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On a comment on this answer: https://bitcoin.stackexchange.com/a/9494/4173
The following was said: "However, what you need to consider is that we're approaching a step change in bitcoin mining with the creation of ASIC-based minders. These will increase the difficulty 10-fold pretty much immediately, and go to 100-fold if they are successful. "
Can anyone explain what this means? What is a minder? Why is the difficulty about to increase 10 / 100 fold?
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That was my answer, and "minder" was a typo and meant to be "miner". Apologies for any confusion this might have caused.
There are ASIC-based bitcoin miners that generate north of 60GH/s. A high-end PC might get up to 1GH/s, with a similar cost for power. So there is going to be a massive influx of GH/s additional power in to the bitcoin mining pools.
The difficulty rating for mining self-adjusts over time to ensure that the number of blocks found remains relatively constant at around 1 block every ten minutes. Let's assume that the influx of ASIC-based miners pushes the overall difficulty up 10x in the short term. This means that for the same amount of work your PC is doing next week as opposed to last week you will only receive 10% of the reward.
The end result is that the idea of mining on a PC to obtain bitcoins is going to go away over the next year or less (depending on how quickly the ASIC companies can churn out production-ready mining platforms).
Thanks for the clarification - I don't suppose you have any links that explain how the difficulty is automatically adjusted? (I guess anything that would explain the process that dishes out the thing to be hashed etc). I'm trying to get my head around the whole process... – Matt Fellows – 2013-04-10T14:36:40.367
2 You can read up on it at https://en.bitcoin.it/wiki/Difficulty
possible duplicate of How is difficulty calculated?
– Stephen Gornick – 2013-04-10T15:03:46.230