Too Late To Get Into Bitcoin Mining?

[supernerd]

Hi guys,

So very recently I discovered Bitcoin and have been reading up on it. It seems like a very genius idea and avoids a lot of the problems conventional money has. Also interesting to me is bitcoin mining. I am pretty good with computers and have built my own so I was thinking of building a mining rig.

Anyway, I have been wondering whether it is too late to enter the world of bitcoin mining and still make a profit. I know a lot of people are bummed out about ASICs making their GPU rigs totally obsolete, and a couple months back tons of people were pre-ordering these ASICs that are coming out January, and one of the concerns was how long it would take these companies to take care of their back orders. Because the bitcoin difficulty would increase drastically with the sudden inrush of rigs with really high hashing rates, obviously the people who got their ASIC rigs up and running earlier would have an advantage over those who started later. (If I understand how this works correctly) If I ordered now I would be way at the back of the pack in getting my ASICs I think.

I could afford to drop a 2 or maybe 3 grand on a rig, and maybe set it up at work for free power, but I am worried it wouldn't even break even if I were to start ordering parts today. Also, how drastically would the profits (if any) decrease in the near future, e.g. a year from now. Could I still make a profit or would it be a waste of money?

Opinions or advice anyone?

Thanks!

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[ninjaboon]

At this juncture, if I were you, I would prefer to buy bitcoins from the open market and wait for it to increase in value / invest in some mining company instead of direct mining.

[OCTech]

I wouldn't even think about GPU mining unless you get free electricity, with that considered it would take a long time to recoup the costs of the hardware. Even if you buy asics later it's still the better option. You can make some good coin just buying Btc when low and selling them when they rise.

[supernerd]

Thanks for the replies!

Just to clarify I am not considering a gpu rig, just an asic one.

[OCTech]

Good! I'm guessing here, but I think if one gets Asic's fairly early on they should solo mine. With the current network hasrate (25TH/s or so) you should find a block every 2-3 days at 60, of course difficulty would quickly rise. But even if at 36,780,534 difficulty later on (guess) in the game you'd be making $10-12 a day per BFL Asic single which would take 120-140 days to break even (even considering power costs for me). To me that's still a VERY good investment if it all works out that way and the exchange price doesn't nose dive. I'm still very new to all this but this is my current understanding of it:)

I'm going to setup my Asic's I pre-ordered back in august to a Raspberry pi running linux to keep power costs lower to maximize profits. My current Bfl single is making about $2-3 a day, and total I've made $900 since August or so.

[maxcarjuzaa]

ASIC is good option if you sell half of your ASIC mined bitcoin to buy LTC, you can make a lot more money, (with more risk offcourse) but I think the reward worth it

[odolvlobo]

Let me put it this way: Suppose you recently got into gold. Would you go out and mine it?

The opportunity for newbies to mine bitcoins has long past. Don't sink a bunch of money into setting up a mining operation unless you know the business and economics of bitcoin mining.

[cynicalsoul]

My friends and I had this discussion about a year ago (I just remember prices were around $7 back then) and we thought it was too late in the game then. Damn, I wish I would have invested in the currency then!

[odolvlobo]

My friends and I had this discussion about a year ago (I just remember prices were around $7 back then) and we thought it was too late in the game then. Damn, I wish I would have invested in the currency then!

There are two ways to obtain bitcoins: buy them or mine them. For the vast majority of people, it is cheaper and more convenient to buy them. Even a year ago, a newbie would have been better off buying them.

[kamizie]

i think it's not too late to buy some bitcoins, they will rise when have more people know about them.

[gocoinz]

I'm new to this stuff too and will give it a shot just using my current hardware (gtx 560 ti). Just to see how it goes. I wouldn't start with investing a lot of money at this point

[evoorhees]

Is it too late to get into Bitcoin mining?

Yes. Just like it is too late to get into gold mining. It's not for newbs.

[gocoinz]

Is it too late to get into Bitcoin mining?

Yes. Just like it is too late to get into gold mining. It's not for newbs.

Why are there so many still mining BTC then? IMO just don't go crazy investing a ton into it and you'll be fine.

Btw it'a a good time to get into gold mining too if you know how to do alluvial gold. I've got around 2 ounces of fine gold that I've mined myself and would go back to it any day if I had the time for it.

[amano]

Don't think it's too late, just depends on the cost of the electricity and the hardware.
Did some mining about 1,5 years ago, but looking back, I wished I had just invested that money into buying bitcoins instead of trying to mine them. But quite a fun and learnfull experience though.

[supernerd]

Hi everybody,

Thanks for your responses, I appreciate the input.  

Anyway, I guess the prevailing opinion is that I would get better return on my money by purchasing bitcoin, rather than mining it. I did not consider this and will probably start investing some money in bitcoin.

However, I don't think it would be a complete disaster if I did some mining. It turns out that I have access to free electricity for my rig for the next 5-8 years at least, so theoretically it should pay itself off almost certainly, which means at worst I would break even. Unless of course you count the opportunity cost of what else I could have spent the money on. Furthermore, the money I would put into it (1-2 thousand USD) is not money I "need" anytime soon, its a fraction of my savings. If I lost it all, it would suck but it wouldn't affect me that much.

So I think out of curiosity, fun, and learning I will set up an asic rig with the hope of breaking even in the year I set it up. If I do the math even with projected huge difficulty based on the increase in hash power from asics, it could pay itself off twice by 2014, but as long as I break even eventually I will consider it a "success"(or at least not a mistake). I am not hoping to make huge profits or anything.

Then as an investment, with the hope of making money I will purchase bitcoins ad let them apprecciate, which will probably be much more profitable for me then the mining, as was suggested.

Do my expectations seem reasonable, or am I making a big mistake?

Thanks!

[Blazr]

But even if at 36,780,534 difficulty later on (guess)

I think you forgot to add on another 0. Seems like a very optimistic difficulty estimate.

[odolvlobo]

However, I don't think it would be a complete disaster if I did some mining.

Everyone should try mining -- it interesting, but they shouldn't expect to make much (if any) money doing it. There is no need to make any investment. Unless you own a laptop or an Nvidia video card, you can mine with your computer's video card.

[CountSparkle]

But even if at 36,780,534 difficulty later on (guess) in the game you'd be making $10-12 a day per BFL Asic single which would take 120-140 days to break even (even considering power costs for me).

Based on the number of preorders, the difficulty will more likely be closer to 134,807,280

[supernerd]

But even if at 36,780,534 difficulty later on (guess) in the game you'd be making $10-12 a day per BFL Asic single which would take 120-140 days to break even (even considering power costs for me).

Based on the number of preorders, the difficulty will more likely be closer to 134,807,280

Just out of curiosity, how are you calculating this?
It would help me decide how much I'm willing to spend if I could calculate it myself.

With half of money you are ready to invest buy bitcoins. With other half, wait until ASICs are in the game for at least few months.
After that, you will be able to better predict future BTC price trends, and make a decision about selling all, buying more bitcoins or
jumping onto miner train.

That is what I was leaning towards; buy one ASIC for about 1100 USD and put around the same amount into bitcoin and see how much the bitcoin outperforms the mining, as an experiment.

Also, does anyone know a reasonable way of estimating how much the value of  bitcoin is likely to appreciate in a year from now?

[CountSparkle]

Current difficulty * 40