Newbie Question

[babel]

Today was my first introduction to bitcoin mining. I watched a webinar by some guys who bought 100 machines and have them set up in a data warehouse. On their next purchase of 300 machines they are offering to sell machines for us to all own individually. I am guessing a lot of you are familiar with this. Of course it sounds good with the numbers they show.

Is this a pool? Is it potentially a great opportunity?

Thanks all, Brandon

[os2sam]

I have NEVER heard of any such thing.  Be VERY cautious.  It sounds like a time share sales pitch where you basically get screwed.

DO YOUR RESEARCH before investing in any mining hardware.  The only people really making money are the ASIC's manufactures at the moment.

Edit:  Keep in mind that the Bitcoin difficulty adjusts every 2016 block's, 10 to 14 days, and it has been adjusting up drastically for well over a year now.  So numbers that look good this difficulty level will only look worse in the future.  It is very hard to recoup your investment these days.

[babel]

Thanks os2sam. Sounded too good to be true, probably is. They did not mention anything about difficulty adjustments. Just massive jumps in Bitcoin price.

Sorry for more newbie questions but I am interested still. Would it be possible to participate in a pool from my own home with computers in my basement and a fiber optic internet connection? Being the quiet geeky type I could really take to that.

[os2sam]

Bitcoin is dominated by ASIC's now.  So if you want to research those it may be doable.  If you want to use a standard PC with a GPU you DON'T want to mine Bitcoin.  Research the altcoins and see which of those are still viable.

Most people, more knowledgeable than me, are recommending people to buy bitcoins and hold onto them.

The price has fallen to half of the $1200 USD high.  It's currently at around $600 USD and inching up, still not too shabby.

[os2sam]

Here's a good starting point for researching mining hardware.

https://en.bitcoin.it/wiki/Mining_hardware_comparison

[philipma1957]

Thanks os2sam. Sounded too good to be true, probably is. They did not mention anything about difficulty adjustments. Just massive jumps in Bitcoin price.

Sorry for more newbie questions but I am interested still. Would it be possible to participate in a pool from my own home with computers in my basement and a fiber optic internet connection? Being the quiet geeky type I could really take to that.

okay  antminer s-1  was considered a great piece of gear


they now have antminer s-3   just came today.  hopefully a great piece of gear.



 s-1 cost  maybe 200 on ebay kind of out of date now .

s-3 cost .75 btc can  be found on ebay but at 600 or more

[babel]

ok, now I am running profitability estimates using the Antminer s-3 numbers and my local power costs. Very interesting, it seems the concept comes down to converting electricity into Bitcoin. The following parameter has me confused:

---
Difficulty override
The estimated difficulty change from BlockExplorer is used by default. Enter a percent value here if you want use a different one.
---

Their default is -6.1% change in difficulty but from what I hear difficulty goes up not down. On the TradeBlock chart difficulty recently jumped rather largely. I replaced the -6% with a +5 and can see that the prediction is for declining profitability. +10% is definitely trouble. I will keep on reading but are these estimators accurate? What % makes sense to plug in?

[philipma1957]

ok, now I am running profitability estimates using the Antminer s-3 numbers and my local power costs. Very interesting, it seems the concept comes down to converting electricity into Bitcoin. The following parameter has me confused:

---
Difficulty override
The estimated difficulty change from BlockExplorer is used by default. Enter a percent value here if you want use a different one.
---

Their default is -6.1% change in difficulty but from what I hear difficulty goes up not down. On the TradeBlock chart difficulty recently jumped rather largely. I replaced the -6% with a +5 and can see that the prediction is for declining profitability. +10% is definitely trouble. I will keep on reading but are these estimators accurate? What % makes sense to plug in?

diff jumps calc at   8%   10%  12%  15%  18%  20%  25%


  at 25 no go at 8 yes.  the real number   my guess is 14 to 18%       

 right now buying to mine does not look as good as buying coins and holding. 

the mining game has a lot of factors.

 s-3 is a nice space heater in the winter. 

do you have noise tolerance?

a place with some cheap power. 

etc.