Post
Topic
Board Hardware
Re: Cloud Hashing
by
Phil21
on 12/06/2013, 19:36:12 UTC
You are making an assumption that Bitcoin's value won't change in that time. There is a lot going on in the financial world right now, I think we're on the verge of a new push. Let's say Bitcoin is worth $500 or more each in 6 months, even making a shaving of a Bitcoin can still be worth serious money.
Irrelevent.  If you're spending bitcoins for mining gear, the only thing that matters one iota is how many bitcoins you get back.  If you're betting on bitcoin rising in price to cover your investment, then simply buy bitcoins.  You'll have a better outcome should they go up in price.

Quote
The miners ultimately set the price of Bitcoin, which only goes up the harder it gets to mine. The currently upward swing will look like nothing soon I agree. More power usage, more time, = more BTC value.
Absolutely not.  The market ultimately sets the price of Bitcoin, miners simply supply it at the price the market will pay.  Should the market not pay enough to make mining profitable, then less people mine.  Eventually equilibrium should be established, but it is not miners calling the shots here.  If they are, we should all give up now as this bitcoin experiment is dead.  About the only thing miners collectively control is the network difficulty, which happens to follow price.  Higher price, more miners are viable, which means higher difficulty.  Lower price, marginal operations get shut down, and you have less difficulty.

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Yes there some large "ifs" there, but don't forget as difficulty goes up, the value of Bitcoin will as well. If all gold were on the surface it wouldn't be worth much, but since we have to dig further and further to get at it using more time and energy, it costs most for the miners, therefor costs more to buy as an investor. Bitcoin follows the mining analogy to a T.
Completely irrelevant if you're investing bitcoins in mining gear to get more bitcoins.  If you simply are betting on the price rising, buy bitcoins!  You'll get more, and have a better rate of return.