Dont forget you can find around new Firmware for example for Z9/Z11 Efudd Firmware,and Hive OS firmwares which can Overclock S9/S15/S17 or Underclock (if your electriciy fee are too expensive), for example my S17 Pro I switched to new firmware (Hive OS) to 36Th/s with 900 Watts power gives me a 2.90 usd/day profit without electricity of course, for Z11 Overclocking without changing PSU from 135 to 150-160Ko/sol. I calculated everything on the basis of 0.15 cens Kw / h. Brand New Miner coming out: ASICminer Zeon Turbo 400,000 Sol/s Equihash Most Profitable Miner in the World. ASICminer Daily Revenue: $27 $16 (less 0.15 Kw/h fee) ASICminer Power Consumption: 2500W asicminer dot co/shop (Factory)
Note: New Reddit look may not highlight links. See old look here. A copy is hosted on GitHub for better reading experience. Check it out, contains photo of the month! Also on Medium
dcrd: Significant optimization in signature hash calculation, bloom filters support was removed, 2x faster startup thanks to in-memory full block index, multipeer work advancing, stronger protection against majority hashpower attacks. Additionally, code refactoring and cleanup, code and test infrastructure improvements. In dcrd and dcrwallet developers have been experimenting with new modular dependency and versioning schemes using vgo. @orthomind is seeking feedback for his work on reproducible builds. Decrediton: 1.2.1 bugfix release, work on SPV has started, chart additions are in progress. Further simplification of the staking process is in the pipeline (slack). Politeia: new command line tool to interact with Politeia API, general development is ongoing. Help with testing will soon be welcome: this issue sets out a test plan, join #politeia to follow progress and participate in testing. dcrdata: work ongoing on improved design, adding more charts and improving Insight API support. Android: design work advancing. Decred's own DNS seeder (dcrseeder) was released. It is written in Go and it properly supports service bit filtering, which will allow SPV nodes to find full nodes that support compact filters. Ticket splitting service by @matheusd entered beta and demonstrated an 11-way split on mainnet. Help with testing is much appreciated, please join #ticket_splitting to participate in splits, but check this doc to learn about the risks. Reddit discussion here. Trezor support is expected to land in their next firmware update. Decred is now supported by Riemann, a toolbox from James Prestwich to construct transactions for many UTXO-based chains from human-readable strings. Atomic swap with Ethereum on testnet was demonstrated at Blockspot Conference LATAM. Two new faces were added to contributors page. Dev activity stats for May: 238 active PRs, 195 master commits, 32,831 added and 22,280 deleted lines spread across 8 repositories. Contributions came from 4-10 developers per repository. (chart)
Hashrate: rapid growth from ~4,000 TH/s at the beginning of the month to ~15,000 at the end with new all time high of 17,949. Interesting dynamic in hashrate distribution across mining pools: coinmine.pl share went down from 55% to 25% while F2Pool up from 2% to 44%. [Note: as of June 6, the hashrate continues to rise and has already passed 22,000 TH/s] Staking: 30-day average ticket price is 91.3 DCR (+0.8), stake participation is 46.9% (+0.8%) with 3.68 million DCR locked (+0.15). Min price was 85.56. On May 11 ticket price surged to 96.99, staying elevated for longer than usual after such a pump. Locked DCR peaked at 47.17%. jet_user on reddit suggested that the DCR for these tickets likely came from a miner with significant hashrate. Nodes: there are 226 public listening and 405 normal nodes per dcred.eu. Version distribution: 45% on v1.2.0 (up from 24% last month), 39% on v1.1.2, 15% on v1.1.0 and 1% running outdaded versions.
Obelisk team posted an update. Current hashrate estimate of DCR1 is 1200 GH/s at 500 W and may still change. The chips came back at 40% the speed of the simulated results, it is still unknown why. Batch 1 units may get delayed 1-2 weeks past June 30. See discussions on decred and on siacoin. @SiaBillionaire estimated that 7940 DCR1 units were sold in Batches 1-5, while Lynmar13 shared his projections of DCR1 profitability (reddit). A new Chinese miner for pre-order was noticed by our Telegram group. Woodpecker WB2 specs 1.5 TH/s at 1200 W, costs 15,000 CNY (~2,340 USD) and the initial 150 units are expected to ship on Aug 15. (pow8.com – translated) Another new miner is iBelink DSM6T: 6 TH/s at 2100 W costing $6,300 (ibelink.co). Shipping starts from June 5. Some concerns and links were posted in these twothreads.
A new mining pool is available now: altpool.net. It uses PPLNS model and takes 1% fee. Another infrastructure addition is tokensmart.io, a newly audited stake pool with 0.8% fee. There are a total of 14 stake pools now. Exchange integrations:
Upbit added DCKRW and DCUSDT pairs. A user reported that DCR deposits and withdrawals are now available.
CoinEx announced the launch of DCBTC and DCBCH pairs.
Bleutrade added DCUSDT pair. Note their reply to our tweet. It was the first exchange to list Decred minutes after launch.
Brazilian exchange OmniTradeadded DCBRL fiat pair following a poll. Worth noting that it is one of the first to integrate Trezor sign-in.
There are reports that DCR was added to Abucoins and Tor Exchange but we don't know much about them.
OpenBazaar released an update that allows one to trade cryptocurrencies, including DCR. @i2Rav from i2trading is now offering two sided OTC market liquidity on DCUSD in #trading channel. Paytomat, payments solution for point of sale and e-commerce, integrated Decred. (missed in April issue) CoinPayments, a payment processor supporting Decred, developed an integration with @Shopify that allows connected merchants to accept cryptocurrencies in exchange for goods.
michae2xl: Voto Legal: CEO Thiago Rondon of Appcívico, has already been contacted by 800 politicians and negotiations have started with four pre-candidates for the presidency (slack, source tweet)
Blockfolio rolled out Signal Beta with Decred in the list. Users who own or watch a coin will automatically receive updates pushed by project teams. Nice to see this Journal made it to the screenshot! Placeholder Ventures announced that Decred is their first public investment. Their Investment Thesis is a clear and well researched overview of Decred. Among other great points it noted the less obvious benefit of not doing an ICO:
By choosing not to pre-sell coins to speculators, the financial rewards from Decred’s growth most favor those who work for the network.
One project that stands out at #Consensus2018 is @decredproject. Not annoying. Real tech. Humble team. #BUIDL is strong with them. (@PallerJohn)
Token Summit in New York, USA. @cburniske and @jmonegro from Placeholder talked "Governance and Cryptoeconomics" and spoke highly of Decred. (twitter coverage: 12, video, video (from 32 min)) Campus Party in Bahia, Brazil. João Ferreira aka @girino and Gabriel @Rhama were introducing Decred, talking about governance and teaching to perform atomic swaps. (photos) Decred was introduced to the delegates from Shanghai's Caohejing Hi-Tech Park, organized by @ybfventures. Second Decred meetup in Hangzhou, China. (photos) Madison Blockchain in Madison, USA. "Lots of in-depth questions. The Q&A lasted longer than the presentation!". (photo) Blockspot Conference Latam in Sao Paulo, Brazil. (photos: 1, 2) Upcoming events:
The Long-Term Bullish Case for Decred by Ben Davidow (medium.com)
Hardware Companies Are Launching Dedicated ASIC Miners for Decred (btcmanager.com)
Iterative Capital partner Chris Dannen and journalist Ben Schiller speak with Marco and Jonathan from Decred at Consensus 2018 (soundcloud)
Decred Review: What is DCR, the Decred Community & Possible Challenges by BitBoy Crypto (youtube)
Decred Founder: Bitcoin Paved Way, Phase 2 Will Shock You! (Marco Peereboom) by Pure Blockchain Wealth (youtube)
Decred & Blocknet: Revolutionary governance for every community feat. JZ at Consensus 2018 (youtube)
Decred coin - Will it be better than Bitcoin? by Bitassist (youtube)
Community stats: Twitter 39,118 (+742), Reddit 8,167 (+277), Slack 5,658 (+160). Difference is between May 5 and May 31. Reddit highlights: transparent up/down voting on Politeia, combining LN and atomic swaps, minimum viable superorganism, the controversial debate on Decred contractor model (people wondered about true motives behind the thread), tx size and fees discussion, hard moderation case, impact of ASICs on price, another "Why Decred?" thread with another excellent pitch by solar, fee analysis showing how ticket price algorithm change was controversial with ~100x cut in miner profits, impact of ticket splitting on ticket price, recommendations on promoting Decred, security against double spends and custom voting policies. @R3VoLuT1OneR posted a preview of a proposal from his company for Decred to offer scholarships for students. dcrtrader gained a couple of new moderators, weekly automatic threads were reconfigured to monthly and empty threads were removed. Currently most trading talk happens on #trading and some leaks to decred. A separate trading sub offers some advantages: unlimited trading talk, broad range of allowed topics, free speech and transparent moderation, in addition to standard reddit threaded discussion, permanent history and search. Forum: potential social attacks on Decred. Slack: the #governance channel created last month has seen many intelligent conversations on topics including: finite attention of decision makers, why stakeholders can make good decisions (opposed to a common narrative than only developers are capable of making good decisions), proposal funding and contractor pre-qualification, Cardano and Dash treasuries, quadratic voting, equality of outcome vs equality of opportunity, and much more. One particularly important issue being discussed is the growing number of posts arguing that on-chain governance and coin voting is bad. Just a few examples from Twitter: Decred is solving an imagined problem (decent response by @jm_buirski), we convince ourselves that we need governance and ticket price algo vote was not controversial, on-chain governance hurts node operators and it is too early for it, it robs node operators of their role, crypto risks being captured by the wealthy, it is a huge threat to the whole public blockchain space, coin holders should not own the blockchain. Some responses were posted here and here on Twitter, as well as this article by Noah Pierau.
The month of May has seen Decred earn some much deserved attention in the markets. DCR started the month around 0.009 BTC and finished around 0.0125 with interim high of 0.0165 on Bittrex. In USD terms it started around $81 and finished around $92, temporarily rising to $118. During a period in which most altcoins suffered, Decred has performed well; rising from rank #45 to #30 on Coinmarketcap. The addition of a much awaited KRW pair on Upbit saw the price briefly double on some exchanges. This pair opens up direct DCR to fiat trading in one of the largest cryptocurrency markets in the world. An update from @i2Rav:
We have begun trading DCR in large volume daily. The interest around DCR has really started to grow in terms of OTC quote requests. More and more customers are asking about trading it.
Like in previous month, Decred scores high by "% down from ATH" indicator being #2 on onchainfx as of June 6.
David Vorick (@taek) published lots of insights into the world of ASIC manufacturing (reddit). Bitmain replied. Bitmain released an ASIC for Equihash (archived), an algorithm thought to be somewhat ASIC-resistant 2 years ago. Threepure PoWcoins were attacked this month, one attempting to be ASIC resistant. This shows the importance of Decred's PoS layer that exerts control over miners and allows Decred to welcome ASIC miners for more PoW security without sacrificing sovereignty to them. Upbit was raided over suspected fraud and put under investigation. Following news reported no illicit activity was found and suggested and raid was premature and damaged trust in local exchanges. Circle, the new owner of Poloniex, announced a USD-backed stablecoin and Bitmain partnership. The plan is to make USDC available as a primary market on Poloniex. More details in the FAQ. Poloniex announced lower trading fees. Bittrex plans to offer USD trading pairs. @sumiflow made good progress on correcting Decred market cap on several sites:
speaking of market cap, I got it corrected on coingecko, cryptocompare, and worldcoinindex onchainfx, livecoinwatch, and cryptoindex.co said they would update it about a month ago but haven't yet I messaged coinlib.io today but haven't got a response yet coinmarketcap refused to correct it until they can verify certain funds have moved from dev wallets which is most likely forever unknowable (slack)
About This Issue
Some source links point to Slack messages. Although Slack hides history older than ~5 days, you can read individual messages if you paste the message link into chat with yourself. Digging the full conversation is hard but possible. The history of all channels bridged to Matrix is saved in Matrix. Therefore it is possible to dig history in Matrix if you know the timestamp of the first message. Slack links encode the timestamp: https://decred.slack.com/archives/C5H9Z63AA/p1525528370000062 => 1525528370 => 2018-05-05 13:52:50. Most information from third parties is relayed directly from source after a minimal sanity check. The authors of Decred Journal have no ability to verify all claims. Please beware of scams and do your own research. Your feedback is precious. You can post on GitHub, comment on Reddit or message us in #writers_room channel. Credits (Slack names, alphabetical order): bee, Richard-Red, snr01 and solar.
So you’ve got your miner working, busy hashing away … but what is it really doing?
Posted for eternity @ https://vertcoin.easymine.online/articles/mining Your miner is repeatedly hashing (see below for detail about a hash) a block of data, looking for a resulting output that is lower than a predetermined target. Each time this calculation is performed, one of the fields in the input data is changed, and this results in a different output. The output is not able to be determined until the work is completed – otherwise why would we bother doing the work in the first place? Each hash takes a block header (see more below, but basically this is a 80-byte block of data). It runs this through the hashing function, and what comes out is a 32-byte output. For each, we usually represent that output in hexadecimal format, so it looks something like:
The goal in Proof-of-Work systems is to look for a hash that is lower than a specific target, i.e. starts with a specific number of leading zeros. This target is what determines the difficulty. As the output of the hash is indeterminate, we look to statistics and probability to estimate how much work (i.e. attempts at hashing) we need to complete to find a hash that is lower than a specific target. So, we can therefore assume that to find a hash that starts with a leading zero will take, on average, 16 hashes. To find one that will start with two leading zeros (00), we’re looking at 256 hashes. Four leading zeros (0000) will take 65,536 hashes. Eight leading zeros (00000000) takes 4,294,967,296 hashes. So on and so on, until we realize that it will take 2 ^ 256 (a number too big for me to show here) attempts at hitting our minimum hash value. Remember – this number of hashes is just an estimate. Think of it like rolling a dice. A 16-sided dice. And then rolling it 64 times in a row. And hoping to strike a specific number of leading zeros. Sometimes it will take far less than the estimate, sometimes it will take far more. Over a long enough time period though (with our dice it may take many billions of years), the averages hold true. Difficulty is a measure used in cryptocurrencies to simply show how much work is needed to find a specific block. A block of difficulty 1 must have a hash smaller than:
So the higher the difficulty, the lower the hash must be; therefore more work must be completed to find the block. Take a recent Vertcoin block – block # 852545, difficulty 41878.60056944499. This required a hash lower than:
The achieve finding this, a single miner would need to have completed, on average 179,867,219,848,013 hashes (calculated by taking the number of hashes needed for a difficulty 1 block - 4,294,967,296 or 2 ^ 32 or 16 ^ 8 – and multiplied by the difficulty). Of course, our single miner may have found this sooner – or later – than predicted. Cryptocurrencies alter the required difficulty on a regular basis (some like Vertcoin do it after every block, others like Bitcoin or Litecoin do it every 2016 blocks), to ensure the correct number of blocks are found per day. As the hash rate of miners increases, so does the difficulty to ensure this average time between blocks remains the same. Likewise, as hash rate decreases, the difficulty decreases. With difficulties as high as the above example, solo-mining (mining by yourself, not in a pool) becomes a very difficult task. Assume our miner can produce 100 MH/s. Plugging in this into the numbers above, we can see it’s going to take him (on average) 1,798,673 seconds of hashing to find a hash lower than the target – that’s just short of 21 days. But, if his luck is down, it could easily take twice that long. Or, if he’s lucky, half that time. So, assuming he hit’s the average, for his 21 days mining he has earned 25 VTC. Lets take another look at the same miner, but this time he’s going to join a pool, where he is working with a stack of other miners looking for that elusive hash. Assume the pool he has joined does 50 GH/s – in that case he has 0.1 / 50 or 0.2% of the pool’s hash rate. So for any blocks the pool finds he should earn 0.2% of 25 VTC = 0.05 VTC. At 50 GH/s, the pool should expect to spend 3,597 seconds between finding blocks (2 ^ 32 * difficulty / hashrate). So about every hour, our miner can expect to earn 0.05 VTC. This works out to be about 1.2 VTC per day, and when we extrapolate over the estimated 21 days of solo mining above, we’re back to 25 VTC. The beauty of pooled-mining over solo-mining is that the time between blocks, whilst they can vary, should be closer to the predicted / estimated times over a shorter time period. The same applies when comparing pools – pools with a smaller hash rate will experience a greater variance in time between blocks than a pool with a greater hash rate. But in the end, looking back over a longer period of time, earnings will be the same. Hashes A Hash is a cryptographic function that can take an arbitrary sized block of data and maps it to a fixed sized output. It is a one-way function – only knowing the input data can one calculate the output; the reverse action is impossible. Also, small changes to the input data usually result in significant changes to the output value. For example, take the following string:
“the quick brown fox jumps over the lazy dog”
If we perform a SHA256 hash of this, it results in:
Blocks A block is made up of a header, and at least one transaction. The first transaction in the block is called the Coinbase transaction – it is the transactions that creates new coins, and it specifies the addresses that those coins go to. The Coinbase transaction is always the first transaction in a block, and there can only be one. All other transactions included in a block are transactions that send coins from one wallet address to another. The block header is an 80-byte block of data that is made up of the following information in this order:
Version – a 32-bit/4-byte integer
Previous Block’s SHA256d Hash – 32 bytes
Merkle Hash of the Transactions – 32 bytes
Timestamp - a 32-bit/4-byte integer the represents the time of the block in seconds past 1st January 1970 00:00 UTC
nBits - a 32-bit/4-byte integer that represents the maximum value of the hash of the block
Nonce - a 32-bit/4-byte integer
The Version of a block remains relatively static through a coin’s lifetime – most blocks will have the same version. Typically only used to introduce new features or enforce new rules – for instance Segwit adoption is enforced by encoding information into the Version field. The Previous Blocks’ Hash is simple a doubled SHA256 hash of the last valid blocks header. The Merkle Hash is a hash generated by chaining all of the transactions together in a hash tree – thus ensuring that once a transaction is included in a block, it cannot be changed. It becomes a permanent record in the blockchain. Timestamp loosely represents the time the block was generated – it does not have to be exact, anywhere within an hour each way of the real time will be accepted. nBits – this is the maximum hash that this block must have in order to be considered valid. Bitcoin encodes the maximum hash into a 4-byte value as this is more efficient and provides sufficient accuracy. Nonce – a simple 4-byte integer value that is incremented by a miner in order to find a resulting hash that is lower than that specified by nBits.
Has the Bitcoin Hash Rate Peaked? Comparisons with Oil Show Interesting Findings
https://preview.redd.it/85lpl2md4e221.png?width=690&format=png&auto=webp&s=2d3bab69f0570a96f55d790d25f1b1ab08c0a49b https://cryptoiq.co/the-bitcoin-mining-hash-rate-has-similarities-to-peak-oil/ The Bitcoin mining hash rate had been exponentially increasing on average since the genesis block in 2009, from MH/s, to GH/s, to TH/s, to PH/s, to EH/s, and it reached an all-time record high of 62 EH/s on 26 August 2018. Since this peak was reached, the Bitcoin mining hash rate gradually plateaued and has now decreased. The chart of Bitcoin mining hash rate actually looks quite similar to a peak oil chart except on a much faster time-scale, as can be seen in the comparison between Bitcoin’s hash rate over the course of 2 years from Blockchain.com and North Sea oil production from an article in The Oil Drum: Europe by Euan Mearns. As explained below, the dynamics between peak oil and peak Bitcoin mining are similar, with the key difference that Bitcoin mining is decentralized and oil is not. https://preview.redd.it/op5ept1g4e221.png?width=512&format=png&auto=webp&s=2b3b35eb631f31a64ed7beb01f283832bd231e4c https://preview.redd.it/nfyhlf4h4e221.png?width=678&format=png&auto=webp&s=46a0ca7e11f274c5678f6421b1eebb788eab5197 Geologist M. King Hubbert is the founder of the peak oil theory, which states that there is a point when the maximum extraction rate of petroleum is reached, after which a terminal decline in production ensues. The peak rate of extraction of Bitcoin of course occurred during the period after the genesis block and before the first block halving, when the block reward was at its maximum of 50 Bitcoins. However, this is not the peak rate of mining profitability, since Bitcoin increased in price by orders of magnitude through the year 2017. The peak rate of Bitcoin mining profits undoubtedly was simultaneous with Bitcoin’s all-time record high of USD 20,000 in December 2017. The reason the peak hash rate did not coincide with the peak rate of Bitcoin mining profits is because the rally happened so quickly that mining operations were not able to add rigs fast enough, so there was a lag effect. Even for mining operations with large amounts of capital it can take months to obtain the amount of mining equipment that they want, and for other mining operations it took even longer because they had to obtain investors, buy land, build infrastructure, and only then could they install the rigs and begin hashing. The Bitcoin mining hash rate chart implicitly indicates that 30 EH/s of Bitcoin mining equipment has been taken offline due to lack of profitability, which represents tens of billions of USD of wasted rigs. This suggests that Bitcoin miners were caught by surprise by the decline in Bitcoin’s price from USD 20,000 to less than USD 4,000 as of 4 December 2018. Coming back to the peak oil comparison, the current Bitcoin mining scene is like a rapid version of peak oil, combined with lack of coordination. Oil mining is a centralized and coordinated activity, where the oil is prospected, land is leased out and then an appropriate number of wells are drilled. With oil mining, companies cannot drill as many wells as they want, or drill wells on someone else’s lease, since this is all closely controlled by contractual agreements. Bitcoin mining is decentralized, and no one has a lease or contract to only mine with a certain amount of hash rate. Anyone in the world can run as much Bitcoin mining rigs as they can afford. The effect is that people all around the world are sticking their straws into the Bitcoin mining network all at the same time, and they sucked it dry. Essentially, so many people started up new mining operations at once without coordination, that the Bitcoin mining hash rate went way past its equilibrium, which hurt everyone involved. This is akin to if oil drilling was a decentralized process, and anyone who wanted to drill for oil could drill in the same field. The oil field would be sucked dry really quick, and then most of the drills would be shut down due to lack of profits. There is hope for Bitcoin miners however. The price of Bitcoin simply has to rally, and all of the disenfranchised miners could restart their rigs, and then it would be back to the races and new rigs could begin being added. However, due to the decentralization of Bitcoin mining, the network hash rate will likely periodically rise past its equilibrium point, leading to catastrophic conditions for miners like we are experiencing today at points in the future. The only thing that could prevent the scenario we are experiencing today is a Bitcoin rally that lasts forever, which is obviously not possible. James McAvity tweeted that Bitcoin mining is still profitable in the current environment, and does some simple linear calculations to prove this point. He also argues that miners are forced to keep mining due to business agreements, choose to HODL in expectation of a rally, and continue mining in expectation of a downward difficulty adjustment as other miners go offline. https://twitter.com/jamesmcavity/status/1069669073552736256 Some of what McAvity says is true, but the reality is that Bitcoin mining is a highly non-linear system, and calculating the support level for mining is somewhat pointless, since it is different for every miner. Bitcoin mining profitability depends on Bitcoin’s price, the Bitcoin network hash rate which is directly correlated to mining difficulty, and the technological efficiency of Bitcoin mining rigs. These 3 factors are related in a non-linear and ever-changing way. Instead of trudging away at trying to develop a set of equations that determine mining hash rate behavior, one could simply look at the Bitcoin mining hash rate chart at the beginning of this article to understand what is going on. Bitcoin mining profitability is different for each individual miner, and the hash rate has trended downwards as individual miners have made the decision to shut down rigs. Clearly there was a fundamental mining profitability support level in the USD 6,000-7,000 range, since that is where Bitcoin’s price was when mining peaked and plateaued. There are clearly numerous miners who became unprofitable on the descent from that level to less than USD 4,000 today, and now approximately 50% of the Bitcoin mining equipment that exists cannot profitably mine. The decrease in Bitcoin’s mining difficulty of 15% on 3 December 2018 could help bring some of those miners back online, at least if the price stays at current levels around USD 4,000, but this will not change the overall trend. When it comes down to it, Bitcoin’s price is in control of Bitcoin mining profitability, and if the price goes up we could see a reversal of the hash rate downtrend and eventually a 2nd peak in Bitcoin’s network hash rate. However, if price continues to go down, the Bitcoin mining hash rate chart will follow a similar pattern to peak oil charts. The reality will likely be a combination of both. Bitcoin bear markets tend to last years, and get more severe, but eventually the rally comes and then Bitcoin exceeds its all-time record high. This would lead to a steady decrease in Bitcoin’s mining hash rate like the peak oil chart, followed by a rapid re-engagement of old mining rigs that have been taken offline, and then the addition of new generation Bitcoin mining rigs once the equilibrium hash rate exceeds 60 EH/s.
Where is the network difficulty headed, come November?
Reposted for accuracy. (Read: My math skills are the result of public education.) KNCMiner announced today that they're doing encapsulation on their new Scrypt ASIC chips, and then when they're completed, will be shipping to Stockholm for integration and testing, buildout and finally...shipping! I have read on forums that they have sold 3,000 Titans via pre-order, for batch 1, at 250MH/s nominal performance, each. I figured it was time to look at my "hashrate/difficulty prediction" again and see where it may actually be, by the time the snow's falling. All of the below is calculated with a Litecoin price of around $5. Let's assume for a moment that both Alpha Technology and Mining ASICs Technologies have also sold around 3,000 systems on pre-order (probably a safe bet) and all three expect to ship in September-October. 9,000 systems @ 250MH/s = 2,250,000MH/s. That's somewhere in the neighborhood of 2.25 TH/s being added to the network in roughly two months' time...that we can account for. The current network hashrate, as I post this? Not quite 1 TH/s...it's 896 GH/s. But at the current rate of network expansion, we're going to be 1 TH/s by the time these systems ship, easily. So...let's say we're looking at a 3.5 TH/s Litecoin network by November. What does that mean? When the Bitcoin network hit 3.5 TH/s back in May of 2011, the difficulty was around 244,000. Litecoin's difficulty is currently around 28,000. You can probably see where this is going, already. Fun with mining calculators time. Say you have one 250MH/s miner and deployed it TODAY (impossible, but for the sake of argument). You're looking at pulling in 9 LTC/day with it. If you pay $.10/kwh you're very lucky not to live in California, but we'll say that's the case. You pay around $4.50/day in power. So you walk away with $42.50 worth of Litecoin, at $5/each. If you somehow managed to freeze the network at that difficulty and the coin at that price, you'd pay off your $9,200 purchase of hardware in roughly seven months or so...or if you bought a Titan at $10,000 you're looking closer to eight. But since difficulty marches on, forget that entire concept. Now...say you get your system after all three companies have shipped and their customers have deployed them, and we've seen the network rocked to the tune of two-and-a-quarter terahashes per second. Oh, it's a rosy picture... Now, with the network difficulty having blown up to 244,000 the miner with a 250MH/s system is mining 1.03 Litecoin per day. And if my estimates are correct...this is NOVEMBER, we're talking about. At the current price of $5/LTC and $.10/kwh you are pulling down a healthy $0.80/day in profits, after power. If you again had the power to freeze the hashrate and price, you'd be able to pay off that hardware purchase in, oh...roughly 35 years. To have a REASONABLE shot at getting a return on your investment (around 5-6 months), Litecoin will need to be $70 by November and climbing steadily, in concert with network hashrate. Bear in mind, again that there is nowhere else for that hashrate to go but Litecoin. Nothing else will profit the Scrypt miner. So what will happen? There is built-in hardware cost here that has to be recouped and the only real way of doing that is by mining...and there's only one game in town for Scrypt mining: Litecoin. It's going to be a really, really wild fourth quarter for this year. Either the miners mine and hoard, decreasing supply and demand increases radically, or miners take heavy losses on hardware, can't afford to run them and the Litecoin network contracts until they CAN make money with them. In the interests of self-preservation, I have a feeling miners will start hoarding. Soon.
Bitcoin Tax Attorney here. I am around for discussion or questions related to Bitcoin Tax treatment, including tax planning opportunities for businesses and individuals.
Anyone have issues with their tax returns due to lots of Bitcoin usage or from the sale and disposition of Bitcoin? Anyone looking for any tax favorable planning opportunities? Either as an individual who sold a bunch for profit or for a business who has begun accepting Bitcoin for the first time. My practice has focused on helping both individuals and businesses for Bitcoin tax related matters for much of this year. I am available for discussion here in the comments, and for more specific matters, please PM me. I'm a tax attorney based in Los Angeles and big bitcoin fan and miner going way back. I've been lurking hear on bitcoin for years. I was a miner back in 2011-2013, build my own custom rigs with 6 Radeon 7970s. Then I was among the first to receive a couple of BFL's 5 gh/s cubes and then one of the first 50 Gh/s. (I knew that was a lawsuit waiting to happen against BFL. Scoundrels) Good memories all around. I still have my spreadsheets keeping track of what I mined. Altogether, with the pools, I mined over 100 bitcoin. Alas, I sold many of them when the price was $300 or less. All this time I was focusing on tax law, finishing Tax LLM courses in Los Angeles. So, it was inevitable that the two interests would merge. I ended up writing a proposal to treat Bitcoin as currency as opposed to property. Here is a link to my paper on this which Tax Notes published as their cover story a few months back, which was completely unexpected but kinda cool to see this niche interest rewarded. Paper: "Bitcoin: Property or Currency?" http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2708188 Got to go on a State Bar Delegation to DC to enlighten folks with the power to actually do something about it. Delegation met with IRS Chief Counsel, including people who drafted the Notice treating Bitcoin as property. Also folks from Treasury Dept, Senate Finance Committee, House Ways & Means, etc. I urged for currency treatment (as opposed to property treatment) of Bitcoin and other cryptocurrencies, in fact anything built on the basis of the Blockchain meant as a mode to transact money. If any of you guys had to do your taxes this year, and have bought and spent a lot of Bitcoin, or even just mined and sold, you probably know some of the difficulties I'm alluding to without even mentioning. Should we really have to calculate capital gains/loss on the purchase of a cup of coffee at your neighborhood cryptocurrency friendly coffee shop, for example? Even with purchases at Overstock.com or Dell, you were technically supposed to calculate capital gains and losses and provide supporting backup on your tax returns this year. What a practical and administrative nightmare for both taxpayers and for the IRS who has to wade through this. I feel like some of what I wrote got through to them. As we all know, government lags far behind emerging technologies. But they did seem genuinely interested, and I do not believe my paper and proposal fell upon deaf ears. I have my own law office these days and work with or for many attorneys on various matters, just as I have a number of attorneys assist me. No such thing as a pure solo practitioner these days. No man can afford to be an island. This tax year has been very rewarding and helped a great many tax clients with Bitcoin issues from anything to bookkeeping to strategic planning for the short-term as well as long-term. Any accountant knows the terms LIFO and FIFO, but there's seemingly no hard and fast rules for measurement for when a particular bitcoin was bought and sold for purposes of calculating gains/losses. Also, no hard and fast rules as to where the particular market price of Bitcoin is found on a particular day. Everything is loose, open to interpretation by the tax payer, and with strategic guidance, can prove incredibly tax favorable ultimately. It is wise for a business to accept Bitcoin for many reasons, including that broad opportunity for interpretation while staying true to the property guidance. So, it is ultimately very taxpayer friendly due to this broad leeway. More than that, treating bitcoin and cryptocurrencies as property rather than currency is also taxpayer friendly by definition. Your bitcoin gains will only be taxed at your capital gains rate instead of as ordinary income, a higher rate. I assisted a lot of individuals and even businesses who accepted bitcoin for the first time this year. I intended to post on /bitcoin before to offer my services and to also just allow people to send me questions, which I am happy to discuss in private for free. I got pretty slammed up to tax day, but I'm free now. Just hit me up by private message or shoot me an email at thebitcoinlawyer at g mail. Any questions or thoughts, I'll be around. I'm often around /bitcoin anyway. Love this community. And if I can serve as help for any of you, all the better. Thanks. TL;DR Bitcoin Tax Attorney available for discussion on tax issues here in comments, or for more personalized issues, hit me up by PM
Buratino Blockchain Solutions: we have found new solutions to old problems
The market of the mining equipment continues to develop strenuously contrary to adverse conditions on the crypto exchanges. Technologies are constantly improving, increasing growth of mining profitability at the reduction of energy consumption and partly compensating negative dynamics of cryptocurrencies rates. However, it automatically increases the complexity of production of new digital coins that form request for creation of more powerful equipment. Industry is constantly changing and miners need to be able to understand modern trends of the branch. Let’s discuss market tendencies, new technology solutions capability to affect the efficiency of this business, and how exactly our team is ready to help miners. Mining market today Lets begin with the general review of the market, with emphasis on forecasts of the authoritative research companies. Analysts of the American consulting company Coherent Market Insights are convinced: in the medium term (5–10 years) mining will be profitable. Demand for the new equipment will remain high even during the crypto -markets depression. According to the last forecast of the company, by 2025 mining industry will exceed the capitalization level of $16,3 billion. The indicator of cumulative average annual growth rate (CAGR), according to experts, will grow by 18,68% from 2017 to 2025. At the time of posting, the greatest share of computing capacities has been concentrated in Asia. Experts from other large consulting company Technavio consider that the Pacific Rim will take 51% of the general growth of the industry in 2018–2022. Then the share of the Pacific Rim will be reduced below 50% level. The cause is a hard governmental line of China in relation to crypto industry. It makes miners migrate to other countries of North and South America and Eastern Europe. According to the Technavio, 33% of the market is now in the New World, but the share of the USA will grow, forcing out China. Coherent Market Insights experts are solidary with colleagues, and also give the future world leadership to North America. Improvement of production technologies of cryptocurrencies and increase in productivity of the hardware remains a key tendency of the current market. Along with it large producers of microelectronics, such as Samsung and United Microelectronics Corporation are entering the market as suppliers of hi-tech accessories. The large manufacturing companies (Bitmain Technologies, BitFury, Advanced Micro Devices, etc.) actively develop ASIC systems with bigger energy efficiency and the increased hashrate coefficients. It is important for providing the more effective mining. However alternation of generations in available lines of the equipment happens slowly that opens opportunities for new players, such as our company. According to the Coinshares company, hashrate of the only one Bitcoin network grows by 300% annually, the efficiency of chips increases by 80%, and their cost falls on average on 50%. So the profitability of digital coins production grows even in conditions of crypto rate instability with the introduction of new technologies in ASIC-mining . 74% of the mining market is the share of ASIC of all configurations in 2017. It is expected that they will continue to dominate. The process of improvement of the hardware leads to the growth of volumes of the mined coins. But the more is mined, the quicker the algorithm of generation of new blocks in the network complicates. As a result — miners need capacities to grow. Escalating levels of complexity become nearly the main factor of mining equipment market growth in the medium term. For example, analysts of Technavio predict the increase in growth rates for 2018 by 9,04%. Increase in productivity as natural selection To be a successful miner means always to work proactively. Anyone who first manages to use more productive mining systems also remains in a prize or at least in the market. The Forbes.ru magazine describes how the market of a mining is affected by the generation of more productive machines. All of us remember the last year's agiotage around the first ASIC systems for Dash cryptocurrency. Before it was mined only on video cards and brought the monthly income of $1-1,5 thousand from one farm. New miner (DM11G from iBeLink, Antminer D3 from Bitmain and DR-100 from Pinidea) promised income from $5 thousand from each installation. Those who the first have managed to connect ASIC to Dash network succeeded the most. Their monthly income has made about $6 thousand, but it was not for a long time. The rapid growth of the number of ASIC devices in the network has provoked the same fast increase in complexity of calculations. Therefore the payback period of one ASIC system has increased from 3-4 to 12 months. As a result, by the end of 2017, the profitability of Dash mining has decreased almost by 3 times (in comparison with September of the same year). In completion to everything, the Dash rate has fallen off in spring 2018. Production of cryptocurrency is favorable only to those who quickly reacts to the production of the new hardware. Only being guided by new generation equipment or modernizing old ones it is possible not to lose. Recent leaders VS perspective beginners BitFury and Bitmain remain recognized leaders in the global market in summer 2018. BitFury generally specializes in providing mining decisions under specific projects. Bitmain, on the contrary, is guided by production and sale of the ready-made mining systems. Today the market is rather highly consolidated and more than a half of all computing capacities belongs to largest companies. Nevertheless, Coherent Market Insights analysts consider that in the near future deconsolidation of branch due to the appearance of new players is expected. This segment is also interesting to us. With the support of the community on ICO, we will be able to impose market competition to the acting leaders. Just because present devices have a number of problems which are still not solved by anyone except for us. Support of the only one cryptocurrency, the impossibility of the partial modification, high noise level, high costs of cooling and a lot of things still. Everything remains unresolved. We plan to put on the market the multi-mining system of the new generation Papa Carlo. The equipment surpasses competitors in all key indicators: energy efficiency, productivity, customizability, the number of coins, etc. With our development, it will be not just ASIC anymore, but the first real multi-miner, allowing to get fifteen digital currencies on the most popular algorithms SHA-256 and SCRYPT. It is difficult to overestimate the potential of such a product. Papa Carlo is capable to take the worthy place in the market of the CIS and the whole world. It is enough to compare our technological product to the acting leader of sales - Antminer s9, to estimate all range of advantages of Papa Carlo. Compare several key indicators of Papa Carlo and Antminer s9: hashrate of Papa Carlo – 26 Th/s, Antminer s9 – 13,5 Th/s; Papa Carlo processors – 10 nanometers, Antminer s9 – 16 nanometers; the number of Papa Carlo chips – 210, Antminer s9 – 189; energy efficiency of Papa Carlo – 0,065 J/Gh, Antminer s9 – 0,1 J/Gh; Papa Carlo noise level – 35-45 dB, Antminer s9 – 75-80 dB. Conclusion Papa Carlo is a high-performance equipment which can compete with leaders of the market. Our Buratino Blockchain Solutions company provides its development and service. The issue of own token will allow attracting the capital for scaling of business and distribution our multi-miner. Everyone who wishes to receive exclusive privileges from the producer at a stage of the closed sales can join our tokensale.
I have been closely watching the mining scene for only about 3 months, so excuse me if this sort of question is asked frequently, or is too speculative. Is all BTC mining now underwater, with a negative ROI? That's what it looks like to me. I initially got interested years ago, when the return was small and BTC was not worth much. I didn't mine because it seemed like a miniscule return on investment. Oh I wish I had started back then, those "worthless" BTCs would be worth a lot now. But I started getting more interested again when that Ars Technica article on the BFL Jalapeno appeared. Holy crap, a machine that prints free money. He made hundreds of bucks in a week. So I started checking it out. With the delays in BFL's product shipping, all the mining calculators show that any new investment in mining hardware will never break even. Difficulty is increasing so fast, that the only machines making money are already in place, and soon they won't even pay for the cost of electricity. Now just to screw this up even further, BFL did a classic "Osborne Effect" announcement of their new Monarch board. Their existing ASIC machines are obsolete. The new 28nm machine that does not exist yet, is promised to deliver 600Gh for 350 watts, and costs $4680. I ran the numbers through the mining calculator at The Genesis Block. Unfortunately their calculator seems to be down at the moment, but I recall running numbers on a Monarch, delivered even in December, would not break even unless BTC went up to 2000 per dollar! Now even accounting for BFL's broken promises, if I could buy mining hardware like this today and turn it on now, it would make a negative ROI. I run the numbers for every possible hardware I could buy, none of them are as cheap in dollars/Gh or Gh/watt as the Monarch. And none of them break even. I decided to track the existing performance of mining using my dinky Mac mini's GPU. It won't mine much, and GPU mining will never break even in a network full of ASICs. But it would give a rough index of how difficulty is affecting mining. Here's a rough description of my results. At this point, it looks like mining is doubling in difficulty every month. Nobody can make money unless either BTC rises in value dramatically, or the majority of miners give up and unplug their unprofitable mining hardware. So someone tell me if this assessment is realistic or not. At the moment, it looks like any new investment in mining hardware will result in turning every dollar of investment into 50 cents worth of BTC at most. With increasing difficulty, soon even existing mining hardware will be turning every dollar of electricity into less than a dollar worth of BTC. ROI is underwater now for new hardware, and soon will be underwater for all hardware, even advanced ASICs that haven't even shipped yet. There are only two ways that mining might ever make a profit. One is if almost everyone gives up when their miners become unprofitable. The other is if BTC goes up massively in value to like $2500/USD, which will only fuel the arms race even more. Yeah, I know there is a big incentive to spread disinformation to convince people to drop out of mining. So don't try to BS me. Let me hear your honest assessments, or please point me in a direction where I can do research to figure this out.
https://preview.redd.it/5r9soz2ltq421.jpg?width=268&format=pjpg&auto=webp&s=6a89685f735b53ec1573eefe08c8646970de8124 What is Bitcoin? Bitcoin is an experimental system of transfer and verification of property based on a network of peer to peer without any central authority. The initial application and the main innovation of the Bitcoin network is a system of digital currency decentralized unit of account is bitcoin. Bitcoin works with software and a protocol that allows participants to issue bitcoins and manage transactions in a collective and automatic way. As a free Protocol (open source), it also allows interoperability of software and services that use it. As a currency bitcoin is both a medium of payment and a store of value. Bitcoin is designed to self-regulate. The limited inflation of the Bitcoin system is distributed homogeneously by computing the network power, and will be limited to 21 million divisible units up to the eighth decimal place. The functioning of the Exchange is secured by a general organization that everyone can examine, because everything is public: the basic protocols, cryptographic algorithms, programs making them operational, the data of accounts and discussions of the developers. The possession of bitcoins is materialized by a sequence of numbers and letters that make up a virtual key allowing the expenditure of bitcoins associated with him on the registry. A person may hold several key compiled in a 'Bitcoin Wallet ', 'Keychain' web, software or hardware which allows access to the network in order to make transactions. Key to check the balance in bitcoins and public keys to receive payments. It contains also (often encrypted way) the private key associated with the public key. These private keys must remain secret, because their owner can spend bitcoins associated with them on the register. All support (keyrings) agrees to maintain the sequence of symbols constituting your keychain: paper, USB, memory stick, etc. With appropriate software, you can manage your assets on your computer or your phone. Bitcoin on an account, to either a holder of bitcoins in has given you, for example in Exchange for property, either go through an Exchange platform that converts conventional currencies in bitcoins, is earned by participating in the operations of collective control of the currency. The sources of Bitcoin codes have been released under an open source license MIT which allows to use, copy, modify, merge, publish, distribute, sublicense, and/or sell copies of the software, subject to insert a copyright notice into all copies. Bitcoin creator, Satoshi Nakamoto What is the Mining of bitcoin? Technical details : During mining, your computer performs cryptographic hashes (two successive SHA256) on what is called a header block. For each new hash, mining software uses a different random number that called Nuncio. According to the content of the block and the nonce value typically used to express the current target. This number is called the difficulty of mining. The difficulty of mining is calculated by comparing how much it is difficult to generate a block compared to the first created block. This means that a difficulty of 70000 is 70000 times more effort that it took to Satoshi Nakamoto to generate the first block. Where mining was much slower and poorly optimized. The difficulty changes each 2016 blocks. The network tries to assign the difficulty in such a way that global computing power takes exactly 14 days to generate 2016 blocks. That's why the difficulty increases along with the power of the network. Material : In the beginning, mining with a processor (CPU) was the only way to undermine bitcoins. (GPU) graphics cards have possibly replaced the CPU due to their nature, which allowed an increase between 50 x to 100 x in computing power by using less electricity by megahash compared to a CPU. Although any modern GPU can be used to make the mining, the brand AMD GPU architecture has proved to be far superior to nVidia to undermine bitcoins and the ATI Radeon HD 5870 card was the most economical for a time. For a more complete list of graphics cards and their performance, see Wiki Bitcoin: comparison of mining equipment In the same way that transition CPU to GPU, the world of mining has evolved into the use of the Field Programmable Gate Arrays (FPGA) as a mining platform. Although FPGAs did not offer an increase of 50 x to 100 x speed of calculation as the transition from CPU to GPU, they offered a better energy efficiency. A typical HD/s 600 graphics card consumes about 400w of power, while a typical FPGA device can offer a rate of hash of 826 MH/s to 80w of power consumption, a gain of 5 x more calculations for the same energy power. Since energy efficiency is a key factor in the profitability of mining, it was an important step for the GPU to FPGA migration for many people. The world of the mining of bitcoin is now migrating to the Application Specific Integrated Circuit (ASIC). An ASIC is a chip designed specifically to accomplish a single task. Unlike FPGAs, an ASIC is unable to be reprogrammed for other tasks. An ASIC designed to undermine bitcoins cannot and will not do anything else than to undermine bitcoins. The stiffness of an ASIC allows us to offer an increase of 100 x computing power while reducing power consumption compared to all other technologies. For example, a classic device to offer 60 GH/s (1 hashes equals 1000 Megahash. 1GH/s = 1000 Mh/s) while consuming 60w of electricity. Compared to the GPU, it is an increase in computing power of 100 x and a reduction of power consumption by a factor of 7. Unlike the generations of technologies that have preceded the ASIC, ASIC is the "end of the line" when we talk about important technology change. The CPUs have been replaced by the GPUs, themselves replaced by FPGAs that were replaced by ASICs. There is nothing that can replace the ASICs now or in the immediate future. There will be technological refinements in ASIC products, and improvements in energy efficiency, but nothing that may match increased from 50 x to 100 x the computing power or a 7 x reduction in power consumption compared with the previous technology. Which means that the energy efficiency of an ASIC device is the only important factor of all product ASIC, since the estimated lifetime of an ASIC device is superior to the entire history of the mining of bitcoin. It is conceivable that a purchased ASIC device today is still in operation in two years if the unit still offers a profitable enough economic to keep power consumption. The profitability of mining is also determined by the value of bitcoin but in all cases, more a device has a good energy efficiency, it is profitable. Software : There are two ways to make mining: by yourself or as part of a team (a pool). If you are mining for yourself, you must install the Bitcoin software and configure it to JSON-RPC (see: run Bitcoin). The other option is to join a pool. There are multiple available pools. With a pool, the profit generated by any block generated by a member of the team is split between all members of the team. The advantage of joining a team is to increase the frequency and stability of earnings (this is called reduce the variance) but gains will be lower. In the end, you will earn the same amount with the two approaches. Undermine solo allows you to receive earnings huge but very infrequent, while miner with a pool can offer you small stable and steady gains. Once you have your software configured or that you have joined a pool, the next step is to configure the mining software. The software the most populare for ASIC/FPGA/GPU currently is CGminer or a derivative designed specifically for FPGAS and ASICs, BFGMiner. If you want a quick overview of mining without install any software, try Bitcoin Plus, a Bitcoin minor running in your browser with your CPU. It is not profitable to make serious mining, but it is a good demonstration of the principle of the mining team.
Authored by Valentin Schmid via The Epoch Times, While the price of bitcoin drops, miners get more creative... and some flourish. The bitcoin price is crashing; naysayers and doomsayers are having a field day. The demise of the dominant cryptocurrency is finally happening — or is it? Bitcoin has been buried hundreds of times, most notably during the brutal 90 percent decline from 2013 to 2015. And yet it has always made a comeback. Where the skeptics are correct: The second bitcoin bubble burst in December of last year and the price is down roughly 80 percent from its high of $20,000. Nobody knows whether and when it will see these lofty heights again. As a result, millions of speculators have been burned, and big institutions haven’t showed up to bridge the gap. This also happened on a smaller scale in 2013 after a similar 100x run-up, and it was necessary.
Time to Catch Up
What most speculators and even some serious proponents of the independent and decentralized monetary system don’t understand: Bitcoin needs these pauses to make improvements in its infrastructure. Exchanges, which could not handle the trading volumes at the height of the frenzy and did not return customer service inquiries, can take a breather and upgrade their systems and hire capable people. The technology itself needs to make progress and this needs time. Projects like the lightning network, a system which delivers instant bitcoin payments at very little cost and at virtually unlimited scale is now only available to expert programmers. A higher valuation is only justified if these improvements reach the mass market. And since we live in a world where everything financial is tightly regulated, for better or worse, this area also needs to catch up, since regulators are chronically behind the curve of technological progress. And of course, there is bitcoin mining. The vital infrastructure behind securing the bitcoin network and processing its transactions has been concentrated in too few hands and in too few places, most notably China, which still hosts about 70 percent of the mining capacity.
The Case For Mining
Critics have always complained that bitcoin mining consumes “too much” electricity, right now about as much as the Czech Republic. In energy terms this is around 65 terawatt hours or 230,000,000 gigajoules, costing $3.3 billion dollars according to estimates by Digiconomist. For the non-physicists among us, this is around as much as consumed by six million energy-guzzling U.S. households per year. All those estimates are imprecise because the aggregate cannot know how much energy each of the different bitcoin miners consumes and how much that electricity costs. But they are a reasonable rough estimate. So it’s worth exploring why mining is necessary to begin with and whether the electricity consumption is justified. Anything and everything humans do consumes resources. The question then is always: Is it worth it? And: Who decides? This question then leads to the next question: Is it worth having and using money? Most people would argue yes, because using money instead of barter in fact makes economic transactions faster and cheaper and thus saves resources, natural and human. _Merchants exchange goods with the inhabitants of Tidore, Indonesia, circa 1550. Barter was supplanted by using money because it is more efficient. (Archive/Getty Images)_If we are generously inclined, we will grant bitcoin the status of a type of money or at least currency as it meets the general requirements of being recognizable, divisible, portable, durable, is accepted in exchange for other goods and services, and in this case it is even limited in supply. So having any type of money has a price, whether it’s gold, dollar bills, or numbers on the screen of your online banking system. In the case of bitcoin, it’s the electricity and the capital for the computing equipment, as well as the human resources to run these operations. If we think having money in general is a good idea and some people value the decentralized and independent nature of bitcoin then it would be worth paying for verifying transactions on the bitcoin network as well as keeping the network secure and sound: Up until the point where the resources consumed would outweigh the efficiency benefits. Just like most people don’t think it’s a bad idea to use credit cards and banks, which consume electricity too. However, bitcoin is a newcomer and this is why it’s being scrutinized even more so than the old established players.
Different Money, Different Costs
How many people know how much electricity, human lives, and other resources gold mining consumes or has consumed in the course of history? What about the banking system? Branches, servers, air-conditioning, staff? What about printing dollar notes and driving them around in armored trucks? What about the social effects of monetary mismanagement of bank and government money like inflation as well as credit deflations? Gold gets a pass here. Most people haven’t asked that question, which is why it’s worth pointing out the only comprehensive study done on the topic in 2014. In “An Order of Magnitude” the engineer Hass McCook analyzes the different money systems and reaches mind-boggling conclusions. The study is a bit dated and of course the aggregations are also very rough estimates, but the ball park numbers are reasonable and the methodology sound. In fact, according to the study, bitcoin is the most economic of all the different forms of money. Gold mining in 2014 used 475 million GJ, compared to bitcoin’s 230 million in 2018. The banking system in 2014 used 2.3 billion gigajoules. Over 100 people per year die trying to mine gold. But mining costs more than electricity. It consumes around 300,000 liters of water per kilogram of gold mined as well as 150 kilogram (330 pounds) of cyanide and 1500 tons of waste and rubble. The international banking system has been used in all kinds of fraudulent activity throughout history: terrorist financing, money laundering, and every other criminal activity under the sun at a cost of trillions of dollars and at an order of magnitude higher than the same transactions done with cryptocurrency and bitcoin. And of course, while gold has a relatively stable value over time, our bank and government issued money lost about 90 percent of its purchasing power over the last century, because it can be created out of thin air. This leads to inflation and a waste of physical and human resources because it distorts the process of capital allocation. _The dollar has lost more than 90 percent of its value since the creation of the Federal Reserve in 1913. (Source: St. Louis Fed)_This is on top of the hundreds of thousands of bank branches, millions of ATMs and employees which all consume electricity and other resources, 10 times as much electricity alone as the bitcoin network. According to monetary philosopher Saifedean Ammous, author of “The Bitcoin Standard,” the social benefit of hard money, i.e. money that can’t be printed by government decree, cannot even be fathomed; conversely, the true costs of easy money—created by government fiat and bank credit—are difficult to calculate. According to Ammous, bitcoin is the hardest money around, even harder than gold because its total supply is capped, whereas the gold supply keeps increasing at about 1-2 percent every year. “Look at the era of the classical gold standard, from 1871, the end of the Franco–Prussian War, until the beginning of World War I. There’s a reason why this is known as the Golden Era, the Gilded Age, and La Belle Epoque. It was a time of unrivaled human flourishing all over the world. Economic growth was everywhere. Technology was being spread all over the world. Peace and prosperity were increasing everywhere around the world. Technological innovations were advancing. “I think this is no coincidence. What the gold standard allowed people to do is to have a store of value that would maintain its value in the future. And that gave people a low time preference, that gave people the incentive to think of the long term, and that made people want to invest in things that would pay off over the long term … bitcoin is far closer to gold. It is a digital equivalent of gold,” he said in an interview with The Epoch Times. Of course, contrary to the gold standard that Ammous talks about, bitcoin doesn’t have a track record of being sound money in practice. In theory it meets all the criteria, but in the real world it hasn’t been adopted widely and has been so volatile as to be unusable as a reliable store of value or as the underlying currency of a productive lending market. The proponents argue that over time, these problems will be solved the same way gold spread itself throughout the monetary sphere replacing copper and seashells, but even Ammous concedes the process may take decades and the outcome is far from certain. Gold is the safe bet for sound money, bitcoin has potential. There is another measure where bitcoin loses out, according to a recent study by researchers from the Oak Ridge Institute in Cincinnati, Ohio. It is the amount of energy expended per dollar for different monetary instruments. One dollar worth of bitcoin costs 17 megajoules to mine versus five for gold and seven for platinum. But the study omits the use of cyanide, water, and other physical resources in mining physical metals. In general, the comparisons in dollar terms go against bitcoin because it is worth relatively less, only $73 billion in total at the time of writing. An issue that could be easily fixed at a higher price, but a higher price is only justified if the infrastructure improves, adoption increases, volatility declines, and the network proves its resilience to attacks over time. In the meantime, market participants still value the fact they can own a currency independent of the government, completely digital, easily fungible, and limited in supply, and relatively decentralized. And the market as a whole is willing to pay a premium for these factors reflected in the higher per dollar prices for mining bitcoin.
The Creativity of Bitcoin Mining
But where bitcoin mining lacks in scale, it makes up for it in creativity. In theory—and in practice—bitcoin mining can be done anywhere where there is cheap electricity. So bitcoin mining operations can be conducted not where people are (banking) or where government is (fiat cash) or where gold is (gold mining)—it can be done everywhere where there is cheap electricity Some miners are flocking to the heat of the Texan desert where gas is virtually available for free, thanks to another oil revolution. Other miners go to places where there is cheap wind, water, or other renewable energy. This is because they don’t have to build bank branches, printing presses, and government buildings, or need to put up excavators and conveyor belts to dig gold out of the ground. All they need is internet access and a home for the computers that look like a shipping container, each one of which has around 200 specialized bitcoin mining computers in them. “The good thing about bitcoin mining is that it doesn’t matter where on earth a transaction happens, we can verify it in our data center here. The miners are part of the decentralized philosophy of bitcoin, it’s completely independent of your location as well,” said Moritz Jäger, chief technology officer at bitcoin Mining company Northern Bitcoin AG.
But so far, this decentralization hasn’t worked out as well as it sounds in theory. Because Chinese local governments had access to subsidized electricity, it was profitable for officials to cut deals with bitcoin mining companies and supply them with cheap electricity in exchange for jobs and cutbacks. Sometimes the prices were as low as 2 dollar cents to 4 dollar cents per kilowatt hour. This is why the majority of bitcoin mining is still concentrated in China (around 70 percent) where it was the most profitable, but only because the Chinese central planners subsidized the price of electricity. This set up led to the by and large unwanted result that the biggest miner of bitcoin, a company called Bitmain, is also the biggest manufacturer of specialized computing equipment for bitcoin mining. The company reported revenues of $2.8 billion for the first half of 2018. Tourists walk on the dunes near a power plant in Xiangshawan Desert in Ordos of Inner Mongolia, in this file photo. bitcoin miners have enjoyed favorable electricity rates in places like Ordos for a long time. (Feng Li/Getty Images)Centralized mining is a problem because whenever there is one player or a conglomerate of players who control more than 50 percent of the network computing power, they could theoretically crash the network by spending the same bitcoin twice, the so called “double spending problem.“ They don’t have an incentive to do so because it would probably ruin the bitcoin price and their business, but it’s better not to have to rely on one group of people controlling an entire money system. After all, we have that exact same system with central banking and bitcoin was set up as a decentralized alternative. So far, no player or conglomerate ever reached that 51 percent threshold, at least not since bitcoin’s very early days, but many market participants always thought Bitmain’s corner of the market is a bit too close for comfort. This favorable environment for Chinese bitcoin mining has been changing with a crack down on local government electricity largess as well as a crackdown on cryptocurrency. Bitcoin itself and mining bitcoin remain legal in China but cryptocurrency exchanges have been banned since late 2017. But more needs to be done for bitcoin to become independent of the caprice of a centralized oppressive regime and local government bureaucrats.
Northern Bitcoin Case Study
Enter Northern Bitcoin AG. The company isn’t the only one which is exploring mining opportunities with renewable energies in locations other than China. But it is special because of the extraordinary set up it has for its operations, the fact that it is listed on the stock exchange in Germany, and the opportunities for scaling it discovered. The operations of Northern Bitcoin combine the beauties of bitcoin and capitalism in one. Like Texas has a lot of oil and free gas and it makes sense to use the gas rather than burn it, Norway has a lot of water, especially water moving down the mountains due to rainfall and melting snow. And it makes sense to use the power of the movement of the water, channel it through pipes into generators to create very cheap and almost unlimited electricity. Norway generates north of 95 percent of its total electricity from hydropower. A waterfall next to a hydropowerplant near Sandane, Norway, Oct. 25, 2018. (Valentin Schmid/The Epoch Times)Capitalism does not distinguish between renewable and fossil. It uses what is the most expedient. In this case, it is clearly water in Norway, and gas in Texas. As a side note on the beauties of real capital and the fact that capital and the environment need not be enemies, the water in one of the hydropowerplants close to the Northern Bitcoin facility is piped through a generator made in 1920 by J.M. Voith AG, a company from Heidenheim Germany. The company was established in 1867 and is still around today. The generator was produced in 1920 and is still producing electricity today.
In the remote regions of Northern Norway, there aren’t that many people or industry who would use the electricity. And rather than transport it over hundreds of miles to the industrial centers of Europe, the industries of the future are moving to Norway to the source of the cheap electricity. Of course, it is not just bitcoin mining, but other data and computing heavy operations like server farms for cloud computing that can be neatly packaged into one of those containers and shipped up north. “The containers are beautiful. They are produced in the middle of Germany where the hardware is enabled and tested. Then we put it on a truck and send it up here. When the truck arrives on the outside we lift it on the container vehicle. Two hours after the container arrives, it’s in the container rack. And 40 hours later we enable the cooling, network, power, other systems, and it’s online,” said Mats Andersson, a spokesman for the Lefdal Mine data center in Måløy, Norway, where Northern Bitcoin has its operations. Plug and play. A Northern Bitcoin data container inside the Lefdal Mine data center, in Måløy, Norway. (Northern Bitcoin)If the cheap electricity wasn’t enough—around 5 cents per kilowatt hour compared to 17 cents in Germany—Norway also provides the perfect storage for these data containers, which are normally racked up in open air parks above the ground. Also here, the resource allocation is beautiful. Instead of occupying otherwise useful and beautiful parcels of land and nature, the Northern Bitcoin containers and others are stored in the old Lefdal olivine mine. Olivine is a mineral used for steel production and looks green. Very fitting. Hence also the name of the data center: Lefdal Mine. “We take the green mineral out and we take the green IT in,” said Andersson.
Using the old mine as storage for the data center makes the whole process even more resource efficient. Why? So far, we’ve only been talking about bitcoin mining using a lot of energy. But what for? Before you have actually seen the process in action—and it is similar for other computing operations—you cannot imagine how bizarre it is. Most of the electricity is used to prevent the computers from overheating. So it’s not even the processors themselves; it’s the fans which cool the computer that use the most juice. This is where the mine helps, because it’s rather cool 160 meters (525 feet) below sea level; certainly cooler than in the Texas desert. But it gets even better. On top of the air blow-cooling the computer, the Lefdal data center uses a fresh water system to pump through the containers in pipes. The fans can then circulate air over the cool pipes which transfer the heat to the water. One can feel the difference when touching the different pipes. The fresh water closed circle loop then completes the “green” or resource efficiency cycle by transferring its heat to ice cold water from the nearby Fjord. The water is sucked in through a pipe from the Fjord, the heat gets transferred without the water being mixed, and the water flows back to the Fjord, without any impact on the environment. To top it all off, the mine has natural physical security far better than open air data centers and is even protected from an electromagnetic pulse blast because it’s underground.
_The Nordfjord near Måløy, Norway. The Lefdal data center takes the cold water from the fjord and uses it to cool the computer inside the mine. (Valentin Schmid/The Epoch Times)_Company Dynamics
Given this superlative set up, Northern Bitcoin wants to ramp up production as fast as possible at the Lefdal mine and other similar places in Norway, which have more mountains where data centers can be housed. At the moment, Northern Bitcoin has 15 containers with 210 mining machines each. The 15 containers produce around 5 bitcoin per day at a total cost of around $2,500 dollars at the end of November 2018 and after the difficulty of solving the math problems went down by ~17 percent. Most of it is for electricity; the rest is for leasing the containers, renting the mine space, buying and writing off the mining computers, personnel, overhead, etc. Even at the current relatively depressed prices of around $4000, that’s a profit of $1500 per bitcoin or $7,500 per day. But the goal is to ramp it up to 280 containers until 2019, producing 100 bitcoin per day. Again, the company is in the sweet spot to do this. As opposed to the beginning of the year when one could not procure a mining computer from Bitmain even if one’s life depended on it, the current bear market has made them cheap and relatively available both new and second had from miners who had to cease operations because they can’t produce at low bitcoin prices. Northern Bitcoin containers inside the Lefdal Mine data center in Måløy, Norway. (Northern Bitcoin)What about the data shipping containers? They are manufactured by a company called Rittal who is the world market leader. So it helps that the owner of Rittal also owns 30 percent of the Lefdal mine, providing preferential access to the containers. Northern Bitcoin said it has enough capital available for the intermediate goal of ramping up to 50 containers until the end of year but may tap the capital markets again for the next step. The company can also take advantage of the lower German corporate tax rate because revenue is only recorded when the bitcoin are sold in Germany, not when they are mined in Norway. Of course, every small-cap stock—especially bitcoin companies—have their peculiarities and very high risks. As an example, Northern Bitcoin’s financial statements, although public, aren’t audited. The equipment in the Lefdal mine in Norway is real and the operations are controlled by the Lefdal personnel, but one has to rely on exclusive information from the company for financials and cost figures, so buyer beware.
Northern Bitcoin wants to have 280 containers, representing around 5 percent of the network’s computing power. But the Lefdal mine alone has a capacity to power and cool 1,500 containers in a 200 megawatt facility, once it is fully built out. “Here you have all the space, power, and cooling that you need. … Here you can grow,” said Lefdal’s Andersson. A mine shaft in the Lefdal Mine data center in Måløy, Norway. The whole mine will have a capacity for 1500 containers once fully built out. (Valentin Schmid/The Epoch Times)The Norwegian government was behind an initiative to bring computing power to Norway and make it one of the prime destinations for data centers at the beginning of this decade. To that effect, the local governments own part of the utility companies which operate the power plants and own part of the Lefdal Mine and other locations. But even without notable subsidies (i.e. cash payments to companies), market players were able to figure it out, for everybody’s benefit. The utilities win because they can sell their cheap electricity close to home. The computing companies like IBM and Northern Bitcoin win because they can get cheap electricity, storage, and security. Data center operators like Lefdal win because they can charge rent for otherwise unused and unneeded space. However, in a recent about face, the central government in Oslo has decided to remove cryptocurrency miners from the list of companies which pay a preferential tax rate on electricity consumption. Normally, energy intensive companies, including data centers, pay a preferential tax on electricity consumed of 0.48 øre ($0.00056 ). According to a report by Norwegian media Aftenposten, this tax will rise to 16.58 øre ($0.019) in 2019 for cryptocurrency miners exclusively. The argument by left wing politician Lars Haltbrekken who sponsored the initiative: “Norway cannot continue to provide huge tax incentives for the most dirty form of cryptocurrency output […] [bitcoin] requires a lot of energy and generates large greenhouse gas emissions globally.” Since Norway generates its electricity using hydro, precisely the opposite is true: No greenhouse gas emissions, or any emissions for that matter would be produced, if all cryptomining was done in Norway. As opposed to China, where mining is done with coal and with emissions. But not only in Norway is the share of renewable and emission free energy high. According to research by Coinshares, Bitcoin’s consumes about 77.6 percent of its energy in the form of renewables globally. However self-defeating the arguments against bitcoin mining in Norway, the political initiative is moving forward. What it means for Northern Bitcoin is not clear, as they house their containers in Lefdal’s mixed data center, which also has other clients, like IBM. “It’s not really decided yet; there are still big efforts from IT sectors and parties who are trying to change it. If the decision is taken it might apply for pure crypto sites rather than mixed data centers, like ours,” said Lefdal’s Andersson. Even in the worst-case scenario, it would mean an increase from ~5 cents to ~6.9 cents per kilowatt hour, or 30 percent more paid on the electricity by Northern Bitcoin, which at ~$3250 would still rank it among the most competitive producers in the world. Coinshares estimates the average production price at $6,800 per Bitcoin at $0,05 per kilowatt hour of electricity and an 18-months depreciation schedule, but concedes that a profitable miner could “[depreciate] mining gear over 24-30 months, or [pay] less for mining gear than our estimates.” Jäger says Northern Bitcoin depreciates the equipment over three years and has obtained very favorable prices from Bitmain, making its production much more competitive than the average despite the same cost of electricity. In addition, the natural cooling in the mine also reduces electricity costs overall.
Cheap Producer Advantage
At the moment, however, the tax could be the least of any miners worry, as the bitcoin price is in free-fall. But what happens when the price crashes further? Suffice it to say that there was bitcoin mining when the dollar price was less than 1 cent and there will be bitcoin mining at lower prices thanks to the design of the network. Mao Shixing, the founder of mining pool F2pool estimated 600,000 miners have shut down since the November crash in price, according to a report by Coindesk. As it should be in a competitive system, the most energy intensive and obsolete machines are shut down first. As with every other commodity, when the price drops, some miners will leave the market, leaving space for cheaper competitors to capture a bigger share. But with bitcoin this is a bit simpler than with copper or gold for example. When a big copper player goes bankrupt, its competitors have to ramp up production and increase cost to increase their market share. With bitcoin, if 3,000 computers get taken off the total mining pool, they won’t be able to mine the approximately 5 bitcoin any longer. However, because the difficulty of solving the computationally intensive cryptographic tasks of bitcoin decreases automatically when there are fewer computers engaged in the task, the other players just have to leave their machines running at the same rate for the same cost and they will split the 5 bitcoin among them. “The moment the price goes down, our production price will go down as well,” said Jäger, a process that already happened from November to December when the difficulty decreased twice in November and the beginning of December. This naturally favors players like Northern Bitcoin, which are producing at the lower end of the cost spectrum. They will be the ones who shut down last. And this is a good thing. The more companies like Northern Bitcoin, and countries like Norway—even with the extra tax—the more decentralized the bitcoin system. The more computers there are in different hands mining bitcoin, the more secure the system becomes, because it will be ever more difficult for one player to reach the 50 percent threshold to crash the system.It is this decentralized philosophy which has kept the bitcoin system running for 10 years. Whether at $1 or $20,000.
https://hashflare.io/87253E49 Check out my HashFlare Microsoft Excel calculator to show how much Hashrate will mine Bitcoins each day. This is for the SHA-256 algorithm. HashFlare sells Hashrate for buyers to cloud mine Bitcoins. You give them USD or BTC and in return they sell you Hashrate, which in return produced Satoshis (lowest unit of a Bitcoin). To use the Excel: bold cell font are user input or headers. There are 3 worksheets: HashFlare, Contract, and Bitcoins. The HashFlare worksheet has 3 user inputs: • First is Hash Power: input how much Hashrate to buy. • Second is Current Balance: input how many BTC you may already have in your account. • Third is Lowest Price BTC: the price per 10,000,000,000 Hashrate is $2.20. a) The price varies in BTC due to the constant change in BTC/USD value. b) 10,000,000,000 Hashrate used to cost $1.50 but due to high demand the price went up and will continue so get in while prices are still low. The Contract worksheet is informational only (no user input), what you buy is 1-year contract of Hashrate. When you consider the future of the Hashrate you bought this worksheet deducts 1-year old purchases because the contract expired scroll down to view the future. One year later, my formula automatically deducts year old purchased Hashrate. The Bitcoins worksheet has 4 user inputs: • First is Reward per Block: right now, when a minepool solves a block they are rewarded 12.5 Bitcoins. a) There soon will be a halving and the reward will be 6.25. • The second is Difficulty: as more miners mine the Blockchain the difficulty increases. a) This ensures a Billionaire will not invest a mammoth amount of money to mine a drastic number of Bitcoins and in turn becomes a Trillionaire and enslave the Earth. • Third is BTC to USD: input an updated value to seek precision on how much 10,000,000,000 Hashrate cost or go on HashFlare website and find it for yourself. a) The bold cell where it is one, decimal, and eight zeros is to know how various BTC amounts to USD. Google everything you need to learn and know. To edit the Excel workbook, you must download the file first. The dates are always updated to today and it helps you to know what day how much BTC you will earn if you invest today and reup 100% of the daily payments. This does not consider external investments after the first investment. Take into consideration as time progress it is safe to assume the difficulty will increase. Therefore, this Excel is good to eye ball the work in the short run and gives a dream in the long run. Use my referral link so we both get a bonus! 12JTNXpLe3Lc6K6W5CL86zZyhY26uQyGhY Bitcoin Donation Address https://1drv.ms/x/s!As44fpPGkuI4he9pXA0iNbq1-KXFRA
HashFlare Bitcoin Calculator https://hashflare.io/87253E49 Check out my HashFlare Microsoft Excel calculator to show how much Hashrate will mine Bitcoins each day. This is for the SHA-256 algorithm. HashFlare sells Hashrate for buyers to cloud mine Bitcoins. You give them USD or BTC and in return they sell you Hashrate, which in return produced Satoshis (lowest unit of a Bitcoin). To use the Excel: bold cell font are user input or headers. There are 3 worksheets: HashFlare, Contract, and Bitcoins. The HashFlare worksheet has 3 user inputs: • First is Hash Power: input how much Hashrate to buy. • Second is Current Balance: input how many BTC you may already have in your account. • Third is Lowest Price BTC: the price per 10,000,000,000 Hashrate is $2.20. a) The price varies in BTC due to the constant change in BTC/USD value. b) 10,000,000,000 Hashrate used to cost $1.50 but due to high demand the price went up and will continue so get in while prices are still low. The Contract worksheet is informational only (no user input), what you buy is 1-year contract of Hashrate. When you consider the future of the Hashrate you bought this worksheet deducts 1-year old purchases because the contract expired scroll down to view the future. One year later, my formula automatically deducts year old purchased Hashrate. The Bitcoins worksheet has 4 user inputs: • First is Reward per Block: right now, when a minepool solves a block they are rewarded 12.5 Bitcoins. a) There soon will be a halving and the reward will be 6.25. • The second is Difficulty: as more miners mine the Blockchain the difficulty increases. a) This ensures a Billionaire will not invest a mammoth amount of money to mine a drastic number of Bitcoins and in turn becomes a Trillionaire and enslave the Earth. • Third is BTC to USD: input an updated value to seek precision on how much 10,000,000,000 Hashrate cost or go on HashFlare website and find it for yourself. a) The bold cell where it is one, decimal, and eight zeros is to know how various BTC amounts to USD. Google everything you need to learn and know. To edit the Excel workbook, you must download the file first. The dates are always updated to today and it helps you to know what day how much BTC you will earn if you invest today and reup 100% of the daily payments. This does not consider external investments after the first investment. Take into consideration as time progress it is safe to assume the difficulty will increase. Therefore, this Excel is good to eye ball the work in the short run and gives a dream in the long run. Use my referral link so we both get a bonus! 12JTNXpLe3Lc6K6W5CL86zZyhY26uQyGhY Bitcoin Donation Address https://1drv.ms/x/s!As44fpPGkuI4he9pXA0iNbq1-KXFRA
Chill everyone, let's talk bitcoin internals, fundamentals and what it means for price.
So I've been watching bitcoin for a couple weeks, and i got a bit of my own dough into it. Of recent everybody seems obsessed with the vast accumulation of wealth in the hands of few, and the hordes of panicky upstarts trying to get in, who might get screwed by falling prices (for instance see this lovely post Hyperbole Now I'm not saying that the doomsday scenario the prophets are peddling is impossible. But it's about as possible as the wonderland prophets who're hoping for a 100'0000% return. Trojans On a related note, yeah some trojan started targeting wallet.dat, surprise surprise. Incidentally, that the same machine you're making VISA payments from and operate your e-banking? You worried about that too? Not? Well I don't see VISA shares falling every time somebody infects himself with a keylogger. Pricing So I thought a fair bit about where prices are going to go, and why, and I asked a lot of people and talked this over, and after this, a few things remain that give some direction. A price of a security (like bitcoins, or gold, stocks, fiat money etc.) is ultimately determined by supply and demand. If you understand supply and demand, you understand prices. So an important consideration is who's bidding for bitcoins, and who's asking for a price to sell them, and what prices to these parties consider reasonable. Buyers (bid) This is a diverse group of people, it may include people who use the small but fledgling bitcoin economy to buy coins to pay other people in them. But by far and large, it's probably a speculation driven market, people buy bitcoins in the hopes the value will rise. The psychology speculative buying ends up being about a zero-sum game. Somebody buys, somebody sells, the overall activity neither adds or removes coins from the market, and hence when viewed over long periods (months/years) this activity is just white-noise. This defines the demand, and demand rises and falls with bitcoin popularity and confidence. Some week confidence may be low, some it may be high. Sellers (ask) This roughly falls into two camps. The speculative sellers and the miners. Speculative selling (that is sells of coins bought earlier) is the other half of the zero-sum game, it neither adds or removes coins overall, and is hence just white noise. Freshly minted coins (by miners) which enter the market are the real driver of supply. The limited and small constant supply myth Every 10 minutes 50 new bitcoins are found. That is a fact, and if it strays from that, the difficulty adjusts to keep it there. If you look at it purely from the point of view of scarcity, this would seem a small (but nearly ignorable) inflationary influence. This however would be an over-simplification. There are substantial amounts of mined coins held by people who've been mining them for the better part of a year. They've been hoarding these coins, and commonly I'd refer to this group as bitcoinionaires. Their actually supply capacity vastly exceeds the day to day supply of fresh coins. Since these stockpiles are the real driver of the supply, it's important to understand when the miners/bitcoinonaires will sell and when they will not. Mining economics The mined bitcoins where obtained by the activity you call mining. This is neither an easy nor free way to get coins. It takes energy, room, time to setup, etc. There are constant costs attached to this (paying rent and electricity) as well as recoverable costs (buying hardware to do it) and unquantifiable costs (work rendered to make it all happen). You can think of mining as a business that has expenses and profits. In order for that business to work, the constant expenses must be covered, the recoverable expenses must be recoverable, and the work invested must be repaid. This all leads to a fairly straightforward calculation which goes something like this: You pay around 1000$ for one 1gh/s (one gigahash per second) in hardware. Running that hardware you pay about 2-3$/day/gh in energy. If you factor in rent of some or another form, you probably pay between 1-5$/day/gh in rent. If you also factor in resale value decay of the hardware you bought, you immediately lose about 20% upon buying the hardware, and around 30%/year. As a business you probably plan to run your miner for more then half a year, so about 50% of the hardware cost has to be recovered in a reasonable time-frame, say 3 months. Which means there's a hardware recovery calculation that you should do that factors in at about 2$/day/gh If you sum that all up, you get a running cost of mining that is around 5-10$/day/gh. One gigahash will get you about 1.2btc/day at current difficulty, which is at current prices somewhere around 17-20$. It is fairly obvious that your expenses need to be lower then your profits. If they are not, what happens? Difficulty You may have heard about difficulty, in essence it is a constant value (for 2 weeks) that aims to keep the rate of fresh coins at about 50coins/10minutes. Obviously, the more difficult it gets, the less coins 1 gh/s will mint, and the more difficult the economy of a mining business becomes. miner psychology Since you can't simply acquire and sell hardware capacity on a dime (it takes weeks and months to do it), and since you will need months to recover your boot costs, miner selling is out of necessity a long-term affair. So what can a miner do when the price of btcs falls below their operational cost?
They can give up mining, much to the delight of everyboy who has not given up, because if they do, the difficulty will go down, hence making their business profitable again. This is essentially an inflationary influence (since btcs get easier to obtain with lowering difficulty, hence making miners willing to sell at lower prices).
They can stop selling, hoping for better times when the prices are more favorable. This is essentially a deflationary influence, since the big stockpile supply of coins held by miners will simply dry out. They'll not sell for months and perhaps years.
They can sell at prices below their operation cost, in which case they soon cease to be a factor, because they're out of business.
bitcoinionaire psychology If prices go down and you sit on a big pile of coins, you lose wealth. Nobody likes loosing wealth, I don't like it, you don't like it, the bitcoinionaires don't like it. In order to become a bitcoinionaire you need to be a hoarder. If you wouldn't hoard, you wouldn't have tens of thousands of bitcoins. A hoarder essentially never likes letting go of his stash. You get rid of as little of your stash as possible to keep your risk and costs in a reasonable balance. Which means, these fat-cats depicted in the picture above, they didn't sell you all they had, not even a fraction. They sold you just about as much as they where personally willing to sacrifice. This means that they're still having the majority of their wealth in the game, and they absolutely do not want to see that devalued to zero. I've talked to a bunch of these very decent folks, and their sentiment is that they're in for the long haul. True they'll sell "big" positions occasionally, but they keep the majority of their assets stashed away. If you're expecting the miners/bitcoinionaires to suddenly explode with supply at lowering prices, you're most likely mistaken. the difficulty/price correlation For the reasons outlined above, there's a very simple correlation. If prices go down and difficulty goes up, by far and large supply dries out. However lower prices drive demand (in bitcoin volume) up, because as the price goes down, the buying power (in $/btc) of the would-be buyers increases. And if the market self-balancing fails, then the difficulty adjust will step in once enough miners have given up. In sum these dynamics lead to deflation. Since difficulty and hardware turnover moves at a much slower pace then prices, prices are far more likely to adjust to difficulty then the other way around in the long term. What does all of this mean? Keep a cool head, and don't let the market fool you. Trust your fundamentals, technicals and sentiment analysis, and tightly control your risk only to what you personally can afford to lose. If you buy in a mania or sell in a panic (we've see both the past 2 weeks), you're probably going to lose (or diminish your profits). Study bitcoin and what drives it carefully and come to your own conclusion. Adjust your strategy carefully and maybe, one day a couple years from now, you can be a bitcoinionaire. If not, life is full of other opportunities, so just pick yourself up and try the next. So chill everyone, and have a good time :)
I am considering investing my money into bit coin mining and have some questions about ASIC's
So live in my parents house in the southwestern US where the house runs on mounted solar panels(free power). I have considered investing in either the 50 GH/s Bitcoin Miner from BFL or the Avalon ASIC which says it mines 60 GH/s either way when I type this into a Calculator it SAYS i should pay off the 3-6 thousand dollar investment in like 20 days. This all sounds to good to be true. I want to know your opinion.
So I'm told my upgradable 50GH $1K ASIC clone order is complete
8/3/13 Update: Hey this post made the sidebar! Oh wait. That ain't good. Still no update from mfg. No tracking #. Site actually still shows my order as processing. If they prove skeptics wrong, I'll update it. newest TL; DR: Don't be "that guy." Don't order from ASX Project. 7/28/13: I admit I was feeling a bit uneasy about this Avalon clone ASIC miner order I made with ASX Project. The "resources" on Bitcoin Talk still sees this as a straight scam. I actually emailed the company a letter reminding them about karma due to a lack of progress/updates for the 2 days past their shipping date. It was money I can afford to lose, but hell, who likes to lose money on a calculated gamble? To be honest I was about ready to write it off (and still willing to write off) with maybe a token complaint to a Shenzhen anti-corruption agency of some sort. I don't have a tracking # yet but man it'd be a helluva coup if a newbie like me can come online in the next week or two with 50GH out of left field. ETA? Will update as it progresses, I did ask for a tracking #. Planning on immediately ordering 3 more modules to nearly triple my hash rate to 125GH if I see it running without too many errors/issues for 24 hours. 25Gh/s Modules sell for $300. FWIW: I'm so new my 1st ever mining equipment: a BFL Jally arrives Mon. TL;DR: N00b takes a gamble on $1K 50GH/s Avalon ASIC clone ~2 weeks ago: allegedly shipping. It's still Caveat Emptor until someone has vid/photos of ASX Project miners in the wild Text below: Hi there. Your recent order on ASX Project has been completed. Your order details are shown below for your reference: Order: #4XX Product Quantity Price ASX Bitcoin Mining System (25-125 GH/s)Assembly: No,Extra ASIC Module: +1 (50 GH/s System) 1 $999 Cart Subtotal:$999 Shipping:Free Shipping Order Total:$999
Bitcoin value. Current value at ~1000 USD. Profits above calculated at 900 USD Bitcoin difficulty: 1,180,923,195 Bitcoins per Block (BTC/block): 25 Conversion rate (USD/BTC): 900 Hash rate: 100 GH/s Electricity rate (USD/kWh): 0.09 Power consumption (W): 3 Time frame (months): 3 Cost of mining hardware (USD): 3011.98 Profitability decline per year: 0.61 Difficulty 1,180,923,195.00 Mining Factor 100: 0.04 USD/[email protected]/s Hardware break even: 84 days Net profit first time frame: 279.64 USD Coins per 24h at these conditions: 0.0426 BTC Power cost per 24h: 0.01 USD Revenue per day: 38.33 USD Less power costs: 38.32 USD System efficiency: 33333.33 MH/s/W Mining Factor 100 at the end of the time frame: 0.03 USD/[email protected]/s Average Mining Factor 100: 0.04 USD/[email protected]/s Power cost per time frame: 0.59 USD Revenue per time frame: 3292.21 USD Less power costs: 3291.62 USD Hardware Cost Breakdown: 100GH Overclockable Bitcoin Miner Kit 2,800.00 USD https://megabigpower.com/shop/index.php?route=product/product&product_id=70 RASPBERRY PI MODEL B 700Mhz; 512Mb RAM 41.99 USD http://www.amazon.com/RASPBERRY-MODEL-700Mhz-512Mb-RAM/dp/B009SQQF9C/ref=sr_1_1?s=pc&ie=UTF8&qid=1389015864&sr=1-1 Cooler Master Silent Pro Gold 800W 169.99 USD http://www.newegg.com/Product/Product.aspx?Item=N82E16817171057 Whatever amount you want to invest determines your percentage of the profits. Example: Total Investment Cost: 3011.98 USD Investor #1: 75 USD = %2.4 Profit Share, net profit of 6.97 USD after 3 months Investor #2: 500 USD = %16.6 Profit Share, net profit of 46.50 USD after 3 months Investor #3: 906.60 USD = %30.1 Profit Share Investor #4: 1505.99 USD = %50 Profit Share 874.16 USD net profit after 3 months with a $800 investment. Mining pool fee. Typically 3%. P2Pool offers 0% mining pool fee. https://github.com/forrestv/p2pool
Variable Block Size Proposal | Justin M. Wray | Aug 29 2015
Justin M. Wray on Aug 29 2015: -----BEGIN PGP SIGNED MESSAGE----- Hash: SHA512 Hey Bitcoiners! While I am an avid Bitcoin supporter, long-term user, and have done development work on tools and platforms surrounding Bitcoin, I have been very busy these past few weeks and haven't had a chance to fully (or closely) monitor the Block Size debate. I'm familiar with the basics, and have read abstracts about the front-running proposals (BIP 100, 101, and 102). Though I've honestly not read those in depth either. With that said, I was driving the other day and thought of a potential idea. I'll be clear, this is just an idea, and I haven't fully fleshed it out. But I thought I'd throw it out there and see what people thought. My Goal: Provide a variable block size that provides for sustainable, long-term growth, and balances the block propagation, while also being mindful of potential spam attacks. The Proposal: Every 2016 blocks (approximately every two weeks, at the same time the difficulty is adjusted), the new block size parameters are calculated. The calculation determines the average (mean) size of the past 2016 blocks. This "average" size is then doubled (200%) and used as the maximum block size for the subsequent 2016 blocks. At any point, if the new maximum size is calculated to be below 1MB, 1MB is used instead (which prevents regression from our current state). Introduce a block minimum, the minimum will be 25% of the current maximum, calculated at the same time (that is, every 2016 blocks, at the same time the maximum is calculated). All blocks must be at least this size in order to be valid, for blocks that do not have enough transactions to meet the 25%, padding will be used. This devalues the incentive to mine empty blocks in either an attempt to deflate the block size, or to obtain a propagation advantage. Miners will be incentivized to include transactions, as the block must meet the minimum. This should ensure that even miners wishing to always mine the minimum are still confirming Bitcoin transactions. At the block in which this is introduced the maximum would stay at 1MB for the subsequent 2016 blocks. With the minimum being enforced of 256KB . Example:
* Average Block Size for the last 2016 blocks: 724KB * New Maximum: 1448KB * New Minimum: 362KB
Example: (Regression Prevention)
* Average Block Size for the last 2016 blocks: 250KB * New Maximum: 1MB * New Minimum: 256KB
The Future: I believe that the 1MB regression prevention might need to be changed in the future, to prevent a large mining population from continually deflating the block size (and keeping us at the 1MB limit). For this, the hard limit could be changed in the future manually, through a process similar to the current one, though hopefully with far less urgency and hysteria. Another option is to add an additional calculation, preventing the new maximum from being lower than 75% of the current maximum. This would substantially slow down a block-size deflation attack. Example of Block-Size Deflation Attack Prevention:
Average Block Size for the last 2016 blocks: 4MB
New Maximum: 8MB
New Minimum: 2MB
Average Block Size for the last 2016 blocks: 2MB
New Maximum: 6MB (2 * 200% = 4, 4< 75% of 8, So use 8 * .75 = 6)
New Minimum: 1.5MB
This would provide a maximum growth of 200% per recalculation, but a maximum shrinkage of 75%. Request For Comments: I'd love to hear your thoughts. Why wouldn't this work? What portion is flawed? Will the miners support such a proposal? Would this even solve the block size issue? I will note that I don't find the 100% and 25% to be hard and fast in my idea. Those we're just the values that initially jumped out at me. I could easily see the minimum being anything below 50% (above 50% and the network can never adjust to smaller block sizes). I could also see the maximum being anything over 100%. Lastly, if a inflation attack is a valid concern, a hard upper limit could be set (or the historical 32MB limit could remain). I think the great part about this variable approach is that the network can adjust to address spikes in volume and readjust once those spikes dissipate. Thanks! Justin M. Wray -----BEGIN PGP SIGNATURE----- Comment: GPGTools - https://gpgtools.org iQIcBAEBCgAGBQJV4UXvAAoJENo/Q5Xwcn83ZWEP/iXAlNk5p9OlOPNSoHkECcxe AcartxMLrmOvAZVudU4+239TEvwPydmYX/ptmBYgrvRJfm/TWmi0ZbTioxbxTIWM IlNta1Y8IOHOEgBCtSW01j1PFHIzkBHQGIuqrKHhjcNVGbegXlPm3Da0gjNuTBIe IV58gf1OfYK2XjuCMQMvo3VyXUKhqbOvBNnZXr+Qo2sAtanmxHQ+TU/gjA02L9LO bb8WqQDj/veGnMexGh/X58tfQ5KCfLO401F7KnConDaFdKVDikp32zaSXZ7JWf/K OeseHW1OHHVdYpHvh5VG5GLtYYB5rnq8g7B0/kyx5n4ldB6GkLxzH9CPB0vxpMnZ dVCS/+EUe/wkHrpRVNhMwP8XfG+8gv9upKg6H/u39XmpL2H2G4cKeot5xRiWRNqY oJclAeIhDTL1bx/9e/VqvM91ESWpBLs+O8Mh9OzgfbN3gKR6BuoWHNwM9jSMDAT1 YzwdneSvAEFzgELMlae2QIzAUHno9qkHMkDVbdY3bBtSM9Xz4ditGgnq1D40ZZ+J zx5WVY7HCebgbk7T35xgKzSKQSEG9zFNW5Dvq66Se3Zpc5vCPw7Q2xwjjPz3zdXQ Lub0ohVWTzKr05tN1e/nu6keiY5cXRZ0w2MtHb19jtdWyoHEWWHanfOZjgbVSsuA saFCydA7O4E4BFxgtNze =JthX -----END PGP SIGNATURE----- original: http://lists.linuxfoundation.org/pipermail/bitcoin-dev/2015-August/010708.html
I have been helping a friend develop business strategies at a Bitcoin start-up over the last few months. In the course of this work, the topic of Bitcoin mining appears often to be fraught with misinformation and uncertainty, especially for individual miners who unfortunately may find it difficult to return an adequate profit in many cases. This informal guide covers some important issues prospective miners should consider to avoid headaches and financial loss. The information is derived from experience deploying a 400 TH/s system scheduled to come online in around December. Opinions are my own; I’m happy to entertain constructive feedback. This year, the Bitcoin network will award miners nearly USD 500 million, at the current price of USD 375 per bitcoin, to participate in a process known as mining. Unsurprisingly, this has attracted significant interest not only from Bitcoin advocates, but from speculators and investors as well. Regardless of one’s motivations, the business of Bitcoin mining must ultimately be profitable, or at least operationally viable, if there is to be any chance of success. HOME MINING Acquiring and personally managing ASIC miners is probably the most fulfilling way to mine bitcoins. It provides the greatest level of transparency, but requires a certain level of technical proficiency to set up and run. Advantages: 1) No hosting fees payable 2) Full control of operating parameters 3) Direct payment from mining pool Disadvantages: 1) Purchasing the latest mining hardware is inherently risky because the ongoing development of energy-efficient ASIC chips requires expertise, time and millions of dollars. R&D is usually funded by customer prepayments with no guarantee of timeliness or success. It is not uncommon for miners to incur financial loss and opportunity costs when a supplier fails to deliver 2) The retail price of hardware is typically marked up anywhere from 25% to 500%, or more, depending on market conditions. This creates a barrier to profitability, making it harder for miners to recoup hardware costs if they are unable to negotiate for volume discounts 3) Shipping fees and import tariffs can cost hundreds of dollars per unit, especially if importing equipment from overseas. This adds to the cost of hardware and must be taken into account when calculating the return on investment 4) Shipping time varies greatly. Each day spent in transit incurs an opportunity cost 5) Miners need to set aside space, usually in the home, to locate mining equipment 6) Many mining units may generate excessive noise, and heat that requires around the clock ventilation to maintain an optimal operating temperature range 7) The average mining unit draws up to three amps of current. A system containing twenty units could easily exceed the power limit in a typical home 8) Electricity is by far the largest expense in any mining operation, making up around 90 percent of operating costs. If the price of residential power is materially higher than the rate paid by commercial operators, it makes home mining uncompetitive CLOUD MINING Buying into a cloud mining service is often marketed as a convenient and hassle-free way to get in on Bitcoin mining. As the mining assets are managed by an intermediary, getting a breakdown of operating costs prior to purchase often proves difficult. This makes it challenging for potential customers to make a fully informed buying decision. The unspoken truth is that some cloud miners incorporate obsolete equipment—cheap miners from previous generations or liquidated, unprofitable hardware—into their cloud to sell to unsuspecting customers. Older mining units can consume 80% more power than the current generation miners, leaving very little profit for the customer. In addition to the acquisition price, those in the market for cloud mining should consider the power consumption of the cloud on offer, including changes over time as new mining units are added to increase total capacity. Advantages: 1) Start earning immediately. No waiting weeks or months for equipment delivery, installation and set up 2) Convenient and fully managed mining service means customer needs not be technically inclined or involved in day-to-day operations 3) Professional hosting service ensures optimal performance and low operating costs. Commercial hosts may be able to purchase electricity for a materially lower cost than residential customers 4) Acquisition price is often reasonable. Sometimes, possibly, too good to be true 5) Some platforms allow miners to sell their assets to other traders Disadvantages: 1) Not all hashing power is comparable. For the same acquisition cost, more energy-efficient miners are better because they use less power and return higher profits. When buying hashing power from a cloud, the buyer should ensure he is not getting obsolete hardware. Often this is not possible to verify without a basic understanding of the costs involved, however subpar earnings is a good indication that further investigation is required 2) Hosting and cloud management fees are typically payable. Sometimes there is little transparency in pricing, resulting in unexpected cost to the customer 3) Miner has little input into how the cloud is managed COSTS BREAKDOWN The amount of money earned from Bitcoin mining over a short period of time, say one week, is fairly easy to calculate. Given mining is a zero-sum game where new entrants dilute existing participants and the mining reward is roughly shared on the basis of each miner’s contribution to the overall hash rate, we can derive profit by estimating the income and costs. Mining Income: Weekly mining bitcoins created = 25,200 = 25 bitcoins x 6 times per hour x 24 hours x 7 days Assuming hash rate is at 300,000 TH/s, bitcoins earned weekly per one terahash of processing power = 0.084 bitcoins = (1 terahash/ 300,000 terahash) x 25,200 bitcoins Table 1: Weekly earnings per one terahash of computing power
As new miners enter the market, an increase in hash rate dilutes the mining reward. This is the source of much uncertainty in mining because it is difficult to accurately forecast the rate of increase. Dilution reduces a miner’s income while the amount of work is the same. Mining Costs: Electricity typically comprises around 90 percent of total operating costs. The two determinants of electricity cost are price and the amount of electricity consumed. If we take a hypothetical 700 GH/s system that is rated at 490 watts, we can normalise it: 0.7 kW per one terahash = (1 terahash / 0.7 terahash) x 0.49 kW Electricity used per week is: 117.6 kWh = 0.7 kW x 24 hours x 7 days If we know the cost of electricity, the dollar value of electricity consumed in one week can be estimated. For reference, power prices in Australia are between USD 14 cents (commercial rate) and 19 cents (residential rate). China averages around 8 cents, while other places can be cheaper. For example, in Georgia, USA the cost of commercial electricity is around 6.5 cents per kWh. Table 2: Weekly electricity cost of running a one terahash system
Other costs to consider include mining pool fee (typically 1 percent of earnings), hosting fee (depends on host) and other expenses such as air conditioning if hosting at home, maintenance, etc. Profit: Using the assumptions that hash rate is at 300,000 TH/s and bitcoin price is USD 375, we can work out the profit. Moreover, knowing the basic cost of Bitcoin mining can help prospective miners avoid offers that are too good to be true. To simplify, we ignore other running costs: Profit = (bitcoin price x bitcoins earned) - electricity expense Table 3: Estimated profit from running a one terahash system for one week
These figures serve as a good benchmark for comparing your personal performance. Where the electricity price is known, the difference between the calculated and actual profits can be attributed to two things: 1) Energy efficiency of mining units can cause significant deviation, especially when the cost of electricity is high. This is usually the case if obsolete equipment is being used 2) Hosting fee, mining pool fee and other costs also contribute to the difference Return on Investment: The rate of return is a measure of how much miners make for a given investment size. Implied annualised return = (52 weeks x profit per week) / (hardware cost + shipping fees + tariffs + installation and setup costs) The current price of ASIC miners runs at around USD 500 per terahash, excluding international delivery and insurance that can cost between five to 20 dollars per kg ($50 to $200 per unit). As a general rule, higher operating profit and lower capital costs are preferred. Investors endeavour to break even quickly on the initial hardware investment and make a profit on top of that. The problem with this model is that it implies the hash rate remains unchanged for the entire year. In reality, the hash rate is likely to increase depending on a variety of factors. Therefore, the annual profit forecast is sensitive to changes in the hash rate as well as bitcoin price. This is a complex and interesting topic that deserves its own post. Please, keep in mind that actual mining results will very likely be less than what is indicated by this simple calculation. Under some scenarios, even informed miners can experience financial loss. OPERATING RISKS 1) Liquidity risk: Bitcoin trading is rather shallow. As such, miners may experience high trading frictions when selling bitcoins to obtain cash. A bid-ask spread of up to 10% is not uncommon in some cases. Furthermore, most mining businesses rely on the liquidation of mined bitcoins to cover operating expenses such as electricity and hosting. The combination of these two factors may result in unexpected trading costs to the miner if there is insufficient demand from bitcoin buyers. 2) Price risk: Bitcoin is highly speculative and this is reflected in its price volatility. There is no guarantee that it won’t be worthless by next year. Therefore, the miner should keep in mind that the market price is just as important as the amount of bitcoins he holds. Bitcoin price is influenced by multiple factors outside of the scope of this discussion. 3) Competition risk: Bitcoin mining is a zero-sum game. While the size of the reward is fixed, new entrants are permitted to enter at anytime reducing all miners’ share of the reward. When bitcoin price is high, more new competitors are attracted to mining, further eroding all participants’ income. 4) As a function of the Bitcoin protocol, the mining reward will be halved between May and June of 2016. When this happens, all miners will experience an immediate decline of 50 percent in income with many operators becoming unviable. This effectively gives new entrants less than 1.5 years to break even and turn a profit. The short window of opportunity is troublesome because it makes mining significantly less profitable as the deadline draws near.
tl;dr: either the growth in the hash rate must slow down, the power consumption must go down, or the price of BTC must go up, a lot. And according to https://bitcoinwisdom.com/bitcoin/difficulty, it is showing no signs at all of slowing down, hashrate actually seems to be still growing exponentially, which is good. Using the following conversion factors, constants and assumptions: Code: GH/s per Diff 0.007158388055 Blocks/Period 2016 BTC/Period 50400 Watts per GH/s 1 (assumed constant rest of this year, is it right to assume this?) USD/kWh $0.10 In other words assuming everyone in the network pays $0.10 per kWh and everyone has miners that burn 1 W per GH/s (1 J/GH) then we can calculate the average production cost for each BTC over the last year as follows: Assuming the network growth rate over the next year is about 20% average we get:
Hash Rate Power Energy Cost Cost Date Difficulty TH/s MW MWh $/Period $/BTC
11-Sep-14 33,220,936,877 237,808 238 66,349 $6,634,853 $131.64 23-Sep-14 40,236,446,759 288,028 288 80,360 $8,035,984 $159.44 04-Oct-14 48,733,473,526 348,853 349 97,330 $9,733,002 $193.12 16-Oct-14 59,024,880,009 422,523 423 117,884 $11,788,392 $233.90 28-Oct-14 71,489,598,585 511,750 512 142,778 $14,277,833 $283.29 08-Nov-14 86,586,583,575 619,820 620 172,930 $17,292,988 $343.11 20-Nov-14 104,871,710,060 750,712 751 209,449 $20,944,876 $415.57 02-Dec-14 127,018,241,359 909,246 909 253,680 $25,367,960 $503.33 13-Dec-14 153,841,618,762 1,101,258 1,101 307,251 $30,725,098 $609.62 25-Dec-14 186,329,486,300 1,333,819 1,334 372,135 $37,213,544 $738.36 05-Jan-15 225,678,056,071 1,615,491 1,615 450,722 $45,072,202 $894.29 17-Jan-15 273,336,153,086 1,956,646 1,957 545,904 $54,590,430 $1,083.14 29-Jan-15 331,058,561,407 2,369,846 2,370 661,187 $66,118,694 $1,311.88 09-Feb-15 400,970,635,767 2,870,303 2,870 800,815 $80,081,465 $1,588.92 21-Feb-15 485,646,557,708 3,476,447 3,476 969,929 $96,992,858 $1,924.46 05-Mar-15 588,204,117,648 4,210,593 4,211 1,174,756 $117,475,554 $2,330.86 16-Mar-15 712,419,512,763 5,099,775 5,100 1,422,837 $142,283,732 $2,823.09 28-Mar-15 862,866,387,600 6,176,732 6,177 1,723,308 $172,330,835 $3,419.26 08-Apr-15 1,045,084,236,901 7,481,119 7,481 2,087,232 $208,723,207 $4,141.33 20-Apr-15 1,265,782,371,309 9,060,961 9,061 2,528,008 $252,800,823 $5,015.89 02-May-15 1,533,086,956,002 10,974,431 10,974 3,061,866 $306,186,635 $6,075.13 13-May-15 1,856,840,218,301 13,291,983 13,292 3,708,463 $370,846,321 $7,358.06 25-May-15 2,248,962,841,151 16,098,949 16,099 4,491,607 $449,160,670 $8,911.92 06-Jun-15 2,723,892,885,897 19,498,682 19,499 5,440,132 $544,013,236 $10,793.91 17-Jun-15 3,299,117,405,623 23,616,363 23,616 6,588,965 $658,896,517 $13,073.34 29-Jun-15 3,995,816,323,188 28,603,604 28,604 7,980,405 $798,040,547 $15,834.14 10-Jul-15 4,839,642,281,734 34,644,038 34,644 9,665,686 $966,568,646 $19,177.95 22-Jul-15 5,861,665,181,962 41,960,074 41,960 11,706,861 $1,170,686,065 $23,227.90 03-Aug-15 7,099,516,184,307 50,821,092 50,821 14,179,085 $1,417,908,463 $28,133.10 14-Aug-15 8,598,773,298,472 61,553,356 61,553 17,173,386 $1,717,338,634 $34,074.18 26-Aug-15 10,414,639,578,109 74,552,032 74,552 20,800,017 $2,080,001,680 $41,269.87 07-Sep-15 12,613,975,712,232 90,295,733 90,296 25,192,510 $2,519,250,952 $49,985.14 In other words something has got to give by the end of the year, or actually before December 1 This does not take into account hardware manufacturing cost or other expenses, just strictly electricity costs to produce one btc. I'm sure there are more efficient miners out now that are better than 1 watt gh right? Regardless of above, from now until 2016 block halving it's going to be extremely interesting to see what happens to bitcoin, and i think during this time peroid is when we will know for sure if bitcoin will become mainstream or not...
Bitcoin's block time is roughly 10 minutes. Every 10 minutes or so, a block is verified and a block reward is issued to the miner. When Bitcoin was first created, miners received 50 BTC for verifying a block. Every 210,000 blocks – roughly 4 years – the amount of BTC in the block reward halves. Accurate BitcoinCash mining calculator trusted by millions of cryptocurrency miners. Updated in 2020, the newest version of the BitcoinCash mining calculator makes it simple and easy to quickly calculate mining profitability for your BitcoinCash mining hardware. Unlike Bitcoin’s price, the Bitcoin block reward is predictable: every four years (or 210,000 blocks to be exact), the amount of Bitcoins awarded for each block, is cut in half. In 2012, the reward was cut from 50 Bitcoins per block to 25 and is now 12.5 Bitcoins per block. In 2020, this reward will fall to just 6.25 Bitcoins per block, and ... Find out what your expected return is depending on your hash rate and electricity cost. Find out if it's profitable to mine Bitcoin, Ethereum, Litecoin, DASH or Monero. Do you think you've got what it takes to join the tough world of cryptocurrency mining? Accurate Bitcoin mining calculator trusted by millions of cryptocurrency miners since May 2013 - developed by an OG Bitcoin miner looking to maximize on mining profits and calculate ROI for new ASIC miners. Updated in 2020, the newest version of the Bitcoin mining calculator makes it simple and easy to quickly calculate mining profitability for your Bitcoin mining hardware.
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