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Anonymous asked: what kind of computer do i need to mine

With the new generation miners you only need a simple computer or laptop.  Most mining hardware will work with a USB or ethernet connection and some are wifi enabled.  Don’t spend too much on the computer.  Spend your $ on the mining hardware.

Avalon Ships First - Implications

There’s a lot of panic and drama surrounding Avalon’s recent announcement that they have shipped the first ASIC Bitcoin mining hardware to their waiting customers. Many feel like they chose incorrectly, put their money into the wrong company and that this choice is going to impact them dramatically. Many fear that the difficulty will skyrocket and ruin their profitability, but how realistic are these fears?


Thankfully, Bitcoin being the wonderfully transparent system that it is, we can do a pretty good job at estimating the actual impact of Avalon’s ASICs, so there’s really no need for speculation.

We know quite a bit about Avalon’s first shipment. They claim to have 300 units going out the door at 60GH/s apiece, so we should expect to see about 18TH/s being added to the Bitcoin network, which is currently around 23TH/s in its entirety.

This means that the first Avalon customers to switch on their rigs will be, at current prices and difficulty, earning about $160 per day and paying about $1 per day in electric costs - until they’ve mined enough blocks to retarget the difficulty. The new power of the network will be about 41TH/s, so the first real retarget should increase difficulty by a factor of roughly 1.78, bringing the current difficulty of about 3.2 million to somewhere in the neighborhood of 5.8 million.

At this point Avalon miners will have raised the difficulty as much as they’re capable of and will be earning about $90 per day and paying about $1 per day in electric costs at my local rates - still not bad. Had BFL shipped first, given that their hashrates and initial costs are identical to Avalon’s equipment, the profit points would have been quite similar - but what would those profits look like after Avalon ships?

Well, the answer should be pretty obvious - Assuming that BFL doesn’t ship until after the above adjustments (but before subsequent rounds of Avalon shipping)  their units, being equivalent in performance to Avalon’s ASICs, should reap about the same reward - around $90 per day, but with a somewhat less substantial $0.20 per day electricity cost to run. That may not sound like much, and at this stage in the game it really isn’t, but a net cost of $73 versus $370 per year to operate is likely to make a difference in days to come - after all, I have a feeling BFL is shipping quite a few more than 18TH/s worth of ASICs.

asker

Anonymous asked: how do i download the bit coin miner software?

This site has a great list of bitcoin mining software options: Bitcoin Mining Software

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Anonymous asked: Just getting started. I could spend the $ 1300 for the new chip. What is the difference between that chip & the lesser $$$ chip. Also, I have newer laptop. Should I buy a new PC with a fast processer? If so what is recommended, especially if I go with the new 60GH/s chip. What is average return on investment say for 6months of mining? Thanks!

The difference is measured in lightyears.  No comparison. FPGA development stops when ASICs hit.  You can use any old laptop. Don’t get a new one.  www.butterflylabs.com just announced mining software for Android devices also. It is difficult to calculate investment ROI.  Try this site: bitcoin profit calculator

asker

Anonymous asked: What is a good signle GPU for bitcoin mining for <=$600?

Better to wait for delivery of ASIC miners.  Check out Butterfly Labs.  There are others (Avalon, ASICminer) but I think BFL has the best packaging and design and are better suited for the long run. They are designing 65 nm chips compared to Avalon’s 110 nm.  They  have the best bitcoin mining hardware available IMO.

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Anonymous asked: I'm just getting into bit coin mining. I pre-ordered the Butterfly labs Single SC 60 GH/s. I am using an old Mac Pro. I realize I may need to buy a new computer once my Single SC arrives. What kind of computer systems should I buy, how much would it cost, and where is a good place to shop for one?

With BFL you can mine with an old used laptop or even an android device.  I am running a FPGA single on a 7 year old laptop.  You can get one on craigslist for cheap.

asker

Anonymous asked: how do you mine

You will need bitcoin mining hardware.  We recommend:  www.butterflylabs.com

Thanks

asker

Anonymous asked: what is bit coin?

The best place to learn more is to check out: www.weusecoins.com

asker

Anonymous asked: Hello! Is there a place on the web which explains how does the bitcoin is being created? Thank you!

Hello,

The best general explanation can be found here:  www.weusecoins.com 

Thanks

Bitcoin - Environmental Impact, and Introduction To Pool Mining

This video is Jörn Loviscach’s talk on Bitcoin mining given at a workshop in September during the Gesellschaft für Informatik 2012 conference.  He describes the environmental impact of Bitcoin.

His numbers do show how CPU mining is roughly an order of magnitude less efficient than GPU mining.  He confirms how GPU mining too is rougly an order of magnitude less efficient than the technology for FPGA mining.  Presumably because there is no ASIC hardware shipping yet his analysis didn’t consider ASIC mining but ASIC hardware too is likely somewhere in the range of being an order of magnitude more efficient than its FPGA predecessor.

The challenge that Mr. Loviscach didn’t quantify was the ratio of current mining that is performed by each type of technology.  Without being able to estimate that ratio, any estimates about any electrical consumption can vary (by over-estimating consumption) nearly 10X from the actual consumption.

For some of today’s miners, including many of the larger ones, nearly 100% of all hashing is performed on the more-efficient FPGA hardware.  However many of those mining who pay little for electricity have been adding GPU capacity, especially since they can absorb the used GPU castoffs at a lower purchase price.   The plurality of miners are individuals running a GPU or two on an existing computer and most haven’t yet switched over to FPGA, though when ASICs start shipping that hardware may obsolete their GPUs in an instant.

An educated guess might come up with a ratio of nearly two-thirds of mining is still done with GPUs (though a small amount of that includes CPU mining yet, including that performed by botnets) and FPGAs are responsible for the remaining third of mining today.  Thus the power consumption results provided are possibly 30% too high, and half a year from now total power consumption for the entire network may drop well below current levels thanks to the one-two punch of the block reward subsidy drop plus initial ASIC shipments that could force nearly every GPU into retirement.

There was another point made in the talk that needs clarification.  Mining activity is nearly the same no matter how many Bitcoin transactions are made.  So more transactions do not require additional mining and thus no noticeable difference in electrical consumption.  Calculating the energy cost today on a per-transaction basis and then extrapolating that out to cover all  transactions produced for all commerce simply results in some ridiculous total power consumption number that has no bearing with how the technology works.  It is like calculating the cost of electricity per passenger for a subway trip at midnight (which transports a total of nine passengers) and then use that result (e.g. $25 worth of electricity per-passenger) to calculate how much power the subway would consume during rush hour when the same subway is packed with several hundred passengers.  It just doesn’t work that way.

Length: 24 minutes.

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