Re: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

My personal impression is that hash rate is dictated by price and (more importantly?) technology, with rate reacting to price and not the inverse. The two big ramps were directly related to a paradigm shift in mining tech, CPU to GPU, and GPU to ASIC. With ASIC gear becoming increasingly efficient we will probably see a rise in hashrate even in the face of a flat or modestly declining price. The upcoming halving should be pretty interesting for those watching this relationship.

Agreed. Hashrate should follow price, but it seems like during those two massive increases it was the price chasing the hashrate.... Huh

Someone better suited to scientific analysis of data sets would do a better job of analyzing this relationship ( hint, hint, Professor Stolfi ) Wink

Anyways, I don't expect any further large expansions in mining technology or efficiency, certainly nothing on the scale of cpu>gpu>asic.

Many people mocked me many pages ago for my concern that the block size could not simply scale exponentially for the next 20 years, but I still believe we are reaching the limits of physics and any further significant exponential type gains in computing power beyond asic will likely take us beyond the singularity. I just hope our new synthetic overlords accept bitcoin. (Ok, yes, I've been watching too much humans (tv show))

The big difference this time around... We have our own little OPEC (OCDM organization of chip designing miners), with apparently only bitmain selling next gen hardware to the small fish. Small fish are more likely to mine and hoard, using it almost as a form of indirect purchase. The current dynamic makes me think that as a percentage, more coins are being mined and sold than in days of yore. The days of mining at a loss with your gaming rig in 2012 are surely over.

Contrary to popular opinion I am confident that a considerable (it may be a majority) part of newly minted bitcoins are being held.

Meaning their profit margin may be > 50% of their revenue? Grin

Consider that some of these mining firms have other revenue streams. You cite BitMain and it is an absolutely perfect example. Considering the amount of money and profit they make selling mining gear. Do you actually believe that they need to sell any % of the bitcoins they mine to cover expenses?

Another example is BitFury which is getting fed by VC money at record rates and have also, in the past, had their fair share of surely spectacular revenues and profit selling their mining gears. Now we don't actually have to speculate about them since they have made it clear in interviews they are absolutely not considering selling any of the bitcoins they mine.

These together amount to nearly 25% of the network. Would you like to suggest they are the exception?