Bitcoin Forum

 Hello, I have just started to read about Bitcoin and I've come to the conclusion that I want to invest in Bitcoin mining. I've tried my best to find answers on the internet and on this forum, but with no great luck.
If any of my following questions has been answered before, please link me to the thread.

1. I am thinking of buying a machine that can mine around 1000 gh/s (or more) for the price around 1000$-2500$. What sites can I trust, and what machines do you guys recommend me to buy?

2. How do I know that it will be profitable? Can I trust the profit-calculators out there?

3. Can bitcoins machines also mine litecoin and other scryptscoins aswell? No?-> Why?

4. I've found a machine ( the sp30 yukon bitcoin miner) but I don't know if I can trust them. Any tips for finding out what firms/sites I can trust?

5. I don't understand how I can earn money from bitcoin mining, other than that a bitcoin is worth around 620$, and that you get bitcoins by mining. How can i get money in my bank by mining bitcoins?

I would greatly appreciate if you guys could answer these questions.
Thank you!

-Messia

1. Don't get into mining. It isn't profitable unless you have cheap electricity.
2. Yes, calculate it yourself, taking into account electricity consumption and price.
3. No. Because Bitcoin is SHA-256, and other coins are other algorith,s.
4. Spoondolies-Tech haven't shipped yet, but they look promising. Use google.
5. Erm... You just answered that yourself. You mine bitcoins, you sell them for fiat, and you transfer it to your bank.

If I should not get into mining, what should i get into then instead? What's the most profitable?

Using this calculator http://www.bitcoinx.com/profit/ I have understood that with 1 th/s costing 1500$ i will earn about 1500$ every third month... Is that not correct?

Hi and welcome.

I can answer number 3 and 5:

3. In short: NO. Explanation: ASIC (Application Specific Integrated Circuits) are chips specifically made to solve ONE (and only that on) particular algorithm very fast. In case of Bitcoin this is the SHA 256 algorithm. SCRYPT is a different algorithm, which is based on SHA 256 but different enough so that SHA 256 ASIC machines cannot solve them. There exist a few (on or two I know of) hybrid miners that can mine SHA 256 and SCRYPT coins but in general a Bitcoin Mining machine can only mine Bitcoin and the other SHA 256 coins (Namecoin, Devcoin).


5. Earning "real" money with Bitcoin is done by selling the mined Bitcoins on an exchange site like bitstamp.net

Look. Bitcoin isn't a get-rich-quick scheme. If you believe in bitcoin, simply buy some and wait for its value to rise.

Other ways is either offer a service for Bitcoin, take part in signature campaigns in this forum (see "Services" subforum) and by traditional trading, which means buy Bitcoin directly when they are cheap and sell them when the price went up.

Using this calculator http://www.bitcoinx.com/profit/ I have understood that with 1 th/s costing 1500$ i will earn about 1500$ every third month... Is that not correct?

You need to take into account electricity consumption, electricity price, difficulty increase, so no.

Well, in my area the power is very cheap.
Can the difficult increase really be so high that if I invest 1500$ in a mining machine I am doomed to lose money?

First, what miner are you talking about, and what is your electricity price? If you don't even know that, I cannot help.

Electricity price: 0.20$ per kw/h

The miner: antminer s2 1000gh/s 1,1 watt/gh/s bitcoin miner

The difficulty generally rises, but you'd need a working crystal ball to actually figure out by how much. The rule of thumb that is constantly suggested is that there is a ~20% increase every time, however this isn't exactly true given the amount of variance and the fact that technology will have decreased gains as time passes. We recently had a tiny difficult increase (roughly like 4% IIRC, google it for the exact) but you can't really predict off these numbers as they can change quite rapidly. The biggest difficulty changes will probably occur when mining companies ship out the next generation of ASICs as miners move away to more efficient miners.

Being optimistic and only assuming a 10% difficulty per month (Impossible), you would start profiting in February 2015.
https://tradeblock.com/mining/a/40e37c8348

Being realistic and asuuming a 30% difficulty per month, you wouldn't profit.
https://tradeblock.com/mining/a/af8c090e6e

Yes it's true!
The difficulty increasing so fast so you shouldn't invest in mining because you'll lose money!

This whole thread is more geared towards "mining" - You should direct your questions, to the mining section https://bitcointalk.org/index.php?board=14.0 for more specific attention.

But I can see, why you posted it here, being a "newbie" - The mining section can sometimes become a bit daunting for "newbie" members.

For now most people would discourage "newbies" from getting into mining, and I agree with most of them. If you want to enter this area, mining for bitcoins, would not be the most profitable route to

follow at the moment. {Difficulty is too high, to see a ROI} But if you want to do this as a hobby or for self development, Alt coins would be the route to follow.

Good luck, it's going to be a bumpy ride.  

Well, if that'd true, why do people even mine bitcoins?

Because they have even cheaper electricity, like $0.05/kwH?
And that IS true.

But if it's the electricity price it depends on, they can't earn any money that matters, can they? A dollar or 2 a week isnt eaxactly alot...

Incorrect. A dollar or 2 a week? Of course not. People have huge farms, and scammers like Butterfly Labs don't even have to ROI.

I thought of mining as well and even asked people if they could import some mininghardware for me but then after figuring I can't compete with companies dedicating their existince in mining bitcoins I thought of Just investing cloud mining.  This way I never have time worry electricity.

Does butterfly labs scam? Do you know of any sites that does not scam?

Butterfly Labs is like the worst ASIC manufacturer ever. You pay them, they use your money to make the ASICs, they hash for it until they become unprofitable, then they ship it to you.

I recommend Bitmain, they always ship on time and are quite good.
bitmaintech.com

http://www.urbandictionary.com/define.php?term=BFL
BFL
Verb
1. To have something you ordered - delivered so far behind schedule, that it is no longer useful to you. Especially in cases where delays are 100+ days and the manufacturer or reseller is refusing to offer a refund for the goods.
2. Scammed
3. Completely fucked over

The term originates from the famous case in the Bitcoin community of longer than 1 year backlog of orders at Butterfly Labs, who have refused to refund their customers.

Usage:
Damn, I think we're getting BFL'd
Be careful, you might get BFL'd

 ;D

There are generally three types of people who mine bitcoins.

First, there are the bitcoin mining businesses.  These people have access to cheap electricity and the ability to purchase the newest and fastest bitcoin mining hardware as soon as it is available.  They purchase large quantities of this hardware and mine with it immediately.  Eventually the difficulty rises and newer and faster hardware becomes available.  At that time it is more profitable to purchase the newer hardware and replace their old hardware, so they do.  It is an "arms race" within the global bitcoin mining system, always needing to stay ahead of everyone else so they can remain profitable.

Second, there are those that participate in bitcoin mining as a hobby.  They buy used mining equipment or mining equipment that is no longer using the newest technology. The spend on maintenance and electricity knowing that they could have gotten more bitcoins if they used the all the money to just purchase the bitcoins directly, but they enjoy the process.  They realize that the hobby is costing them profitability, but the value that they get from the enjoyment of participating in the activity and working with the hardware compensates them for this reduced profitability.

Third, there are people who are bad at maths.  They hear gossip that you can get free money by running special equipment and they quickly buy anything that claims to mine bitcoins.  They usually end up with old technology that won't ever recover the costs.  They often will sink a significant sum of money into equipment and electricity without realizing that they are making less money than they would have if they had just bought the bitcoins directly.  Occasionally the exchange rate will shoot up, and they will make a small profit on the increase in exchange rate, but they fail to realize that they would have had a lot more bitcoins (and therefore made a lot more profit on the increase in exchange rate) if they hadn't been mining.

Hahaha, i lol'd ;D

How do I know which firm I can trust and which firm I can not trust? Does Gawminers.com seem promising? How can I keep myself updated on the latest technology in Bitcoin mining? Please ellaborate a bit :)

You have to do your own research. GAWMiners is trustable. They're very good.
Use this to get discounts: http://r.sloyalty.com/r/tylyZfa0Ghz5

That's not actually true. A cloud mining contract's costs are covering the electricity it costs to be hashing at the contracted hashrate for the contracted amount of time. If you calculate it completely considering the cost for the cloud mining contract it is as profitable as getting hardware with the same hashrate and mining at home for a while and selling the hardware again afterwards.

One thing to mention though in this thread in general though is this: All the calculators out there make estimates about the rise in difficulty but none of them takes into consideration possible rises in bitcoin's value. And I think that's why so many people are buying mining hardware and mine even though it is unprofitable with current numbers. They look at the development of the price during the past 4 years in which they did not mine and extrapolate that to another 4 years in which they do mine. For a lot of people it is simply a bet on the price.

Another thing is: Many people buy big hardware, mine for a while, then sell it to fools for almost the same price they bought but keep the mined bitcoin, then repeat with the next generation of hardware. But this scheme works only in above a certain amount of hashing power in the hardware.