Bitcoin Arms Race Anxiety...

[BitJunkie223]

So for the last few months... Hell, for the last year and a half, I've been trying to get as many bitcoins as I possibly can. Problem is, money is limited. Still, I'm in Bitcoin for the long haul, and hopefully, it'll be as big as some of us think.

I've never spend any money I didn't have on hardware, but had it not been for future investment, I would've spent that same money on a number of other things...

A few months ago, my goal was to eventually amass 100BTC. I only started in mid-2014 with a single S1 unit. Over time, I've gotten a bunch of S3's. But this whole thing has given me a whole lot of anxiety, to be perfectly honest. I'll only just about get to 10, let alone 100BTC...

Now I realize that rewards will halve in less than a year... And to meet my quota, I'd have to spend about 10k USD in hardware to ever hope to get to that level. I wouldn't mind it, but as a dude with a part time job who is going to college and living at home, this provokes a lot of anxiety. My mom hates the electric bill, which I can already barely keep up with, regarding my current setup because I compensate for it... And the heat... And there's no AC in our current place, so the summer is brutal. And there's only so many outlets I can use... You get the idea. A setup powerful enough to meet my goals is not possible in this location...

And on top of it, I have several units I just got in that I can't even get working because they're corrupted, or something... You can see my other thread for that, but some have said to reinstall firmware using the Serial port on these S3's, not that I know how. So if you know anything about doing that, it would be much appreciated...

But yeah, overall this is not looking good. 'Cause being relatively poor, I guess I have this grand expectation of hopefully riding this BTC thing far enough to be well-off one day... But not being an early adopter in this revolution, is nothing short of disappointing. And anxiety-provoking, especially with all the other stuff that I've gotta' juggle every day. I know a lot of you can relate... Just a rant, I guess...

[BitJunkie223]

Oh and P.S., I kind of want an Antminer S7 because the added power efficiency is going to pay for itself vs a bunch of S3's, and it'll be able to mine for far longer and still be profitable... But as always, no money to upgrade my arsenal.

Like I said, you guys know how it is.

[Remember remember the 5th of November]

The thing is, you should have bought Bitcoins directly. I mean think of it this way. You bought miners to get the same amount of BTC you'd get if you had just simply spent the money on buying them.

[BitJunkie223]

The thing is, you should have bought Bitcoins directly. I mean think of it this way. You bought miners to get the same amount of BTC you'd get if you had just simply spent the money on buying them.

Yeah, I do suppose that's true... For some reason, I guess I preferred the trickle of BTC income over getting them at once... On the other hand, I only made a larger investment now because I figured that BTC could only go up and that if it skyrocketed, I'd continue to mine anyway, but in the end, it'd probably just even out. On the other hand, I could always sell off my current units and then I'm well ahead since I've mined a bunch. :/

[DannyHamilton]

- snip -
My mom hates the electric bill, which I can already barely keep up with, regarding my current setup because I compensate for it...
- snip -

The thing is, you should have bought Bitcoins directly.
- snip-

Yeah, I do suppose that's true... For some reason, I guess I preferred the trickle of BTC income over getting them at once...
- snip -

You might have preferred it, but that doesn't mean that it made good sense financially if you had bothered to take the time to do the math.

How much did you spend buying hardware?  How much did you (or your mom) spend on electricity each month? How much time did you spend maintaining it all, how much heat in the summer, and how much is that time and comfort worth to you?

If you took all that money and spent it on purchasing bitcoins directly each month, how much bitcoins would you have today?  Sure, you acquired some bitcoins, but did you come out ahead by mining or would you have a lot more bitcoins if you hadn't bothered with the mining in the first place?

Bitcoin mining is a highly competitive business.  Unless you have access to very inexpensive resources (large amounts of highly efficient hardware, very low electricity costs, and very cheap cooling), you are typically going to end up with less bitcoins from mining than if you take the same amount of money each month and just buy the bitcoins directly.  Others that have access to those inexpensive resources can afford to run MUCH more mining power than you, and therefore can acquire a much larger percentage of the 3,600 new bitcoins that are created each day.  Since their costs are so low, they can turn around and sell those bitcoins at a profit where you'd be just barely breaking even (or even taking a slight loss).  They can turn those profits around and use them to increase their mining power even more, increasing difficulty and taking an even larger percentage of the daily bitcoins until there's nothing but dust left for you.

Over time, profitable mining will migrate to geographical areas with the lowest costs of electricity and cooling.  This is a simple fact of finance and mathematics. Some people will continue to mine at a loss as a hobby, but for most people that want to maximize the amount of bitcoins they can hold for a given amount of capital, the answer will typically be a bitcoin exchange.

[Slark]

Op, so long story short, basically you are frustrated you you can't mine effectively and you can't earn 100BTC with your mining equipment in a fast and easy way? It is not easy anymore, solo mining is not profitable as it used to be. If I don't have access to cheap electricity and high end mining equipment I wouldn't bother to mine at all. You will better sell your mining gear and try to trade your btc.

[BitJunkie223]

Thing is, my electricity is already pretty cheap at 6 cents per kilwatt hour. But I know some people have access to electricity that is several cents cheaper... Yeah, maybe I should just get rid of it all and buy some BTC directly. :/

[Meuh6879]

poor must not mine (i'm poor).
they must buy the final product (bitcoins).

simple.






















and wait the halving ...

[Slark]

poor must not mine (i'm poor).
they must buy the final product (bitcoins).
-snip-

Being 'poor' in this case is very subjective term. Op is still far more wealthy that majority of earth's population, he is just not 'wealthy' by US standards.
That is a difference. Currently you can mine only if :
1. You are already rich, and can afford costly equipment.
2. You have free electricity.
3. You don't care about reward and want to try it for fun.

[Meuh6879]

well, you can't mine if you're poor ... because you need to PAY the device (and the electrical bill).
i prefer PAY for bitcoins.  







because i understand this curve : http://bitcoin.sipa.be/
and i have used this calculator : https://bitcoinwisdom.com/bitcoin/difficulty

[samuel999]

You can probably sell off all of those S3's and make 10 or more BTC from just selling off the equipment. I think it would be more worthwhile to take the money you spend on electricity and spend that to buy some Bitcoin every month. That will probably be better for both you and your mom.

[gentlemand]

I looked briefly into mining well over a couple of years ago and ran away screaming. GPU era and before yes, any time after that, hell no. I wonder what the landscape will look like in another five years.

[BTCroll]

Wow good luck with this OP! 

[_Miracle]

I enjoyed mining and was disappointed when my S3s were no longer profitable.
And of course I had to fight the urge not to continue "the arms race" by continually moding/upgrading:
I usually compare that experience with hot-rodding or the first computer I ever built (which ended up being a monster at the time ;-).
I am happy to just be buying them at this point but would like a machine again in the future to tinker with.

If this is not a hobby and you are thinking "pure investment" then sell your machines and buy coin with the proceeds.  

[VirosaGITS]

well, you can't mine if you're poor ... because you need to PAY the device (and the electrical bill).
i prefer PAY for bitcoins. 
because i understand this curve : http://bitcoin.sipa.be/
and i have used this calculator : https://bitcoinwisdom.com/bitcoin/difficulty

poor must not mine (i'm poor).
they must buy the final product (bitcoins).
-snip-

Being 'poor' in this case is very subjective term. Op is still far more wealthy that majority of earth's population, he is just not 'wealthy' by US standards.
That is a difference. Currently you can mine only if :
1. You are already rich, and can afford costly equipment.
2. You have free electricity.
3. You don't care about reward and want to try it for fun.

I did it. Start few months back with a S3 and got a bunch of S1. Kept reinvesting and getting more and more miners with what it was earning + the little i could put into getting more miners. Now i got a couples of THs worth of old gen miners.

If you're poor and you respect #2, it can be very easy to get into and very lucrative.

[BitJunkie223]

Hmm... So, because I'm such a noob (not sarcastic, I really am), can someone give me the straight up figures on why I should buy instead of mine, assuming my electricity rate is .06 per KW/h, and assume that I was going to invest $10k into mining, perhaps Antminer S7's?

I did some calculations assuming I put 10k into S3's... I figured $200 a piece for S3, and the PSU to power it, but this may be slightly on the high end. And I would never be able to run that many, but just for the sake of science...

10k buys me 50x S3's... At 455GH/s x 50 units is 22,750 GH/S with a Power Consumption of about 18,200 KW/H. That's a lotta power, bruh.

So... That's about 5.65 BTC per month... At current difficulty. The only thing I don't know, is a legit number for difficulty increment... But profit-wise, it seems that if you were strictly mining for profit, you'd only be at about $674 first month... But it seems that since the middle of august, difficulty has went from 50 to about 61... So is that 20% difficulty increment on BTCwisdom accurate?

But if you put that same 10k into BTC, and current market value... That's about 40 BTC... Could you ever catch up by mining? An accurate increment percentage seems to be what I'm missing here... My guess is no, or it would take a long time... For those of you who are smarter than me (most of you ) am I going about it the right way? Would mining ever catch up to buying BTC? I increased difficulty from 60 to 80 in the calc, which would probably only take about 3 months... Monthly payout was down to about $300+ a month. It was still 4.24 BTC per month, but if mining for actual profit...

I'm still not wrapping my head around this. Perhaps I just need someone to articulate it better for me. :/

It seems like you could catch up my mining in BTC, then sell your remaining hardware when caught up and make a crap ton of profit... But maybe I'm not seeing something here... I went up to 100 difficulty, estimating that would take about 6 months. Payout was still at monthly 3.4 BTC/month... Like I said, it still seems plausible as far as straight up BTC goes.

[VirosaGITS]

Hmm... So, because I'm such a noob (not sarcastic, I really am), can someone give me the straight up figures on why I should buy instead of mine, assuming my electricity rate is .06 per KW/h, and assume that I was going to invest $10k into mining, perhaps Antminer S7's?

I did some calculations assuming I put 10k into S3's... I figured $200 a piece for S3, and the PSU to power it, but this may be slightly on the high end. And I would never be able to run that many, but just for the sake of science...

10k buys me 50x S3's... At 455GH/s x 50 units is 22,750 GH/S with a Power Consumption of about 18,200 KW/H. That's a lotta power, bruh.

So... That's about 5.65 BTC per month... At current difficulty. The only thing I don't know, is a legit number for difficulty increment... But profit-wise, it seems that if you were strictly mining for profit, you'd only be at about $674 first month... But it seems that since the middle of august, difficulty has went from 50 to about 61... So is that 20% difficulty increment on BTCwisdom accurate?

But if you put that same 10k into BTC, and current market value... That's about 40 BTC... Could you ever catch up by mining? An accurate increment percentage seems to be what I'm missing here... My guess is no, or it would take a long time... For those of you who are smarter than me (most of you ) am I going about it the right way? Would mining ever catch up to buying BTC? I increased difficulty from 60 to 80 in the calc, which would probably only take about 3 months... Monthly payout was down to about $300+ a month. It was still 4.24 BTC per month, but if mining for actual profit...

I'm still not wrapping my head around this. Perhaps I just need someone to articulate it better for me. :/

The first mistake would be looking into S7. Then it would be getting S3 at 200$. Try 50$ per. I'd recommend S5, it would be a good middle ground, S7 are way too expensive. Your electricity cost are actually decent, its not dirty cheap so you still need to be careful but thats better than many around here.

The S5 at the moment can be obtained for fairly cheap, anything over 300$ per is a rip off imo. Try for 200-250$/per.

No 20% difficulty increment is just default from old time. Look here;
https://bitcoinwisdom.com/bitcoin/difficulty

You could run 2% for a good case scenario, 5% for a worse case scenario, don't forget there's BTC halving happening in 9 months;
http://bitcoinclock.com/

Feel free to run more ideas/numbers by me/us but this should get you started in the right mindset.

[_Miracle]

I was hoping someone would post a good link to a btc mining calculator, it's been months since I checked and we all know how long that is in bitcoin years ;-)
Difficulty rises will get ya and where are you planning to plug in 50 miners?
Not in any average home.
You will require some serious access to power or you WILL be burning things down :-(

[VirosaGITS]

I was hoping someone would post a good link to a btc mining calculator, it's been months since I checked and we all know how long that is in bitcoin years ;-)
Difficulty rises will get ya and where are you planning to plug in 50 miners?
Not in any average home.
You will require some serious access to power or you WILL be burning things down :-(

This one that was linked/referenced several time before on this page
https://bitcoinwisdom.com/bitcoin/calculator

Just make sure to edit the difficulty increment value to your estimates and remember that in 9 months~ the reward will be halved, which is not counted on the calculator.

[_Miracle]

Yes your link and the one above were what I was referring to. Used to have Bitcoin Wisdoms price graph up 24/7.

I just wouldn't mine and call it an investment right now, considering my costs + the stepped up cost after a certain level of usage.
I lucked out with mining, didn't make a bunch of coin but didn't lose money either.
Have been missing it and lurking to see if there are any worthwhile machines.