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Author Topic: Too Good To Be True  (Read 2281 times)
D_Thomas
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October 12, 2012, 05:23:13 PM
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I'm a newbie to mining and was rather disappointed to find out my PC would cost more in electricity to run than my hardware could mine. So I set out to see what I could buy to make money mining this rather strange currency.

I found a company taking pre-orders for devices costing $1,300 that will perform 60 GH/s. If my math is right, the device would pay itself off in just a week or so of mining. Have I completely miscalculated the payoff or is this pixie dust machine the cash cow of the century? I did see a topic on the CEO of that company having a criminal past so no need to get into that here. But I'm curious if anyone here has gear that actually has produced real money for them in more than just a token novelty amount?

This entire BTC thing is not very user friendly. I have better than average PC skills and it took me a while to get one of my PCs to mine. But it is so slow I don't know if I'm actually getting any payoff yet. I wonder if it is intentional that it is not a user friendly thing so only the more geeky people participate in mining and using BTC currency? It would seem like if the BTC community wanted this to spread and become a thriving alternate currency there would be a number of GUI apps so that Mac and PC users could easily start mining even with minimal PC skills.

Still trying to decide if I should buy a graphics card that allows me to theoretically make money, wait until the new generation of mining processors come out allegedly near the end of this year, or just watch from the sidelines a while longer. Any real world stories of making money without investing a large sum of cash would be appreciated. This all sounds intriguing but I'm a bit skeptical on the entire alternate currency thing. I hope it thrives as we sure need something that is not manipulated by dishonest politicians.




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DeathAndTaxes
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October 12, 2012, 05:27:28 PM
 #2

I recommend reading a lot more.

No idea if BFL will deliver on time and on spec but lets say they do.  It won't be "the cash cow the century".  The network adjusts to increased hashing power because the purpose of mining is to secure the network not to get "free moniez".   

So if you could buy a device which is 40x as powerful as other devices used today then so can tens of thousands of other people and quickly the difficulty will jump 40x as high.  So redo your payoff math using difficulty 40x as high and reduce the block reward from 50 BTC to 25 BTC.
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October 12, 2012, 05:35:59 PM
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. . . But I'm curious if anyone here has gear that actually has produced real money for them in more than just a token novelty amount? . . .
This will really depend on what you consider to be an amount that qualifies as "real money", and what you consider an amount that qualifies as "just a token novelty amount".

. . .Any real world stories of making money without investing a large sum of cash would be appreciated. . .
Mining has advanced quite a bit from the early days of mining with a CPU.  As the technology advances and competitive forces influence the future of mining, it is likely that the "sums of cash" that are needed to start up a profitable mining operation will continue to increase.

D_Thomas
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October 12, 2012, 05:38:02 PM
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So basically if/when the new super fast processors come out everyone using their graphics cards now is out of business pretty soon?

I've seen graphics cards that cost $100-200 that are rated around 300-400 MH/s. So even if the difficulty did not change over the next year, it would take about a year to payoff the card if the calculator I used is correct. So it would appear that if you do not already have a PC with a good graphics card to do this as a recreational hobby, there is no point to purchase a graphics card to actually make a profit mining, correct?

In light of potentially new super fast and relatively inexpensive hardware on the horizon, does it make any sense at all to purchase any current generation hardwire to get into mining now?


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amigaman
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October 12, 2012, 05:38:36 PM
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That were my thoughts also.
The reward halves in a few weeks, and also all the BFLs will go online, pushing the difficulty.
Mining with GPUs will get unprofitable by then, at least if you don't steal the electricity and hardware.
But BTCs earned and kept up to that time: What will happen?
- Reward halving will drop the price for a given work, so BTC -> USD will likely also drop, your coins will lose value.
- Diff rise will increase the work for a coin, so it gets harder to get some. BTC -> USD will likely rise.

The question is: Which effect is greater?
I have seen "early place in shipment of some BFL" offers for weird amounts of BTC.
If you had the luck to get one a few days earlier then others, the effect will be noticeable, i think.
But the network quickly adapts and keeps the block gen time at 10mins by rising diff.
So when all pools are flooded by BFL, we will have to see what happens...

I have made some 400 USD not thinking about the electricity and hardware, some by speculation on exchanges.
Now i for myself split my earnings, half are sold/used, the rest is kept to sell after the rewad drop & diff increase.
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October 12, 2012, 05:39:35 PM
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I agree DeathAndTaxes but would like to add that with technology moving so fast you would not get anywhere trying to mine from your computer.  

The new BFL and the like offering are looking like the only viable way forward and will put all other previous GPU's etc out of the game.  


“We don’t stop playing because we grow old; we grow old because we stop playing.”

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D_Thomas
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October 12, 2012, 05:54:31 PM
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I should have been more specific on "token amount" in my original post. What I was curious about is whether anyone who has purchased equipment for the sole purpose of mining has been able to recover their investment? I guess a token amount would be money you are making that either does not cover your electricity costs or the cost to pay off your gear in a reasonable time period.

I was about to buy a decent graphics card to mine but after reading about possible new ultra fast processors coming out later this year paused on my purchase. If I had an alternate use for the card such as playing video games then I could rationalize the card was free as far as cost for mining so anything it generated would be good. But since I no longer have time to play games the card would need to be able to pay itself off to make any sense to buy it.

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zomnut
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October 12, 2012, 06:12:27 PM
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Too good to be true? Yes, very likely. But pairing one with, say, a Raspberry Pi should still give good results without eating too much in electricity.
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October 12, 2012, 06:13:27 PM
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What I was curious about is whether anyone who has purchased equipment for the sole purpose of mining has been able to recover their investment?

Yes, many have, including myself, but this is for hardware purchased many months ago. In my case, the hardware that has paid itself off was all purchased last year.

Right now it's hard to say if a video card would pay itself off, but all signs point to no. With reward halving and projected difficulty increases, this is more likely to not have a return on investment. The only thing that would allow for it is a sharp rise in the value of bitcoins, but if that occurs, you were probably better off just buying some bitcoins and sitting on them.
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October 12, 2012, 06:23:11 PM
 #10

Mining is just an alternative way to buy bitcoins - ie it's speculative.
If you believe in bitcoin's future then mining is potentially very profitable.
Who mines bitcoins without believing bitcoin has a future?
Do miners really just cash out just to pay their electricity bills?
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October 12, 2012, 06:28:29 PM
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You should remember that eventually you won't be mining for that 50BTC, but 25BTC, and then less, and less, until all of the Bitcoins are distributed and then you'll be mining for transaction fees.
DannyHamilton
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October 12, 2012, 06:48:33 PM
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You should remember that eventually you won't be mining for that 50BTC, but 25BTC,
In a few weeks.

and then less,
About 4 years from now

and less, until all of the Bitcoins are distributed
In over one hundred twenty years.

amigaman
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October 12, 2012, 07:36:19 PM
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Just FYI:

At the moment i am trading ~2kW electric Power for ~4GHash/s = 1,3 BTC/Day.
I have:
1 Rig with 2 Club3D 7970 = 1350Mh for 520W
2 Rigs with 2 Sapphire 7970 = 1220Mh for 520W/each
1 Rig with 1 Sapphire 6950 = 320Mh for 215W

Just calculate if your electricity costs are below the ~15USD/10Eur i earn per day. For 20ct per kWh it does never pay.
Dancing Dan
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October 12, 2012, 07:39:44 PM
 #14

Nothing to be skeptical about you just have to believe.
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October 12, 2012, 07:40:26 PM
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Also keep in mind that Bitcoin is meant to be more than just a way for people to make money "mining".  It's meant to be a currency in which people transact.  Many people here have never touched mining, and have no interest in it.  They are here because they see the value in a currency that acts like digital cash.
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October 12, 2012, 09:56:36 PM
 #16

I'm getting more BTC from the daily faucets, bitvisitor, and cointube.tv than I am mining at the moment. When my GPU gets here this week, hopefully I can finish the 1 BTC I've been trying to get from slush's pool before Halvsies Day. I got the GPU cheap or I wouldn't even have bought it.
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October 12, 2012, 11:59:32 PM
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Mining is fine if you have less than 0.03 $/ kwh costs like in ukraine.
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October 13, 2012, 12:06:22 AM
 #18

Its more profitable to mine LTC at the moment.

D_Thomas
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October 13, 2012, 12:27:03 AM
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I do find this concept very fascinating partially because I detest most governments and the ever increasing regulations and invasion of our privacy. So I'd love to see a viable alternate currency to use that is confidential.

I would like to mine for fun just to do it and learn more about it, but it sounds like I should probably wait until December to see if any of the new super fast and inexpensive hardware really comes out.

In the interim I will continue to read on the topic and try to learn a bit more about the various aspects. I have tried to mine using 3 computers. No luck at all to get software working on my Mac. Loaded exact same software on two different PCs and one would not communicate with the server. The other connects and is mining but at a very slow 300 KH/s. If I turn on the second cpu core it overheats and the PC shuts down. LOL. So now I am trying to mine just to learn how it all works given that at 300 KH/s it doesn't even cover the electricity to run the PC. I'm very interested to see if the Butterfly gear actually ships out later this year. I don't have enough trust in them yet to put money down just yet.

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D_Thomas
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October 13, 2012, 01:04:17 AM
 #20

Mining is fine if you have less than 0.03 $/ kwh costs like in ukraine.

Here the cost is about $0.20 per KW/h.  : (

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