ASICs are rapidly approaching the marginal cost of production and ASIC accessibility will not be restricted to VIP’s. People with low cost power and efficient use cases (EG waste heat recovery) will dominate . Mining decentralization is bound to improve.
Rob, can you further explain this logic.. “Larger & larger scale power becomes harder to find, and growth in this way isn't sustainable”. Thank you.
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Large miners flock to inexpensive power. They don't act like most other power customers - they're running full tilt 24/7 - this puts a huge full time load on power generators. Power generators have to slow growth to meet energy production growth
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The way to do this, of course is raise rates, or refuse service. And this is precisely what were seeing. 2 counties here next to where I am in Washington have banned mining altogether because the grid can't deal with the load caused by large miners.
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This means that in order to continue large scale miner growth, the miners will have to start producing their own power. This takes time to build out physical plants. Meanwhile the networks will need continued growth. The way to get that is commodity asic hardware for home use
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Distribution of miners to home users has additional benefits in heating & cooling. A miner in the home doesn't cause the cooling load that the large miner has. In summer this load could over stress the grid/production capacity
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Additionally, what would prohibit large miners from using short term profits to patent asic tech? Do you see patented ASICS as a problem for individual adoption? For example, maybe large miners develop asic tech, patent, + lease out to individuals where power cost is worth it
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How does patented asic tech change the issue? GPUs and CPUs are patented tech and have plenty of user base. Why mining chips would be different is beyond me. Idealism in Bitcoin continually gives way to pragmatism
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In reality the leasing is little different from selling. It provides a possibly better financial arrangement for both the miner & the lease company. But that doesn't change the fact the manufacturer can't provide power to absorb excess inventory in bear markets
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This is fascinating stuff. Thanks for clarifying.. I've heard desantis suggest that the state should start mining operations at the power source. However, IF global adoption of
$btc starts to rise, wouldn't large mining operations be very profitable in the mid-term? - 1 more reply
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