Mining looks very profitable - or?

[wingding]

From occasional reading (not a miner myself) I have been left with an impression that mining is not profitable - but:

By observing the current difficulty, 194E09, I calculate that you would need an average of 833E6TH (terrahashes) to make one bitcoin. With the current BTC price you then get 1.3E-5 USD/TH.

I see that mining hardware available can produce 6TH/s with 1600W. Given an electricity cost of 0.1 USD/kWh i find that mining cost (hardware not included) with this equipment is 0.74E-5 USD/TH. This gives a profit ratio of 1.8, which to me looks very god. Or have I somehow got it wrong?

[VirosaGITS]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

[wingding]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Why, when you confirm my math? Your numbers means a profit ratio of 1.7, close enough to my 1.8. I'm talking about current state.

[philipma1957]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Why, when you confirm my math? Your numbers means a profit ratio of 1.7, close enough to my 1.8. I'm talking about current state.

your math is harder and disregards  diff change.  So  the guess is what will diff do 163/65 = 2.51 x 1 jump in under 100 days

or 62.5/34.6 = 1.81 x 1 jump in more then 380 days

also block size drops from 25 to 12.5

so  yeah if diff moves slow like the blue below mining is good.

but if it moves fast like the black below mining sucks


Difficulty History

Date                   Difficulty                 Change   Hash Rate
May 11 2016   194,254,820,283   8.73%   1,390,530,167 GH/s
Apr 28 2016   178,659,257,773   -0.01%   1,278,892,782 GH/s
Apr 14 2016   178,678,307,672   7.09%   1,279,029,147 GH/s
Apr 01 2016   166,851,513,283   0.82%   1,194,369,655 GH/s
Mar 18 2016   165,496,835,118   4.46%   1,184,672,491 GH/s
Mar 04 2016   158,427,203,767   -3.10%   1,134,066,098 GH/s

below is :
Feb 19 2016   163,491,654,909   13.44%   1,170,318,852 GH/s
Feb 07 2016   144,116,447,847   20.06%   1,031,625,717 GH/s
Jan 26 2016   120,033,340,651   5.89%   859,232,121 GH/s
Jan 13 2016   113,354,299,801   9.12%   811,421,684 GH/s
Dec 31 2015   103,880,340,815   11.16%   743,604,444 GH/s    
Dec 18 2015   93,448,670,796   18.14%   668,931,642 GH/s
Dec 06 2015   79,102,380,900   8.77%   566,236,898 GH/s
Nov 24 2015   72,722,780,643   10.44%   520,569,941 GH/s
Nov 11 2015   65,848,255,180   5.77%   471,360,171 GH/s
very brutal


while this is good:

Oct 29 2015   62,253,982,450   2.25%   445,631,364 GH/s
Oct 15 2015   60,883,825,480   0.12%   435,823,399 GH/s
Oct 01 2015   60,813,224,039   2.49%   435,318,014 GH/s
Sep 17 2015   59,335,351,234   4.17%   424,738,988 GH/s
Sep 04 2015   56,957,648,455   4.98%   407,718,729 GH/s
Aug 22 2015   54,256,630,328   2.95%   388,384,088 GH/s
Aug 08 2015   52,699,842,409   0.81%   377,240,166 GH/s
Jul 25 2015   52,278,304,846   2.35%   374,222,683 GH/s
Jul 11 2015   51,076,366,303   3.39%   365,618,871 GH/s
Jun 28 2015   49,402,014,931   -0.58%   353,633,397 GH/s
Jun 14 2015   49,692,386,355   4.42%   355,711,957 GH/s
May 31 2015   47,589,591,154   -2.50%   340,659,563 GH/s
May 17 2015   48,807,487,245   2.44%   349,377,603 GH/s
May 03 2015   47,643,398,018   0.07%   341,044,727 GH/s
Apr 19 2015   47,610,564,513   -3.71%   340,809,696 GH/s
Apr 05 2015   49,446,390,688   5.84%   353,951,052 GH/s
Mar 22 2015   46,717,549,645   -1.50%   334,417,246 GH/s
Mar 08 2015   47,427,554,951   1.59%   339,499,662 GH/s
Feb 22 2015   46,684,376,317   5.01%   334,179,783 GH/s
Feb 09 2015   44,455,415,962   7.71%   318,224,263 GH/s
Jan 27 2015   41,272,873,895   -6.14%   295,442,739 GH/s
Jan 12 2015   43,971,662,056   8.20%   314,761,417 GH/s
Dec 30 2014   40,640,955,017   3.00%   290,919,288 GH/s
Dec 17 2014   39,457,671,307   -1.37%   282,449,013 GH/s
Dec 02 2014   40,007,470,271   -0.73%   286,384,627 GH/s
Nov 18 2014   40,300,030,328   1.76%   288,478,854 GH/s
Nov 05 2014   39,603,666,252   10.05%   283,494,086 GH/s
Oct 23 2014   35,985,640,265   2.81%   257,595,247 GH/s
Oct 09 2014   35,002,482,026   0.98%   250,557,526 GH/s
Sep 25 2014   34,661,425,924   16.20%   248,116,151 GH/s

Sep 13 2014   29,829,733,124   8.75%   213,529,547 GH/s
Aug 31 2014   27,428,630,902   15.03%   196,341,788 GH/s
Aug 19 2014   23,844,670,039   20.86%   170,686,797 GH/s
Aug 08 2014   19,729,645,941   5.30%   141,230,307 GH/s
© 2013-2014 BitcoinWisdom.com

[Newcoins2020]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Why, when you confirm my math? Your numbers means a profit ratio of 1.7, close enough to my 1.8. I'm talking about current state.

The halving will be in July which means you income will be cut in half. But not just at the halving.

Check here: https://bitcoinwisdom.com/bitcoin/difficulty.
The difficulty is increasing (over 8% the last time). You will be at loss well before the halving...

[notlist3d]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Why, when you confirm my math? Your numbers means a profit ratio of 1.7, close enough to my 1.8. I'm talking about current state.

The halving will be in July which means you income will be cut in half. But not just at the halving.

Check here: https://bitcoinwisdom.com/bitcoin/difficulty.
The difficulty is increasing (over 8% the last time). You will be at loss well before the halving...

So much depends on electricity cost at this point.  A LOT of miners are trying ETH currently.  We will see if it becomes easier and profitable.  And BTC still has many options such as value going up, more efficient gear (we know it's coming).   

Just so many variables right now it's kinda hard to do much but watch and see what happens.

[adaseb]

Look obviously making 80% gains in a year sounds too good to be true so its common sense that something like "difficulty" and "halving" play a very important role.

Its a gamble just like a stock investment.

[philipma1957]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Why, when you confirm my math? Your numbers means a profit ratio of 1.7, close enough to my 1.8. I'm talking about current state.

The halving will be in July which means you income will be cut in half. But not just at the halving.

Check here: https://bitcoinwisdom.com/bitcoin/difficulty.
The difficulty is increasing (over 8% the last time). You will be at loss well before the halving...

So much depends on electricity cost at this point.  A LOT of miners are trying ETH currently.  We will see if it becomes easier and profitable.  And BTC still has many options such as value going up, more efficient gear (we know it's coming).   

Just so many variables right now it's kinda hard to do much but watch and see what happens.

The game is 80% power cost. 15% decent gear 5% common sense.

Did not used to be this way but it is.
Basically bitmain ,avalon ,BW   and even bitfury have push it that direction.
Which is fine with me as I can get some cheap power not as much as I want, but still by the end of the year maybe 13.5 kwatts from the current solar array.

The problem is how do I expand it. $$$ that I do not have.  I also don't know if the bigger array will ever get built. Would be nice if it does.

[Winoc]

Difficulty will increase over time.It will not remain same everytime.So your earning will reduce constantly when difficulty increases.

[notlist3d]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Why, when you confirm my math? Your numbers means a profit ratio of 1.7, close enough to my 1.8. I'm talking about current state.

The halving will be in July which means you income will be cut in half. But not just at the halving.

Check here: https://bitcoinwisdom.com/bitcoin/difficulty.
The difficulty is increasing (over 8% the last time). You will be at loss well before the halving...

So much depends on electricity cost at this point.  A LOT of miners are trying ETH currently.  We will see if it becomes easier and profitable.  And BTC still has many options such as value going up, more efficient gear (we know it's coming).   

Just so many variables right now it's kinda hard to do much but watch and see what happens.

The game is 80% power cost. 15% decent gear 5% common sense.

Did not used to be this way but it is.
Basically bitmain ,avalon ,BW   and even bitfury have push it that direction.
Which is fine with me as I can get some cheap power not as much as I want, but still by the end of the year maybe 13.5 kwatts from the current solar array.

The problem is how do I expand it. $$$ that I do not have.  I also don't know if the bigger array will ever get built. Would be nice if it does.

And you hit the nail on the head about power costs.   S7's and A6's are still going to be great miners with right electricity even after having.  So for those with the "mega" mines with super cheap power.... I think they still look profitable for quite a while.

Expanding is kinda one of those scary things I know when going from mining in house to mining area... that was a scary time investing.  It worked out good last summer for me.  This summer I'm a little more cautious.

I also am cautious on ETH to.  I just am afraid of a lot of these miners who became unprofitable going GPU's.   And it's totally banking on ETH.   Time will tell how many jump over and what difficulty vs price goes.

I see this as the summer off BTC and ETH as far as coins.  Value... we will see.

[Amph]

the halving alone will make it unprofitable, based on your ratio, so i would avoid this scenario you are describing

i still believe it's better to wait for the next gen before investing again in the asic department

[Syke]

Given an electricity cost of 0.1 USD/kWh

A reasonable assumption for a home miner, but miners aren't in homes anymore. Big farms pay much less than that.

[digaran]

While mining always remain profitable, since the whole idea of mining is to profit. But you could hit a loss of funds if you don't adapt and evolve.
As to use solar and wind energy or any renewable source of energy. otherwise big or small you can count on money loss.

[paradoxum]

At halving your "profit" doesn't get cut in half.  Your Gross income (barring changes in fees) gets cut in half.  The difficulty will drop some as negative/marginal players drop out - but ultimately only the leanest players will remain.

[CryptoBjorn]

At halving your "profit" doesn't get cut in half.  Your Gross income (barring changes in fees) gets cut in half.  The difficulty will drop some as negative/marginal players drop out - but ultimately only the leanest players will remain.

Which is why it don't make sense to buy miners before the halving. You are taking a big risk, since there is no solid information what will happen. Price drop, less diff. etc. 
But when it comes down to mining in general I don't think it's profitable for the small miner in a year now. Just look at the stats:

https://bitcoinwisdom.com/bitcoin/difficulty
Today: 194,254,820,283
1 year ago: 48,807,487,245

That's 4 times more!!!

[philipma1957]

At halving your "profit" doesn't get cut in half.  Your Gross income (barring changes in fees) gets cut in half.  The difficulty will drop some as negative/marginal players drop out - but ultimately only the leanest players will remain.

Which is why it don't make sense to buy miners before the halving. You are taking a big risk, since there is no solid information what will happen. Price drop, less diff. etc. 
But when it comes down to mining in general I don't think it's profitable for the small miner in a year now. Just look at the stats:

https://bitcoinwisdom.com/bitcoin/difficulty
Today: 194,254,820,283
1 year ago: 48,807,487,245

That's 4 times more!!!

Well a lot more on the plate at this ½ ing of btc then the one in 2012.


on dec 2012  we were close to 11m diff  the entire network was 21or 22 th.  almost all gpus some fpga's no asics.

a top card was 35 to 40 percent of a gh  so 3 hd7970's were 1 gh to 1.3 gh this would mean  22,000 x 3 or 60,000-70,000
gpus were the whole network.

I now mine 28th  which would have been  1.25 x the whole network at the last ½ ing.

we have more hear now mining eth coin I figure about 100,000 r9 390's is the eth network.

we have about 300,000 s-7's mining the btc network now.
 A lot can happen different.
including a big retreat to eth coin.

look at the market cap


https://coinmarketcap.com/

6.8 bill     = bitcoin
1.1 billion = eth coin

I am juggling the two coins at the moment.  basically while anything can happen

I fail to see a         3000 usd btc price in the next 7 months.

while I could see a  100 usd eth price in the next 7 months

note

3000/445 = 6.74 x 1       this would be future btc price vs current btc price jan 1 2017

100 /14.4 =   6.94 x 1    this would be future eth price vs current btc price jan 1 2017

I could see Eth coin doing that jump but not btc.

[Gaugh]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Then miners will make the bulk of their money from transaction fees.

[VirosaGITS]

Yes And you're going insanely nuts on math.

It cost bout 100$ to run a S7 per month. It return 168$. Very soon the reward will halve and the difficulty constantly rise over time, diminishing returns.

Then miners will make the bulk of their money from transaction fees.

Erm. Not really, its like 1-4% at the moment. So at the halving, assuming same fees, it would be 2-8%. Maybe it got up since i last checked, but i still think for a couple more halving, before the TX fee being the mainstay.

In short, if you pay 100$ per month for your S7, high fees or no fees, you will not profit afterward by mining with it.