KnCMiner Offers New Incentives for Neptune Mining Rig Delays
How do you feel about KnC Neptunes? : BitcoinMining
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bit_by_bit's mining-cost analysis is wrong - here's mine
bit_by_bit publishes a daily mining-cost-per-coin watch. Though his work is thorough and commendable, it is unfortunately incorrect, and his conclusions naive. I'm sure he has misled people on this board, so I'm here to set the record straight. Roughly using bit_by_bit's assumptions:
difficulty increase is (probably) impossible to predict
I'm 100% sure your miner would not arrive and be switched on today
Given those two huge, highly variable (and unpredictable) factors, trying to work out a cost-per-coin is ... more-or-less impossible. It's simply enough to assume that mining is extremely unprofitable at the moment and (probably) a very poor investment. Here are some examples of variability:
Cointerra TerraMiner IV
cost per coin
0% difficulty increase
20% difficulty increase
15% difficulty, but starting at 30bn difficulty
How are these numbers so different from bit_by_bits?
His calculations do not factor in an exponential difficulty increase. Instead, he says (in his maths) : "if the bitcoin network were composed of the miners here, and no extra miners are added/removed (i.e. difficulty remains the same) what would those miners (on average) achieve as a cost per coin over six months."
The problem with these numbers is
The percentage of miners he uses to compose the network is unknowable, and as you see above, miner performance varies greatly. I'm quite sure that huge operations custom manufacture their machines and never sell them. Their performance is unknown. (an unknowable unknown)
The makeup of the mining network in the future is unknowable, and difficulty will undoubtedly increase, but we can't know by how much. It has previously plateaued. Will it do the same? nobody knows.
They assume the very latest miners, shipped immediately. Historically, new miners are not shipped on time. It's been suggested that the manufacturers keep them and do highly profitable day-zero mining with them.
Also, to suggest that it is possible to predict market movements (and depth) is naive as it asserts that demand is constant, and that supply is the major, or key, factor. This is highly unlikely to be the case.
Let's talk about mining's effect on bitcoin price or, first should we talk about the effect of the price of bitcoin on the mining industry?
The two are intimately linked chicken-and-egg in a feedback loop. For a manufacturer to decide to make a rig, they need to design chips, get industry contacts, produce things (in china), make sure they work, then ship. They also need to get orders and decide if they are able to get the whole project in time for market. These projects are multi-month/year, and I've heard success is largely decided by who you know in china (china's pretty busy already). There is some kind of lag. Investors also pre-order, and must take a wild guess at future conditions with no guarantee whatsoever. At times like now, where mining is so unprofitable, which miners are actually selling coins (at a loss)? Large operations have large overheads, but to sell now, when the price might rise by 10x again would be idiotic. So, really this "supply" aspect of the supply-demand equation is very difficult to get a decent hold on, though I would love somebody to attempt it as a PHD. The blockchain should provide some answers. The other side of it (what miners will be produced) is also difficult to know. It could be that right now (with an unprofitable industry, and miners actually being quite close to desktop PC chip-size - i.e. as fast as humans can make them) no miners are in the pipe-line. This could (in crazy theory) lead to a zero difficulty increase for the lucky new owners of the above rigs. In that case, bit_by_bit's numbers would be spot on. Unfortunately, it's absolutely unknowable.
So... why do people buy miners now?
Quite simply, getting your head around an exponential anything is hard. The exponential difficulty increase is a motherfucker. But it's good for bitcoin (it protects our network from meddlers). Also, you could gamble that mining difficulty has to slow down... surely...
In my experience, looking at price charts is far more informative about future market movements. But, whilst I've got the microphone, I would remind newbies not to trade their coins.
$0.15 (varies quite a bit from country-to country, like 0.7 canada to 0.2 UK?)
price per BTC
I got these numbers off bit_by_bit. I don't care about the details. My argument is that it's not an answerable question. Result:
2252/600 = 3.75 BTC
7446/3.75 = $1985
Please, if I've made a mistake, let me know and I'll send bit_by_bit some flowers.
"Why are you just posting stuff directly against another user: that's not cool"
Well, it's whatever motivates you eh? I just go wound up by our discussions. But, I'm quite sure there are people on this board who don't know this stuff, so ... it's probably beneficial. Have fun EDIT: Ok, so I genuinely thought that I had made a fact-based post. Er, I added a few comments that I thought were funny, but I guess that wasn't a great idea. I removed one of my comments myself, but it's true that the moderators were in touch..... And - to bit_by_bit, I am sorry, because some of the things I said were above and beyond "spirited discussion". I absolutely agree that polite conduct is the way forward, and my initial "hang on a minute" reply to him was nice. But, I do have to admit that this subject has wound me up a fair amount. I genuinely believe that he's made a quite serious mistake - but I am happy to be proved wrong. Right now - I just want to get to the bottom of this. More Edit:
I am a miner
I didn't want to add this before, because I'm sure it (incorrectly) gives my argument more weight. But I need you to understand that bitcoin difficulty is a total motherfucker. I pre-ordered a BFL single for 11BTC in May 2013. The difficulty was about 4 million, and I worked out I'd make 30BTC/day at those conditions. It arrived at around 30 million difficulty, and I think now we're 18 billion. I've made about 0.7 BTC mining, and It's on the limit of believability that I'll make 1BTC before I throw it in the bin. I have a suspicion that it will be useful in the future for some altcoin/blockchain like thing. Also, I got free heating (which was the whole reason I discovered bitcoin in the first place!) Horrific loss. I think it makes about $1 more than it costs in electricity to run (at current price......) This whole post is not a "bitter miner" but somebody who has experienced bitcoin's exponential difficulty First Hand. Honestly, it is unbelievable. I genuinely think that the guy that does the profitability calculator deliberately does not explain what the 'profitability decline per year' is ... because he knows it will adversely harm bitcoin and the manufacture of miners. Even More EDIT:
Am I sure I've got the difficulty increase thing right?
So, I've made a spreadsheet thing to see if the 0.0022 difficulty thing is right. It is. All this table tells you is that in order to calculate 15% difficulty increase, you need to use a number LIKE 0.0022 in the 'profitability decline per year' box, and not 0.98 (which bit_by_bit calculated). I've sanity checked my numbers against the 'profitability calculator' and they don't quite line up, but they're close enough. The difficulty is not the same either, but it's in the same region. I don't know why. Also, the months aren't exact fortnights, so they don't line up. These are details. This proves my above workings to my satisfaction.
what is this horrible data?
It shows how much BTC your miner earns each 2 weeks (average difficulty change period). The last 2 rows (calc:) are from the profitability calculator website (and so are right). My attempt is on the left. Fortnight 13 is 6 months. Oh, this graph uses 14.07% difficulty.
BTC earned accumulated
calculator says BTC
2 bold numbers. 1 is approximately the 3.75 coins that gives you $1900 / coin whatever. 2 is the "profitability decline per year" as a tiny number. The pro tool comes up with 0.01095125 and I got 0.02257 but I don't care - it's close enough. My whole point is that these numbers are totally unworkably all over the place. You can't calculate them meaningfully.
I CANNOT BELIEVE the amount of effort that I have had to go to in order to show you that you made a minor mistake. (at time of writing you still deny it). There is no doubt in my mind now that I was right in the first place. Your calculations do not include a significant difficulty increase. I wish you well.
KNCminers CEO, Sam Cole dumping Bitcoins worth 466,000USD on various exchanges everyday.
As you all know, KNCminer builds and develops mining rigs used to mine SHA256-coins and Scrypt-coins. So far so good. What you dont know is that they bought an old helicopter-hangar in northern Sweden (5.500 m2) to simply mine Bitcoins with their powerful minings-rigs. "We make three million swedish crones (466,000USD) everyday from mining Bitcoins and selling, says Sam Cole, CEO KNCminer." My theory: KNCMiner have been mining lots of Bitcoins with their powerful rigs, dumping it on the market. When difficulty goes up they ship them to us for 9,995 dollar each. I think they are doing just the same with their new scrypt-rigs, just check litecoin difficulty: https://bitcoinwisdom.com/litecoin/difficulty 80% harder to mine than one month ago, it is so obvious KNCMiner are mining loads of SCRYPT-currencies to dump on us. When difficulty have gone up, they will sell their used rigs to us. http://www.di.se/artikla2014/3/20/drar-in-en-halv-miljard-pa-bitcoin/ Article translated: Draws in half a billion on bitcoin Swedish KNC Miner, which sells servers for mining bitcoin, has pulled in more than half a billion in revenue since its launch last summer. This extended operations with a new server for the excavation of another virtual currency, litecoin - a launch that already generated SEK 27 million in revenue. In mid-February, the Swedish IT company KNC Miner hit the headlines with the news that they would build one of the largest data centers in Constance. The company is therefore the second, after Facebook, Norrbotten who choose to build a giant data center. An old helicopter hangar at 5,500 square feet is now starting to be filled with KNC Miners specially developed servers that devotes his days to "break" new bitcoin. The virtual currency is produced namely of advanced servers cracking algorithms. "We are serving more than three million dollars a day to resell the bitcoin we break ourselves," said Sam Cole, founder and vice president of KNC Miner with 80 employees and offices on West Higgins Road in central Stockholm. Besides producing and selling bitcoin feeds KNC Miner to develop, build and sell specialized servers called bitcoinbrytning. The best seller is called Jupiter, which is now being followed up with twice as powerful server Neptune. "Since the company was founded in June 2013, we had revenues of $ 78 million (half a billion dollars)," said Sam Cole, with his roots in Britain. On Wednesday, the company rolled out a new line of servers they call Titan. Unlike the company's other products, the Titan server is not focused on bitcoin, but on the other virtual currencies. "Titan is our first server that focuses solely on scripts basse conditioned virtual currencies Litecoin" said Sam Cole, referring to the currency that is currently the second most popular after bitcoin. The new servers have been selling like hot cakes. On one day have KNC Miner received over a thousand orders for Titan servers. "We have confirmed revenues of $ 4.2 million (27 million)," said Sam Cole. In June it will be time for KNC Miner to close the books for their first year as a company. Sam Cole does not exclude in the first year will be a billion companies. "We will have over 100 million dollars in revenue (640 million) for KNC Miner Group in late June, I can say with confidence," he says. KNC Miner AB is based in Stockholm but has all of its revenues in dollars. Even when the company will charge you in bitcoin is careful to immediately switch the virtual currency to U.S. dollars, according to Sam Cole, who founded the company along with three Swedes. Behind KNC Miner is two companies: Kennemar and Cole (founded Sam Cole and Andreas Kennemar) and ORSoC (founded by Marcus Erlandsson and Michael Unnebäck). http://www.di.se/artikla2014/3/20/drar-in-en-halv-miljard-pa-bitcoin/
What is the best mining rig for cryptocurrencies in general without spending a fortune in hardware?
Hello Friends, I love cryptocurrencies but there are so many of them and I don't know where I should start from to mine them without spending a lot of money in hardware and in electricity. I see that mining bitcoin does not even make sense, unless you are willing to buy a KNC Neptune or something even more powerful. I also see that people mining litecoins are using multi-video cards mining rigs which end up costing a lot of money, both in terms of hardware and electricity. I see that you can mine some alt coins using CPUs but unfortunately I have a Macbook and an iMac and it's not advisable, due to the hardware design go these machines, to have them CPU mine for long times. What would be a good crypto currency to mine with a small budget PC, let's say with a good processor and a good video card? Thanks!!!
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