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Originally Posted by fizzwont
basically unless you get can the hardware cheap and have free/nearly free electricity - it is always better to just buy the coins outright instead of mining.
The next two difficulty jumps will be 50%+, further crushing mining. Given the rate old, dormant coins have woken up the last 3 days, it's unlikely the price will be jumping until all of these new sellers are satisfied.
I have a script that monitors the unspent generated coins from block 60,000 and lower. The number of them finally being spent after so long since generating is up 300% in the last 3 days vs the last few weeks average. The likely destination is mtgox to cash out.
I'm still bullish long term, but pretty much the only reason these coins are 'waking up' now is to sell.
This is interesting analysis on it.
One possibility is someone hacking early adopters and stealing their wallets. There was a mention of this by lulzsec on twitter, with a suspicious transfer taking a lot of 50 coin inputs and sending them to one place.
300% is a big number, but it could be huge or nothing depending on what it was last week. I think we are going to see things stabilize a bit. It's super easy to move the price way up when a lot of coins are "dormant". When they wake up, that's when it becomes VERY hard.
There's also a lot of transactions going to a single address (likely Mt. Gox), and it would be interesting to back-trace everything at that address to see where they are going. It also would be interesting to see how much of each day's mined coins make it to Mt. Gox or how many transactions they have on average.