Bitcoin is on fire again

[lxskllr]

You are still forgetting something

You want us to believe that we can double out money every 52 days? Turn a $10k investment into $80k in five months?

Where did he say you can multiply money? His corrected statement was a flat $23 a day.

 

[sdifox]

where did he say you can multiply money? His corrected statement was a flat $23 a day.

1200/23~=52

 

[artvscommerce]

You are still forgetting something

You want us to believe that we can double out money every 52 days? Turn a $10k investment into $80k in five months?

The missing variable is that the "difficulty" is increasing exponentially. The profitability will likely be substantially less from the time you pay for the ASIC to the time it actually arrives. Then, assuming it's still profitable when it arrives, the profitability is sure to continue to exponentially decrease as a result of the difficulty going up. The only way for the current profitability calculations to the accurate in the long term would be for the bitcoin value to also be rising at a similar exponential rate, which is extremely unlikely. The one thing I think we can count on though is many more ASICs to be coming online in the foreseeable future, which means that giant bitcoin pie that all of the miners are sharing is going to continue to be sliced into smaller and smaller pieces.

 

[Train]

maybe I didn't get all the variables, but using what he gave and the calculator, I got $23 a day REVENUE, $21 profit. So 57 days to break even (pay back the $1200), 114 to "double your money"

 

[sdifox]

maybe I didn't get all the variables, but using what he gave and the calculator, I got $23 a day REVENUE, $21 profit. So 57 days to break even (pay back the $1200), 114 to "double your money"

except the complexity goes up as you go further along, so the 114 turns into something like 150 or more.

 

[artvscommerce]

Perhaps a visual aid will help:

http://bitcoindifficulty.com/

 

[lxskllr]

1200/23~=52

That paid for the machine, and you've broken even if energy is free. Also, as noted above, you don't get a constant payout.

 

[artvscommerce]

except the complexity goes up as you go further along, so the 114 turns into something like 150 or more.

whatever your estimate is (in this case 150), it's probably going to be much much worse than that. take a look at the chart.

 

[Train]

except the complexity goes up as you go further along, so the 114 turns into something like 150 or more.

right, but aren't those points very far apart right now?

 

[sdifox]

That paid for the machine, and you've broken even if energy is free. Also, as noted above, you don't get a constant payout.

just explaining Doppel's number, I don't have a dog in this race :awe:

 

[sdifox]

whatever your estimate is (in this case 150), it's probably going to be much much worse than that. take a look at the chart.

I don't know what the number is, I just know it is much higher than 114. I figured adding 30% to his number is a decent estimate.

 

[sdifox]

right, but aren't those points very far apart right now?

no clue. It's a function of how many TH people are churning out.

 

[artvscommerce]

I don't know what the number is, I just know it is much higher than 114. I figured adding 30% to his number is a decent estimate.

The next difficulty change is estimated to be around a 50% increase. The difficulty changes every 2016 blocks, which works out to be every ~2 weeks. Considering this, along with the current ASIC development, and the history shown on the chart, I would think the break even point would be more like a year or more.

To anyone thinking this sounds too good to be true: well, it is.

It's extremely unpredictable. Even with the best ASIC out today, there's no guarantee that someone won't come out with a more power efficient ASIC next week, and with enough volume, all current ASICs could become unprofitable if the difficulty was increased enough.

Alternatively, if the value of the bitcoin dropped to say, $10, even at the current difficulty the existing ASICs would likely consume more $ in electricity than they produce in bitcoins.

In summary, high risk = high potential reward. but don't fool yourself, it's very high risk.

 

[sdifox]

There is also the illegality of it. As far as I know, it's an investment that you should be declaring as such. I bet you 99% of these bitcoin fanboys are not declaring their gains, and thus are evading taxes. And only a patent fool thinks they are anonymous enough to ensure they can get away with it.

I read somewhere someone contacted IRS about it and they told the guy forget it since the Treasury Board doesn't recognise bitcoin as a currency, therefore there is nothing to declare.

 

[Red Squirrel]

While it may be an income it's not an "official" income, ex: a job, where you'd get a T4 slip or have other paperwork involved such as if you own a business. So you're probably in the clear. Though I guess technically you'd have to start a business and declare it under that maybe. Then the ASICs would also be a tax write off. Hmmm.

 

[sdifox]

interesting. Vancouver is getting a Bitcoin ATM...

http://www.cbc.ca/news/business/world-s-first-bitcoin-atm-goes-live-in-vancouver-next-week-1.2251820

 

[Red Squirrel]

haha that is awesome. For some reason I can't see that lasting though, the government will stop it for some reason or the other.

 

[SheHateMe]

ASICS cost a fortune. Good luck trying to break into the bitcoin game with a regular ole GPU rig.

 

[Red Squirrel]

Some of the ASICS actually look affordable. Like, under a grand. The risk though is they are made for one purpose. So the question is will they be replaced by something else in a year from now, then you have this hardware that is completely useless.

My guess is you want to start small, and then use the money you're making to buy more ASICS. From what I gather it's too late to get into mining now though. The returns are probably not worth the risk.

 

[IEC]

I've got two ASICs on the way, and will likely resell on a certain auction site...

Difficulty increases are exponential at this point, so it'd be cheaper to make a small profit than risk losing money.

Edit: Even at 0.09c/kWh it's barely profitable (until the next difficulty increase in a week...) - with free power I guess it could be nice side income generation.

 

[lxskllr]

Edit: Even at 0.09c/kWh it's barely profitable (until the next difficulty increase in a week...) - with free power I guess it could be nice side income generation.

Their waste product is heat. As long as you don't live somewhere lame, the cost gets taken out of the heat bill.

Edit:
Whoops. You live somewhere lame :^D

 

[Mandres]

I can't believe BTC hasn't completely collapsed yet. Their only real-world value was anonymous purchases from Silkroad. That's it, that's the only inherent worth they had. Their value is derived solely from the security they afforded on illicit marketplaces.

And now that SR is gone, the value of bitcoins skyrockets? WTF? Has the whole world gone crazy?

 

[Arcadio]

I can't believe BTC hasn't completely collapsed yet. Their only real-world value was anonymous purchases from Silkroad. That's it, that's the only inherent worth they had. Their value is derived solely from the security they afforded on illicit marketplaces.

And now that SR is gone, the value of bitcoins skyrockets? WTF? Has the whole world gone crazy?

Or maybe your assumptions were wrong?

 

[Red Squirrel]

Their waste product is heat. As long as you don't live somewhere lame, the cost gets taken out of the heat bill.

Edit:
Whoops. You live somewhere lame :^D

LOL I read your post, glanced at his location, saw Texas, then saw your edit. :biggrin: At least it's not California. (that should be Texas' motto)

But yeah especially if you heat with electricity it actually makes sense to crunch. Or use the heat to drive a steam turbine which is then used to generate electricity which is then used to power it. Since electricity converts 100% to heat, you'd only need to feed outside electricity to make up the difference which is the inefficiency of the steam turbine. At least in theory I think it could work. Sterling engine would probably be better though as if you are producing enough heat to make steam your equipment is probably dangerously overheating. Wait, I think I'm seriously on to something here. :awe:

And I highly doubt Silk Road was the only reason for bitcoin.

 

[Crono]

I can't believe BTC hasn't completely collapsed yet. Their only real-world value was anonymous purchases from Silkroad. That's it, that's the only inherent worth they had. Their value is derived solely from the security they afforded on illicit marketplaces.

And now that SR is gone, the value of bitcoins skyrockets? WTF? Has the whole world gone crazy?

You do realize that anonymous or transparent purchasing of legal items is still possible, right? The point of bitcoin and other altcurrencies was the same as any real-world investment: to turn capital into wealth.

It's also valuable as decentralized currency, as a way to have a non-fiat monetary system (if I can call it that) independent of governmentally controlled currencies. Cryptocurrencies are just an easy way to trade, too, and to trade fractions of equivalent amounts of other currencies. There's also the mathematical/computer interest if you take it as a hobby. Convert idle CPU/GPU time into money? Sure, why not? Especially whenever it's actually profitable. And even when it's not, plenty of users find it fun to tinker with hardware, anyway. Might as well use that GPU for something other than "Can it run Crysis... on 4k at 60 FPS?" if that's what you want to do.