat of a middle road in selling bare modules (the ASIC PCB) and letting third parties assemble them into larger systems (host, connectivity, power, cooling, case, etc).  There is certainly a business precedent for doing it.  Look at AMD.  AMD sells no video cards anymore.  They just sell millions of GPU chips and license reference designs to OEMs who sell to the general public. 

I understand there is added value to a datacenter however Bitcoin is all about margin and efficiency.  At $0.20 per kWh (no matter how super duper wonderful it is) it is unlikely you can remain competitive for any extended period of time (say 12-18 months). For example difficulty could rise so high that you have a negative operating margin but someone with lower input costs can still buy MORE rigs because power is only 30% of their gross revenue.

Call it a "glorified" warehouse if you want but if your plan doesn't have a lower marginal cost you have no hope to profit on any long term scale.  The break even efficiency is going to be set by people with lower input costs then you.   Iceland has decent power rates (most of Europe is a dead end for commercial scale mining) but it isn't anything unusual.  The northwest of US has similar low power rates, and mild climate.   I agree with the larger context in looking for low input costs and mild climates just pointing out long term paying $0.20 per kWh using ASICs makes about as much sense as paying $0.20 per kWh using GPU.


Datacenters (anywhere in the world) are going to be money pits for commercial scale mining.   The largest input is the energy cost,  rent is generally cheap.  Hell you could throw in chiller cooling, 24/7 security, and fire supression and end up with an amortized cost of less than $24,000 annually per rack.

One of the things that is happening is the ASiC suppliers are focusing on big farms and not small miners, that trend will continue,  however some ASIC suppliers will end up just selling bulk chips, so the DIY market should continue although it will lag behind the corporate farm shipments. Remember that it's  the lowest Wattage per GH/s that will end up winning, as ther is no such thing as free electricity.

Again, that price isnt for electricity, its for a full service datacenter rack. If you want a glorified warehouse, I still think Iceland could be the perfect place to build it. A few years old, but try to beat this:


Dirt cheap, 100% green and geographically not in the worst place imaginable inbetween the EU and US.

"My garage" was tongue in cheek not a serious offer however you will be competing against people who's costs are much lower.

I didn't realize the price was in Euro well that is just horrible (~$0.20 per kWh).    Like I said not bad for a datacenter but the margin on mining is going to be a lot lower.  When industrial space (think racks in a warehouse) is cheap in parts of the US and China and marginal power rates are $0.05 paying more than double just means you will be the "marginal miner".

I know, but your garage doesnt supply 99.995% SLA's, nor did you include cooling costs (if you have several Sierra's), you probably have very limited theft prevention, no one on 24/7 standby etc. The fact the first quote I asked for a single rack is already competitive with most of our electricity rates alone bodes pretty well. I"ll see if I can work something out.

Oh and your garage probably doens thave 100% green energy. Even if it does, you would be using green energy that would otherwise replace non green energy elsewhere, making no real difference whereas in Iceland it really wouldnt contribute to pollution at all. They have far more (100% green) electric capacity than they can use.

PS, price was in euro, not dollar.

$1500 / (14 * 24 * 30 ) = $0.15 per kWh.

Not bad for datacenter but hardly "super cheap".  You could use my "datacenter" = garage and get rates 30% lower.   Some parts of the US have power rates under $0.05 per kWh.

Your colo clients will be the first to go. The thousands of home miners completing with the large colo clients don't have to pay colo costs including running aircon and your wages. Just wait and see. BTC was designed to absorb all the margin with rising energy costs, until only the rigs with low overheads are left standing.

Ive been looking in to collocation options. The cheapest electricity anywhere is in Kuwait, but doing business there as a foreigner seems almost impossible.

Iceland seems like a compelling alternative. They have way too much green energy there. Thats not unimportant to me, if bitcoin ever goes mainstream, the amounts of electricity it will use becomes quite scary. At least in iceland your miner wouldnt be burning coal or oil, but tap in to an almost an infinite supply of geothermal energy thats currently unused.  Connectivity in iceland isnt the best, but more than good enough (3 independent fiber connections to UK, Denmark and Greenland) for bitcoin.

Nice side effect of their geothermal energy is that electricity is relatively cheap.  I asked a quote, for a full rack in a level 3+ datacenter, using 14 kW (thats their limit) it costs ~1500 euro per month. It could house and power 17 HF Sierra's (@800W) so thats 88 euro per month per sierra, all in.  Thats cheaper than many EU and US miners would pay for electricity alone and I havent even tried talking the price down or checking elsewhere. I did check if liquid cooling was a concern, and its not.

IM considering renting a few racks there for bitcoin miners.

Large farms mostly.  All my new clients are getting bigger with the amount of gear they are throwing at this.

I would add Avalons and BFL (65nm) rigs.   They will only be operational in areas with insanely low power costs.  Say <$0.05 per kWh.



Well it isn't that ASICs would infringe upon CPU/GPU production it is simply that 22/20nm is cost prohibitve especially for a product.  Other than Intel (who uses their own fabs) the first 22nm customers are cellphone chips.  For something like a cellphone paying 3x the cost per mm2 of silicon is worth it if you can cut power consumption by 30% or more.  For an ASIC miner not so much.   Generally it takes ~3 years before a new process node has a lower cost than the prior node.  That means there won't be smaller than 28nm tech until late 2015 at the earliest.


Still even with efficiency "capped" at 28nm there is a huge spread.  An Avalon is 8.8 J/GH and a ASICMiner blade is >7.5 J/GH.  HF and Cointerra are promising ~0.8 J/GH.  Bitfury achieves roughly that at 55nm so with a die shrink to 28nm they could be even less (<0.5 J/GH?).  You are looking at a 11x (potentially 16x) spread between least efficient and most efficient hardware.  This is something we never saw in the GPU era.

Another way to look at it is when difficulty is so high that an Avalon miner with $0.05 per kWh electrical rate is underwater (electricity cost > BTC value) a HF miner with higher $0.10 per kWh electrical rates will only be spending ~ 20% of gross revenue on electricity.  At some point the least efficient miners won't make sense anywhere.

Exactly this. A worldwide army of renters (with free electricity) and college students will keep the difficulty high enough to prevent a corporation or government from overpowering and destroying the network. I hope.

Personally, I'll keep mining just for the lulz.

Almost all ASICs that are currently mining or are in preorder will still be mining a year from now, with possible exceptions for USB Block Erupters, maybe ASICMiner Blades and of course units that have malfunctioned.

While most ASICs will never earn back their initial cost, they're energy-efficient enough to still generate a positive net income even if the difficulty jumps up by more than an order of magnitude. So while ASICs that are currently out on the market may switch owners once or twice as current owners try to find a way to cut their losses, they will still continue to mine.

Of course, the difficulty-explosion is due to come to an end somewhere next year. ASICs are already at the level of 28nm feature size. There isn't much room to improve before you start to infringe on the area of CPU/GPU production and that market is still massively larger than the BTC mining market, so I don't see mining ASICs going significantly below the 28nm feature size anytime soon, putting a cap on the efficiency of any new models in the next year.

I won't be mining 3 months from now.

BFL customers will still be mining. They will ignore electricity costs and their children and grandchildren will still be mining 50 years from now, still hoping to break even on their ancestor's investment. Or at least on the $1400 "express shipping" fee of their mini rig.

These threads pop up ever week, and it's the same story. The people that will be still mining in a years time, are the ones that don't have to pay for air conditioning, data center space, and staff wages. So that pretty much means the thousands of small home mining rigs. The big corporate farms have way too many overheads, and they will just fold each out out of business.

I just sold my BFL preorder 2 days ago (a 60 gh/s unit) for 9 btc.  It should ship in a few days.
It was an upgrade for an Fpga unit that had just barely given ROI. I only needed to clear about $750 usd to break even, and I figured I still could. My price on the BFL classifieds page was below average and I got several offers. I think of the sale as a kind of 'pre-mine'. I figure I can use the coins now to buy bonds or a CD on coin traders and be better off with interest income. So after mining for 8 months and planning on ramping up for the next year, I'm now totally out of the mining game. I'll take a look at it again in the Spring.
Always an interesting ride with bitcoin....

I've been watching the cost of mining hardware on E-bay, just for fun.

BFL Little Singles (30 GH/s) are down from about 1100-ish to 900 -ish. (original retail $649)

Biggest drop seems to be the Singles (60 GH/s units), list price at $2499, in hand units are not even going for current retail price.

As for ASICMiner stuff, blades use to go for $3000-ish, now down to $300-ish.

Bitfury starter kits at about $1100ish.

Block erupter USBs for $17 bucks and change.

I'm predicting a HUGE drop in mining gear prices, once people realize that it's not worth it to buy anything at 250 million difficulty, and climbing.

The bus has left the building. Unless you have half a terahash mining tomorrow morning or right now, you ain't making squat.

Of course, some people do not really care, and they are securing the network, making a little on the side. Nothing wrong with that either.  

The network self-regulates itself. It's a beautiful thing.

If some miners stop mining then difficulty goes down and those remaining miners get paid more.  The network needs someone to mine, it doesn't necessarily need you to mine.  If your electrical costs are too high, your rig too inefficient, or you simply overpay then you may never turn a profit.

If it doesn't even pay the electricity you shut the device down and buy bitcoins instead.

What I find difficult to understand is that the BTC logic is to keep the miners mining up until 2140. I'm a miner myself (just received my BFL 60) but I can get no clue as to what I'll be doing when this will be producing something like 0.01BTC/month within a year from now. Well, I see no other logical explanation for this to be done but the BTC/fiat rising to a level that we miners are going to have some sort of profit...

Labcoin I hope.

AM and ActiveMining, or any other company who makes their own ASICs, but who knows...

It's kinda puzzling but I want to verify this:

According to Genesisblock calc, whatever gear you're going to buy -right now- seems to draw itself obsolete within a year or so. Well; this is a bit puzzling but who will be mining by then? What for? And most importantly, with what gear? I can only think of ONE good reason for one to be mining at this difficulty rising rates and this is an outrageous BTC exchange value with fiat money.

Thoughts?