Avalon Wins the ASIC Race – Sort Of

Over the past year we’ve seen a few companies competing to be first-to-market with an ASIC miner – Well we now appear to be in the final stretch and the ASIC race is heating up in lots of interesting ways. bASIC is undergoing some… restructuring… while BFL expects to ship by February thanks to an ever-growing pile of delays and Avalon… appears to have shipped a product.

Bitcoin Magazine has already dubbed Avalon the “winner” of the ASIC race and while Avalon’s ASIC certainly shipped first, I have to question if it’s really the “winner” with so many factors saying otherwise. Let’s assume for a moment that BFL ships next month as planned and that all their stats and previews hold – quite an assumption I know, but stick with me. Avalon and BFL are both offering a 60GH/s rig for about $1,300 but Avalon’s offering sucks down over 350 watts compared to BFL’s 70. That means that at my local electricity cost, the Avalon rig will cost about $30/month to run while BFL’s will cost me about $6. Add in the fact that Avalon’s rig is almost the size of my desktop computer and costs $150 to ship and “first to market” doesn’t sound much like “winner” to me.

Of course the big question is how this will affect the difficulty for customers of non-Avalon ASIC companies? Avalon claims they’re set to ship 300 units in their first run, worth a combined 18TH/s. For comparison sake the entire Bitcoin network is only pushing ~23TH/s at the time of this writing. This means that we should be [seeing difficulty nearly double](/what-is-bitcoin-mining-difficulty/), but not until all of those units ship, come online, and have been mining long enough to trigger a difficulty retarget. Assuming it takes BFL, the next nearest competitor, long enough to ship that all of the above can happen their expected profits will likely be reduced by about half. Quite a price to pay for backing the wrong horse, but nowhere near what the fearmongers would have you believe.