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Anyone know what is happening today with Bitcoin Prices? Typically there are wild swings of several percentage points throughout the day. Now the chart is close to flat: http://mtgoxlive.com/orders

What's changed in the past 24 hours?

Thank you for the clarification of that point, Patvarilly. That does change things quite a bit. I was wondering why the number of bitcoins sent each day was so much higher than the number traded on MtGox and the other exchanges.

That may or may not be the case with a typical CPU (i've heard reasonable arguments from either side) but when you're running 3 6990s at a time, they generate a lot of heat, with a lot of moving parts and there are a lot more things that can go wrong. Typical desktop computers are reasonably low-stress environments. When I've got this thing cranking, it sounds a bit like a jet engine. My guess is that it won't work flawlessly, continuously (what does?)... I'd love to be proven wrong, though.

I think this question is fascinating. For the past century we've been told by all the powers that be, that inflation is necessary for the economy. The money supply must grow for the economy to grow. If your money became more valuable just sitting in your matress, people would hide all their money under their matress, and not spend any.

Maybe they are right, but Bitcoin is an interesting experiement to see if a deflationary currency can work. I think people will want to spend a deflationary currency, because once it is widely known to be deflationary, they will get better prices purchasing in deflationary currency than an inflationary one. They will transfer some assets from inflationary currencies to deflationary currencies, and then find themselves richer... and spend more as a result.

I hope I'm right. If you look at the numbers on Bitcoin Watch www.bitcoinwatch.com there are 6.7 million bitcoins in existence, and 2 million of them traded hands in the last 24 hours... that seems like a very vibrant economy with a very high velocity of money, no? Then again, it's hardly been a deflationary last 30 days. So the jury is still out.

As for the paying in fractions of bitcoins, currently the annualized GDP of the bitcoin economy is about $10 billion US. (A bit larger than the country of Macedonia.) The US GDP is around 60 trillion dollars. In the highly unlikely event that the bitcoin economy became as large as the US economy, the dollar to bitcoin ratio would need to be 3 million to one. And while you might find it odd to pay BTC 0.00000833 to purchase a book on Amazon.com, I suspect we'd all do our payments in microBTC or some unit that signifies the millionth decimal place. We'd pay mBTC 8.33 for our book and the wheels of the world would go about spinning as before. I don't see this as the fatal flaw in Bitcoins. (Though I will admit that there may be many other flaws... both seen and unforeseen.)

Where would you get that idea? http://bitcoinwatch.com/ shows that the next change in difficulty in about 10 days will be a modest increase. As long as the ac and electricity costs don't yield a negative return, I doubt that many miners will go offline.

And if difficulty did decrease temporarily, it would just encourage retired miners back into the market... Any drop would reverse pretty quickly.

Because I am a paranoic who is always planning for a life on the run from the law, underworld or shadowy agents of a global conspiracy. Bitcoins struck me as a good way to transfer assets untraceably to my new identies.

A month ago, I ordered a triple 6990 mining rig. At the time, the payout on 2100 Mh/s looked to be about $1900 per month, so the cost of over $4,000 (including taxes) looked liked it would recoup itself in just over two months.

Shipping was delayed for weeks because of scarcity of 6990s. I finally received the unit and got it set up yesterday. In the intervening time, the economics of mining have changed dramatically. Difficulty has increased and prices dropped. One would expect a machine running 2100 Mh/s to generate about $600 per month. Of course, it doesn't run 2100Mh/s 24/7, so a more realistic number is $500 per month.

At these returns, electricity becomes a major factor. The rig draws about 1.2kW, but also included in the electricity is the air conditioning costs at perhaps another 500W -- so 1.7kW per hour, or 1,300kW hours per month. California has tiered electricity pricing for people who use above the "baseline" average household use, so one could expect to pay at least $260 per month for that electric usage. (If you just paid the average cost for electricity in the US, you'd be at around $190 per month in electric costs.)

Net payoff for Bitcoin rig is now $240 per month. Break even in... about 17 months. Of course, a lot can happen in 17 months. During that time, difficulty will only increase, and my 2100Mh/s in processing power will be static. My equipment can get fried by running it 24/7. The only way it continues to make $240 per month is if I have no breakdowns and bitcoins increase in value faster than the difficulty increases. These are two pretty shaky propositions to invest in.

What do you all think? I'm sure many people thought mining looked like easy money a few weeks and months ago... but do you still think it? Who out there is placing new orders for 6990s? If you thought bitcoins were going to increase in value, wouldn't it be better just to buy bitcoins?