Bitcoin Forum

I've done some math and research into all ASIC producers and this is the conclusion I've come up with. I truly think only those Chinese guys next to the foundries, who are the first to get their hands on the new technology, can really make money. All those who buy mining hardware even from companies like KNCminer end up losing more than they've invested.

Just enter the values here http://www.coinish.com/calc/# in Expert mode and you'll see what I'm talking about.

It's way more profitable to just buy BTC than mine it.

I'd like to hear the counter-arguments on this topic.

+1!

Agree, hoarding lots of Bitcoin, have been long since Bitcoin price rise rapidly..

This is correct but is also short-term thinking.

Care to elaborate a bit?

It's true that if say price of XBT doubles or triples, currently unprofitable mining operations can suddenly become profitable. This doesn't change the fact that you're better off buying XBT than investing in mining operations.

You can try and make the case difficulty can normalize but I don't see that happening any time soon. It will most likely just keep going up because I see XBT value skyrocketing in next 2-3 years and willingness to mine coins should increase accordingly. What we've seen in terms of computing power since the early 90s was nothing but pure exponential growth and I think we'll see the same with XBT mining.

Yap, you're, probably, right!

Unless people have free electricity, mining at home doesn't pay off.

Then don't buy ... and if enough people do that prices will go down.

Since the lifetime of any mining unit bought today is going to be measured in the short term, that is the only timeframe worth considering for whether to purchase a mining unit now.  There may be some future time when it is again profitable to mine, but without being able to shove off the externalities (electricity) on some other party, that time isn't now for most people.

Thing is, leaving electricity issue aside, assuming you'd have free electricity, it's practically impossible to get a ROI on all these ASICs with current projected difficulty increase unless there's significant increase in XBT price. Probably the only exception to this rule are those +1Terahash units but only IF and that's a big IF they're shipped in timely fashion. Who knows how landscape will look by then. Most likely savvy Chinese or Taiwanese entrepreneurs, close to those foundries, will be once again ahead of the curve, passing leftovers along to gullible western "savvy" tech crowd.

Well, I believe the opposite will happen. When the difficulty will be very high and even the most ignorant peoples realize these miners cant pay off, instead of buying miners people spend USD on Bitcoin, thus increase buying BTC demmand

Its time for me to step in here:

Its all about Cex.io Cloud mining.  Lease from Ghash.io instantly and get paid...do it quick get in get out and right now with zero fees you will earn ROI.  
ZERO Electricity
Zero Maintenance*

*Obviously you should look everyday to see your earnings...you could convert your earnings into more mining power and convert your earnings into a savings account.  make sure to cash out quickly though because the cost per GH is expected to decrease especially with their referral program for which I have linked above.  It's fair you know that I myself would like to gain from sharing this information which is why I Converted this into a Promo Link.

http://cex.io/img/b/728x90.jpg
 (https://cex.io/r/1/frankenmint/0/)

Have actually checked Cex.io also. They do have decent gigash/$ prices but you'd still lose. Not as much as pre-ordering some November 500giga ASICs, but you'd still lose nonetheless.

Just enter all the numbers here http://www.coinish.com/calc/# in expert mode. At 0.1850/gigahash, you'd still make a loss even with zero electricity costs. Price of hashrate is going down so in 12 months time what now costs 0.18xbt might be worthless so resell value is also questionable, though I have to say seems better deal than buying ASICs and have them delivered to your home.

cex.io (https://cex.io/) beats every preorder because you get GHs mining for you *now*, which is the most important thing when you look at constant difficulty increases before you get your preorder delivered. Another thing going in cex.io favor is that you can easily sell GHs and get the most cost of it back, which may not be true for in-hand hardware.

Yeah, was basically saying same thing, however buying bitcoins is much better deal. Not only is it more profitable but you avoid the 3rd party risk of trusting these guys run a legit business or of them just vanishing into thin air. You also have to trust that hash power you buy is actually the real power used in paying those dividends. There's zero auditing and zero accountability, so no one would know if they're really trading unbacked ponzi paper contracts or the real thing.

Given the number of Bitcoin sites going offline just like that, I'd say risk is pretty high.

+1

If the hardware was profitable to mine with, the companies would just plug them in themselves.

If you buy mining hardware, you are purchasing a fixed amount of bitcoin which can be calculated using btcinvest.net

If you pay more for those bitcoins by buying the mining hardware then you would to buy on an exchange, you're an idiot.

Ug another calculator that locks you into a daily percentage increase of hashrate.   :P
I'd like one that lets you predict the hashrate/diff for each month yourself, since there's going to be big bumps from each manufacturer release.  We're seeing the end of the BFL bump and the beginning of the KNC bump at the moment, with hashfast in there as well, and a few others.  Eventually, BFL will stop shipping the SC units.  KNC will continue shipping, but IIRC they only sold 500TH or so - perhaps this number has changed.  At this point, buying much of anything would probably be a bad move until someone else announces pre-orders that are reasonably priced.  Holding an ASIC order that's sufficiently early will probably work out fine though.

Which other Bitcoin sites sell the currently mining GHs on exchange? I thought the cex.io is the only one, if there are any others I would like to know.

This exchange are part of Bitfury business network, which were extremely reliable up to this point. They are the only manufacturer which delivered hardware to the day as promised. Don't know how you came to conclusion that the risk is high buying anything from them.

By any reasonable expectation of the short term difficulty increases cex.io is still overpriced. We're about 3 days out from a 40% difficulty increase. If you say that the next few increases after that are 30%, the correct price for a GH *right now* is about 0.097BTC, i.e., about half of cex.io's prices.

Getting it now doesn't save it as an investment.

This is not true. After the last difficulty update a week ago CEX.IO price for GHs hardly blinked, it stabilized very quickly at around the same level as before the difficulty update. Why? Because you keep forgetting you are not renting GHs the owner can opt you out on his will, you are buying GHs which you can sell at your will and regain the majority off the profit from that sale, not only from mining. If you would rent mining rights that would be another story, like you described, but that is not the case. Your GHs are mining for you even when you issue a sale order and your account shows 0 GHs in your possession, all the way until somebody accepts your sell order.

The risk-adjusted return on miners has been absolutely dire since at least April of this year; this is still the case today. I am glad that miners are securing the network even at a loss, though.

But if it is overpriced for the amount of Bitcoin it can generate, why would you be able to resell it for that overpriced figure?

Because people are buying them at this very moment at the current price some consider overpriced, having their own views on how the network rate will behave and other factors. KnC is lagging heavily with their delivery, HashFast may be a week late, and considering the miners get half their mining revenue in their first five weeks of mining during 30% difficulty increase, they calculate that GHs bought on exchange will mine more than someone expects. Hell, people are even buying 2.7GHs USB miners for 0.9BTC, how crazy is that? And they can't even make enough of them for the interested buyers. Those miners will not return the third of their price in the same mining calculations, so the only price that can define the real GHs value is market (exchange) price. And cex.io is giving you exactly that.

Mining hardware is worth buying, you just need to stop thinking about profits and think how to protect the bitcoin network!

I got out of mining in May and devoted the free time to building web sites. Let me tell you, I've made a lot more money off the web sites than I ever did on mining. The income/expense ratio is much better.

The entrepreneurial spirit is great to have but Bitcoins are becoming a black hole of expense now. It's just as it always has been, the earlier you get in the more you make and now there is very little meat left on the bone.

How's that working out for you guys? I'm curious about this but haven't been curious enough to dabble in Bitfury specific GH trading/instant buying.

What are the price premiums like compared to pre-order deals?  Thanks in advance!

==

BTW, I specialize in helping out the little guys and newbies. I'm not here to help people that can buy top of the line miners by themselves or people just holding BTC; just the ones that still want to buy portions of ASIC hardware at the cheapest possible prices. Some people still want to protect the BTC network, even if they take a slight loss or ROI isn't certain, and I hope to give them a scam free/high value sales outlet to at least explore mining at fractional risk.

If someone only has $70 to spend on ASIC hardware, I'd like to think that if they're dead set on trying out mining, my at-cost (and sometimes below-cost) GB shares are going to give them much more equivalent hashrate (+ UPS backup) then the equivalent number of USB thumbs...as long as they have the patience to wait a little while.

I hold BTC myself but it's a bit boring, so I do allocate a big chunk of my BTC investments into what I see are the strongest ASIC pre-order deals across the industry, at the best values I can get for our Democratic at-cost Miners Cooperative.

I think if you like to take risk, there are still mining hardware worth buying.

So it's just buying an overpriced asset and finding a bagholder? OK, good luck with that. I think I'll pass.

I've being following what you are doing and appreciate it, though I'm still not in your Cooperative. If you consider group buying cex.io GHs for your Miners Cooperative, I suggest that you delegate someone who has experience with exchanges to handle this part for you. It's not rocket science, but it ain't exactly easy. You can't just buy GHs and wait for months, you have to be active, if not constantly than daily on the exchange. Would hate to see you organize something in good will and get burned.

It's not like that at all. Consider that, for instance, production price of gold is around 15% of it's current market value. Is buying/selling gold "buying an overpriced asset and finding a bagholder" like you described it? I'm just saying that nothing can fix the price of the asset except the market/exchange. Everything else is false economy and bad speculations.

Did bot build web sites for you when you been slipping?
Oh, sorry, you did web sites yourself in your "free time"...
Yeah, I heard some people work as doctors and attorneys when they have the "free time", and some people work as engineers (sure, when they have the "free time"). Cool, right?

Your comparison with gold is false.

Gold doesn't produce an income stream; a mining asset does. Unlike gold, if I buy a miner I know its value is falling to zero in the near future. It's just a question of what income it will produce before it does.

To profit from cex.io you have to trade out of a position before the inevitable market correction. As soon as the market corrects, you are not only underwater in your fundamental position (i.e., intrinsic value, what income would I get if I held this down to 0), as soon as you liquidate you crystallize your loss.

It's a truly horrible investment.

This is a fallacy. If you buy a 1 BTC miner and it will make you 0.8 BTC over it's lifetime, your profit is -0.2 BTC. If you buy 1 BTC now, your profit is 0 BTC. Future cryptocoin value doesn't affect your calculation of whether to buy mining hardware or buy the currency itself, only the calculation of if the hardware will earn you more in a reasonable time than it costs.

If you are in possession of hardware, it may have some resale value that could help you get back into the black, but if it becomes obsolete, a mere fraction of it's original price should be expected. Look at resale of BFL FPGA singles, the first dedicated mining-only hardware: https://bitcointalk.org/index.php?topic=305242.0 or http://www.ebay.com/itm/141079903811

Of course not everyone buys miners with BTC.

If you buy a $1000 miner with dollars, and mine 10 BTC @ $110 each, sell them, pay your fees, electricit etc then you break even, if you mine 10 BTC @ 150 each then you make $500 or so more.

 :) yeah I have to agree with No mining hardware is worth buying

cex is the best way to mine quickly. But some decentralization advocates won't love this concept. They'd better buy off equipments and mine at home to raise more decentralized mining population.

Your example is wrong, let me help you.

Right now you can buy 1 BTC @ $100 or you can buy a $1000 miner, and mine 8 BTC @ $130 each, sell them, pay your fees, electricity etc then you break even, if you mine 10 BTC @ 200 each then you make $600 or so more.

If you buy 10 BTC instead, you will profit $300 and $1000 respectively when the price of BTC hit $130 and $200.

You forget that, cex.io (https://cex.io/r/0/cowandtea/0/) also gives you dividend. Price is more important in this sense that if its cheap enough, the dividend should be able to ROI over the lifetime.

Thanks friend, I hadn't forgot about the dividend. My whole point is that the asset is currently massively overpriced for the likely dividends it will return. If we were in an era where 20% difficulty increases were the norm, the price would be fair. But we're not, we're in the dawn of the 28nm era, difficulty is rocketing up, which is why it's a terrible investment.

But it's your BTC, go ahead and buy at these prices and we'll talk in 6 weeks.

My example isn't wrong, I'm not talking about buying BTC and selling it, I'm disagreeing with the statement that you don't earn a profit if the price of BTC goes up. You can't earn a profit in BTC if the price goes up IF you paid for your miner in BTC, but if you payed cash for you miner and you sold your BTC at a price that earned you more than you spent on the miner then you are quids in.

So gold doesn't have an income stream, cex.io has, and that's bad for cex.io? What gives you the idea that cex.io GHs value is falling to zero in the near future? It's nonsense, Bitfury is energy efficient chip and their mining farm is at the place with extremely cheap electricity, so GHs you bought on the exchange may very easily still mine while most other current miners shut down.

I see that you don't like them for some reason, but please try to think over before you post such things, you are giving people biased financial advices.

I think overpaying for any asset is stupid, whether it's gold or bitfury miners. I have nothing against bitfury's products, I think he is a talented ASIC designer. If you sell me bitfury miners *today* at 0.05BTC/ghash, I'll take all I can get.

*ANY* mining asset's value is tending to zero rapidly. All that matters is what revenue it produces before that happens. We are at the beginning of the 28nm era. 30%+ difficulty increases are going to be the norm for the next few months, as KnC, HashFast, Cointerra and other players come to market. We are at 189 million difficulty right now. While we've been having this little tête-à-tête, the network has been hashing 10 blocks an hour. The next difficulty increase is going to be huge, 40%, maybe higher. The ones in the coming weeks are going to be around 30% or more.

If the upcoming difficulty increases were around 20%, you could argue that paying 0.18BTC/ghash is fair value. But at upcoming 30% increases, it's stupidly overpriced.

Let me turn the question back at you - what price per ghash do you think is fair value right now, and why? Why should investors put their bitcoins into this investment?

How about your follow through and simply put up the chips price / hash rate and delivery data and put it on a table for us all to see... that be a great way to show people. No need to discuss the merits of different systems just the chips themselves. Some won't even ROI as bare chips... but is that going to stop people from buying the latest miners?

However, you'd have made more of a profit simply by purchasing BTC.  So given a choice between purchasing BTC which will appreciate in value, or purchasing the future potential of fewer BTC by mining for the same amount of fiat currency, choosing mining is obviously the inferior choice.

It's nice that you want to buy *today* at 0.05BTC/GHs, but nobody wants to sell you at this price. The only raw chips selling today (Bitfury) manufacturer sells for 4X that price, + you have to add the price for the PCB, small parts and assembly to complete the miner. To answer your question about what is the fair price right now: It's the price rational person willing to sell, and rational person willing to buy, agree on. That price can only be determined on the exchange, and if they can't agree on the price you have a spread. Currently that spread almost doesn't exists and trading is very alive, which means there is a fair value most people agree on - just check the exchange. The idea anyone will sell the miner at the price which is sure to give positive ROI is wishful thinking. The times when AsicMiner sells initial shares or Avalon sells batch #1 miner where a Bticoin infancy, they are long gone and will never be repeated. All further purchases of mining assets will be small (if any) reward.

Mining never pays off. With the skyrocketing difficulty, its a negative profits.

So far you just appear to be a shill for cex.io. But I want to give you the chance to prove me wrong. Let's all find out about what you really think.

C'mon, don't be so coy. Forget about the market for a moment. Let's blue sky this.

What would *you*, itod, the real living and breathing human being, who has bills to pay, honestly, pay for a ghash on cex.io right now? If you saw the market price was 0.25BTC/ghash right now would you get your wallet out and start buying? How about 0.15BTC/ghash? Or 0.1BTC/ghash? C'mon, you're not that stupid that you don't know what a ghash is really worth, even approximately.

If you expect others to part with their hard earned BTC, what would get you to part with yours? I've told you my buy price. What's yours?

If you want to give me another of your "whatever the market thinks" answers, OK. There's no point in arguing further with you, Mr. Shill. But to others who have read this far, *caveat emptor*.

So when you have no arguments you resort to insulting me, calling me a shill? I would not get to that level, it just speaks for you.

To answer your question: I would not buy any GHs on cex.io, since I already have small amount of GHs there, and don't want to invest that way any more. Happens that I just like that we have an exchange for GHs, which is essential for anyone deciding to buy or not some specific miner for immediate delivery. Just look at the price on the exchange (currently BTC0.1838 per GHs) and skip every offer above that.

So you have no opinion on whether or not it's overpriced. OK. I withdraw the shill accusation.

For everyone who's read this far, my opinion is the prices on cex.io are far too high. Invest at your own peril.

Hey itod,

Thanks for saying that! Compliments are always appreciated.

Of course, teaming up with thomas_s has had a synergistic effect where we can focus on what we both do best. Also, there's 5 of us helping to lead and run the co-op now, with software support from two other world class programmers. It helps us to get Group Buys off the ground as we can pre-reserve chunks of shares in miners we're interested in, and then run them at the absolute lowest possible costs with the maximum amount of A/C to improve Overclocking.

Overall, between the 7 of us, we've donated thousands of dollars of pro bono work to help make this democratic at-cost mining experiment appear to work (so far). People have been appreciative to be part of something solid that's a mesh network that works hard to secure at-cost or below-cost deals. Since I co-lead our merry bunch with Thomas, he and I can fill in for one another, when necessary.

==

Thanks for giving me some info on that exchange. It sounds like a bit of work & my free time bandwidth is already pretty saturated, even when taking more of a backseat to co-op GBs since Round 5.

Great idea, but price / GH/s is absolutely too high.

you guys can argue until blue in the face and it wont matter. Bottom line is the current market rate is ~$20 per 1 GH.  Whether that is overpriced or not strictly depends on what the difficulty increase percent will be in the next 3-6 months, if it is going up like it does now then no it is a money loser, but if it starts to top off and flatline in 2 months then you will make a return.

Again noone knows what the difficulty percent increase will be in the future, i count at least 3 major players who havent come online yet but it's still all speculation.   So there is no point keep beating the same deadhorse.

cex.io is an interesting idea by taking the physical labor out and trade the mining GHs, not much different than commodity futures.  However i am not clear exactly what happens in the background, when you buy 1 GH who physically holds this 1 GH of hardware and mines for you?  do i actually own this 1Gh hardware ie can i exercise the contract and take physical delivery of the hardware or is it cash settled or you can never redeem?  how do you know you are actually getting 1GH worth of btc (besides constantly checking the payout and do the math).

The only "profitable" ROIs thus far:

Avalon Batch 1
Avalon Batch 2
BFL first day/week orders
Avalon Mini Tradehill auction

All others are negative ROI I think.

Bitfury?

Bitfury August delivery is definitely positive. AsicMiner IPO was also huge positive ROI.

Avalon Mini Tradehill auction is highly doubtful, I wouldn't bet it will turn out to be positive.

bitfury august was >2x the current price, 400GH at $18k (or was it 19k dont remember exactly), they took delivery at the very end of august.

Not factor in the bitcoin/usd price increase as you never should for roi calculations,  please enlighten on that hardware is "definitely positive"

you guys all screwed up...if you are willing to keep sell orders alive (buy in and once your buy order clears immediately place sellorders at a slight gain [still gain from mining earnings while your gigahashes are on sell order]) you basically get mined coins but can either sell at a gain if you play the market correctly or sell it to be at just a slight loss such that you are still in the black on mined shares earnings.  Sure its small, but I did it daily the buy/sell game and ended up gaining  maybe 2-3x what I put in initially which was like a single coin (cashed out around 2.5, I was greedy and didn't get out before the correction which would have put me in at 2.7 BTC for simply putting in and playing on a single bitcoin within a three week period)

Ok, let me try that: I don't have any of this Bitfury full-kit 400GHs units so can't testify first hand (if someone has them please confirm or deny), but let's say they started mining Sept. 1st to be on the safe side, although some did few days earlier. According to reverse mining calculations it already earned close to 80 BTC, maybe few BTC more or less. 400GHs will mine around around 35-40BTC more before network difficulty reduces mining income to satoshies, so it will return around 120 BTC mining in profitable conditions. Bitfury is energy efficient, so it will continue to grind over electricity costs even in double-digit PHs conditions. Don't need to calculate that in fiat, although they were paid in fiat and not in BTC, but it looks to me that whoever invested in that at the beginning of July is looking at his wallet and smiling to the current ASIC buyers.

And it would cost a lot less than $18k to buy 120BTC; plus there's no risk/hassle/work involved.

Your estimate is spot on, but your conclusions are a bit off. With 120 BTC income in profitable conditions you're looking at about a 50% ROI overall after about 1 year. One scenario where you can make anything more than that is if the BTC price collapses right NOW to $20, instantly crowding out everyone who is less efficient than you and collapsing the sales market. Then there would be a net wealth transfer from the inefficient miners to the efficient ones, because the inefficient miners are out of the competition and immediately bankrupt.

Of course there are a few other scenarios which make hashpower more valuable than bitcoins, but I don't see them happening within the next 2-3 months, where this would make any impact. Instead, given that the BTC price will not collapse and keep rising sub-exponentially, the hash power will simply inflate away your yield and will cause the remaining 50% to take a lifetime.

There is no incentive to smile at anyone. The only satisfaction which is left is that the miners are the peons who make this industry work and without their sacrifice, bitcoin may not succeed. As such, giving up opportunity gains (loss of potential profit) when mining may be a small price to pay in the grand scheme of things.

That's a comfortable thought, now I feel much better.

 < curls up into fetal position and rocks back-and-forth, mumbling under breath incoherently >

I'm still sitting on my thought that the difficulty will be 1.8 billion by april 2014.  That's according to what the hardware manufacturers have promised.

Lsst time I ran the numbers, 0.18 BTC/gigahash would make ROI by april. Now, I think it's ~0.13/gigahash...

How much difficulty increment did you use in your calculation?

Wat is this cex.io dividend you are mentioning?

Well, I can answer your question, the hash you buy from cex.io (https://cex.io/r/1/hulk/0/) is mining continuously and thus giving you some Bitcoin. You can call it instant pure mining.

sorry but that still doesnt make any sense to me. 

1) Let's use your 120 BTC return (even though i think it's very optimistic)
2) Hardware cost $18000
3) BTC/USD price at time of purchase $100  (it was below 100 but lets just use 100 for simplicity sake)

4) $18000 would yielded 180 BTC if purchased direct btc instead of mining hardware.
5) Factoring in today's $150 price, 120 BTC mined * $150 = $18000 = break even not factoring in any electricity cost etc..

So i still dont understand how the people who took delivery at end of august is profitable or making money, at best they will breakeven after months more, if difficulty continue to go up the way they do now, they will not make that 120 BTC but less and lose money.

Cannot compute...

can someone please answer this? thanks

you might be right, but with all the bolded shouting and spelling errors its hard to tell if you are smart or on crack

I use the btcinvest calculator.  I think it was 30% with 8% less per jump gets you to 1.8 billion. 25% with 5% less also did it...

Go to the calculator, say you have 1 gigahash, and play with different difficulty changes that give 1.8 billion in april.  Then you can see how much BTC you generate.

But remember, this 1.8 billion in april assumes that all hardware manufacturers sell out, (or mine themselves with what they don't sell...) and that they deliver on time.

ALSO, there may be unpublicized hardware incoming too.

Jamie Dimon is that you? ;D

Wow, this was beautifully stated. Almost poetic and definitely the truth of the matter. Thank you for that. 

Who cares of ROI... My rigs are bought with cash... From poker. Now I have good money. Poker is illigal in my country. BTC is not. So my pokerwinnings are now good. I am happy to pay tax...

So what you're saying is that you're okay with mining at a loss because it enables you to launder your illegal gambling winnings.  Got it.

Or you could say I have no real loss, since I do not think of my pokerwinnings as real money. I know its stupid, but for me it works. I also have free power, so even next year my TH/s is stil going to make me money. I think mining supports the Bitcoin better then hoarding and speculation. Transactionfees, and so on. All hardware investments into bitcoin is a risk. I think ppl should only invest what they can afford to loose.... I do not play poker any more, since I hated the idiots doing it. Greed and machobullshit...but the winnings made me able to buy miningrigs, and I do not have to think about R.O.I

resell on ebay for a profit...hah I'd like to see that one....it only worked between the months of June and August...that shit doesn't work anymore because casual folks can understand that hardware is overpriced in terms of difficulty....also the genesis block calculator really put people's calclations in check to where they realize that you don't make thousands upon thousands of dollars  instantly from bitcoin like you could have back in april with a 50 GH miner like I hoped I would have.

oh, it's banned in norway?  online poker isn't banned in the USA, just funding it is. 

i thought USA + Australia were the only two countries with restrictions...

norway is member of WTO since 1995, same as US.  were they forced to pay up millions in concessions to antigua as well?

According to genesis calculator - no minor is worth buying anymore - there are no returns on investments unless bitcoin price goes up to match the increase in difficulty. Like 300, 500, or 1000 price levels.

I'm going to stick to cloud mining for now.  I'm cancelling all my miner orders.

Even cloud mining isn't profitable :)

This, every company is coming out better and cheaper asic. 1GH/s now ganna be like 1MH/s..

Yeah - but at least the cloud miners are going up in price?  I wonder if it is temporary??  I would have thought it should go down since bitcoin prices went.

It was .085 per GH/s yesterday and now it's around .089 per GH/s.

100GH today will get you 7BTC

http://btcinvest.net/en/bitcoin-mining-profit-calculator.php?diff=390928787.63809&dcosts=8000&diff_mincrease=30&blpbtc=25&dhsmhs=100000&diff_mincreasedecrease=3&btcusd=190.75&dpowcon=30&btcusd_mincrease=1&pcost=0.25&calcweeks=32&dleadtime=0&action=calc

If you pay more then 0.07BTC per Gh, then you'll lose money.

Everyone should use that mining calculator from now on.  TBG is very stupid because it doesn't go by diff updates, only by month.

All the more reason to rent the hashing power, for around .104 BTC you can get 1 GHz hashing power at cex.io (https://cex.io/r/0/huryde/0/) hopefully when you decide to sell it back it's close to the original price.

Can we get an answer from a pro on this subject? Is it still worth buying mining hardware - is there a positive ROI worthwhile?  Or do the perks go to the guys that get the chips manufactured and then proceed manufacturing the boards and mining with them. Earn some BTC and then sell the units while they're hot.

i think you are right because we are in a bubble. not a bitcoin bubble but an asic bubble. however those who manage to buy the most advanced hardware to come to market before that bubble bursts will have a really great opportunity i think. everyones future difficulty predictions will be way off because they will be expecting a new generation and that generation will not come. this will cause them to undervalue the last generation of hardware to be released before the bubble pops, and that is an opportunity to someone who can sense it.

the only peole making money are the ASIC manufacturers. This said, if they were selling the machines for what one would expect, there would be a such a rush that no one could make ROI also. Kind of a catch 22. But history repeats itself. During the california gold rush the only ones making money were the shovels sellers

only when people smart up and figure the potential minuscule rewards do not compensate the risk, they'll stop buying ASICs  and figure its only greed. At that point the difficulty bubble will burst and they'll be dumping their ASIC on Ebay. Its hard to predict when that will happen but my guess is sometime over this coming spring.

Supply and demand. The prices will tend to go down though. I think it's substantially overpriced. Fortunately there are other ways of participating in the mining market.

it is better to invest your money in BTC, when they are on low price

 >:( >:( >:( oh well im missing the boat!  I wasnt on the buying end for a while now I am!

My guess is probably not.  Anyone who has figured out a way to eke out a profit at this isn't going to shoot a hole in the boat they're on by saying how.

Anyone who already has a farm that is producing more than the cost of electricity is going to keep doing it until that equation goes bad, and there are probably people in special situations, such as having free electricity, or at least electricity someone else is paying for, or they have a solar farm, or their farm is doing double duty heating their home or office, essentially the same as free electricity.

I have not recently seen any kind of analysis that shows that ANY of the units being sold new are even near break-even much less profitable.  In pretty casual looking at auction type sales, it does seem there are occasional sales of equipment at really low prices that could conceivably be profitable, but I haven't looked into those enough to know they aren't just scam sales.  "Too good to be true" prices quite often are scams.  But occasionally, someone is forced to liquidate stuff, so some may be legit.

It's a racket I wouldn't advise anyone get into unless they know way more about it than I do, and those who do know more are obviously not going to be giving advice unless they are true altruists.

Yeah cex.io (https://cex.io/r/0/mobile314/0/)is great. Insanely overpriced at the moment but hey the demand is there so you cant argue with that. Im still waiting for my reentry point.

How can one make a positive ROI on CEX?

One way: Trade Ghs. Buy, then sell, then buy, etc...

If you only buy once and mine with it you'll probably get only 60-70% invested back. Just my 0.00000002 BTC.

ROI can be positive if you hold your BTC and wait for increase in price

By selling to someone else at a higher price.  http://en.wikipedia.org/wiki/Greater_fool

If I sell you a turd in a box for $18 and you sell it to some sucker for $20 we both profit and only the sucker loses everything.   That is CEX "investing".

Paying $18+ per GH today hoping someone dumber than you will pa $20 is well stupid.

I humbly disagree. Why is that stupid if the probability of that event is high? Current price on CEX.io (expressed in USD) is $22.64, currently I've put a buy order for all BTC I have there on $18.89. Many times already happens that I buy 5% cheaper and sell 5-10% more. Don't get why do you think my current buy order is stupid?

when u can earn some BTC nothing is stupid :D

Meh in that case I will just buy and sell the currency.  I That's where I see the money at.  The hardware guys can build-mine-sell to make their living. I'll do it by converting my USD to BTC. Hopefully get a big payday someday. :)

you are right. I wish i invested my money tto btc instead of buying miners

Why not go to Crypsty, if what you want to do is trade?
The difference with cex ghash shares is that they are guaranteed to fall in value, in terms of the BTC/day they generate.
Price may not have caught up with that fall in value yet, but eventually it must.

so it is not profitable to be short and not to discuss :)

What's wrong with a little trading? + I like the idea of a mining while trading. You can't have that on Crypsty. + I like the idea of determining the real price of GHs, and exchange is the right place for that.

And what's the problem trading with something that's guaranteed to fall in value? There are million things that are guaranteed to fall in value and people trade with them all the time.

I guess you just have to watch every 10 days or so...to make sure your ROI outpaces the fall in value... As the next stage of ASIC miners come into play...it should fall down to .05 GHS.... at some point, they will need to start selling them in THS =)

Right, lets buy mining equipment!

1+1=-10

Actually....

There is, just wait until the ASIC war is over and the difficulty stay the same :)

Difficulty wipl never stay the same it will always rise and rise cuz of new mibers coming8l

True, might happen next year (late probably).

Worth the wait, the 1 TH miners will cost like GPU

It will never ROI

what everyone seems to forget is that for the diff to double from here it requires 4000 1T machines. Its not going to happen as fast as most people thinks

every new miner who comes to mine BTC is taking a pice of your pie, and what is wilth ppl whoose ordered mineres are still in delivery

Yes I will stop mining just to reduce the competition and have a short minded blow out.

BFL alone estimates they can make 1000 Monarchs/day. So could happen in just one week sometimes early next year :)

BFL estimates are usually very accurate...

there you go  ;D written in stone. As the price of equipment goes up the universe of miners willing to put 1000's into a asic is reduced and that will level difficulty.

Hahahaha, their estimates are so accurate, delayed more then a year for some of the products they sold...

My 0.01 BTC worth...

1 - From an ROI perspective, it doesn't make sense to buy any hardware available right now at today's prices.

2 - If you want to invest, invest in BTC.

3 - Presumably because of #2 is why the value of BTC continues to climb.  The investors have nothing else to do with their money.

4 - At some point people want to start selling BTC to make a profit.  When that happens, the price of BTC stabilizes or falls.

5 - Hardware manufacturers and resellers have a problem right now.  They're invested in manufacturer/reselling ASICs and people are catching on to point #1 above.

6 - Something has to come from #5.  I suspect more than one ASIC company is going to go belly up because no one wants their hardware at the price they need to sell to break even, let alone make a profit.  Resellers are going to hurt too.  Watch for fire sales, but buy wisely not emotionally.  1/2 off normal price is probably still too much.

7 - As someone stated above, there is an ASIC bubble right now.  Horsepower is thru the roof.  Hard to make an honest BTC anywhere.  (Day trading is not honest.)

8 - Something has to come from #7.  I too think we're going to see a decrease in hashpower at some point, but I think the bubble has to get bigger first.

9 - Don't trust a word BFL says.  Their motto is a "there's a sucker born every minute".

10 - Seems to me the making of a perfect storm are here.  Be careful, there aren't going to be many winners in how this plays out.

M

Really?  One company--Cointerra--claims that they're going to deliver 2,000 terahashes of hashing capacity in December alone.

Or think about it this way.  If the difficulty increases 25% for each of the next three intervals--which of course it will, it's not like the ASIC vendors are closing up shop--then the difficulty will double.  And an interval is like 10 days now, so we're talking a month.

It isn't profitable to mine anymore but, without our miners there would be no transactions going through!

ASIC prices can come down a LOT before hardware manufacturers are hurting.   <$2 per GH/s is pretty easy.  $1 per GH/s might be harder to do but I would expect raw chips (ASICs on the reel) to hit that sometime in 2014.  Of course vendor would rather sell a unit at $10 per GH than cutting prices to $5, or $3, or even $2 per GH/s isn't going to put anyone under.


That being said we likely will see one or more company go under.  These are small and often poorly run companies.  This is the gravy train portion with massive margins, lines of customers, or limited competition.  Pretty much impossible to not make money now.  When crunch time comes some won't make it.

Point noted, thanks.  I haven't been following prices close enough to observe, so I'll take your word for it.  I assumed the profit margins were thin. 

However I would think resellers will end up in a bind first.

M

If this continues, it would come to a point where no mining hardware is worth selling and all ASIC company would have to switch to scrypt-asic and the war starts again...

But then everybody swathes to scrypt and you can get more BTc :)

This title is wrong, there is hardware that is worth buying just not yet.... wait couple of months...

Lool no hardware is worth of buying esspecialy in couple of months when difficulty will be insane

hardware manufacturers have been thief's selling for what the diff is. Look at asicminer that started selling at 3BTC now at .035BTC with a hub included. They have been playing on people greed and stupidity and laughing their way into the bank. The eruptor doesn't cost more then $1 to produce  for gods sake!!! But look at how they are selling on ebay. The Jalo's are going for over $250 when they are worth tops $50 if one hopes to make ROI. Even the KNC 500G selling for $6000 are overpriced with a .15BTC return daily on the next diff, they'll never make ROI, NEVER. Thief's, that's the only name I can call them

There is a better Class of ASIC mining company coming . Mark my words . Other companies will need to modify their prices and customer care to compete with the next generation of Asic developers.

GPU's are profitable, ASICS not. Go LTC!

I'm afraid that's true.  Maybe not in the beginning, but definitely right now.  They're selling people investments that will never pay off.  It's no better than selling someone stock in a company that you know is going bankrupt.

ASIC AND FPGA for LTC is coming out soon. Good luck....

Did a small test sale Tuesday night (6 Nov).  Said it would be there by 12 Nov.  Was actually there this morning.  Only difference was six days was slightly longer than their usual projected date.  The actual time it took to appear was normal.

Larger transactions may be handled differently.

Why hasn't anyone mentioned the fact that 1BTC is about $350 today?

Yes it will go down at some point, then back up (it is high risk though!)

I really am not too concerned about the power cost investment since I paid off my hardware

In my opinion mining is not worth it anymore as the diff is skyrocketing to the moooon! Script mining is worth it atm with free power and LTC price going up. I invested in GPUS some month back and have nearly payed them of :)

I would buy some BTCs now