Quote from: dadugan on October 24, 2014, 07:23:57 AM

Quote from: brg444 on October 23, 2014, 11:53:15 PM

Quote from: MrBig on October 23, 2014, 11:21:31 PM

Just finished reading this article: http://mobile.bloomberg.com/news/2014-10-21/bitcoin-miner-ditches-clients-to-chase-2-billion-coding-prize.html

Basically the co-founder of KnC, Sam Cole talks about small-time mining operations becoming obsolete as their profit margins shrink and they get replaced by mega-mining farms. He continues to talk about the $2 billion in btc that will be mined in the next few years and expresses his company's intention to milk as much cash from this cow as possible.

What is interesting to note here is that this guy is measuring the profits in $$$, which is indicative that his company doesn't care for btc and are in it for the potential fiat profits. He doesn't say that there's x amount of BTC up for grabs because he and his investors are only interested in the cash/fiat that can be made from mining BTC. Another thing to note is that he mentions their cost per unit is significantly below $400.

So basically these scumbags have a lot of hashing power, fiat, and probably BTC to manipulate the market.

This is speculative.

He doesn't say there is X amount of BTC up for grab because the interviewer and his audience is not familiar with this unit of account.

In reality, it is more probable that they hold a considerable amount of BTC. I have mentioned this in another thread but Bitcoin miners are some of the most bullish entities in the Bitcoin ecosystem.

BitFury has confirmed that they hold most of their coins. DigitalBTC in a recent investors letter have confirmed they are not selling production from their mining farms "at these low prices".

They will eventually sell due to shareholders pressure. If the price is dropping when these mega farms are holding, what is going to happen when sentiment really turn negative and all mining companies decided to cut loss?

As for the 2B figure coming from Sam of Knc, he is probably using an optimized bitcoin price estimation. If he really build a farm so big that will threaten integrity of the network, what is going to happen to the price? Not to mention the constant selling from his company will further depress the price.

The $2 billion figure is based on the current price of BTC multiplied by the approximate amount of BTC that will be mined in the next few years.