One Bitcoin By the Numbers: Is There Still Profit To Be Made? 239
massivepanic writes with an article that "runs through the logistics of mining a Bitcoin on everyday gaming computers while keeping an eye on power consumption, time spent, and return on investment. From the article: 'I have mined a Bitcoin. This was not much of an accomplishment a year or two ago, but in 2013, after the infamous early-April peak at $260, unearthing a Bitcoin is no easy task. Competition is on the rise and we are getting close to the end of the good ol' days of Bitcoin; the time when a desktop computer or two have any real mining capabilities.'"
There are alternative alternatives. (Score:2, Interesting)
More crypto-based currencies are coming around, Litecoin being the apparent "next big thing" I have been hearing.
Me and a friend were going to get in on it to see if it would at least maybe get a few quid or so, not expecting huge returns, just a little bit of profit.
But eh, I'm too lazy to leave a program running on its own.
I may try it out, but it is getting in to figuring out exchanges, knowing when to sell, etc.
I have a hectic life as is. Watching my investments is something I already don't do, probably stupidly on my part.
Litecoins seem to be aiming at a more general lower priced currency for cheaper purchases because it is easier to do initial mining even on fairly old machines.
So what does this say in general?
There is likely going to be a boom in crypto-currencies in the coming decades.
It might even end up leading to more virtual currencies in this century than there has been in the past all of human history, in fact.
As more begin to dry up and stabilize, people will jump to new systems, or even make new systems, in attempt to get money.
I could see a scenario where the creator of a currency gives their friends and family X coins before even going public, then when it gets remotely big, sell it.
Someone smart enough could probably make a killing, and it will likely happen sooner rather than later since it is early days.
Governments should probably get in on this and potentially make lots of money too.
As these systems grow, it is going to get harder with time in general.
If you thought the stock markets were crazy, this would be 100 times worse, it would move so much quicker because the only thing backing it is literally number count and word of mouth.
Re:Remember the old adage (Score:5, Interesting)
And remember another old adage: "There's a sucker born every minute." Want to get some ROI? Don't mine bitcoin, sell bitcoin mining rigs. Like selling shovels and booze to miners in a gold rush, it's a great way to make sure you get the cash now, and leave someone else scrabbling in the dirt with all the risk that tomorrow's newer custom FPGA rigs and market prices will make today's mega mining cluster not worth the electricity to switch on.
Re:Another bitcoin article? (Score:5, Interesting)
A founder at the top making a mint...
Analysis of the block chain indicates that somewhere around 5 million early Bitcoins have never been traded. Those were generated when the difficulty was so low that ordinary CPUs could generate thousands of Bitcoins. Some of them were probably lost by people running the software in the early days and not keeping the results, but there's a reasonable chance that, somewhere, the anonymous people behind this have a few million Bitcoins stored up. Someday they may cash out.
Re:Another bitcoin article? (Score:3, Interesting)
I just read from an investment newsletter that the Winklevoss Twins have a ton of bitcoins on flash drives locked up in safety desposit boxes.
Re:For those to lazy to click the link.... (Score:5, Interesting)
While that doesn't sound great, the 5 hours setting it up is one-time fixed overhead.
Let's assume he can sell coins for at least $125... and the rate of generation stays about the same.
That's $50 a week. If you saw $50 on the sidewalk, would you bend over to pick it up?
Re:US Currency on soft rolls of paper (Score:4, Interesting)
I am an advocate of fiat money, but that is because I fear deflation more than inflation. (Well, my view is a bit more complex then that.)
As for what you are saying, “years” is not the right answer. We have been in a finical crisis for the past few years, and those tend to be deflationary. The reason why we have not seen major deflation is because Central Banks have been pumping money.
As for modern systems, there is a tension between independent Central Bankers who fear inflation verse politicians who like easy money. I can point to issues in recent years, but not in big mature countries.
What I fear (though less than inflation) is a repeat of the 1950s and financial repression. Back then the governments had a lot of debt (from WWII), like today. They rigged the bond market so interest rates were low in relationship to government debt, thus inflating the debt away (This does not require high inflation, just the relationship).
Bill Gross of Pimco has done some great blogs on this issue.
Re:US Currency on soft rolls of paper (Score:5, Interesting)
I am an advocate of fiat money, but that is because I fear deflation more than inflation. (Well, my view is a bit more complex then that.)
Most economists would agree with you on that (not sure if that in geek circles is taken as a compliment or not, but given as one, we tend to be far too dismissive of other expertise than our own)
As for what you are saying, “years” is not the right answer. We have been in a finical crisis for the past few years, and those tend to be deflationary. The reason why we have not seen major deflation is because Central Banks have been pumping money.
As for modern systems, there is a tension between independent Central Bankers who fear inflation verse politicians who like easy money. I can point to issues in recent years, but not in big mature countries.
Indeed. And this tension is holding the balance. These are much more complex systems than most imagine, and we have developed a set of checks and balances that work. Soundbites about "feds printing money" doesn't really mean anything if you don't understand the model. And your point about the issues not being in big mature countries is my point as well. On the other hand bitocoins that some see as a better alternative loose 2/3rds of value overnight. You have you to be really idealistically theoretically motivated to compare that as equal or better.
Thanks for blog references, will read, actually interested in the various sides of this topic.