Bitcoin Forum

I have tried to do a lot of research and used calculators etc, however there is a lot of guesswork and I would appreciate more informed opinions.

With ASICs on the horizon - If I were to invest in GPUs:

1) Am I likely to get at least my money back?

2) Are there realistic options in Alt currencies that the GPU could be useful for vs ASIC - can ASIC at this point or in the near future be used in Alt?

3) Are there any realistic ASIC options at this point, all the sellers seem rather dodgy to me?

4) What other angles could I look at other than actually buying Bitcoin of course?

Feel free to add any other pearls of wisdom that spring to mind...

Thanks for your time.

The manufacturers do seem rather dodgy don't they? I am personally not willing to send thousands of dollars to a website for the promise of fortune later (unless of course it's a Nigerian widow).
I believe that if ASICS are that good, mainstream companies will begin producing them and the price will drop once they are in full production. I say wait.

Well I think when you can't make profit with BTC change the mining to an alt coin with the same GPU.
Anyways you are less likely to loss completily you investment because GPU's can easily resell to a PC Gamers.

Here's what I've found in doing similar research and then crunching the numbers in available profit (http://www.coinish.com/calc/#) calculators (http://www.bitcoinx.com/profit/). Your realistic options for things you can do to mine right now are:

• Add a powerful GPU (http://www.amazon.com/Sapphire-DisplayPort-PCI-Express-Graphics-21196-00-20G/dp/B00BXVFM3K) to an existing PC (600 Mh/s - $280)
• Build a 4 GPU rig (http://www.coinminingrigs.com/) specifically for mining (2400 Mh/s - $1600)
• Buy an ASICMINER Blade (https://bitcointalk.org/index.php?topic=204030.0) (12000 Mh/s - $6500)
• Buy an ASICMINER USB Erupter (https://bitcointalk.org/index.php?topic=195004.0) (333 Mh/s - $275)
• Buy a Lancelot FPGA (https://bitcointalk.org/index.php?topic=187549.0) (400 Mh/s - $350)

If you plug these into any of the mining calculators I think you'll find that the most of the options break even in 3-4 months. After that you are looking at things like:

• You can re-sell the GPU's but they are very hot and draw a lot of power
• You can re-purpose the FPGA's or resell them
• An ASIC will only ever hash for Bitcoins but draws very little power

Of course then there's all the preorder mumbo jumbo with various companies, the group buys for chips that you then have to build into a working PCB, and the ASICMINER shares.

This.  The GPU rig you can point at a profitable scrypt coin after BTC hits a difficulty level that makes it unrealistic, or sell it.

A quick search on Ebay will show that there's a feeding frenzy going on for ASIC mining gear, and even the new Asicminer Block Erupter USB's are selling for nearly twice as much as you could buy them for on this forum.

It's a little bit of a risk, but I would buy (for example) two Asicminer Block Erupter USB's on this forum for about 2BTC with the intention of selling one of them on Ebay, and with a little luck you'll sell it for enough to bring your cost basis to nearly zero on the one that you keep, making the ROI a non-factor.

Do tell... how exactly can you re-purpose the FPGA's? You already had them running SHA256, so you're looking to get away from that... can't repurpose them to Scrypt, I already tried asking a question to try to figure out what path we could go down to retrofit them for memory access Scrypt needs, and was given the "here's a quarter, buy a clue" video as my first response in the thread.

SHA256 and Scrypt are the two coin models. What other profitable usage do you have that you are suggesting to repurpose the FPGA for?

GPUs will be a viable option for cryptos for the next year atleast imo.

I think one of the neatest things about GPU mining is the fact that you can buy them with fiat  :D

Then "getting your money back" is subject to the BTC exchange rate.  They also have potential resell value.

FPGAs are programmable chips. They have many uses and they were not created for bitcoin/altcoin mining. They can be re-purposed to do a variety of things (by someone that has expertise in FGPA programming). So, they do have an intrinsic value even when they are no longer profitable to use for mining. See wiki here: http://en.wikipedia.org/wiki/Field-programmable_gate_array
Maybe not a profitable use for you, but you could sell them to someone that wanted to re-program them to do something else.

FPGAs could in fact be used for mining scrypt, the problem is that the current designs do not have onboard memory and programming them to use system RAM would cause them to be slow and inefficient. This is why GPUs are so good for scrypt, they are essentially ASICS that have fast access to high bandwidth DDR.

It would be possible to design an FPGA for mining scrypt, but it would be different from the FPGA chips that are out there now. I have heard they have been prototypes on an Altera board for mining scrypt, but cost vs performance has put it well in excess of a GPU.  GPUs are already mass-produced and their design is very close to what you would do if you wanted to design an FPGA or ASIC for Scrypt, so for the foreseeable future, GPUs will remain the most effective method for mining scrypt based alt-coins.

I'd like to see someone repurpose an FPGA that is already soldered on a board designed purely for SHA-256 hashing.

I doubt that is it would be cost effective (or even possible) for most miners unless they have hundreds of FPGAs and can contract out the work.

why not buy and sell some of those asicminer usbs on ebay? make double your money that way

It's a good idea but apparently Ebay is canceling auctions (http://www.reddit.com/r/Bitcoin/comments/1fj6c3/ebay_canceled_my_asicminer_usb_auctions/) related to Bitcoin mining.

So again I ask... you're proposing to repurpose those FPGAs (as opposed to selling them.... repurpose implies you are using them again for your own purposes.) What way, right now, is a profitable way to use those FPGAs that you have in hand for YOUR use? As you agreed, you can't use it for Scrypt. I tried asking the question here: https://bitcointalk.org/index.php?topic=187772.msg1946610#msg1946610 ... and you can see what the answers were. In short, once that FPGA is not profitable in SHA256 mining anymore, it has no other purpose to YOU. (This is why I keep suggesting either a project to retrofit FPGAs to Scrypt, cannibalize them to make a new Scrypt FPGA, or develop a third mining algorithm that does not have the memory requirements of Scrypt, allowing FPGAs a cryptocoin life beyond SHA256 once ASICs fully trounce that.)

I would love to have the knowledge of how to make an add-on board for existing FPGAs, make it something like rather than computer-USB cable-FPGA, have computer-USBcable-memory module-FPGA, where the memory module has a USB in from computer, and a USB out to the FPGA. Or, take the FPGA's in, desolder the chips, pop them into a new board with memory, and send them back out.

But, when I try asking the question, a Hero Member gives me this: Let Josh answer your question: http://www.youtube.com/watch?v=UlWrmIqGs3Y&t=2m48s

This board is pretty hostile to anything other than BTC only, though...

Thank you all for taking the time to provide feedback - I am going to try a 3 card rig with the hope of not losing too much and will treat it as an hobby, then watch how things develop...

this is a bad choice, buy klondike boards

If you're starting from scratch like I was a couple months ago, here's a roadmap I've been following:

-Utilize your current machine while you wait on orders. Your current machine can probably mine a little, sometimes.
-Choose which route you'll take, and how fast you want to start. Videocards... you can have them shipped with Amazon Prime and overnighted if you so desire. FPGAs, I can't seem to find anyone who is actively making them and shipping within 1 week from order. ASICs, again, no one seemed to be actively making one for a week order when I started... now there's Block Eruptor USB's, but they are minimum batch 100*2BTC=20 thousand bucks, or get in on a group buy and wait for them to be distributed.

I decided to go video cards, since I had a spare older machine hanging around collecting dust that had PCIe slots, and since at the time FPGAs were rare to find, and ASICs were still on horizon.

Mining Rig
----
-Make a spare miner machine. Tried mining with my active everyday desktop machine... and its not really the best option to make a profit when you're NOT mining more often that you ARE.
-Grab an old motherboard with a few PCIe slots. I had an older one hanging around, Core Quad processor, 1x PCIe 16x, 2x PCIe 1x. Its 5 or so years old.
-Buy as many video cards ASAP that you can to populate your 16x slots. My suggestion would also be to start with 7950s, but theres 17 different arguments about who/what to start with. If you want, place your order for the ones in the 1x slots, but know you're also going to wait a while for those to run as you'll have to wait for...
-Buy as many riser cables as you need, INCLUDING 16-16's. My board, one of the 1x slots was obscured by the fan shroud of my 16x card... couldn't use it until my 16-16 riser came along.

For your first couple months, if your outside world can afford it, mine as a hobby, and just record your extra electric costs, the cost that you sunk into your cards, and the cost you sunk into your hardware.

Mine some coin. Use dustcoin and coinchoose to determine which at the right time, unless you're morally opposed to Scrypt, and morally opposed to any other SHA256 than BTC. Actively trade it toward BTC at Vircurex/BTC-E/Cryptsy. Invest some to buy dividend producing securities at Bitfunder or BTCT. I'd probably suggest looking at one of the partial ASICminer stocks like TAT.asicminer, until you can afford a full asicminer stock. This will give you some additional income, but not necessarily as much as your card gives you. More importantly, its relatively constant income that you aren't paying any electricity or hardware cost to... I look at it as that my already sunk card investment is averaging a few more hashes each week, for the same electricity as I pay.... and moreso that when I get a week outage from a East Coast hurricane, that I'll still make some income.

I did this until I had a full Bitcoin into stocks, and am now saving up enough crypto to pay myself back for electric bills [I've been paying the increase out of pocket, but want the whole thing to be self sufficient over time]. My goal after that is to save some up for an actual BlockEruptor USB so that my average hash/W is better (compare 1100hash/400W, and add 300h/2.5w to make it 1400hash/402.5w.) Then, throw a little more into ASICminer shares, then start paying down my initial hardware investment.

Just my roadmap... Yours will be different.

You have to treat it as a hobby.  Less stress.

Besides, mining it is not that expensive comparing to other hobbies. 

Not too many hobbies let you earn back a bit and in most cases, pay for themselves.

they are relevant as long as you can turn a profit from them over power. They can always be sold for nearly what you paid, given they are 7xxx series...gamers will always eat em up.

Do you think there will still be a market for resale to gamers when AMD releases the 9xxx series later this year (they are skipping 8xxx)? It is not officially announced by AMD, but seems to be widely reported that its coming in late 2013.
http://www.mcvuk.com/news/read/amd-confirms-new-volcanic-island-gpus-for-2013-launch/0115398

Here's my take:

Best Buy still sells 6xxx series cards and lower.  A quick search on ebay shows several 4xxx, 5xxx, and 6xxx series cards currently being bid on.  So, yes.

And since they're twice the price of equal games wise performing nVidia cards, one could probably deduce they are bid on by hobbyist bitcoin miners, eh?  8)
(The ones on eBay that is)

exactly.. ask how many 'photographers' ever make anything back from all the lenses, etc they throw down on

Yeah, I would think so... it may be at a lower price point, but our GPU's , I would highly doubt will be useful in mining till that time(9xxx)...so most likely the 7xxx from miners would hit months before any new product comes out.
Worse case is one can only get 50-60% what they paid for a 7xxx GPU when done mining...but as long as your mining made up for the rest of it and had a little profit in addition then its still worth it.

GPUs for Bitcoin mining will still make BTC, but at current prices, will stop being profitable by about 22 million difficulty.

This depends on your power cost as well. At 15 cents a Kwh, they stop being profitable closer to 19 million difficulty. If you have cheap power, you could probably extend that to 22 million, roughly.

When they stop returning significantly over power cost is a question that each individual miner has to answer for themselves.

You can also mine other scriptcoins, not just BTC. Most of the BTC mining will probably be going over to ASICs in 6 months tops.

Maybe true, but I know some folks who absolutely will not buy nvidia or vice versa, for whatever purpose.  I know plenty of gamers who have 'good enough' gaming rigs and who don't need/want to be on the bleeding edge of new tech.  The newest stuff is expensive  ;D  For example, I have 7950s in my mining machine and a 6770 in my gaming pc.  Could my games be a little bit prettier with a 7xxx?  Sure.  Does it really affect my gameplay? Nope.  I wonder how many people are waiting for the next series of cards to come out so they can grab a cheaper 7xxx card to game on?

My point is that there will always be a market for older hardware.  I really don't care who buys it or for what, just as long as people will still buy it.  You may not be getting close to what it originally cost, but it will sell.  I used to sell 10-20 year old computer parts on ebay in my old job, and always thought 'why the hell would anyone buy this??'  My boss at the time even got mad at me for trying to sell some new(er) obsolete parts for a few bucks more than I could find them anywhere else, because it was less than half the original price (they were 5+ years old).  Couldn't explain that they weren't worth that much anymore to the guy.... those parts probably still gathering dust and losing value in his office today lol

IMO, no. See https://bitcointalk.org/index.php?topic=204322.0. With difficulty now at 15.6 million, I think it's a very bad time to buy GPUs strictly for mining. You may be able to mine some BTC and then sell them to make a tiny profit, but I don't think it's worth the risk.


I discussed that in the above linked thread--current GPUs will hash scrypt altcoins while ASICs will not. However, my theory is that GPUs will shift to scrypt coins (mainly LTC), keeping it roughly in line with BTC, until ALL GPUs have shifted over to LTC. There may be a period at that point where LTC mining is somewhat profitable, but FPGA development is already underway for scrypt, and that will doom GPU mining in the same way.


I don't really think so. They are either too expensive (e.g. ASICMINER), unavailable, or delivery date too uncertain.


Well, you could always look at stocks on btct.co, but the options are pretty limited.


The numbers have gotten even worse after the 28% jump in difficulty. A 7970 put to work today will likely make less than 1 BTC over its useful life--which is probably only until mid-October before it costs more to run than it earns when difficulty hits about 60 million (this is for 650 MH@250W). Currently, you will start at only about $2 per day, and that likely drops to $1 by the end of July.

Don't start a GPU farm!

yes OP, read the thread linked above, but just incase you're lazy  ;)


This!  I have been mining altcoins with my rig and to say that they are dead when some of them are consistently more profitable than btc to mine screams 'i have ulterior motives'... Historically LTC has been ~30% more profitable to mine than BTC, and I will admit that it was a wash 2 weeks ago when this thread was posted, but look again and you will see that it is back up to 30% more profitable today.  Some alts even better than that.  I have made 1btc in the last week on a single rig with those 'dead' altcoins....


lol, yes, FB... why exactly do you care enough to start a new thread warning everybody to stay away from gpus?  Are we all buying them on your credit card?  I must have missed the memo, I will take some free 7950s please.   ;D



and here is an example of it working out for another newbie...


The real point is that FB here can't see the future any better than you or me.  Read up and do what you want, don't put anything not expendable 'hobby money' into btc and don't expect to get rich ....  you'll be alright and might even have some fun doing it.

I got in by treating it as a hobby that happens to return a bit of investment back. I've dropped about $5k into model helicopters and got nothing back except the fun of flying (and needing to put more money in whenever I crash).

With bitcoin, I've dropped about $1500 and so far gotten about $500 back from mining, and love the cool facter as well.

I completed my first mining rig about a month ago (4 x 7950) and have been mining 24/7 since I got things going. I'm right at 2.4 GH/s, and to be honest, I'm fairly underwhelmed with my payouts. I've been mining in Slush's pool and the dramatic hash rate increase has really slashed my per block earnings. It's not just Slush though. The worldwide hash rate has gone up a dramatic 40,000 GH in the past 30 days, and Slush's pool is up 50%.

http://blockchain.info/charts

I would do some serious pondering if you are concerned about investing in a GPU rig. I have no doubt you will make your money back, it's just a question of how long.

You could, of course, try my approach. Just keep telling yourself it's a hobby until you're out of the red.

Then you can tell your spouse or friends how invisible coins paid for your computer.  ;D

Hah, mine asked me last night if we'd even reached 1BTC mined in the 7 or so weeks I've been mining. She was quite suprised and relieved I said we're up to about 3½ so far. 1 card paid off, about ¼ through the next one. Well on track for my 6 month ROI estimate for the 4 cards and 2 power supplies.

Why dont you mine scrypt?  Ive almost paid off my 3 7950s in two months.  I made a big gamble on wdc that paid off though.

according to my girlfriend there is no "cool factor" lol

Yeah. I said this in another thread. Mining scrypt really does help. 100 day ROI on a 7950!

I guess that's a bonus of being married to a geekgurl, lol

A newly bought GPU will not make the price back from bitcoin.

Maybe you can mine the cost back with litecoin.. It's a big maybe.

Agree. I am still buying old HD5850 ($120) for mining LTC. At present difficulty level the hardware break even date is about 205 days. If it is not profitable, I will sell the card, for $60.

If you use sites like coinchoose, dustcoin, or coinwarz, and are actively involved with switching your miners to the most profitable coin at the time (even if its only twice a day... like when you leave for work, and before you go to sleep), and actively and regularly converting those coins at the exchanges (BTC-E, vircurex, cryptsy) to BTC, it is still quite viable to pay down a GPU. If you put some of that BTC into a stock site like BTCT or bitfunder into a dividend paying stock, the initial paydown time will be delayed, but that money is still available to pull out (unlike pyramining), and is gaining some interest in the form of dividends. Now, if you're buying riser cables, a new Power supply, or a whole new system, it will obviously take longer, and yes, could theoretically take too long.

If you are morally opposed to mining any other coin, and insist on mining JUST Bitcoin and nothing else... then yes, GPU mining will probably not pay off in a sensible amount of time. GPUs give certain hashrates... And with the influx of Avalons, Avalon-chip miners, the slow influx of BFL, ASICMINER blades, and the eventual influx of KNC ASICs, the amount of hashes your card can put out compared to the huge rise in difficulty will be negligible. Unless the pricing of BTC/USD increases to match, then yes, GPU mining will be unprofitable. It would THEORETICALLY be possible to pay off that new GPU if you could even guarantee 1 penny per day off it after power costs, but that GPU is not going to live for 75 years.

Scrypt coins were made to address just this issue, the rise of ASICs and eventual obsolescence of GPUs in SHA256.

Not much longer at 1 BTC = $120
600MHs cards work out about $30 profit per BTC after power costs.
It won't be long before it's cheaper the buy the BTC than run the graphics cards at this rate.
If the price of BTC rises GPUs will stay running.

The critical path item is the pricing of BTC/USD, and secondary, the trade of a given coin to BTC. The conversion of the latter usually hovers real close to the generation rate of the one compared to the generation rate of the other, eg all hardware being equal, how many bitcoins can be generated and how many Digicoins can be generated in the same exact time frame, and express that as a ratio. That's the median... you might see pricing shoot above it as investing is done, then drop back down toward the median, maybe slightly dipping below for a very brief time.

The more critical item is BTC/USD. This itself is what determines the pricing for just about everything else. And at this point, we have to thank the people who pay USD and buy BTC, as they are the ones who inject the cash into the economy. If BTC stays level at $120, then yes, slowly things will tend toward un-profitable, as the one CONST is block reward decreases, and the variable that figures in to change things is difficulty, driven by global hashrate. (The same was said when BTC was steady around 5 a couple years ago, and 30 a year ago.)

As before, you will see one of two major changes:
-BTC/USD stays stable, causing miners with less profitable equipment to drop offline, global hashrate to decrease, and difficulty to decrease. (In this case, GPUs that are from the x7xx of their line and earlier... but in the case of SHA256, also GPUs heading up into the high x9xx cards.)
-BTC/USD rises, causing purchase of more equipment, and more global hashrate, driving a difficulty increase.

I invested about $4k into 2 rigs, with 3 7950's each. They've been running for about 1 month, and I've earned 4 bitcoins since. It's a slow payback, but I didn't do this for a fast return. We'll see how well it goes.

The "better" alts are typically only "better" for a matter of minutes or hours lately. Not really viable unless you're auto-switching. Litecoin is still a wash, if your pool also mines NMC. This will likely be the case until ALL GPUs are mining LTC. However, that point may be after GPUs are completely unprofitable.


It's easy to get that "bitcoin fever" and look at profitability calculators that don't take increasing difficulty into account and say, "hey, this will be pretty profitable," when the reality is it won't be. Honestly, I'm just trying to sound the warning. Sue me for my honest opinion.


Well, you are not posting my rebuttal to that post--I will leave it to the readers, but suffice to say I believe my assumptions are realistic if not conservative. Nobody has even argued about my ACTUAL assumptions, which so far have proved to all be correct.

[/quote]

Wow, a whole $140 on a $700 investment. He will never make $700 total. Thank you for making my point.


I wouldn't have posted if I didn't believe it. Please do the math and just plug in the 18% average difficulty increase we've seen every two weeks for the last 3-4 months. That is the proper way to calculate ROI, not pulling up a calculator that calculates today's profitability and extrapolate 200 days out. We just increased 28% and it sure looks like the next increase will be over 20%. With more and more ASICs getting plugged in, do you think that we will enjoy nice, gentle increases? Do you think GPU miners make any difference in recent hash rate increases (e.g. your theory that I'm trying to keep GPU miners out of the market)? If so, you're suffering from denial.

This statement points to a big portion of the picture that you seem to disregard and misunderstand.  Auto switching is actually not a good way to go IMO, because the alts do bounce around and you mine on the upside...  you need to mine one of them and wait for the upside to come after you already have coins.  I have been watching a few alts that have remained better than LTC for several days, they bounce down to near LTC, and they come back up and let me know when to trade.  Another cornerstone of your argument is that price will not rise with difficulty.  Now, I know that price and difficulty are not directly related, but look at the long term charts and they match up perfectly.  So to disregard the idea that price rises might keep gpus mining longer than you expect is not something I can agree with.  You do make some good points, but you disregard variables in favor of your own assumptions, which may or may not be right.  At the end of the day cryptos are a hobby, what do you care how anyone else does it?  Besides, people have been screaming gpu mining is dead for such a long time that you shouldn't expect anyone to believe you now even if you are right  ;)

Timing is critical with your method, and you're basically speculating and timing the market. You may as well just buy the coin you think will rise.

If you believe BTC price will rise, buy coins rather than GPUs. Difficulty will certainly rise quicker than price; hence it will ALWAYS be more profitable to buy coins directly than it is to buy GPUs, if you believe price will rise.

Of course I expect at least some people to believe me...otherwise why post at all? If I help even one person avoid losing money on GPU mining, it's worth it.

Next month about $400, month after that about $300.  After that if price does not rise then electricity cost will be close to return and time to power down.

I got a small mining rig with just 1 7970 and mining on Slush and 50BTC and have a return of 1.3 BTC (2 months). But I have opened up a coinbase account and have bought 40BTC and recently was able to buy in the mid 90s this weekend. I also make a lot more gambling on satoshidice, 1 BTC just in the last 8 hours. The little BTC I get from from mining is barely anything when compared.

Don't bother. Alt coins are going to die as everyone who used to GPU min bitcoins switches over to them. The difficulty will soar, and there will be no one buying alt coins up since none of them offer anything bitcoin doesn't already.

Come on, do you even look at coinchoose.com? That shows every altcoin's current profitability vs. bitcoin (and now the 7-day average). Adjusted for stales, the absolute best coin over the last week was Bitbar, at a whopping 22% more profitable than bitcoin alone. If you throw in namecoin co-mining, it's only 15% more profitable. And that's the best one. Litecoin is actually less profitable than bitcoin+namecoin.

Your 7970s *may have been* bringing in 200 bucks a week, but starting on about Saturday, they will be bringing in about $50 a week total. For 6 cards. The total income for all 6 going forward is probably around BTC2.5 ($275) through September, when you start losing money mining.

As for "there will always be new and more profitable coins to switch to..." well, I kind of doubt that, but I suppose that's possible, for awhile. Scrypt coins could stay marginally profitable for efficient GPUs, but that's not terribly likely IMO.

I know the first step of loss is denial...you need to get past it.

Still relevant in the scrypt world..but not much longer as prices keep dropping for scrypt coins.. let's hope for another Cyria

I'm honestly just breaking even. But that does include adding new GPUs so I suppose if I sell them all off I'll make some cash.

I wouldn't get in to this now with GPUs because I don't think it will be profitable enough come September. Difficulty keeps going up. If you're really keen you might want to try one Block Erupter USB. I'm considering getting a couple but the mh/$ is quite high.

Please don't. Theyre incredibly overpriced

Gpu are relevant and for quite some time.  Soon a lot coins will start to grow and more GPRS will be needed. 

the secret is to have a large vga farm so you can switch very fast between altcoin, mining a good amount of them, and sell them asap, because the duration of their profit is very short

Well, that's true, but I see it as no more true than mining or trading BTC.  If I had BTC and panic sold during this last weekend in the mid 90's, it is no different than holding my coins and trading at the wrong (or right) time.  You do have a point about trading coins instead of mining, if price is always on the rise.  We all know price is going to be volatile, but I do expect it will go up for the long term.  However, I like mining because it supports the crypto network and because it gives a (somewhat) constant supply of coins to play with.  If I made a BTC last week and lost it in a stupid trade, I can always (at least for now...  ;) ) make another one this week.  If the day comes when it makes no sense to run my GPUs, most of it gets rebuilt into nice gaming machines that I would use anyway.  Even if I sold off my mining hardware it doesn't need to make very much BTC to break me even in that case.  So in this example my view of losing 1BTC != losing $ had I bought that BTC.  It's a hobby and everyone does it differently.  I do think most of the alts will die out in the long term, but I also think that scryptcoins in general will stick around.  We don't really know how it all will play out, so do what you want and have fun  :)  Personally, I will be planning on getting more GPUs going unless the prices come down on some of these ASICs.  So far I have only seen one start up that offers a reasonable price and if they deliver on time then I will switch, until then it's go 7950s, go!  ;D

Wow what a great thread - excellent arguments from both camps and in good humor....well sorta  ;)

Update:

I did take the plunge and as anticipated I am not going to be making my fortune but I am having fun, I am currently mining litecoins, though have tried bitcoin (too difficult) and I did take advantage of FTCs little bubble recently.

Please keep the discussion going I was thrilled to come back and see how much it had grown in a productive way.

Sometime Sunday, difficulty is going to jump about 23%, to 19.2 million (the last jump was 28%). That will bring the average 650 MH/s GPU down to about $1.04 per day after electric. Around June 29, the difficulty will likely jump to 23 million or so, which will bring profit down to $0.73 per day. The BTC price dropping to ~$100 is not helping at all.

Plugging in a new 650MH/s GPU today will likely yield less than $50 (0.45 BTC) in mining profits over the life of the card at 20% difficulty increases (which is probably optimistic). By September at the latest, GPUs will cost more to run than they produce.

Pretty irrelevant if you asked me. FPGAs are also irrelevant.

Litecoins are less profitable than BTC over the last week. I don't understand your "too difficult" comment re: BTC.

I have been running the math - My GPU rig is now at 100% break-even with 8.5 cents/KWh, $101/BTC and difficulty at 15.8M.  Difficulty will be at 19M by Monday morning.  Unless BTC goes to $120, I'm pullin' the plug and putting it all on Ebay.  If you still think GPUs are relevant, you can bid for it there.

Now I just need to wait for the BFL stuff to materialize on my doorstep.  I'm hoping that the hashrate is below 300T and that Hell is still warmer than Texas (i.e. not frozen over) when that eventually happens.

In looking at prices for ASIC-Miner "block-erupter" cards, they are about the same cost in $/MH/s as Radeon cards.  Their only benefit is power savings.  It's hard to recover $5,000.00 in power savings while the hashrate heads moonward. 

Just got my first electricity bill.

Surprise! PG&E Tiered Rates!

Baseline	$0.13 per kWh
Tier 2	$0.15 per kWh
Tier 3	$0.31 per kWh
Tier 4	$0.35 per kWh
Tier 5	$0.35 per kWh

I blasted all the way to Tier 5. That means I win? Right?

My own fault for not knowing.
Mining has officially become a labor of love.
Or collecting BTC.

It means you should move out of CA.

I tend to agree.

Mine scrypt for now.  It will keep profitability at least for alittle.  I'm waiting for the difficulty to stabilize after the majority of asics are shipped (or turn out to be scams) then sell my gpus and buy an asic or whatever will be equivalent then.

Got my electricity bill.  Tier 2!  After all the extra fees, ECA_VEA_CRPSEA_CRPSEA, etc  The per kw/h comes to around 0.22399 plus 10% of the subtotal.  So friggin expensive in california.

Right now I'm barely making profit.  Probably won't be mining for much longer :(

Mine alt-coins... save power and make real money... BTC is dead to GPU's...

We are all moving or have moved to alt-coins...

Litecoins
Feathercoins
Novacoins
Worldcoins
Mincoins
Digicoins
Memecoins
Fastcoins
etc...

Places like www.Multipool.in have ports that simply mine whatever coin is the most "profitable" those few minutes. (Eg, lowest Diff and highest trade-value. Port 7777 I believe. Average value is greater than 120% of BTC, and up to 210% on some coins, when they sell. EG, if mining BTC earns you $100, these earn you $120-$210 when you mine them.)

Or, jump on a coin of your choice.

Great solo-mine coins are... (You actually see returns within hours, not days.)
Memecoin
Fastcoin
Mincoin
Worldcoin

The others are sort-of pool dependent, for the best value, over solo mining. (The diff is higher and you get more on average from pools.)

See returns? Yes, you may see a few mincoins in a few hours, becuase they're worth 0.000437 BTC each. You'd need nearly 2300 for 1 BTC. According to coinchoose, it is not really any more profitable to mine altcoins--Mincoin may be 200% of BTC right now, but it has averaged only 90% of the profitability. As more people join pools like multipool.in, it will ensure that whack-a-mole is played more effectively, knocking down the most profitable altcoin.

Rather then jumping around I think it's a good bet to bet on one or two coins and put your power there.

i get discounts for using more electricity

where/how?

From a post above in this thread:

"why not buy and sell some of those asicminer usbs on ebay? make double your money that way

It's a good idea but apparently Ebay is canceling auctions related to Bitcoin mining."

To be more specific, Ebay has cancelled AN auction related to Bitcoin mining.

Did anyone notice the drop in hash rate? Could it be some GPU miners backing out after the difficulty change?

http://blockchain.info/charts/hash-rate

Mine scrypt...

I highly doubt there will ever be an ASIC for scrypt, so GPUs are going to be the norm for scrypt mining.

The main question is will ASIC mining of BTC kill all cryptocurrencies?  It could because it will force people who are still using GPUs to mine SHA256(BTC) to switch to Scrypt(LTC) if they want to make any coin.  This will just make LTC/FTC/etc more difficult to come by.

I just started mining last month, but overall I have only put in $140 to my "rig".  I bought a 5850 for $80 and a 850W PSU for $60, and slapped them into my PC with a 6950 I already had.  I get about 800MHash/s for BTC (800KHash/s for scrypt).

I've only made like $30 so far, and will likely piss that away with gambling, but I did it more for fun and experimentation. 

My advice:  Don't buy new hardware if you can avoid it.  Spend $60-80 on a 5850 instead of $300 on a 7950 unless you just have a lot of extra income OR you want to upgrade your graphics card anyways.

I plan on getting a 7950 or 7970 next month but that will be going in another desktop that I will only mine with while I sleep/work. 

I'm a n00b though, so I could be wrong, but I think there is still profit to make here.  A lot of people pay some ridiculous amounts for electricity, too.  I'm in Texas and pay $0.06/kwh... so it costs about $40 to leave my computer on all month. On average, I make ~$2-3/day right now, so I get a small profit, but it's not really about the money for me as much as it is the experience. 

It's a way better hobby than smoking rock and playing dice.

Hard to tell. I think there are at least FPGA development efforts already underway. If LTC hangs around and becomes significantly more profitable than BTC due to hashrate not increasing as quickly as BTC, there might be incentive to do an ASIC run.


Yes, eventually all GPU miners will switch to scrypt as BTC hashrate rises and LTC and other scrypt coins become more profitable. That is, unless it doesn't become more profitable.


Huh? All cryptos become easier to come by as they get mined (there is more in circulation). Difficulty adjusts to keep production constant--I don't understand the logic here.


Absolutely. Just as people gamble (and expect to lose), this can be a fun gamble as well. Personally, I'm trying to invest only in opportunities that appear to have a positive ROI. But everyone is different!

texas

by using a different plan, with a guarantee to use x amount of kilowatts

i.e. plan A charges you $20 a month (flat fee) and 6c per kWh

plan B charges you $50 a month (flat fee) and 5c per kWh, provided you use a minimum of 3000 kWh.  if you don't, you get billed for 3000.  if you use 3000, it's a wash.  if you use more than 3000, then it's a discount

ed:

ok, i just checked.  plan A is $20 per month, the next one is $40 per month.  there's also one where there's a 'minimum bill' of $500, where you can get electricity for 4.16c/kWh, that may be business only though

oh texas, only you would charge more for conserving energy.

well, natural gas is so cheap that some wind farms got shut

aha

http://stateimpact.npr.org/texas/2013/05/17/under-new-approval-more-natural-gas-will-be-sent-abroad-from-texas/

http://news.investors.com/business/053013-658108-eagle-ford-shale-oil-output-to-pass-bakken.htm?p=full

that's a lot of fracking

I just meant that as more GPU miners leave BTC and flock to the scrypt-mined currencies, then the hashrate of those currencies will increase meaning that a 800-1200KHash rig will not generate as many coins as it does now.  So it would obviously not be as profitable (if profitable at all) to mine the scrypt coins depending on how much higher the hashrate climbs, and the value of the coins.

So yes, they will be easier to come by, but the relative ease of mining for them with a GPU rig could be exponentially increased depending on how many GPU rigs switch over from BTC to LTC/FTC/etc

This was due to ASICMiner having some kind of problem with their Data Centre I believe. If you have a look at the charts on their website you will see that it coincides with drop in hash rate.

Interestingly it shows that 1 company now has the power to impact the entire network. If they lost all power to the data centre it would have a massive impact on the overall network performance.

Personally I feel ASICMiner are far too large and could seriously damage Bitcoins. The market share they have goes completely against the decentralisation of Bitcoins. But they are greedy bastards so I don't expect them to give up any market share.

Next difficulty rise and GPU's will not be viable any more.

The main problem being it is impossible to get your hands on an ASIC and it will remain that way for a while.

Once they do become mainstream the hash rate of the network will be so high that you will need very deep pockets due to the number of devices you will need to buy.

This problem never occurred when people started GPU mining as GPU's could be purchased next day by anyone - this jump to ASIC's is going to purge out a huge number of miners and just leave a small minority with ASIC's.

It will be interesting to see what happens.

It may even drive the Bitcoin price lower as they can be mined more efficiently. The more efficiently something can be produced generally the lower the value.

True, but it will also concentrate the mining of bitcoins into fewer hands. The fewer there are to sell a resource, the higher the price (assuming demand stays the same).  Definitely will be interesting to see how it all unfolds  ;D

Possibly - I just feel for all the small guys as what is happening really goes against the grain of Bitcoins - Bitcoins were meant to empower them.

Yes, BTC was meant to be as decentralized as possible, and fewer people mining more of the coins = less decentralized.

However, I do think that it will all even out eventually.  Look at GPUs for example, $300 typically gets you 500-700mhs.  You can get a $300 ASIC that does 4.5-5.5ghs....  or, you can get in line for one would be more accurate.  Eventually the hardware demand for ASICs will level off and the small miners who want to continue will be able to do so, but they won't do as well as the folks who waited in line for it.  That's the only real big difference, nobody ever had to deal with this kind of buying frenzy/scarcity with GPUs.

I do think / hope that scrypt mining will keep GPUs around longer than some would guess though.

Dude you summed it up perfectly with " nobody ever had to deal with this kind of buying frenzy/scarcity with GPUs."  Law of unintended consequences.

As nobody has had to deal with this situation before the outcome could be very detrimental.

I can clearly see that what has happened is not good - all they have done is made something that was available to everyone (mining bitcoins) now the remit of the select few which is basically no different to banks.

If I could walk into PC World and buy an ASIC today then it would not be a problem - but this is so far from the truth. You can not even order an Avalon unit for example.

You said you can buy a $300  5ghs ASIC - you can not though - you can pre order one and hope that by the time it arrives you may be able to make your money back because none of the manufactures guarantee any kind of delivery date and that is if they are not using them to mine themselves which has been highlighted on other threads.

Put it like this someone that received an AVALON unit 4 months ago has made such vast sums of money they can order another 20 without batting an eye lid aka Exponential growth. By the time we get our hands on any we will have to order 30 just to be competitive - and we won't do that so we will be forced out leaving fewer and fewer miners.

I'll keep using GPUs over ASIC because of a few reasons.

1) I don't trust any of these companies that are pre-ordering
2) If my ASIC is no longer bringing in many coins, or the hashing power is insignificant because of more powerful ASICs and/or the increasing difficulty, then it is a worthless device that will resell for no-where near what I paid for it 
3) If my GPU is no longer bringing in many coins, then I can move to another crypto-currency that is more profitable, if that doesn't work then I can move to another one, if that doesn't work then I can sell it for relatively the same amount that I paid for it.  People are always upgrading their computers and these cards are all pretty beasty

I am with you on that for sure.

The ASIC companies are just gold digging opportunists that are ruining mining.

+1

The thing is this - as soon as somewhere like MT Gox accepts LTC - I feel the majority of us miners won't give a hoot about ASICS's - if they want to wreck BTC let them - a valuable lesson may be learned.

At least we can keep mining then with our "old school" rigs :)

GPU will be relevant for several years to come.

1) Just because you don't trust the ASIC companies doesn't mean at least some of them won't deliver (and all of them look like they are so far, so later than others, but still delivering).

2) GPUs will never sell for what you bought them for. GPUs will be mining so few bitcoins these days that you will have no chance of making the difference between what you buy and sell the GPUs at. Don't forget that they use far more electricity than ASICs.

3) The difficulty of those alt coins is going to soar as all the GPU miners do this. Alt coins are all going to die anyways within a year as there is only people mining them with no one buying them or using them as they are pretty much useless.

I respectfully disagree with you.

Right now, I am running a 5850 that I bought with $60 on CL.  I could sell it right now on eBay for $80 and make a profit.  It has also been mining for a month generating ~$1/day.

You sound like my friend who told me that "there is no market for used hardware"

Yes and no... certainly the people who adopt early will have the best potential rewards, but the point I was trying to make is that eventually the market will settle down and you won't have to wait in line for the 4.5ghs ASIC that costs as much as a 700mhs GPU.  It won't make crazy profit like it could right now but it will be worth running.  When that time comes is when GPU mining is no longer relevant....  could be a few months or a couple years, with all the uncertainty around ASICs right now.  The cat being out of the bag at this point, I still think there will always be at least one scrypt coin to mine with our old GPUs....

As far as remaining competitive...  also yes and no.  There is a big difference between mining above the cutoff where it's still profitable to run the hardware and being competitive with the other miners out there.  The example you are using can be applied the exact same way to CPU mining being overtaken by GPUs.  For example, I have a single rig of 4x 7950s mining right now and it's well worth it to mine, but I am not even close to being competitive with the next guy who has 50-100 GPUs or more farming away.... I think that eventually the ASIC situation will balance out and become just like GPUs now.  You will have some small guys just getting a little bit of BTC for fun with their small miners, and you will have others who sank a ton of money on their crazy multi TH/s farms getting more BTC.  It's the crazy transition period where big risks/rewards are made available, but in the long run it will be same sh!t, different year.

+1

My thoughts exactly.

1) The chip game is a rat race right now. I don't believe many people will see ROI on A LOT of the miners scheduled to be "delivered soon" (KNC, BFL Chips, Cointerra, Bitfury etc.) Still didn't stop me from throwing a few BTC at them  :P

2/3) GPUs don't sell for what you bought them for but you can get close, especially if you're selling a not-so-dated card. (79XX)
The altcoin diffs will be rising but not at the incredible rate that BTC is. To be honest I'd be surprised if there are really that many people mining BTC with GPUs. I'm running around 5 Gh/s worth for example. Why would I mine $3/day worth of BTC when I can mine $12 worth of LTC?

GPUs are not relevant if you only just performing the SHA-2 operations.

If performing SHA-3 or Scrypt(1024,1,1), GPU is still relevant as the steps are not simple.

I doubt it, maybe in a couple years  :-\

Litecoin and Feathercoin seem promising at this point

I'd avoid ASIC's at this point, seems really hard to be successful

Buying Altcoins?  I think that's about it.

Litecoin price is plummeting (see chart (http://www.cryptocoincharts.info/period-charts.php?period=6-months&resolution=day&pair=ltc-btc&market=btc-e)) and the currency itself has no future. However, it's great to mine LTC with GPU and convert LTC into BTC.

"Great" is not the right word. Right now, a 600KH/s Litecoin miner at 200 watts is mining $0.79 per day after electricity. That's 3 cents per hour. The best altcoins may get you a dollar a day or so. I can probably find more on the ground walking around the mall. Alt coin prices seem to be falling over time, which will only make mining less profitable.

As less efficient GPUs become unprofitable (many are already), you will likely see declining network hash rates among alt coins, killing them off when split blockchains and orphans become unmanageable. Eventually we will probably be left with only a couple (thankfully), and those will be marginally profitable for the more efficient GPUs and those with low electricity costs.

What? There is NO WAY you will ever get your money back with a GPU. Even when the OP posted, that was probably the case.

But my rig heats my apartment in this cold autumn days :) for free :)

lol where is the profit calculator that takes heating bills into consideration?? how many BTUs does a mining 7950 produce? ;D

yeah im useing my little rig as a heater as well , man what are we doing.

Very little, as it's quite energy efficient, but if you stack lots of it together :)
Also that's where old cheap gpu's would come in handy, if they were available in my region.

I'm thinking about buying ASIC miners but also thinking similar to what you said.
If all this bitcoin story stops, ASIC is only good for trash. Same scenario if somebody sell much stronger miners.
On other side, I lost some value of GPUs but I can sell them if I stop mining and with alt-coins there is still some income.

Soon I will probably end up with both, hardware and GPU miners. :)

Not worth anymore

Not profiting any more with GPU, sell all your gpu and buy 2TERAH/S ASIC!!!

If you've got few GPUS i'm interested to have them .  ;D

GPU's are like only relevant with altcoin mining, and LTC in particular.
In the beginning of LTC I could mine 1 LTC every 10 minutes @ 400Kh/s, damn shame I only mined 25 and quit it after that...

Now I have 800Kh/s sitting here occasionally playing some games for me...

Who is crazy to dig BTC with GPU rigs :)

Haha, I just recently change to mine alt-coin instead, I will sell once alt-coin have ASIC :)

Well, GPUs convert essentially 100% of electrical energy into heat (the only "work" they do is move air, but that is turned to heat as well). So a 250W GPU makes about 850 BTUs.

I though 1W is about 1BTU? How did you get the 850 BTU from?

The biggest issue with using GPUs for heat is that heating your house with electricity is pretty much the most expensive way to do it. As compared to natural gas (at least where I live) electricity is about 10x as expensive.

If you want expensive try oil heating :(

No gas where we live so I though of GPU's mining alt coin for heat instead but then you can't hear the TV over heating  :'(

Yes, heating with electricity is expensive but you are in this case not using it directly and only for heating.
If you spend 2 BTC worth electricity and make 2 BTC worth alt-coins then you have heating for free.
But gpu rigs take a lot of space and you can't live with noise they make and stay sane.

It depends how you set your GPU, just mine at stock speed and undervolt.. should be cool enough to reduce fan speed to 40-50%..