Reply to post: Re: Is it that difficult...

FTC nails pin in Bitcoin mining rig maker Butterfly Labs

kphair
Mushroom

Re: Is it that difficult...

No, they are custom-built ASICs in a chassis; Not even GPUs have the grunt needed these days to mine bitcoins profitably*. Even when looking into their kit a year ago, it was obvious from looking at the publicly posted waiting list that the only people who were getting up-to-date gear which could actually mine whole coins were the review sites, everybody else had to wait in line.

Their business model was effectively a pyramid scheme. The money from customers was being used to develop the next generation of ASICs rather than fulfil orders. It was only a matter of time before their luck ran out.

Icon chosen because the whole bitcoin mining industry is not much different to a nuclear arms race, with the only winners being the arms suppliers - If they can get out in time!

* Mining other cryptocoins with GPUs is a different story, but Bitcoin is one of those where ASICs are so far ahead of the game that it's pointless for anything other than research, but then you might as well do it on paper! http://www.righto.com/2014/09/mining-bitcoin-with-pencil-and-paper.html

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