They were selling the kit for $22,000, so it'll take at least 5 weeks for the ROI, probably longer given there will be at least 2 difficulty resets in that time frame.
I looked at investing in one but I couldn't come up with the funds. Instead I have pre-orders out for gear due in October.
If everyone begins doing this, then it will become extremely difficult to mine any Bitcoin without any sort of gear
This is already the case. I'm mining at about 250GH/s with 3 Avalons and I earn on average about 1.2 BTC per day per machine. A month ago is was closer to 2BTC per machine per day. Right now, GPU mining is dead. It's literally cheaper to buy a bunch of USB sticks that mine at 350MH/s for $100 each than to buy a bunch of video cards as the USB sticks are more power efficient. Even so, depending on the difficulty, those USB sticks could take a year to earn back the 1BTC.
So yeah. The shovels seem to run a decent risk of being worth more to sell than to use.
For mining, no. This was always seen as the future state, it was just a question of when. Not too long before the first ASICs started coming out, it was already basically not profitable for most people, you had to be running a limited set of GPUs and be in a place that had cheap electricity to make any real money.
>Is it just that everyone uses fractions of BTCs now?
Since they're roughly $100 each, yes, basically everyone uses fractions. Thankfully they're way more divisible than e.g. pennies, and if the value / userbase goes up by a couple orders of magnitude, they can be made more divisible, also unlike pennies.
It already is and has been for a long time
> Feathercoin [1] appears to try and stop this, although I am not sure how effective it is.
IMHO, Feathercoin should not be taken seriously.
That said, the point of Bitcoin is not to avoid that; it is to avoid forced centralization by governments (among other things), which we have for fiat money, and it is succeeding at that.
Bitcoin is not supposed to be a democratic experiment where the little guy gets some kind of special treatment. It is a digital currency that is not backed by force.
I don't think there is any real point in having more than one cryptocurrency. Litecoin could have been great if it had come first, but Bitcoin came first, so I think there is little to no point in having Litecoin.
Yes, bitcoin is not a democratic currency. But it is designed (and desired) to prevent all power from landing in the hands of very few / one, since then the entire foundation it's built on is worthless. Bitcoin is fundamentally stronger with more players, and Litecoin is easier for more players to join.
Absolutely, it came out a distant second, and that very well could be it's death. But why is there no real point in having more than one? With more than one, "money" is more resilient against new crypto attacks.
Play with the knobs some more and you realize: If you purchase the 400 GH/s August device in December, you will never make back the 7.5k that the thing costs. Wait "only" until November and you barely get a 60% ROI.
That's some fast, fast market right there.
I wonder what effect all this has on the Bitcoin economy. If everyone begins doing this, then it will become extremely difficult to mine any Bitcoin without any sort of gear. Feathercoin [1] appears to try and stop this, although I am not sure how effective it is.