5 ms·

Exactly, except that overnight the population of miners doubles so everyone is getting half the gold that they were just yesterday and they can no longer afford

by Osiris 13y ago

Exactly, except that overnight the population of miners doubles so everyone is getting half the gold that they were just yesterday and they can no longer afford the $83 eggs, and the prices drop. The same thing is happening with mining hardware. Over the last two months, the difficulty has from 21m to 65m. My ASICs are generating 0.6 BTC per day versus 2 BTC / day in early July.

yebyen 13y ago
Look at this sad, sad graph. It will get better when I rewrite my business plan to have something other than "Mine bitcoins" in it. https://www.beeminder.com/yebyenw/goals/christmas-bitcoins https://www.beeminder.com/yebyenw/goals/christmas-bitcoins I cashed in 22BTC in January to buy two BFL Jalapenos. I paid an extra $100 each just last week to get the 2GH/s bonuses added, because I knew they'd be shipping soon. They just arrived with one bad power cord, I'm starting to recoup my losses now. It's going to take some mental anguish to get myself over the idea that "I'll never have that much disposable money again, at least not in five more years of saving." The calculator says I can still mine $512 in 43 days, but I'm skeptical it will be more like 75 or 120 days, given the pace of the various difficulty graphs that I've seen.
- mahyarm 13y ago
  That is why you put a hard percentage cap of assets on any speculative ventures.
  - yebyen 13y ago
    You don't understand at all. I've never invested more than $50USD in any bitcoin schemes, and I've cashed out of them all without loss. That 22BTC was what I generated and earned myself mining. At the time it was worth no more than $12/BTC. I spent it on more mining equipment. It's really true what they say, sell shovels.
    - yebyen 13y ago
      Or maybe you understand in spite of the fact that there aren't any USD involved. Buying a new miner is a risky venture. Even in the face of the coming obsolescence of my existing (working) mining rig. Whether you use bitcoins or USD to do it.
    - mahyarm 13y ago
      You said "I'll never have that much disposable money again, at least not in five more years of saving." I thought you poured a lot of your money into buying miners, and the return you though you would get was different the return you'll be actually getting.
      - yebyen 13y ago
        Yep. I'll lay down the timeline for you since it's hard to imagine how badly I've played these hands of poker. The mining calculators all (most) account for a future decline in the profitability of mining, but "0.61 per year" apparently can't accurately characterize how quickly the difficulty has ballooned and how much you need to upgrade your hardware to keep up the pace. I started with nothing but the computer on my back. I learned about bitcoin, started CPU mining when they were worth pennies. Accumulated 220 bitcoins through solo mining when blocks were worth 50 coins and learned to trade them at exchanges. I bought and sold enough times that I was willing to add $50 to the mix. I made some bad trades and cashed out my $50 anyway in spite of the bad trades as $300, then bought in for $50 again. Eventually I had 22BTC and the price was about $12.50. BFL was making their announcements about "shipping soon" again and I decided to take a risk and lay out $300 worth of bitcoins in mining equipment. I never paid $312. In fact I had already walked away with $300 separately. Time passes. The price of a bitcoin approaches $300. I kick myself; I could have paid off all my student loans. Time passes. The price of bitcoin is back around $115. It's getting harder to mine. I can't get back my 22BTC (or even close) with the GPU miner I'm using now. The community started to express doubt that BFL customers will get what they bargained for, as shipping deadlines continue to slip. I keep my eye on the build queue and realize I'm next. I pay $200 (USD) to get 30% faster miners. At this point my GPU output is next to nothing. I'm making $6 twice a month... once a month. Jalapenos arrive a few days ago. I plug them in (eventually) and I'm now mining 0.12 per day. I should have my $512 in about 43 days at the current difficulty. Next difficulty is estimated to be x1.32 on September 4, much sooner than that. I may never make back my $512 if this pace keeps up. Hopefully the exchange rates can keep pace with the difficulty. At a minimum I should have made back my BTC investment in USD if the whole market does not go bust before then. Maybe it's 80 days. I still started with nothing and never risked more than $50, except for "play money." It's all shoulda coulda "would have been" but you can see that 220 or even 22BTC is again well out of my reach.

by Osiris 13y ago

yebyen 13y ago

Look at this sad, sad graph. It will get better when I rewrite my business plan to have something other than "Mine bitcoins" in it. https://www.beeminder.com/yebyenw/goals/christmas-bitcoins https://www.beeminder.com/yebyenw/goals/christmas-bitcoins I cashed in 22BTC in January to buy two BFL Jalapenos. I paid an extra $100 each just last week to get the 2GH/s bonuses added, because I knew they'd be shipping soon. They just arrived with one bad power cord, I'm starting to recoup my losses now. It's going to take some mental anguish to get myself over the idea that "I'll never have that much disposable money again, at least not in five more years of saving." The calculator says I can still mine $512 in 43 days, but I'm skeptical it will be more like 75 or 120 days, given the pace of the various difficulty graphs that I've seen.

mahyarm 13y ago
That is why you put a hard percentage cap of assets on any speculative ventures.
- yebyen 13y ago
  You don't understand at all. I've never invested more than $50USD in any bitcoin schemes, and I've cashed out of them all without loss. That 22BTC was what I generated and earned myself mining. At the time it was worth no more than $12/BTC. I spent it on more mining equipment. It's really true what they say, sell shovels.
  - yebyen 13y ago
    Or maybe you understand in spite of the fact that there aren't any USD involved. Buying a new miner is a risky venture. Even in the face of the coming obsolescence of my existing (working) mining rig. Whether you use bitcoins or USD to do it.
  - mahyarm 13y ago
    You said "I'll never have that much disposable money again, at least not in five more years of saving." I thought you poured a lot of your money into buying miners, and the return you though you would get was different the return you'll be actually getting.
    - yebyen 13y ago
      Yep. I'll lay down the timeline for you since it's hard to imagine how badly I've played these hands of poker. The mining calculators all (most) account for a future decline in the profitability of mining, but "0.61 per year" apparently can't accurately characterize how quickly the difficulty has ballooned and how much you need to upgrade your hardware to keep up the pace. I started with nothing but the computer on my back. I learned about bitcoin, started CPU mining when they were worth pennies. Accumulated 220 bitcoins through solo mining when blocks were worth 50 coins and learned to trade them at exchanges. I bought and sold enough times that I was willing to add $50 to the mix. I made some bad trades and cashed out my $50 anyway in spite of the bad trades as $300, then bought in for $50 again. Eventually I had 22BTC and the price was about $12.50. BFL was making their announcements about "shipping soon" again and I decided to take a risk and lay out $300 worth of bitcoins in mining equipment. I never paid $312. In fact I had already walked away with $300 separately. Time passes. The price of a bitcoin approaches $300. I kick myself; I could have paid off all my student loans. Time passes. The price of bitcoin is back around $115. It's getting harder to mine. I can't get back my 22BTC (or even close) with the GPU miner I'm using now. The community started to express doubt that BFL customers will get what they bargained for, as shipping deadlines continue to slip. I keep my eye on the build queue and realize I'm next. I pay $200 (USD) to get 30% faster miners. At this point my GPU output is next to nothing. I'm making $6 twice a month... once a month. Jalapenos arrive a few days ago. I plug them in (eventually) and I'm now mining 0.12 per day. I should have my $512 in about 43 days at the current difficulty. Next difficulty is estimated to be x1.32 on September 4, much sooner than that. I may never make back my $512 if this pace keeps up. Hopefully the exchange rates can keep pace with the difficulty. At a minimum I should have made back my BTC investment in USD if the whole market does not go bust before then. Maybe it's 80 days. I still started with nothing and never risked more than $50, except for "play money." It's all shoulda coulda "would have been" but you can see that 220 or even 22BTC is again well out of my reach.