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Discussion thread on bitcointalk.org: https://bitcointalk.org/index.php?topic=82941.0 https://bitcointalk.org/index.php?topic=82941.0 I don't know what the ske

by mrb 14y ago

Discussion thread on bitcointalk.org: https://bitcointalk.org/index.php?topic=82941.0 https://bitcointalk.org/index.php?topic=82941.0 I don't know what the skeptics think, but to me, the fact that at least 2 wealthy individuals or entities have invested $100k in 360-FPGA farms should send a signal that at least some consider Bitcoin sufficiently reliable, trusted, and stable to warrant this kind of investment. They put their money where their mouth is. I will soon write a blog post documenting the numerous other FPGA board vendors that started designing custom boards targetting the Bitcoin mining market. Disclosure: I am myself a long-time miner.

taligent 14y ago
The more logical conclusion is that they simply see money to be made. I don't believe they are sending ANY signal that Bitcoin is reliable, trusted or stable. In fact I personally see this as a clear sign that Bitcoin is fundamentally unfair and easily gamed.
- celticninja 14y ago
  How is it easily gamed? Production of bitcoins is related to processing power, if you can purchase the processing power you can increase your capacity to mine.
- etherael 14y ago
  Wait, what? it's a sign that it's fundamentally unfair and easily gamed that the market is responding to the incentives implicit in the design? Miners don't just suck away all the value in the system, they are the value in the system; no mining, no blockchain, no blockchain, no transactions. More mining, more secure blockchain, etc.
- Andys 14y ago
  They are taking a huge risk with this investment. With the mining reward set to automatically halve in 2013, and the currency still in its infancy, its a bold move. And despite dropping 6 figures on the hardware it barely a percent of the total hash rate.
  - maxerickson 14y ago
    They are only risking the amount that the hardware depreciates while they own it, which is apparently quite a lot less than the purchase price for this hardware.
- wamatt 14y ago
  > I personally see this as a clear sign that Bitcoin is fundamentally unfair and easily gamed. Curious that you used the word "unfair". It is quite likely that the fairness of bitcoin, is not related to it's future viability. Disparity is alive and well in the real world, and seems to be doing just fine.
- wr1472 14y ago
  Who said the creation of wealth should be or is fair? (not that I think it shouldn't be)
- excuse-me 14y ago
  Mining is the problem - these people at Newmont/BHP/Barrick are trying to destroy the economy by digging gold out of the ground.
bigiain 14y ago
Isn't it a lot like historical "gold rushes"? These guys are selling shovels to the miners. "Step right up! Get your ~10k/month bitcoin mining gear right here! Only $90,000 and _guaranteed_ to make you rich!"
- jerguismi 14y ago
  > "Step right up! Get your ~10k/month bitcoin mining gear right here! Only $90,000 and _guaranteed_ to make you rich!" I don't see any false advertising here. I think the people who invest to these things know the risks. After all, bitcoin is pretty open project. You can easily calculate how much you will be making money with this with current difficulty/exchange rate. Of course both of them will probably fluctuate heavily in the coming years.
  - gravitronic 14y ago
    Tell that to all the people who bought expensive video cards only to see the price of bitcoin fall until their recoup period's measured in years.
    - sp332 14y ago
      The rate of BTC generation falls off in a very predictable way. The only gamble is USD/BTC exchange rate.
      - gravitronic 14y ago
        USD/BTC is not the only gamble. BTC Generation system-wide is predictable, but you can't predict the size of the mining industry. So your 1GH/day contribution will be worth a smaller and smaller cut as more people like you are mining. These mining rigs are in competition with one another.
  - bigiain 14y ago
    Sure - I wasn't intending to imply any "false advertising" (and apologies if I did). I just saw a real parallel with local (Australian) school taught history of the gold rushes in the late 1800s - a few people got rich mining gold, but a lot _more_ people got rich selling shovels and camping gear to all the people who _didn't_ get rich looking for gold. Another notable modern example is Apple and the App Store - sure Rovio "struck it rich" with Angry Birds, which Apple "only" skimmed 30%off the top, but how much _more_ money do you suppose Apple has made as a result of Rovio's success spurring on many many imitators? (all of whom pay Apple $100/yr + 30% of whatever success they manage)
otterley 14y ago
I think it's telling that the manufacturer doesn't accept payment in BitCoins.

by mrb 14y ago

taligent 14y ago

The more logical conclusion is that they simply see money to be made. I don't believe they are sending ANY signal that Bitcoin is reliable, trusted or stable. In fact I personally see this as a clear sign that Bitcoin is fundamentally unfair and easily gamed.

celticninja 14y ago
How is it easily gamed? Production of bitcoins is related to processing power, if you can purchase the processing power you can increase your capacity to mine.
etherael 14y ago
Wait, what? it's a sign that it's fundamentally unfair and easily gamed that the market is responding to the incentives implicit in the design? Miners don't just suck away all the value in the system, they are the value in the system; no mining, no blockchain, no blockchain, no transactions. More mining, more secure blockchain, etc.
Andys 14y ago
They are taking a huge risk with this investment. With the mining reward set to automatically halve in 2013, and the currency still in its infancy, its a bold move. And despite dropping 6 figures on the hardware it barely a percent of the total hash rate.
- maxerickson 14y ago
  They are only risking the amount that the hardware depreciates while they own it, which is apparently quite a lot less than the purchase price for this hardware.
wamatt 14y ago
> I personally see this as a clear sign that Bitcoin is fundamentally unfair and easily gamed. Curious that you used the word "unfair". It is quite likely that the fairness of bitcoin, is not related to it's future viability. Disparity is alive and well in the real world, and seems to be doing just fine.
wr1472 14y ago
Who said the creation of wealth should be or is fair? (not that I think it shouldn't be)
excuse-me 14y ago
Mining is the problem - these people at Newmont/BHP/Barrick are trying to destroy the economy by digging gold out of the ground.

bigiain 14y ago

Isn't it a lot like historical "gold rushes"? These guys are selling shovels to the miners. "Step right up! Get your ~10k/month bitcoin mining gear right here! Only $90,000 and _guaranteed_ to make you rich!"

jerguismi 14y ago
> "Step right up! Get your ~10k/month bitcoin mining gear right here! Only $90,000 and _guaranteed_ to make you rich!" I don't see any false advertising here. I think the people who invest to these things know the risks. After all, bitcoin is pretty open project. You can easily calculate how much you will be making money with this with current difficulty/exchange rate. Of course both of them will probably fluctuate heavily in the coming years.
- gravitronic 14y ago
  Tell that to all the people who bought expensive video cards only to see the price of bitcoin fall until their recoup period's measured in years.
  - sp332 14y ago
    The rate of BTC generation falls off in a very predictable way. The only gamble is USD/BTC exchange rate.
    - gravitronic 14y ago
      USD/BTC is not the only gamble. BTC Generation system-wide is predictable, but you can't predict the size of the mining industry. So your 1GH/day contribution will be worth a smaller and smaller cut as more people like you are mining. These mining rigs are in competition with one another.
- bigiain 14y ago
  Sure - I wasn't intending to imply any "false advertising" (and apologies if I did). I just saw a real parallel with local (Australian) school taught history of the gold rushes in the late 1800s - a few people got rich mining gold, but a lot _more_ people got rich selling shovels and camping gear to all the people who _didn't_ get rich looking for gold. Another notable modern example is Apple and the App Store - sure Rovio "struck it rich" with Angry Birds, which Apple "only" skimmed 30%off the top, but how much _more_ money do you suppose Apple has made as a result of Rovio's success spurring on many many imitators? (all of whom pay Apple $100/yr + 30% of whatever success they manage)

otterley 14y ago

I think it's telling that the manufacturer doesn't accept payment in BitCoins.