If current difficulty growth CAGR stays the same those investing today will never breakeven

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  • shawn_Blah_Blahshawn_Blah_Blah Member Posts: 57
    adaseb said:

    Didn't think you can mine ETH with 750ti

    Plus you really shouldn't complain. There are many people who bought Antminer S7 which have like a 6-9 month ROI and use crazy amount of electricity and are very loud.

    The 750ti's aren't mining ethereum that why it says I have other rigs on ethereum. I have 9 rigs in total, 3 are 750ti's. The other 6 are composed of a meshmash of AMD cards except one rig that has 2 970's. The 750ti's mining nicehash pay the power bill essentially, that'll change once summer rates kick in.

    I use variable priced electricity that is why it's pretty cheap. powersmartpricing.com
  • workwork Member Posts: 2,084 ✭✭✭✭
    @shawn_Blah_Blah very cheap power indeed. We have ~8cents(usd)/KWh power here year round, and that's considered cheap compared to most of the world.
  • shawn_Blah_Blahshawn_Blah_Blah Member Posts: 57
    work said:

    @shawn_Blah_Blah very cheap power indeed. We have ~8cents(usd)/KWh power here year round, and that's considered cheap compared to most of the world.

    It's variable priced, so in the summer it will spike if it's hot outside, it'll go over 10 cents. So, I've set up a little server to shutdown the computers when that happens. So, lose some mining time occassionally, but it works out cheaper overall, as 90%+ of the time the rates are lower than the standard rates. I just don't do anything when it's high.
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @work Mine's 7.5 cents all the time. Hydro, too, which makes me feel good. :)
  • workwork Member Posts: 2,084 ✭✭✭✭
    dlehenky said:

    @work Mine's 7.5 cents all the time. Hydro, too, which makes me feel good. :)

    We have step rate in BC - 7.97 cents per kWh for the first 1,350 kWh in a 2 month period. Above that amount, you pay 11.95 cents per kWh. Tends to work out to about 10 cents with the amount of power I use. (CAD prices, so 8cents USD). Thankfully, most of my rigs are setup in a building that has a dedicated account and doesn't use power for anything else.
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @work I just moved all my rigs down to my utility building that I used for a prior business. It's basically a concrete bunker, with its own 400 amp service.
  • adasebadaseb Member Posts: 1,043 ✭✭✭
    Either way, even with 20c KWH power we are all still pulling in profits. So we are all considered lucky at the moment.

    I think some of us are getting a little greedy.

    My S3 was only making $1 a day and I didn't complain.

    That's the way it is. Where there is profit to be made, its a rat race essentially. Advantage is to get in early.

  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @adaseb Personally, I wouldn't waste the electricity for $1/day, but that's just me. I guess if you've already made the cap investment, ya' gotta get it back somehow.
  • workwork Member Posts: 2,084 ✭✭✭✭
    @adaseb getting in early is definitely the way to do it. The best time to buy GPUs for mining is when there is nothing profitable to mine =).

    @dlehenky I did some mining while it was break-even with power. But, it saved probably $1000 in heating costs over the winter.
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @work Yes, I was taking advantage of the "free" heat as well. :)
  • ilia7777ilia7777 Member Posts: 113
    @oslak @o0ragman0o Its a simple idea with a bit complex implementation if you really want details you may spend few days trying to understand this https://github.com/ethereum/wiki/wiki/Ethash . I see no point in understanding details if the major principle is clear. This is the mining function code:

    def mine(full_size, dataset, header, difficulty):
    target = zpad(encode_int(2**256 // difficulty), 64)[::-1]
    from random import randint
    nonce = randint(0, 2**64)
    while hashimoto_full(full_size, dataset, header, nonce) > target:
    nonce = (nonce + 1) % 2**64
    return nonce

    You could see that it loops until the desired number is below target and traget is set based on difficulty. The data stucture of a block in simplified terms is a header (kind of block ID with a bunch of parameters) and a payload. The payload being the actual transactions. Each block contains a hash of a previous one, so you could verify all the blocks sequentially. So your GPU is mining until it finds the correct nonce. Thats it. For the purpose of our discussion here we only need to understand that WITH GROWTH OF HASHING POWER OF THE NETWORK THE DIFFICUTLY IS GOING TO BE INCREASED EVERY (I think about 2000 blocks or so) AND IT WILL TAKE LONGER AND LONGER FOR EACH AND EVERY SINGLE RIG TO FIND THE PROPER NONCE BELOW TARGET.

    This what is done for every single block to validate that its correct (but there is no point to dwelve into these details):

    Check if the previous block referenced exists and is valid.
    Check that the timestamp of the block is greater than that of the referenced previous block and less than 15 minutes into the future
    Check that the block number, difficulty, transaction root, uncle root and gas limit (various low-level Ethereum-specific concepts) are valid.
    Check that the proof of work on the block is valid.
    Let S[0] be the state at the end of the previous block.
    Let TX be the block's transaction list, with n transactions. For all i in 0...n-1, set S[i+1] = APPLY(S[i],TX[i]). If any application returns an error, or if the total gas consumed in the block up until this point exceeds the GASLIMIT, return an error.
    Let S_FINAL be S[n], but adding the block reward paid to the miner.
    Check if the Merkle tree root of the state S_FINAL is equal to the final state root provided in the block header. If it is, the block is valid; otherwise, it is not valid.
  • o0ragman0oo0ragman0o Member, Moderator Posts: 1,291 mod
    @ilia7777 Thanks, but I still find your prior statement confusing...
    ilia7777 said:

    If you call hash function 2 in the power of 32 times it is guaranteed to get an number with 32 leading zeros for example.

    How is calling ethash 2^32 times guarantee that you'll get a 64 bit number with 32 leading zeros? The 64 bit search space is itself 2^32 times bigger than what you've search by calling ethash only 2^32 times.

  • oslakoslak Member Posts: 191
    @ilia7777 The reason I ask how ethereum block design was created is to fully undertand its concept. What is the math behind it?

    Also why 5.** ethers are rewarded on each block? Are these a 5 block-design?
  • ilia7777ilia7777 Member Posts: 113
    For 64 bit number yes there are 2^32-1 combinations that produce not all leading zeros, so the total would be (2^32-1)*2^32
  • o0ragman0oo0ragman0o Member, Moderator Posts: 1,291 mod
    @oslak, I believe 5eth/block is an arbitrary choice. I don't know how they arrived at it but there are monetary policy considerations given that Ethereum in an inflationary currency.

    If you really want to understand the maths behind ethereum, you need to digest Gavin Wood's formal Yellow Paper, but be warned you might need a degree in discrete mathematics. Else there is the code examples/explainations on the wiki
  • ilia7777ilia7777 Member Posts: 113
    Going back to the topic I see my daily payouts for discovered blocks delayed by 3 hours everyday. I guess everybody else expereince the same. This is daily difficulty growth in realtime.
  • ilia7777ilia7777 Member Posts: 113
    work said:

    dlehenky said:

    @work Mine's 7.5 cents all the time. Hydro, too, which makes me feel good. :)

    We have step rate in BC - 7.97 cents per kWh for the first 1,350 kWh in a 2 month period. Above that amount, you pay 11.95 cents per kWh. Tends to work out to about 10 cents with the amount of power I use. (CAD prices, so 8cents USD). Thankfully, most of my rigs are setup in a building that has a dedicated account and doesn't use power for anything else.
    So you are in Canada. I used to live in Canada for 12 years. Here in Russia one of the few positive things that came out of ruble collapse is cheap electricity which is about 5 cents US. That is residental, commercial is way cheaper.
  • heandog69heandog69 Member Posts: 283 ✭✭
    I have 8 solar panels on the roof, until the summer time comes they not much use to me here in the uk, but i suppose it keeps costs down, at the moment i only have two small rigs, debating weather i should make these 6 gpu's per machine but it is not looking likely i will get my investment back, profits are dropping daily, but profit is still there.

    when will the growth of difficulty slow or stop ? i cant see that many more people buying into this
  • ilia7777ilia7777 Member Posts: 113
    edited April 2016
    Here are updated numbers. I started watching difficulty growth daily from March 6 last month. If it grows 40% monthly it should be 24.6 on April 8. But its already 25.15 today. The following calculation is for 270 Mhs in which 5378 USD was invested and which producing daily payout of 4.95 eth as of right now. The payout keeps shifting 3 hours later daily as I mentioned. So below is the total payout for the next 180 days assuming stable price of ETH (todays price used) and stable difficulty growth like today. Its equal 2536 USD after 180 days. Assuming you could sell everything with discount of only 30% after 180 days the total profit would be 6300 USD :smiley: Classic zero sum game. Like I said before I just want everybody to clearly understand the game they are playing. And those that wanted excel here is excel. 0.02118 (2.12%) is daily difficulty growth which average for the last weeks.

    https://docs.google.com/spreadsheets/d/15QQ3Qs1wKhlkRnwR2axq_ZeJ9y5-VOmjXoYqeJQwjXc/edit?usp=sharing
  • ilia7777ilia7777 Member Posts: 113
    Most of the cards bought were brand new 390s, there are some 7970 and 380s as well. I saw no point in buying used because price difference is not that big. And yes the electricity cost is excluded altogher to make the picture even more clear.
  • ilia7777ilia7777 Member Posts: 113
    heandog69 said:

    I have 8 solar panels on the roof, until the summer time comes they not much use to me here in the uk, but i suppose it keeps costs down, at the moment i only have two small rigs, debating weather i should make these 6 gpu's per machine but it is not looking likely i will get my investment back, profits are dropping daily, but profit is still there.

    when will the growth of difficulty slow or stop ? i cant see that many more people buying into this

    No it won't stop because greed is the ultimate motivation. Not until we reach the pont where electricity cost is higher that monthly profits. And people will continue to pour into this hoping that the price will increase 40 fold to reach that of bitcoin. Currencies will come and go and people would continue to see them as "value" storage. The whole concept of crypto currency having any value is still beyond my understanding. But since the exchange rate is subject to supply and demand, bitcoin price rose on darknet demand :) And ethereum phenomena is based on bitcoin. The current price reflects one thing and one thing only - expectations !
  • workwork Member Posts: 2,084 ✭✭✭✭
    Difficultt growth isn't a stable thing... stop trying to "math the future" based on extrapolation of bad data.
  • ilia7777ilia7777 Member Posts: 113
    work said:

    Difficultt growth isn't a stable thing... stop trying to "math the future" based on extrapolation of bad data.

    It has been around 39-40% on average monthly for bitcoin and it will be for ethereum. How much ETH you'd like to bet that in a month we will see another 40% increase ? Its April 4th today.
  • oslakoslak Member Posts: 191
    @ilia7777 I have a degree in discrete mathematics. :)
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @ilia7777 The difficulty is adjusted on each and every block. I'm not sure where you got 2000 from. You can watch it in realtime on stats.ethdev.com. If you're referring to the "bomb" that would, if it were to stay in place, bring an end to PoW, then that difficulty increase occurs every 100,000 blocks and is tiny, at this point. However, VB has already stated that the "bomb", aka ice age, will be delayed past the current code in Homestead.
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    ilia7777 said:

    work said:

    Difficultt growth isn't a stable thing... stop trying to "math the future" based on extrapolation of bad data.

    It has been around 39-40% on average monthly for bitcoin and it will be for ethereum. How much ETH you'd like to bet that in a month we will see another 40% increase ? Its April 4th today.
    You and @bitcanuck should get together and start a betting parlor. :)
  • ilia7777ilia7777 Member Posts: 113
    oslak said:

    @ilia7777 The reason I ask how ethereum block design was created is to fully undertand its concept. What is the math behind it?

    Also why 5.** ethers are rewarded on each block? Are these a 5 block-design?

    Everything is available online on it if you'd like to read.
  • ilia7777ilia7777 Member Posts: 113
    oslak said:

    @ilia7777 I have a degree in discrete mathematics. :)

    And I have a degree in Statistics, but I don't really like to go into details once I see the big picture. What you do mean hy 5 block design ? I have no idea why the reward is 5 ETH may be somebody knows here on the forum
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @ilia7777 Because that's what the Ethereum foundation decided was an adequate incentive you miners to mine? Why would you think there has to be more of a reason than that? That's the whole purpose of the reward.
  • dlehenkydlehenky Member Posts: 2,249 ✭✭✭✭
    @ilia7777 @oslak And I have a degree in "this is what it takes to make a living in this world".
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