Bitcoin ASIC Miner from BFL, finally(codinginmysleep.com) |
Bitcoin ASIC Miner from BFL, finally(codinginmysleep.com) |
People seem to be oblivious to the fact that a currency must be available in order to be useful. There is a reason that Gresham's Law has achieved "Law" status.
Oddly, the right thing to do for currency acceptance would be to shutdown all of the ASICs.
Gold serves as a currency yet the methods of mining have changed drastically in the last 1,000 years.
Why would anyone wants to sell the goose who lays golden eggs while gold cost more than the goose?
They'll pile up cash from "preorders", mine bitcoins and when time is right - will dump outdated devices to customers.
From BFL's perspective if they don't release first they're dead in the water. They don't know where their competitors are compared to them but they recognize it's a winner take all situation. The natural thing to do would be to take pre-orders to fund the manufacturing and start realizing profits now. Also, if your competitors are offering pre-orders you should be too.
Only if they're "long BTC". What makes you think they are? They're just providing shovels & tools to "miners in a gold rush". Historically, such providers have always done phenominally well.
At least they get the rigs at production cost to run them---selling them for good ol' USD may just be a hedge or sideshow, only time can tell.
Can you explain this in more detail? I don't understand what decentralization has to do with miners' profit.
That said, I've half-joked that probability of receiving my miner is probably about 0.98^(USDBTC).
Also, for anyone wondering: At current difficulty and rate of exchange this will cost you <$0.10 a day to run and generate $40 of Bitcoin.
Additionally, he tried to convince people to buy BFL rather than one of the competing boards by arguing it was so much more power efficient miners using them would be forced to shut down. It's barely more power efficient than ASICs which shipped months ago, and those companies are already looking at newer models.
Oh, for what it's worth that's also less than 10x the power efficiency of the best FPGA boards...
As ASICs come online, the difficulty is going to go up, which will reduce the daily generation rate for any given miner. I've been trying to decide whether or not to order a device now based on my profitability prediction for months from now when I might actually get it. I'm guessing by the time I get one I might be able to produce at least 0.05 BTC/day. Assuming that's $6/day, the $274 device will take about six weeks to pay for itself. Not too bad, but I don't know if keeping tabs on it afterwards is worth it for $6/day. It'd only be worth it if I think BTC are going to be worth a lot more in the future... getting back to hoarding coins as an investment rather than using them as currency.
If you run a CPU at the same voltage, but at half the speed, it uses 1/2 the power because CMOS circuits only really use power as the transistors change state. However you're also able to run at about 1/2 the voltage without getting errors. Because V=IR, 1/2 the voltage at the same resistance is 1/2 the amperage, and since P=IV, that's 1/4 the power for normal circuits. Of course CMOS circuits already run at 1/2 the power. In the real world there's also leakage and such, but in a perfect world doubling the clockrate takes 8 times the power.
Transmeta's Crusoe was the first processor to really take advantage of this, by varying the voltage and running slower to save battery life. Before this time (2000), laptops would use a duty cycle to save power. Soon all the major chip manufacturers started copying them.
I still haven't paid and am going to now. I wonder if they will honor it or not.
I don't see where it says you won't be penalized for the time it takes for you to make a payment. With that said - I'm curious, did people pay in advance of shipping?
Holy moly: $27K.
I wonder who reaped the most out of this.
Miner's profits have to do with the stability of the network and the demand for bitcoins. At high bitcoin prices, their return is better than when the prices are low, other things (thing, mining difficulty) being equal. It's much like gold mining: it has become much more profitable of late because the difference between extraction price ($250 to $400 per ounce in most places) and sale price (roughly $1,500 per ounce) is how much the miner takes home.
Decentralization increases this price because it makes bitcoin sound. If there's no one door to knock down, or one person to subpoena, the cyberpunk currency can robustly survive losses in its network and still have enough computing power trained on it to prevent attacks.
but yes, they have been taking pre-orders for like 9 months and people have been paying.
But then, may be it's better just to hoard BTC directly right now by reallocating thousands of dollars required for device? Can't decide for myself.
Once an established lending system based on bitcoins is established it will have the same problems as our current currencies. It wasn't printing money that caused the real estate bubble, it was the way to banking system has the power to expand credit and the systemic risk that expansion of credit causes.
Once there are fractional reserve bitcoin banks it will no longer be a deflationary currency.
IMHO the Real estate bubble was from the Fed bailing the prior tech bubble by suppressing interest rates - which encourages borrowing. When loans are paid back, the currency created by taking the loan is extinguished but they have been juicing the system by continually suppressing rates via QE/bond purchases and not letting the real market decide the risk (ie: price of bonds). Now that interest rates have hit the floor - the next bubble to pop is the USD itself.
Loans are generally repaid in currency, paying back a loan creates even more currency as the additional currency created by the interest becomes an asset against which loans can be issued.
As long as we don't have a big bitcoin credit market and we don't want to regulate the bitcoin "printing press" to adjust for market cycles, it won't even be a disadvantage. = As long as it's only a secondary currency to most users.
If anything this is an extremely interesting time in currency experimentation. Side effect of this is massive energy cost, another awesome side effect is hardware/supercomputer miniaturization and evolution. Great for really hard problems like verification (as in mining here) and maybe brain research/processing or other really hard data crunching problems.
http://thenextweb.com/au/2011/06/23/abc-employee-caught-mini...
Doesn't mention anything about the computing capability of those servers though.
- Are reciprocal judgements possible in a lawsuit such as this hypothetical example?
- What is to stop the defendent from liquidating and reappearing as a new legal entity?
Liquidation: Corporate governance issues are a matter of the country where the defendant is organized. So if the law there allows them to do it, they can. I'm less familiar with the process of chasing the money. Trying to remember back to law school here: In the US, the debt doesn't just disappear. It would either attach to the old entity (which would have to be paid a fair price for the acquisition of its assets) or the new entity (which acquired its assets and liabilities per the acquisition agreement). So if it has no assets to begin with, it's possible. If it has real assets, it's more difficult to do. Not impossible, just more difficult.
* Buy up $10K worth of devices
* Make your money while flooding the market with fast and easy BTC
* Sell off all your hardware after the profit margins have cratered
* Wait for new hardware and rinse and repeat
Personally I will be extremely glad when the first wave hits as the hoarders will start feeling the pinch of inflation.
Yes, buy these are 110nm v1 designes, it looks like they will be able to squeeze something like 10x per watt by moving to better process and iterating on design. And probably additional 10x in cost by ordering more than current quantities that are in the ballpark of the smallest possible order.
Right now entire network runs at speed equal to all hardware in first two Avalon batches (300 and 600 units). When batch 2 and 3 and BFLs hit in the future, everything else is going to be wiped out. But then it will be wiped out again by the next iteration.
http://en.wikipedia.org/wiki/Bretton_Woods_system http://en.wikipedia.org/wiki/Executive_Order_6102
I'm not a gold bug and I see many problems with using gold as a currency, namely that the amount of currency in circulation should depend on how much stuff we can dig out of the ground. (In the case of BTC something about how many times a SHA-256 hash can be calculated.)
The idea that gold fell out of use as currency because of industrialization is either a completely new discovery in economics, or completely wrong. I'm pretty sure it's the latter.
Not for the last 80 years it hasn't..
TL;DR: only outside the US, only to Central Banks.
Meanwhile, BTC gains and loses 50 - 80% of its value in a single day. I wonder which is more stable.
It would have been in the 70s -- which is why USD support has remained despite the Nixon shock for a few more decades. By now, most central banks and governments are increasingly, dare I say "prepared" or slowly preparing for the possibility without it impacting their economies or trade too badly. Nobody wants to see the USD fail or die --- but day-to-day economic / monetary policies on US soil should become less and less of a rest-of-the-world economic worry, concern or impact compared to previously.
Now, the last remaining problem is savings of millions tied up in USD promises worldwide. Still a big problem, and rest assured the USD will continue to get "support" to the proportion that these savings haven't "migrated" over to "something else" yet.
Anyway, one day all these notes the US has been "exporting" globally for many years will come home one way or the other. Hope the new cash supplies won't, ahem, "overwhelm" a struggling domestic economy at that time, shall we?
But more importantly, is there any real sign that that time is soon? Global financial crisis...and the world's investors are literally paying the US to take their money with the current returns on US treasuries.
But it's hardly the USD "collapsing" - it's a gradual process over time, which crucially doesn't effect the buying power of individuals over meaningful timespans to them (decades, not days - unlike BTC).
And, probably more importantly, whatever replacement reserve currency comes to the fore (and what would it be, exactly?), it won't be something like BTC.
USD collapse would certainly be a far reaching global event but that doesn't mean it will not happen. I'm sure all prior entities with reserve status also thought their position unasailable.
http://www.zerohedge.com/sites/default/files/images/user5/im...
Global support for it is waning. China is doing direct currency swap deals and is no longer supporting USD by stacking treasuries at the rate it was. Russia is dishoarding treasuries too. The current trade deficit is propped up by the Fed buying USG bonds and suppressing interest rates. USD is not long for this world in its current form.
People don't go around predicting the decline and fall of the Australian dollar for example.
In the short term you are probably right. In the long term you are almost certainly wrong.
Agree mortgages didn't pop due to being paid back.
At a national level, yes the Central Banks settled in gold, but that was after the micro transactions bubbled up to be settled from the commercial banks and then eventually cleared at the Central Bank level (Talking on the edges of my understanding here - just trying to see if the reality for an individual level was the currency was gold backed until 71).
Yes, "effectively gold-backed" until the first guy came along to openly demand an actual physical (rather than "potential") exchange of USD reserves for real ounces, in size, from the US. Bam, Nixon shock. Essentially "caused" by one "individual Frenchman" (de Gaulle) testing whether the system can in fact, in size and in physical actuality consistently deliver what it promised to the world.
Bingo! You got it! The USD is not going anywhere or collapsing. The global "reserve asset" named dollar however seems to be slowly on its way out.
Fair game right?
Problem is, there's a wave of trillions global dollars that will now seek to "go home". Inflation hasn't happened yet when fresh currency notes are "exported" (exchanged for real goods from the world) immediately. But those USD, whether in bonds or treasuries or bank deposits or hard cash, will seek to come back to their native soil when global savings or trades no longer desire them as they used to. Wait for it! The money has already been "printed", then "kept in custody" all over the globe for some amount of time (circulating at times, finding a good temporary residence for some other times), but still waiting to go back to their permanent home, to circulating with ever-increasing velocity..
(Not making a case for "collapse gonna happen", just saying "if, then your military's worth sinks with your currency"...)
US debt cannot increase indefinitely without consequence, and in a time of desperate need (such as the 2008 bailouts) it has to print lots of money and hence cause inflation. If the US dollar suffered 10% inflation 2 years in a row, it could originate some drastic changes, as dollar holders might want to get rid of the coin. Figure china selling out its entire dollar reservers in one year, US goes to the tank.
Im not being alarmist, its just a possibility. Comparing Bitcoin to USD makes no sense at this stage in many ways, starting with volume.
Plenty of BitCoin people seem adamant the USD is definitely going to collapse, but can't explain why it hasn't already, or where the instability causing it too would come from, or why smaller, less wide-spread currencies don't do the same barring exceptional circumstances (i.e. Zimbabwe).
