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Watch Wired Get Rich Quick With A Sleek Bitcoin Miner
- NegativeK 13y agoI'd never considered that there would be journalistic ethics issues around making money during the course of a story. The solution of effectively destroying the earned money is pretty funny, given that that's an occasionally expressed concern.
- cma 13y ago> So we’re destroying the private key used by our Bitcon wallet. I wonder if the typo was intentional.
- wmf 13y agoAt least they're sensitive to the issue. BFL customers who paid in full 11 months ago are pissed to see Ars and Wired (aren't they the same company?) getting free equipment before paying customers.
- nobodysfool 13y agoI believe 11 months ago, the price for a Jalapeno was $150, and they increased the cost to $270, while giving it just a slight jump in speed.
- fnordfnordfnord 13y ago>journalistic ethics Hyping a BFL's product with no mention of the number of outstanding orders that haven't been delivered, nor of competitor products. Also, failing to disclose that he was mining on a BFL employee's mining pool (Eclipse Mining Consortium) is connected to BFL-Josh completely destroys any credibility that otherwise might have been. I'm less impressed than ever WRT Robert McMillan's journalistic ethics.
- consultutah 13y agoUh, the bitcoin minor that they linked to costs $2,400. So, at the same rate it will take more than 20 weeks for ROI. [EDIT] They linked to the wrong one. The one they are using does cost $274. Not bad ROI.
- fixxer 13y agoThe $2,499 miner is 10x the speed of the $274 dollar miner, so the ROI is actually better.
- lingben 13y agolol yes but this is a product that has within itself the seed of its owners undoing... the more they sell, the more bitcoins are mined and the harder the next is to be mined
- fixxer 13y agothe sustainable part of their business is not this product, but their process.
- wmf 13y agoBFL actually moves very slowly (planned schedule: 4 months, actual schedule: 11 months); Avalon are the ones moving fast.
- fixxer 13y agoagreed; edited my point was that these businesses that produce products with short life cycles are process oriented; can be very rewarding... VC won't come knocking, but that isn't always a bad thing.
- sgk284 13y agoWhen there is a gold rush, sell pickaxes.
- 13y ago
- jackmoore 13y agoSomething about how the real people that get rich during a gold rush are the ones selling the shovels.
- adventured 13y agoNot exactly true. More people made money selling shovels. The people that got the richest owned the mines.
- dangrossman 13y agoSpending real resources (electricity/CO2) to produce money, then destroying the money, reducing the eventual money supply of this currency permanently, doesn't seem like the best way to handle any worries of journalistic integrity. They could've donated it just as easily.
- Shinkei 13y agoExactly! The only obvious thing to do is something constructive... not a blatant waste. In addition they are increasing the difficulty for others. He might as well flush money down the toilet and let sick orphans watch.
- mikeash 13y ago> He might as well flush money down the toilet and let sick orphans watch. I hope you're engaging in Poe's Law here. Wasting an amount of electricity comparable to leaving a single incandescent light bulb turned on is like flushing money down the toilet while sick orphans watch? Okaaaay then.
- Shinkei 13y agoThe resources were minimal, but the final product has a non-trivial value. You are saying that being proud of throwing away hundreds of dollars is not an affront to all those who could use that money? I am not using Poe's law here.
- mikeash 13y agoYes, because money isn't value, and throwing money away hurts nobody.
- Shinkei 13y agoBitcoin is either a commodity or a currency, depending on who you talk to. If it's a currency, it has the ability to purchase goods and services. If it's a commodity, then creating it and throwing it away represents a waste of resources... plain and simple. Your opinion that 'throwing money away hurts nobody' must mean that you disagree with the statement that 'all that is necessary for evil to prevail is for good men to do nothing.' That is essentially what is happening if we take currency/commodity and throw it away. They could have donated it to any charity and escaped the ethical issues. Instead they passed on that ability, there IS value in the money. This isn't some purist Economics debate, this is real life application. Same principle behind the whole idea of 'every dollar spent on war machines is a dollar not spent to clothe and feed the masses.'
- fixxer 13y agoPretty awesome watching the technological innovation around Bitcoin. I personally don't have any, but just from following the progress and learning, I am starting to dabble with technologies (FPGAs, for example) in my research that I completely did not anticipate getting familiar with. Great hardware opportunities today for those traditionally limited to software (like me!).
- dclusin 13y agoThis sort of thing has actually been pioneered by high frequency traders. Utilizing FPGA's & ASIC's is pretty standard fare for high frequency trading and algorithmic trading. What's novel about bitcoin is that it has been driven largely by end consumers. Thus, it is easier to see the technical landscape around it evolve.
- fixxer 13y agoexactly my point... all this technology just got a lot closer to mainstream.
- gregable 13y agoIf I understand their graph, they are generating about 0.29 BTC / day with this. Current BTC exchange is $118, so $34.22 revenue / day. At 44W, they'll spend ~1kW/day on power so only around $0.10 or so depending on where their power is coming from. So their break even point is somewhere around 8 days if I have everything correct. It seems that if these devices can be produced at scale, the marginal cost of mining 1 BTC will be only about $0.30 for now, thereby possibly pushing down the market price for BTC significantly.
- maxerickson 13y agoBitcoin are mined at a (relatively) fixed rate, around 3600 per day right now. Mining has little impact on the market price (10,000s of bitcoin are crossing Mt Gox each day). What will happen is that the 0.29 BTC / day will go down as more people plug in their asic miners.
- nobodysfool 13y agoYeah, that line from the story: >So in just two weeks, those lucky enough to have snagged one of these rigs will have paid off the initial investment. Everything after that is gravy. That's the biggest joke ever. The difficulty will go up substantially once thousands of people get their ASIC miners. It will take a lot longer than two weeks to pay itself off.
- mikeyouse 13y agoFrom the very next paragraph: > Meanwhile, with more and more computers joining the network, mining difficulty is quickly getting harder. So the amount of money these machines can make per day is slowly declining.
- wintersFright 13y agoThe value in USD of BTC comes from the supply and demand of people exchanging it for USD. So the value is derived from usage, not the cost of what it took to mine. How much does it cost the Fed to mint a USD? The gap in cost/value is called seigniorage.
- stfu 13y agoSorry for my ignorance, but can anybody explain what makes the Butterfly Labs machine special? What kind of propitiatory knowledge do they have that there are these long waiting lines for the machine? What is they key issue that makes these boxes so hard to replicate?
- crisnoble 13y agoIt is an ASIC, it means Application Specific Integrated Circuit. It was designed for one thing and one thing only: mining coins as fast as possible.
- kolinko 13y agoThey were one of the two companies which managed to produce dedicated integrated circuits - so called ASICs. ICs are blazingly fast, because they have only one purpose - to compute SHA2 / to mine bitcoins. There is no overhead that processors & GPUs had. A production of the IC costs high hundreds of thousands of dollars, and requires a ton of domain-specific knowledge. But once they're produced, each batch is quite inexpensive, and is capable of quite fast. Of course there could be other startups doing the same thing, but you'd need an around a million dollar budget. Not easy.
- wmf 13y agowhat makes the Butterfly Labs machine special? Marketing (for example, BFL equipment is much prettier than Avalon). What kind of proprietary knowledge do they have, that there are these long waiting lines for the machine? None. But they do have capital, which they got by having a fairly good reputation from making cheap FPGA miners which they could do because they found a way to buy obsolete Altera FPGAs really cheap. What is they key issue that makes these boxes so hard to replicate? People who know what they're doing don't design Bitcoin mining equipment. There are probably a lot of different reasons why, mostly due to very high financial risk. The only people designing this stuff are incompetent noobs, with predictable results.
- ValentineC 13y agoHow are people getting such huge variances in the wattage drawn for the 5GH/s miners? Wired measured it to be 43W-44W, Ars measured it as 50W [1], while David from Coding In My Sleep [2] measured it to be 30W. [1] http://arstechnica.com/gadgets/2013/05/weve-got-a-butterfly-labs-bitcoin-miner-and-its-pretty-darn-fast/ http://arstechnica.com/gadgets/2013/05/weve-got-a-butterfly-... [2] http://codinginmysleep.com/bfl-jalapeno-unboxing-and-demo/ http://codinginmysleep.com/bfl-jalapeno-unboxing-and-demo/ (see 7:33)
- Jach 13y agoLikely because they're using different revisions of the hardware. BFL didn't meet their power usage promises and have been going through several design changes over the past few weeks to try to get the power down more.
- grimtrigger 13y agoThe economics of this makes 0 sense. Why wouldn't the company that built these just plug them in and keep the money for themselves?
- mikeash 13y agoBecause people paid them for the product, and if they don't deliver, they could get sued. As for why they sold them at all, I'd assume they didn't have the capital to build them on their own.
- grimtrigger 13y agoMakes a little more sense then, didn't realize it was a crowdfunded project.
- simcop2387 13y agoLikely not worth it actually. In 6 months they'll be obsolete or barely make as much money. The entire premise of the protocol is that the difficulty keeps going up basically. As so many of the machines enter the workforce things even back out to where there's no distinct advantage. If they can keep R&D going to make better ones they can keep selling them regardless of how the bitcoin market is doing as far as difficulty goes.
- glomph 13y agoPlus if they mined all the coins themselves it would lower confidence in the currency (especially if it meant they aproached 51% of the mining capacity) which would entail that the price of bitcoin would go down. Possibly before they got their moneys worth. It is a lot safer to make money selling them to lots of people.
- runn1ng 13y agoOnly the first few miners will be profitable - if there will be tens of thousands of them already running, the costs will be higher than the returns. (Probably - nobody knows for sure.)
- 13y ago