Quote from: fullzero on September 19, 2015, 10:05:14 AM

Quote from: QuintLeo on September 19, 2015, 08:17:19 AM

The REAL reasons for slower growth rate of late are
(1) the bitcoin price collapse, giving much less incentive to folks to mine and lower profits for those that DO mine and sellers of mining gear
(2) the tech race is slowing a TON as the tech used to mine Bitcoin gets close to the best AVAILABLE tech
(3) the COST of developing new tech gets a LOT higher as you get close to the "bleeding edge" on tech
(4) the death of some miner companies due to the above factors making them unprofitable

There is ZERO "economic need" to pace growth rate, in fact there is at least one good reason to NOT pace growth (ref market share) for any single company, and there have been way too many cases in history where it's hasn't happened even where it was a GOOD IDEA to do so (look at the history of Oil Production for a well-documented example).

Do keep in mind that there is a significant random factor in hashrates.

Strange that you now seem to have the same opinions you argued agianst in the Q7 thread.

Quote from: fullzero on August 30, 2015, 03:50:18 PM

Look at the CPU stats for your CPU. Look at the GPU stats for your GPU. Consider what "State of the Art" means. If a company can make a 14 or 16 nm chip but the production costs are orders of magnitude higher; this is not a desirable option unless it is cost effective.

When Bitcoin Application Specific Integrated Circuits first began to appear there where many chip manufacturers. This was due to the huge profit margin to be had. That is long gone; we are in the plateau. I do think network difficulty will increase with each new generation of miners; but not like it did in 2013 and 2014. Probably somewhere around 100 PH per generation; with old miner deactivation trailing that increase.

The normal profit model for Bitcoin ASIC has been dependent on the ability to use older tech to make comparatively cheap chips for their mining value. This was possible because of both a high BTC exchange rate and the disparity between chips a company can cost effectively make and their relative efficiency to those already in existence. This disparity is what enabled the violation of Moore's law. The closing of this gap occurred in 2014. The relative depression of BTC exchange rate in 2015 is why you are only now seeing new 28 nm chips being sold. I don't believe Bitmain can double efficiency again with a 28 nm chip ( hats off to them if they can ). Unless the BTC exchange rate goes up significantly I don't believe it is cost effective to produce a 14 or 16 nm asic.

KnC and Bitfury may roi with their own because they have been mining with them longer; but maybe not. I think both of them are more interested in becoming the visa and mastercard of the future via new sidechains and XT add ins. Mining pools will be not only the payment processors of the future; but "processors" in markets that do not currently exist.

I agree the plateau was not do to collusion. I do not think there is mass collusion between the big three. However, I do think one of them has been following a very specific hashrate optimization for ~2 years now. If you have a very large % of the network hashrate, hashing at your maximum possible hashrate continuously is not optimal. This is because of how the network adjusts the difficulty. The mathematics to optimize complex iterative systems is very counter intuitive.

I will try to make a simple analogy. The returns from making better mining equipment is diminishing and approaches zero; thus the graph of making better equipment ( or even more equipment ) vs return ( generated BTC ) is asymptotic. ( it gets closer and closer to zero without ever getting to zero; see https://en.wikipedia.org/wiki/Zeno's_paradoxes )

It is important to understand how the iterative nature of the system makes mining BTC significantly different than say drilling for oil. It IS possible with enough equipment to drill all the earths reserves of oil in a period of 20 years. It is NOT possible with infinite equipment to mine all the BTC in a period of 20 years.

Now lets think about how they are the same. Even though we COULD drill all the earths reserves of oil in a period of 20 years the production AND storage of oil is LIMITED and TIGHTLY CONTROLLED. Why? This is how you maximize profit. Diamonds are similar. There exists a company which mines almost all diamonds; and holds an enormous horde of them. They slowly sell them and thus maximize their profit.

Because no mining company has a monopoly their iteration is modeled after a modified Iterated Prisoner's Dilemma. It is modified because if they can bankrupt one of the other companies they remove an opponent from the following iterations.

Nice write up. Pretty much spot on. Now if a new magic chip is invented like the gpu to asic chip jump
That was from 333 watts a gh to 10 watts a gh we will have big growth.
But .5 watts to .25 watts you get swap and not 100 % swap .
This does give the company a safety margin. It also slows growth.