Let’s talk about ASIC mining


#2919

It might be something in-between. If less than 5,000 units have been sold, the difficulty shouldn’t increase more than 5%. There are already difficulty swings greater than that every few days. You might not notice any drastic changes.

My theory, in this case, is that buyers are on the fence about a Z9 mega (rather than mini). Nobody wants to buy an ASIC only to have a new one within a year overpower it many times over. The risk of this situation would make ASIC miners pause before purchasing large bulk orders.


#2920

That would be a first with crypto. Every time they launched new ASICs the difficulty for that currency skyrocketed (usually 30%+ in the first week). It’s not just what they sell, but what they keep and mine themselves. It has already inflated difficulty by over 50% because they are already mining with them as of November.


#2921

Yes, maybe they are maybe they aren’t. Don’t buy their ASIC’s. That’s the only message you can send them that will matter.

If that issue affects many other people they too will not buy and boycott. Personally, I don’t care. If I were them I’d do the same thing.


#2922

What I think people are starting to see is the move to a few PoW currencies that form the backbone of the market and the rest being PoS. It’s not really sustainable for so many currencies to be PoW but they are ultimately dependent on the PoW coins to develop the trusted market. This has been a major discussion piece for macro-planning for some time now. I can’t find it at the moment, but there’s a couple good videos from a lead analyst from the CME on this topic.

Basically, in the long run, the result will be only a couple (maybe half-dozen) currencies that will run on PoW globally. All other currencies will be based on the development of those primary ones and run on PoS or private centralized servers.

THIS is the cryptocurrency bubble. So many separate coins developing their own protocol, algo, and networks. In the end most of them will consolidate to just a few protocols or die out.


#2923

Interesting view and these are good points that make sense of course.

Just out of the head i as well could imagine a reverse process, let’s say POS until the project is established and than switching to POW or mixed POW/POS eventually.

After seeing this 51% chart it makes perfect sense that many small projects don’t start with POW from a POV security view.

We have to see how it will work out in the long run, i agree that the majority of coins from the 2000+ or so currently will vanish. I daily spent about 10 hours of my 16 hours working day in reading through all available coins, it’s insane how many useless coins there are around, serously, i totally agree with your bubble view here.


#2924

Actually, they haven’t been mining since November. See So I had a videochat with Jihan Wu


#2925

LOL…ok…because the guy selling them told me so…I guess it’s true. Give me a break. They have been caught with their hands in the cookie jar more than once to the point I wouldn’t trust anything from him.
However, I can base my decisions on my assessment of what he did SAY (whether true or not) and the underlying motivations of someone in his potions.

This is where I could go on a huge detailed breakdown of competitive intelligence and psychoanalysis but that would be largely off-topic for this thread.

The short is…

  • they have “withheld the truth” before (if you consider that lying or not)
  • Bitmain has no motivation to declare otherwise concealed assets
  • there are tons of free and paid avenues to communicate between east and west (I’ve used them before) especially for a multi-millionaire

While I applaud Zooko in communicating with Bitmain on the topic (giving benefit of the doubt that it was all above board, though I know some here have doubts), in this case “straight from the horse’s mouth” doesn’t make it any more trustworthy.
People are making assumptions that Bitmain wants to be on the level and open about what’s going on. That is a western-business assumption…that is NOT how business is conducted in China. They owe us no explanation and, unlike in open-western-markets, there is virtually no repercussion for them to act that way.
(AMD and nVidia would never get away with that)

Plenty of businesses, making a lot less earnings than Bitmain, have no problem with communication channels and PR with western markets. If they wanted to, it wouldn’t be a problem as they claim.


#2926

Jihan Wu be like, I’m gonna lie to the person who is fully in charge of the development that includes changing PoW algorithm of the cryptocurrency which my lastest mass-produced ASIC miner is mainly aimed for.

ok then lol


#2927

If he has motivation to do so…absolutely (just because you’re naive or ignorant about something doesn’t make it “tin foil”). In honesty, that part is not a jab at chinese business…but business in general.
Also, you’re over-estimating the importance/value of Zcash mining in the bigger picture for Bitmain. It’s a big deal for us, not nearly as big of a deal for a multi-billion dollar company. Bitmain owes us nothing.

  • I don’t fault them for developing the ASICs
  • I don’t fault them for withholding information pertinent to their business
  • I don’t fault them for keeping quite about their development efforts

Anything contrary to those points “smells funny” to me.
I wear real nice shoes…I’ve gotten quite good at not stepping in the B.S.


#2928

Hey, dropping in to say that I feel like I’ve seen an improvement in how people are talking to each other in this thread :+1:

Still riding the line of civility occasionally, but I want to let you know that I appreciate the effort to converse in good faith.


#2929

Bitmain is company and its goal is to make as much profit as it can.

IF you say ASIC are profitable why would you sell it if you can make more money with mining with that same unit.

Bitmain has mining facilities in places with very cheap electricity ,they dont have cost off shipment ,import tax ,they can mine instantly and not waiting for months for unit to come so their cost off mining is much lower then your would so from one unit they can make much more money they you would.
So why would Bitmain sold something if they can make much more money if they dont sell it?
IF you are CEO you job is 2 make as much as possible and you dont see CEO says OK we want to make 3 times less money then we can.
THAT DOES NOT HAPPEN…so they will only sell symbolic numbers and most hashrate will keep for them self .
Anyone in their place would do the same… i would do the same…no one wants to give up from huge profit.


#2930

They selling ASIC’s because prime cost is much lower than selling price (x5-10). Bitmain no need to worry about setup and maintenance, everything rests on the shoulders of the buyer (even possible hardfork’s and ROI inaccessibility). Sell shovels is more profitable than mine gold


#2931

What maintenance ASIC needs…none …and they already have big mining facilities with giant warehouses …and setup…they already have own mining pool …so setup is one minute…and if price is x5-10 then selling price they ROI in a week and after that pure profit…why bother to send just to earn much less money then not selling it.


#2932

If prime cost for Z9 mini ~$500, then for Bitmain ROI is just 2 weeks if they mine(~$950 for 10Kh/s). They sell it for $1500-2000 and 1 ASIC you buy became 4 new ASIC’s Bitmain products, your (buyer) ROI - 2-3 months, their (seller) ROI - instantly with 3x profit, simple math


#2933

Business doing isn’t that simple as you might think it is. You forget all the time that it’s main business is Manufacturer. And their is something called risk management, and when you sell something immediatly you have made the profit, you have fresh money on your account, you can invest it again to produce/research more products/units. And you have no maintain costs, you need no additional storage/electricity/maintance/whatever. If you would have had inside in a larger business than you would know that these are expeneses. You would as well know that selling something immediatly without having even to store it is the perfect case for a business.
What Bitmain is doing i would call it simple, “Maximum profit at minimal risk with minimal expenses”. So if this isn’t a business argument for you, do yourself a favour and never go into any business task.

What you suggest or think is “(Eventually) maximum profit at maximum risk at maximum expenses”. This is actually as well a very valid argument for individuals like us miners for example or for smaller companies, but no big corporation/enterprise/company will follow this, easy as that.

Edit: Adding this:

Thinking about it, i think remember 1 company doing what you think is best, it’s Bitfury. Don’t nail me on this but if i remember right they produce their own miner and while they sell it (maybe and eventually) you can’t get it have shipped but only hosted in their facilities.


#2934

Bitmain has stated that they didn’t pre-mine the Monero miners and haven’t pre-mined Zcash miners. The Monero difficulty changes could easily have been caused by botnets or another secret ASIC from another company. On the Zcash network, the difficulty hasn’t spiked many times - and as Jihan Wu said - it would be hard to keep that as a secret. Further people would be reluctant to buy used mining hardware.

I trust that Bitmain isn’t pre-mining the Z9’s due to business reasons. It wouldn’t make sense to undermine their main, multi-billion dollar hardware selling business.


#2935

Do we know actual figures? I mean, Bitmain’s revenue split from hw sales vs mining ?
I guess we don’t, but by employing a common logic and math one can make a valid conclusion that mining brings a constant revenue in a long term, and selling HW is healthy for cash flow in a short term + compensates the risks of mining. Combining those two is a win for a big company as Bitmain is.


#2936

How yes no…Bitmain start selling its monero X3 ASIC just days after Monero sad they will fork…before that they did not even sad they have any ASIC for monero…you dont make ASIC in 3 days.

If it was botnes they would update their code for this 2 months .
It was ASIC for long time in silence…and only Bitmain can make that much.


#2937

Also after todays fork off ETN X3 dropped 2 just 5-6$ a day (it costed 3800$ +shipping + taxes last month)

Now so call Monero original or Bitmain scam off Monero has 3 times hash rate then Monero even it has only 6 BTC daily volume compare to Monero 2200 BTC.

Now coins that are left with cruptonight with ASIC will race 2 the bottom because they are low volume coins end people who run ASIC will sell every day to try to at least back some part off money they spend.


#2938

Z9 arrived in korea