Bitfury 400 GH/s Bitcoin Mining Rig Hits US Shores
thegenesisblock.com
thegenesisblock.com
Just as in every gold rush, it is a much more blessed position to be the one selling the blue jeans and shovels than to be the one attempting to sift and mine.
I wonder if Bitfury accepts bitcoin as payment. I suspect they do not. EDIT: You can totally pay with bitcoin - http://www.bitfurystrikesback.com/checkout/
I wonder what effect all this has on the Bitcoin economy. If everyone begins doing this, then it will become extremely difficult to mine any Bitcoin without any sort of gear. Feathercoin [1] appears to try and stop this, although I am not sure how effective it is.
[0] http://www.alloscomp.com/bitcoin/calculator
[1] http://feathercoin.com/It already is and has been for a long time
> Feathercoin [1] appears to try and stop this, although I am not sure how effective it is.
IMHO, Feathercoin should not be taken seriously.
That said, the point of Bitcoin is not to avoid that; it is to avoid forced centralization by governments (among other things), which we have for fiat money, and it is succeeding at that.
Bitcoin is not supposed to be a democratic experiment where the little guy gets some kind of special treatment. It is a digital currency that is not backed by force.
I don't think there is any real point in having more than one cryptocurrency. Litecoin could have been great if it had come first, but Bitcoin came first, so I think there is little to no point in having Litecoin.
Yes, bitcoin is not a democratic currency. But it is designed (and desired) to prevent all power from landing in the hands of very few / one, since then the entire foundation it's built on is worthless. Bitcoin is fundamentally stronger with more players, and Litecoin is easier for more players to join.
Absolutely, it came out a distant second, and that very well could be it's death. But why is there no real point in having more than one? With more than one, "money" is more resilient against new crypto attacks.
Play with the knobs some more and you realize: If you purchase the 400 GH/s August device in December, you will never make back the 7.5k that the thing costs. Wait "only" until November and you barely get a 60% ROI.
That's some fast, fast market right there.
They were selling the kit for $22,000, so it'll take at least 5 weeks for the ROI, probably longer given there will be at least 2 difficulty resets in that time frame.
I looked at investing in one but I couldn't come up with the funds. Instead I have pre-orders out for gear due in October.
If everyone begins doing this, then it will become extremely difficult to mine any Bitcoin without any sort of gear
This is already the case. I'm mining at about 250GH/s with 3 Avalons and I earn on average about 1.2 BTC per day per machine. A month ago is was closer to 2BTC per machine per day. Right now, GPU mining is dead. It's literally cheaper to buy a bunch of USB sticks that mine at 350MH/s for $100 each than to buy a bunch of video cards as the USB sticks are more power efficient. Even so, depending on the difficulty, those USB sticks could take a year to earn back the 1BTC.
For mining, no. This was always seen as the future state, it was just a question of when. Not too long before the first ASICs started coming out, it was already basically not profitable for most people, you had to be running a limited set of GPUs and be in a place that had cheap electricity to make any real money.
>Is it just that everyone uses fractions of BTCs now?
Since they're roughly $100 each, yes, basically everyone uses fractions. Thankfully they're way more divisible than e.g. pennies, and if the value / userbase goes up by a couple orders of magnitude, they can be made more divisible, also unlike pennies.
So yeah. The shovels seem to run a decent risk of being worth more to sell than to use.
I wish we were just as enthusiastic and race to solve other problems too -- like spreading education, finding out ways to purify water, or maximizing agriculture throughput in famine, or predicting when the next hurricane, tsunami, or earthquake is coming our way.
if we get to manage to have a income to our needs, and do what we like.. be happy with it, and help others in the process.. what could be better than that?
Is such a waste to have so many bright people working to make rich people even more richier, while there are so many simple needs that all of those good brains could be helping to solve.. there are people that doesnt even have basci needs like water, food security, eletricity, education, dignity, etc..
meanwhile all the rich people problems "how i can get even more rich?" get all the brains working for it..
doesnt it say something about us all?
That we're utilitarian in nature? This isn't exactly Nobel-prize winning stuff.
The idea that we collect money and this is greedy or inherently bad is a highly personal view. Besides, what about Bill Gates and others who are donating their fortunes to do EXACTLY what you two ask?
You're also ignoring the fact that "getting richer" is not the enemy of "doing good."
but there are parts of "getting richer" that can really do harm.. drugs? corruption? greedy banks?
Im all the way for the "good capital", and thats the one that creates goods and value to us all..
acomplished people should have sucess, this is cool..
but i see a lot of the "get rich first, donate later" much people praise.. but in the majority of cases.. this is just a way they can feel good about themselves.. but in the end it will just create more greedy people that doe more harm than good..
the beginings, and true intentions always count.. easy money without real value, is what corrupts our society, and worse.. make the dollar created by value of the real working people (and i include bill gates/steve jobs in that list) less valuable..
thats all about the 2008 crysis.. its the same evil root.. but see the guys behind it.. and how they use to make money
I'm totally not saying the two are equivalent, but look at the non-obvious ways that NASA has helped all of us: http://www.wtfnasa.com/
creating something with good will, and with a good purpose at least can do us less harm.. but even than.. it always depends of the intentions of human beings..
(a plain could be used for fast transport or to kill) (discoveries about the atoms can cure câncer, energy reactors or to create atomic bombs)
However, I do know how to write code, and if I can take some of the money I've earned to buy one of theses "useless" devices which can also make me some money, maybe one of the engineers at that company can spend his paycheck to send his daughter to college, where she can study ways to fix these other problems you mentioned.
In other words, read up on the economic theory called "guns and butter".
Whilst there will always be localised crop failures and unlucky weather, true famine requires incompetent government; historically, either no effective government (through war or some other circumstance) or a government able and willing to enforce agricultural insanity. Peoples who have been farming for generations know about crop failure and unlucky weather; incompetent government is just plain stupid.
Mao's famine, for example, despite the constant claims that it was really bad weather, was an endless cycle of stupid agricultural decisions, totalitarian enforcement of stupid decisions, a horrifically useless harvest reporting scheme, massive movement of people, refusal to give people stored food as they were starving, efforts to save face internationally, on and on in a perfect storm of government created famine.
North Korean famine of the nineties; whilst it's hard to get data on government policy at the time, it seems that there was a move to implement utterly inappropriate terrace farming, which was subsequently disrupted (or indeed, washed away) by pretty normal rains, rendering those terraces useless and also causing new flooding (as the terraced fields use to be water absorbers and rain diffusers).
Ethiopian famine of the eighties; civil war going on.
Soviet famine of 1947; an awful lot like Mao's famine.
On and on. Certainly in modern times; obviously there's a lot less explanation of the causes as one goes further back, and it is in the nature of incompetent government to blame the weather.
I suppose what I'm saying is that to prevent famine, we need competent government.
It's supposed to help said currency become more solidly established, and therefore more useful to more people.
I wish we were just as enthusiastic and race to solve other problems too -- like spreading education, finding out ways to purify water, or maximizing agriculture throughput in famine, or predicting when the next hurricane, tsunami, or earthquake is coming our way.
I'm pretty sure people are enthusiastic about those things, and probably quite a lot more people than are into bitcoin. They're just less visible, since those aren't the cool new shiny thing (and aside from the weather/earthquake predictions, they're probably not heavy enough on software to be considered of interest here).
I don't think you're going to find people flocking to a currency where it turns out that they have zero change of a big score. At least during the gold rush there was the possibility that a small miner could get lucky.
An exchange of money for a thing usually means that the buyer wants the thing more than they want the money, and the seller wants the money more than they want the thing, but in this case the seller is selling ... money?
Is, uh, the delivery date guaranteed?
In essence, they're selling a risky bet. It's like a lottery ticket, except more dependent on external factors. The buyers get to make a bet that might pay off, and the seller gets more concrete payment in exchange. It's sort of a physical embodiment of a financial instrument.
It's not quite as simple as selling money, since the amount of money that the box will print depends on various factors like the difficulty, exchange rate, and delivery date. So it's really a question of whether the customer's risk analysis is better than the vendor's (which is doubtful given the information asymmetry; see also Goldman Sachs). And the delivery date is definitely not guaranteed; most vendors are shipping late.
EDIT: another thing to consider is that the ASIC companies have had much trouble shipping on schedule, affecting ROI calculations
If you don't double down, someone else will, and your hardware will be worthless. Therefore you need to keep spending to keep mining.
We build 50, plug them in, make $500,000 in 3 months We build 50, sell them all, make $250,000 in 1 month
But I'm sure they'll have a couple they keep for themselves, and plug in at the same time as the early deliveries arrive.
I'm thinking if someones smart enough to built a specialized piece of hardware like this, they are smart enough to write up an algorithm that tells when to sell the hardware once the commodity hits peak level.
A mass dump of these would too quickly devalue the market since the increase in new Bitcoins would cause inflation.
edit: Ha, obviously they know it by taking Bitcoins and charging €700 difference in the price of one chip between a July & October delivery.
This needs to be repeated every time btc ASICs are discussed: ASIC economics don't work like most physical products, and instead work more like software. For high-performance asics, the costs of design and masks completely overshadow the costs of actually making chips unless your volume is in the millions. To make the first chip costs many millions, to make the next chip costs $15. The most valuable assets they have are the masks. One of the least risky ways of bootstrapping an ASIC venture is to presell enough chips to pay off R&D, and when you can make them for cheap, keep the rest.
In the long term, the mining rigs should barely be paying for the electricity required to operate them.
In other words, Bitcoin will be anchored to the value of USD (with some factor comprised of average rig efficiency and prices per watt)
No, you have completely misunderstood how bitcoin mining works. The bitcoin value won't ever stabilize to electricity, the rewards of mining will. The effective reward per Ghash can go up or down independently of the bitcoin price, and tends towards costs (ie, electricity). Electricity costs have no bearing on the actual bitcoin value.
The complete story is that the chips are developped in a 50/50 partnership between Leszek Rychlewski (aka "tytus"), and "bitfury" (a group of investors and engineers mostly from eastern europe):
- Tytus set up a company to launch a project known as 100TH-Mine that will deploy a farm running 100 Thash/s of these chips in Wenatchee, WA: https://picostocks.com/businessplan/19
- Bitfury is very discrete and was, as far as we know, merely planning to mine for themselves.
But over time, both entities realized they would be able to generate a lot more predictible revenues if they sold chips and/or fully assembled devices. So Tytus partnered with Megabigpower.com and BFSB as distributors is US and Europe. And the Bitfury group partenered with MetaBank to resell chips and devices in Russia.
Very expensive hardware with a very short shelf life, it must be quite interesting (and stressful) to design.
400 Giga Cycles/s makes more sense, unless I am missing something.
I don't have my notes with me but these Bitfury chips run around 150-250 MHz individually. There are 256 of these chips in the 400 Ghash/sec device. Each spits out about 10 hashes per clock cycle.