Post
Topic
Board Speculation
Re: The negative impact of mining farms
by
dropt
on 30/10/2014, 07:34:31 UTC
You do know that likely the biggest mining company out there, BitFury, sells industrial mining gears to other miners. I would say this qualifies as "enabling others to compete with them". They actually offer the service of building data centers and supplying mining equipment for mining operations i.e. other Bitcoin miners.

In fact, every mining companies in the ecosystem probably mine Bitcoins themselves AND sell mining gear. So your point really doesn't make any sense, at all.

So if a mining company makes a rig that is projected to generate $10,000 worth of bitcoin what do you think they will sell it for?

A.  $8,000 basically giving someone $2,000 because they just love people and support bitcoin.
B.  $10,000 because it allows them to get the $10K right away upfront locking in maximum profit right away.  (This leaves the buyer $0 in profit because they paid what it was going to produce)
C.  $12,000 Suckers!  Person buying looses $2,000 because they were overly optimistic about something.  

The answer is C or some form of it.  KNC characterized their shift to just mining themselves as more honest.


unfortunately, most of the naysayers would choose option A, as they believe that mining companies are some of the biggest supporters of BTC.

What's wrong with option A?  As the manuf. you sell for $8,000 today or try to mine the $10,000 over the next five months, but really you have to mine more than $10,000 because you have to pay for power and somewhere to put the machine.  That's not evem considering the possibility that the exchange rate may go to shit. While you might actually earn more BTC than it would have net you if you had just sold the unit outright, the shit exch. rate means you actually lost money relative to the $8,00 you could have made from the get go.  Further that's not even considering the opportunity cost by having your return tied up in a miner which has to earn it back over time.

But, yes. C