Swedish ASIC miner company kncminer.com

Quote from: timmmers on October 29, 2013, 03:30:10 AM

The reason the difficulty rose for BTC was the people pushing it up by adding hashpower. They aren't mining BTC anymore ...what then? IT's not going to rise, the network is going to lose a ton of hashing power. Maybe very suddenly. What calculator sees that?

The only way this can happen is if mining suddenly becomes less profitable than it is now through some mechanism other than a difficulty increase. Otherwise, anyone who finds mining profitable today will still find mining profitable and will continue mining. There are really only two ways this can happen. Either the price of Bitcoin drops or the price of power increases. Either way, if you're mining you're just as screwed as the other miners. In other words, any change that makes other people want to stop mining will also make you want to stop mining.

The reality is this simple -- if mining isn't profitable, you don't want to be mining. If mining is profitable, you still don't want to be mining because profitable mining means difficulty increases. The only time you want to be mining is if for some reason you can mine more efficiently than most other people. This could be because you have already bought mining equipment as a sunk cost or it could be because you have an unusually low price on power.

Otherwise, it's near certain to be outperformed by just buying Bitcoins. This is so for two reasons. First, buying Bitcoins has the same upside benefit and downside risk as mining -- you profit from an increase in price and suffer from a decrease just the same. Second, buying Bitcoins allows you to time your buying and selling more flexibly -- you can buy Bitcoins when the price drops and sell earlier if the price rises.

There is, however, one big upside to mining -- the "bigger fool" principle. You may be able to buy a miner, mine with it until it costs more to power than it can make, and then *still* find someone to buy it from you at a high price.

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