Bitcoin Forum

What's the average cost to mine a coin now, kindly tell me, guys.

On average it costs around 1 BTC to mine a bitcoin -- less for some, more for others.

It should never cost more then 1 BTC for someone to mine 1 BTC. If it does then the miner is essentially giving away money to the electric company. This miner would be better off buying bitcoin on an exchange if they wanted to acquire additional bitcoin

The average cost to mine a bitcoin is more then a bitcoin. A lot of people is mining at a loss...

What is the profit of folding@home, mersenne prime number search, or other distributed computing projects (http://en.wikipedia.org/wiki/List_of_distributed_computing_projects) that people participate in? Even if merely donating your computing, you are supporting Bitcoin's transaction processing and defending the network against attack in a way that just buying Bitcoin does not.

Regarding profit, there is a certain "turn off the miner you already bought" point. This has already happened for CPUs, GPUs, FPGAs and a lot of ASIC miners. It doesn't make sense to pay the power company for BTC when you could just buy them for less. Some miners have contracts or operations with "free" electricity that allow them to operate older equipment, and still others continue to operate their equipment even after they are past break-even.

Bitcoin miners turn electricity into heat, so if you were running a space heater under your desk to keep your feet warm, you might as well have a miner plugged in instead to make heat + Bitcoins.

assuming you are running this hardware https://bitcointalk.org/index.php?topic=735982.0
assuming you dont pay cooling costs.
assuming you pay $0.07 CAD for electricity
assuming your dont have any interest or amortization costs on your hardware.
assuming you dont have any space rental or employment overhead.
amusing you mining for a shitty pool with bad luck but they pay anyway.

the average bitcoin costs $123.33 CAD to make today.

this cost changes every 2 weeks, at the moment it will become 7.5% less efficient to mine 1 coin in 5 days. that percentage is historically low - should be average around 10-15% and is expected to increase exponentially ever 2 weeks.


in 3-5 months things should get interesting as something will have to give, mining hasrate will fall or price will go up, as the cost of production = market price.

So in 13*10 = 130 days, with difficulty increase of 10% each 13 days, the cost of mining is $319 CAD. It is still lower than current price.

Only the manufacture doing large scale production making money now.

The rest of the miners are hinging on false hope.

Yip that said amortization isn't included so one can expect mining hardware investments to slow in the near future and the hash rate to be somewhat dictated by price.

Last week I would have said cheap coins if price doesn't rise but this week I'm not too sure.

Very good points you make, I was participating in the Great Internet Mersenne Prime Search back in 2004, running an overclocked Pentium 4 for most of the year, in terms of power it was a total loss, but the cost is of no interest to me.  Funny you should mention running a non-profitable miner for heat, that is exactly what I am doing right now, it's cold.  Think of it as subsidized heating :)

I was seriously thinking of starting mining. Then after a lot of calculations I decided to buy Bitcoins than mining.

yes
buying bitcoin is better then mining in current situation
mining is not profitable for new miners untill its price rise up

You need to somehow factor in the cost of your equipment. Even though it is only a one time expense, it is still an expense and if you are not able to mine enough bitcoin at a cost below the value of bitcoin then you will end up with a loss

Yes I agree but lets say your capital investment is a sunk cost, when do you power down and call it quits? If your operating costs are lower than the cost of Bitcoin you can keep going. You may never ROI but it's more profitable than quitting.

price of capital for mining bitcoin is currently very large, we need high specification computers cukum, large electrical power from the power source, and of course all it requires no small cost, while for the results of the mining bitcoin itself, for the time being too significant, so I think this time is the wrong time to mine bitcoin ...  8)

thinking its easy to engage in mining  and reading this post encouraging me more to decide whats best to do..thanks for this amazing Ideas...

For most people, its more then a bitcoin. So its really not worth mining but they want to secure the network..

wrong time to be buying mining equipment if you want a ROI from mining alone. I'm happy to be mining atm. My equipment was bought with $600 BTC, its earned 90% back, and I've replaced the BTC with $350 BTC so it can still be done, its just not easy.

The cost of buying the miners will need to be taken into consideration prior to someone buying the miners in the first place. 

The cost of the equipment has to be amortized and used to calculate the profitability. The amortization period depends on the difficulty rise period when the cost of mining is more than the revenue. I think the period is between 70 to 100 days.

Keep in mind you're looking at this like an investor and rightly so you won't profit true.

But entrepreneurs take risks too I'm only highlighting the situation that a bad investment will still never ROI but continue to support Bitcoin by mining.

I don't think many miners will continue to support the security of the bitcoin network by continuing to mine. This is not a rational activity as they would essentially be paying money to secure the network (via paying more in electricity then the worth of bitcoin they mine).

Also the network is already more secure then it realistically needs to be right now based on the transaction volume

I'm not sure you read my earlier posts, I'm saying it's rational to continue mining so long as your operating costs are less than your income even if you never earn enough to pay for your hardware in the case where you have paid for your hardware from savings.

lets say I spend 10BTC (cash - no interest due)  to buy a few miners. That is a sunk cost.
If I never get a return on that 10BTC by mining (ie. A bad investment)  it is still possible to carry on if my operating costs are less than my income.

At the moment many miners have an operation cost around $130CAD per BTC, some won't earn enough to recoup the investment in hardware, but given the hardware is fully paid, quitting now when the price is $380CAD is premature. They are in the red but plowing on is better than throwing $250 away by stopping.

In a way you are right, but you should also think of the resale value of the miners. If your net profit is really low then you should actually sell off the miners when the value is higher.

It also seems to me that bitcoin miner value drop about 1/3 every month. So if you think your profit in a month is less then 1/3 of your hardware price then you should consider selling it off...

There is always the greater fool but that's not fundamental dominating growth stimulus. Lots of people succeed doing that, good for them.