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Permalink Reply by Kevin J Baird on March 15, 2013 at 10:24am

My understanding of the Bitcoin tech is that it's exponentially difficult to find the next bitcoin.  And I don't think (Not sure) you can mine partial coins.  So, for instance, in your calculator, if you have currently 250 hashes, you are not even getting 1 coin a month.  So at BEST you're going to get one every month and a half, and it will get exponentially more difficult to get the next one as you go.  So I'm not sure these numbers you're citing will work out, especially if other people are mining them at the same time, you're only going to rapidly increase the complexity of trying to find one.

I suppose, in terms of just having your computer sit there and do nothing but try and make you money, it's not a bad idea, so long as the power usage doesn't exceed the income.  

I would use Bitcoins if it made sense to do so.  Once, when I was gambling on the Internet, I had to open an account in the Isle of Man, to transfer money from my bank to it.  Then I could transfer money from the Isle of Man to the casino that was offshore.  I ended up winning $5,000 and sent it back to myself the same way.  These days though, it's much harder to gamble overseas.  At least at legit sites that won't rape you.

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Permalink Reply by Hawksprite on March 15, 2013 at 5:54pm

Well most people actually mine bitcoins in a pool. With the pool you take a large group of people (Last time I checked slush's pool had around 3 million contributes) then they pool all there hashes together to try and get bitcoins when they're distributed.  Then once the pool has them they internally divey up the reward to the work load, within a pool you can easily earn a portion of a bitcoin.  That's what the calculator was based on, just taking the most popular pools and breaking down how much you normally get per hash.

Bitcoins were frowned on pretty heavily when they first started out but the crowd that stuck with it ended up making a decent chunk of money with it.

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Permalink Reply by Kevin J Baird on March 18, 2013 at 11:44am

Right, I agree that if you can mine them you'll make money on them.  It's just that it becomes exponentially harder to mine them.  The spec makes it so eventually it'll be virtually impossible to get new coins, which will drive up the price of existing coins.  The real question I have always had, is that would interest in the currency wane if there was no longer an easy way to mine the coins.  Then the bulk of the people who have them would exit the bitcoin market.  Making them worthless.

It's a very erratic currency right now.  It needs much broader adoption and acceptance before I would trust it.  That said, if I were to use it for a short term exchange, I would have no problem in doing so.

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Permalink Reply by Hawksprite on March 18, 2013 at 11:51am

I agree, it is a very unstable market and while it's adoption is spreading it's still not there yet.

I feel like $150 isn't an absurd amount of money to try it out though, I feel like I could considerably pay it off and if it dies shrug my shoulders and walk away.

Hopefully anyways.

For the most part though I agree with you.
Kevin J Baird said:

Right, I agree that if you can mine them you'll make money on them.  It's just that it becomes exponentially harder to mine them.  The spec makes it so eventually it'll be virtually impossible to get new coins, which will drive up the price of existing coins.  The real question I have always had, is that would interest in the currency wane if there was no longer an easy way to mine the coins.  Then the bulk of the people who have them would exit the bitcoin market.  Making them worthless.

It's a very erratic currency right now.  It needs much broader adoption and acceptance before I would trust it.  That said, if I were to use it for a short term exchange, I would have no problem in doing so.

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Permalink Reply by Payden on March 21, 2013 at 11:13pm

I'm buying a Jalapeno bitcoin ASIC machine.

Should be fun. Bitcoins are up to $73.

Based on calculators using the latest everything (bitcoin price, hashtag difficulty, processing power, etc etc), you'd make about $850 of pure profit in 1 month (31 days) with a Jalapeno at 4.5 GHashes/s.

Now, I understand that the moment the Jalapenos and all the other ASIC processors hit, the difficulty will likely rise considerably. But even then, I'd imagine, at worst, you'd make back your money in 1 month, then it's pure profit (electricity aside) from there.

Edit: I ran the numbers on the other ASIC machines and with a 60 GHash/s bitcoin miner, you'd make almost $13,000 of pure profit. My point isn't that you'd get rich quick off of this, but that it's more so viable, even if the profits per month drop 90% due to the increased difficulty, that's still profitable over a 2 month period.

I have one question though, who would bother buying bitcoins? That's the only thing that makes me question it. Where will the actual "real" money come from when I feel like selling my bitcoins.

And what sites accept them as currency?

Edit 2: Oh and one other thing, Butterfly accepts bitcoins as payment for their ASIC machines.

If I can get one, I'll begin building an arsenal. Shall be epic, I'm sure.

Last Edit: I did the maths on the $30,000 mini-rig they sell.

Profits at current prices and difficulties is at $320,000 a month. Just, holy s***.

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Permalink Reply by Hawksprite on March 22, 2013 at 3:31am

Yeah we're basically on the same page with this (As we are on just about everything else on this forum haha).

I've been watching the prices with some notification app on my phone and this last weeks it's just been crazily rising.

I'm fully expecting it to crash I just don't know when.

It'll be interesting when more the ASIC units hit the market; there in such high demand that it seems really difficult to get your hands on one.

Payden said:

I'm buying a Jalapeno bitcoin ASIC machine.

Should be fun. Bitcoins are up to $73.

Based on calculators using the latest everything (bitcoin price, hashtag difficulty, processing power, etc etc), you'd make about $850 of pure profit in 1 month (31 days) with a Jalapeno at 4.5 GHashes/s.

Now, I understand that the moment the Jalapenos and all the other ASIC processors hit, the difficulty will likely rise considerably. But even then, I'd imagine, at worst, you'd make back your money in 1 month, then it's pure profit (electricity aside) from there.

Edit: I ran the numbers on the other ASIC machines and with a 60 GHash/s bitcoin miner, you'd make almost $13,000 of pure profit. My point isn't that you'd get rich quick off of this, but that it's more so viable, even if the profits per month drop 90% due to the increased difficulty, that's still profitable over a 2 month period.

I have one question though, who would bother buying bitcoins? That's the only thing that makes me question it. Where will the actual "real" money come from when I feel like selling my bitcoins.

And what sites accept them as currency?

Edit 2: Oh and one other thing, Butterfly accepts bitcoins as payment for their ASIC machines.

If I can get one, I'll begin building an arsenal. Shall be epic, I'm sure.

Last Edit: I did the maths on the $30,000 mini-rig they sell.

Profits at current prices and difficulties is at $320,000 a month. Just, holy s***.

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Permalink Reply by Kevin J Baird on March 22, 2013 at 11:25am

https://forums.butterflylabs.com/showwiki.php?title=FAQ:Get+Rich+Qu...

Basically says you'll make about $6 a month.

Think about this, if the guys making this hardware knew they could make thousands of dollars for free, why would they sell you the hardware?  That would just crash the market for them.  It's not as good as it looks.  At the very least, if their hardware comes in, they'll be mining before anyone else gets theirs, so the difficulty will go up long before you start mining.

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Permalink Reply by Kevin J Baird on March 22, 2013 at 11:39am

You know, in looking at this further, I suppose it's not the worst thing to try based on the price and potential for revenue growth.  Bitcoin effectively allows an independent person to mine the coins.  So given that low wattage of the device (Minus the host computer) that you can expect to make your money back even at very low exchange rates, and the rest is profit.  

I don't think anyone will drive a Ferrari based on this, and without question the value of the coins will tumble.  But getting your foot in the front door should get you a little bit of cash.

Hopefully Butterfly Labs isn't some fly-by-night website that doesn't actually ship anything to you guys.  That would suck.  You never know when the Internet is involved.

Let us know how it goes.

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Permalink Reply by Payden on March 22, 2013 at 12:08pm

Will do.

And the page you linked has the words "No text on this page" and that's about it beyond the title.

It says nothing beyond that.

The thing is, currently, people are using GPU's to do the heavy labor. Most of these people will likely not upgrade to a Jalapeno immediately (or anything else), which means, proportionally, the ones with these ASIC devices will be doing 99% of the work.

I can't imagine what will happen to all the people who invested in this beforehand. These devices will make their profits drop to zip.

But yeah, that's my goal, to get my foot in the front door, grab a good chunk of Bitcoins then leave the machine to get 1 every couple of months.

I don't see why the price would tumble. If the difficulty keeps getting higher, the coins will keep getting rarer. Thus the price will stay high.

Plus, I'll likely just use the bitcoins as they are. Not convert them to real money. Hell, Butterfly labs accepts bitcoins as payment for their machines. Buy one, save up enough bitcoins to buy the $30,000 one. ????. Profit.

Plus there are some cool sites that accept them as well. Particularly normal computer hardware related sites (I'd love to get some more storage space for my computer).

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Permalink Reply by Payden on March 22, 2013 at 1:26pm

http://yro.slashdot.org/story/13/03/22/153226/bitcoin-to-be-regulat...

Relatively related news story.

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Permalink Reply by Kevin J Baird on March 22, 2013 at 5:20pm

https://forums.butterflylabs.com/showwiki.php?title=FAQ:Get+Rich+Qu...

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Permalink Reply by Kevin J Baird on March 22, 2013 at 5:23pm

The coins don't get rarer.  Just harder to get.  They release the same number of coins in the market every ten minutes.  Your odds of getting a block of coins, not so good spread out over everyone that is mining.  Join a group, share the money and the processing.  Or try and be greedy, I dunno.

As the value of the coins go up, more people jump in to mine coins, complexity goes up.  Complexity goes up, less people get coins and potentially drop out from trying to mine them.  

We'll see... I know $72 won't last.  That's just a side effect of the Cyprus situation.  I figure it'll probably stabilize near $10.  Whoever is cashing in their coins now, must be pretty happy.

Payden said:

Will do.

And the page you linked has the words "No text on this page" and that's about it beyond the title.

It says nothing beyond that.

The thing is, currently, people are using GPU's to do the heavy labor. Most of these people will likely not upgrade to a Jalapeno immediately (or anything else), which means, proportionally, the ones with these ASIC devices will be doing 99% of the work.

I can't imagine what will happen to all the people who invested in this beforehand. These devices will make their profits drop to zip.

But yeah, that's my goal, to get my foot in the front door, grab a good chunk of Bitcoins then leave the machine to get 1 every couple of months.

I don't see why the price would tumble. If the difficulty keeps getting higher, the coins will keep getting rarer. Thus the price will stay high.

Plus, I'll likely just use the bitcoins as they are. Not convert them to real money. Hell, Butterfly labs accepts bitcoins as payment for their machines. Buy one, save up enough bitcoins to buy the $30,000 one. ????. Profit.

Plus there are some cool sites that accept them as well. Particularly normal computer hardware related sites (I'd love to get some more storage space for my computer).

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