Bitcoin Mining Difficulty Discussion


#1

Can’t believe that we don’t have a thread dedicated to the bitcoin difficulty yet. So here it is cause difficulty just went up again as seen on Bitcoinwisdom.

500 TH/s at 100% probability (pool luck) will mine an avg of 4.238 BTC over the next 14 days.


General Bitcoin Discussion
#2

To put the recent two adjustments into perspective:

Network hashrate went up by about 30 PH/s in the last ~4 weeks. In Bitmain terms that’s roughly 6000 brand new S7s or > $10m at retail value, not including infrastructure. Someone - maybe not Bitmain though as they probably haven’t manufactured that many yet - is putting a lot of money into this, likely a last ditch effort before the halving.

And a shameless plug if I may - check out philipma1957’s diff threads in Bitcointalk’s mining speculation section - there is some money to be won. No purchase necessary. https://bitcointalk.org/index.php?board=81.0


#3

Seems about right.


#4

2015 has been a moderate average of about 5.55% increase in difficulty per month. That and a relatively stable BTC value of 220~260 and mining hasn’t been too shabby for the year. Contrast that to 2014 where we saw an average monthly increase of 23% difficulty with a drop of BTC from ~$1000 USD to around $300 USD. 2015 was awesome in comparison, but in reality it still wasn’t overly profitable. :smile:

I wouldn’t doubt that the last 2 increases (28 days) has largely been the result of the S7’s being “Tested”. Take for example the 1000 they put up on Hashnest. I’d guess they have double that available for larger mining operations and all the individual physical miners. That’s probably batch 1, which is already hashing as “Test” - Batch 2 is probably near completion and already being thrown into the “Test” phase while batch 1 gets shipped out. Sep 21 is only 4 days away.

I hope there is another plateau in the difficulty levels after the S7’s so the damn things aren’t obsolete in a few months. That and a fat increase in BTC value would be nice to give the S5’s some longevity. With the increase in Hashrate and the imminent halvening, you’d think a large jump would be coming in the next 6-9 months.


#5

I dont this is only S7. All all major companies have announced new chips. KnC, Bitfury, 21 etc. I think we have to start accepting the fact cloud mining s slowly getting out of the reach of small home miners, the same way classic home mining did. It ll comes down to people with access to cheap electricity and efficient chips and since lots of these large mines do not even offer cloud component, you have to ask yourself how these companies which offer cloud mining can stay competitive if they continue sharing their profit with cloud investors, us. It all comes down to economics 101, price equals marginal cost.

This is why I have switched all my cloud investments into stake coins, several of them. Much more profitable and no chips and electricity to think about.


#6

I said a long time ago, and I say again, Throwing more power at the problem is a bad thing, soon the home miner will have an insurmountable barrier to profitable entry. Once the barrier is high enough, decentralized will become centralized.


#7

BitFury keeps bringing power online too probably more than Bitmain has in the last weeks.

Agreed. It’s the bitcoin elite preparing the path for bankers and co to “experiment with block chain technology”. Those people don’t want to build on a tech in the hands of random folks like us… corporatism.


#8

I agree with this thinking for the most part. In theory BTC value should increase as hashrate increases, thus increasing difficulty, thus increasing scarcity. Unfortunately we haven’t really seen that since MTGox. In fact in 2014 we saw the direct inverse. 2015 we see relatively flat BTC value with relatively low difficulty increase. Scarcity is having little effect on the BTC value. This may partly be the result of the exit of many home miners as profits become losses, perhaps also in part due to pseudo BTC acceptance by companies accepting and dumping on the markets, and the prevalence of scam in the environment leading folks to abandon cryptos in general. Decentralization breeds inclusiveness in my thinking. It’s unfortunate that some of the large manufacturers have abandoned the home miners, when it was the home miners that ultimately built their companies with their initial investments. It’s great that we have companies like Bitmain that fill the void for those willing to still be a part and take the risk, even though profits are minimal and often times unlikely without BTC value increase. If Asic manufacturers all abandon resell of miners and hoard the gold themselves you’ll end up with a non-inclusive BTC let alone a centralized coin. They’ll have less buyers, less users, and a lowered value coin. Ultimately they may end up mining massive amount of bitcoin with very few people to sell them to. They should be sticking to the plan of Decentralization and Layman Inclusivity. The greater the number of people involved in the coin, at every level - including the mining, the greater the value.

While this might appeal to bankers at a greater level then a completely decentralized blockchain ledger, it’s my understanding that most of the corporate banks are working on in-house blockchains that are completely centralized complete with charge reversal integration. These closed systems have little to do with BTC other than a “borrowing” of the ledger system. Ultimately in the banking institutions this means very little change to the end user, but a great amount of savings to the banks. The only change an individual might notice is the speed at which a transfer occurs from bank to bank. The more things change, the more they stay the same :slight_smile:


#9

While this is true to an extent, there’s a forgotten factor in the equation: Profit.

All the while there is a profit to be taken with what is perceived as a reasonable rate of return on investment people will respond to it. Unfortunately a lot of that profit is considered in £/$ etc - plus there’s the obvious electricity costs.

With less profit machines will switch off and regular home miners would be in with a shot again. Then it’ll reverse again. It’s a very fluid system and I don’t think we’ve seen it in action for long enough to be able to easily predict it’s future, so obviously I’m just guessing :slight_smile:

I’ve been following the exploits of the banks experimenting with this and I’ve come to the conclusion that they haven’t seen what gives btc it’s advantage yet. If all they use the blockchain for is shuffling figures between branches it’s not going to make enough of a difference to their business to make it a worthwhile adaption to their business models.

What they’ve got to realise is that what this tech does is make them obsolete. If they want to exist in the future (assuming enough people choose to use blockchain currencies) they’ll simply become service providers, key holders, and we’ve got enough of them in the bitcoin space as it is. Sure, I reckon there’s space for that kind of service, but I don’t think all of the current banks will be able to compete with the incumbents.


#10

We need banks to provide safe deposit boxes for the cold wallets.

Just like we need Best Buy to be a showroom for Amazon. Hmmm… maybe not the best business model.


#11

There us a second that make people blind. Greed.

If i where to throw 100PH into the system run them till they are unprofitable then sell them off to home miners and in effect make 150-200% of my initial investment, and walk away with cash…do I care what harm I just did?


#12

Probably shouldn’t have limited it to “bankers”… corporatism is most accurate.


#13

Next Bitcoin difficulty adjustment is looking promising. Only ~1% increase in 5 days unless one of the big players pushes another lot of hardware live. Let’s hope they wait till after the adjustment.


#14

Estimated Next Difficulty: 71,298,596,219 (+8.28%)
Hashrate(?): 525,519,626 GH/s

For those of you with S5 power on HashNest, time to shift it over to S7.


Official Bitmain & HashNest Thread
#15

Estimated Next Difficulty: 72,772,679,475 (+10.52%)
Adjust time: After 15 Blocks, About 2.3 hours

@InsaneMiner, you know what I mean?


#16

posts about HASHNEST should be in the HASHNEST THREAD!!!


#17

The whole forum should be one big thread. That would solve all issues with off-topic posts and make it really easy to follow everything (unless you’re employed that is).


#18

but but but… 5 days ago I was just pointing out the anticipated difficulty increase, making a suggestion :stuck_out_tongue:

Edit:

Yeah I can already hear the “who dafk came up with this idea? Aint nobody got time to scroll through eleventhy thousands replies to XYZ” applause.

:laughing:


#19


#20

Holy crap, I haven’t seen a diff increase like this since early to mid-2014.

https://bitcoinwisdom.com/bitcoin/difficulty