Bitmain's Released Antminer S9, World's First 16nm Miner Ready to Order

[rizla.plus]

I don't think the profitability counter graph is accounting for HODL. I think if you are counting on cashing out for a revenue stream, then yes, it's reflective, and that's what a lot of the bigger miners are doing, because they have such large investment. Or a little guy with a few machines trying to make a little extra. I'm getting s9's to mine and hold. Buying 10k btc is a one way dead end street. Spend 10k on 2-3 s9's, put them in a spare room, pay the electric from my regular job, and in a couple years, let's see what btc price is. Years later when I calculate my profit I'll ignore my electric costs to make my profit look better to me  

I don't think you have understood what this graph shows, because it does account for your HODL strategy, let me explain.

First here's the numbers again for a single S9, starting up January 2018 (I've added a few more columns to make it clearer):


It's all about the total network hashrate (and corresponding difficulty off course but they are dependent on eachother so I could have used either here, I chose hashrate).

The spreadsheet forecasts what the total network hash rate will do in 3 different scenarios:
- follow current trend (middle line)
- continue to grow faster and faster as it has always done in the past (top line, pessimistic outlook miners)
- stop growing and decrease again over the course of the year (bottom line, optimistic outlook for miners)

Based on this it predicts for the 3 different scenarios how much Bitcoin an S9 will make every month of 2018.
Up to this point this is all very solid data, you can pick your favorite scenario or anywhere in between, hashrate is not likely to go outside of these outer lines. You can get a really good idea of how much BTC your S9 will make every month over the coming year.

Now from this point onwards it becomes speculative as it depends on BTC/USD exchange rate, but that does not matter if you're trying to compare with a HODL scenario. I'll explain that later.
First I'll explain the rest of the spreadsheet:

The next columns show how much your miner will make you in USD based on today's echange rate, how much profit you get from that substracting power cost, and what your subsequent position is each month against your initial investment of your S9 (I've estimated $3000 to get an S9 incl. PSU into the country with shipping, tax etc.)

If you now look at the 3 position columns, only in the optimistic scenario (where hashrate stops increasing and eventually decreases again over the year) do you actually pay back your miner and end up in the green. Even following today's trend does not pay back your miner over the course of the year and by the end of the year you're only making $14/month so you never will either (I could add a few months to the spreadsheet to confirm this).

So to come back to the HODL comparison,
If yo put that $3000 into BTC today at $11500/BTC exchange rate, regardless of whether it goes up or down you will always remain in front compared to the current trend and pessimistic scenarios because the value of the initial investment fluctuates with the exchange rate, if you buy an S9 it doesn't (in fact it decreases because it depreciates but lets ignore that for now).

Now if you're claiming that you're not paying back your S9 investment with the BTC you earn and you're not paying the power cost with the BTC you earn but from another source of income, well, then in the other case where you just invest $3000 in BTC you should also convert that money from your other source of income to BTC every month and add that to the initial investment, so that investment grows equally from that other source of income. Otherwise you're not comparing apples with apples.

Again, only in the optimistic scenario where hashrate actually stops growing, is it economically sensible to invest in an S9 now at these prices and current hashrate growth, unless you have access to really cheap power.

I'd be happy to be proven wrong somewhere in my predictions/assumptions, but for now I can't see any way that would be the case.
Anyway, here's the adjusted spreadsheet again for those interested in playing with the numbers:
https://www.dropbox.com/s/v1m3xac87ptylj0/hash%20forecast.xlsx?dl=0

i see the points you are making here, but why is your difficulty different than these? https://bitcoinwisdom.com/bitcoin/difficulty

Because I’m using total network hashrate, not difficulty.
But difficulty is totally dependent on that anyway so I could have used difficulty as well.

Also that site is grossly out of date. Use this one: https://data.bitcoinity.org/bitcoin/hashrate/6m?c=m&g=15&t=a

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[rizla.plus]

So I don't have a degree in MS Excel, but I cannot agree with this prediction. Before I spent money on new miners I picked up a used S7 off Ebay, this was pre-psychotic pricing ($630.00+ $37.00 shipping). Before doing so I looked at the predicted earnings and compared that to the price of the miner. I set my target buy price to ROI at roughly the same time a new S9 would. It took me a bit, but I found a solid seller.

So yes, if you spend too much on **ANY** miner (or business equipment for that matter) it will not be profitable. But if your spreadsheet and theory were accurate and as predictable as you make it seem that old ass miner should not be making anything! Yet is is happily hashing and has almost paid for itself.

It has already paid itself off, (almost)
That is very different. Any money it makes after that is profit as long as it is more than your power cost.
This scenario is specifically for an S9 starting to mine in Jan 18.

[rocketman7666]

I don't think the profitability counter graph is accounting for HODL. I think if you are counting on cashing out for a revenue stream, then yes, it's reflective, and that's what a lot of the bigger miners are doing, because they have such large investment. Or a little guy with a few machines trying to make a little extra. I'm getting s9's to mine and hold. Buying 10k btc is a one way dead end street. Spend 10k on 2-3 s9's, put them in a spare room, pay the electric from my regular job, and in a couple years, let's see what btc price is. Years later when I calculate my profit I'll ignore my electric costs to make my profit look better to me  

I don't think you have understood what this graph shows, because it does account for your HODL strategy, let me explain.

First here's the numbers again for a single S9, starting up January 2018 (I've added a few more columns to make it clearer):
https://s13.postimg.org/jghsyuxp3/network_hashrate_prediction.jpg

It's all about the total network hashrate (and corresponding difficulty off course but they are dependent on eachother so I could have used either here, I chose hashrate).

The spreadsheet forecasts what the total network hash rate will do in 3 different scenarios:
- follow current trend (middle line)
- continue to grow faster and faster as it has always done in the past (top line, pessimistic outlook miners)
- stop growing and decrease again over the course of the year (bottom line, optimistic outlook for miners)

Based on this it predicts for the 3 different scenarios how much Bitcoin an S9 will make every month of 2018.
Up to this point this is all very solid data, you can pick your favorite scenario or anywhere in between, hashrate is not likely to go outside of these outer lines. You can get a really good idea of how much BTC your S9 will make every month over the coming year.

Now from this point onwards it becomes speculative as it depends on BTC/USD exchange rate, but that does not matter if you're trying to compare with a HODL scenario. I'll explain that later.
First I'll explain the rest of the spreadsheet:

The next columns show how much your miner will make you in USD based on today's echange rate, how much profit you get from that substracting power cost, and what your subsequent position is each month against your initial investment of your S9 (I've estimated $3000 to get an S9 incl. PSU into the country with shipping, tax etc.)

If you now look at the 3 position columns, only in the optimistic scenario (where hashrate stops increasing and eventually decreases again over the year) do you actually pay back your miner and end up in the green. Even following today's trend does not pay back your miner over the course of the year and by the end of the year you're only making $14/month so you never will either (I could add a few months to the spreadsheet to confirm this).

So to come back to the HODL comparison,
If yo put that $3000 into BTC today at $11500/BTC exchange rate, regardless of whether it goes up or down you will always remain in front compared to the current trend and pessimistic scenarios because the value of the initial investment fluctuates with the exchange rate, if you buy an S9 it doesn't (in fact it decreases because it depreciates but lets ignore that for now).

Now if you're claiming that you're not paying back your S9 investment with the BTC you earn and you're not paying the power cost with the BTC you earn but from another source of income, well, then in the other case where you just invest $3000 in BTC you should also convert that money from your other source of income to BTC every month and add that to the initial investment, so that investment grows equally from that other source of income. Otherwise you're not comparing apples with apples.

Again, only in the optimistic scenario where hashrate actually stops growing, is it economically sensible to invest in an S9 now at these prices and current hashrate growth, unless you have access to really cheap power.

I'd be happy to be proven wrong somewhere in my predictions/assumptions, but for now I can't see any way that would be the case.
Anyway, here's the adjusted spreadsheet again for those interested in playing with the numbers:
https://www.dropbox.com/s/v1m3xac87ptylj0/hash%20forecast.xlsx?dl=0

i see the points you are making here, but why is your difficulty different than these? https://bitcoinwisdom.com/bitcoin/difficulty

Because I’m using total network hashrate, not difficulty.
But difficulty is totally dependent on that anyway so I could have used difficulty as well.

Also that site is grossly out of date. Use this one: https://data.bitcoinity.org/bitcoin/hashrate/6m?c=m&g=15&t=a

thats a much better site. thanks. so this is bitcoin, what about the other coins with the same scrypt? BTH for example.

[Raymond_B]

So I don't have a degree in MS Excel, but I cannot agree with this prediction. Before I spent money on new miners I picked up a used S7 off Ebay, this was pre-psychotic pricing ($630.00+ $37.00 shipping). Before doing so I looked at the predicted earnings and compared that to the price of the miner. I set my target buy price to ROI at roughly the same time a new S9 would. It took me a bit, but I found a solid seller.

So yes, if you spend too much on **ANY** miner (or business equipment for that matter) it will not be profitable. But if your spreadsheet and theory were accurate and as predictable as you make it seem that old ass miner should not be making anything! Yet is is happily hashing and has almost paid for itself.

It has already paid itself off, (almost)
That is very different. Any money it makes after that is profit as long as it is more than your power cost.
This scenario is specifically for an S9 starting to mine in Jan 18.

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

[kenji]

Its been like this many times in the past.  People use all kinds of weird logic and math to come up with awesome profit scenario's to justify mining.  Mining rigs fly off the proverbial shelf with manufacture's getting interest free loans from investomers!  Most newbs don't understand a basic fact about Bitcoin POW mining.  Mining was designed as a "near" zero sum game and the network is constantly making its way towards that goal.

Another often over looked perspective is that mining can be looked at as a bet AGAINST diff increase.  Based on available data this doesn't like a good bet to me right now!  I think a lot of people will find this out over the coming months!

That's exactly what I'm trying to explain here and the numbers show this so very clearly. Only in the most optimistic scenarios will your miners make some money for some time.

For those who have S9's on hand now, new, used or coming soon, sell'em now!!!
You will make a massive profit given the prices they sell for on Ebay right now.
Your miner will never make that kind of money, the numbers are just not in your favor no matter how you put it.

But, wait a month or 2 and they will be worth peanuts and your miner will be making little or no money at all.

Again, It's really NOT about the bitcoin price, it's about the growing network hashrate and given Bitmain has been dumping S9's like there is no tomorrow in the last month or two, the most pessimistic line on the graph above might well not be pessimistic enough.

I made this chart a little while ago when I was deciding whether or not to sell my S9 miner (which I did at a massive profit), and looking at what the network hashrate has actually done since then: https://data.bitcoinity.org/bitcoin/difficulty/5y?t=l,
It appears to be tracking well above the middle line towards the pessimistic line.
(I had it at 14.9E at Jan 1st, it was actually 15.4E)

You couldn't possibly know that in a month or two the S9 will make little or no money at all.

The price of bitcoin could continue dropping, the difficulty continue rising, and the S9 would still be profitable, so how in the world is it that you think in 2 months it will be making little to no money at all?

Just look at the numbers, even the most optimistic scenario where total network hashrate growth (and thus also difficulty growth) decreases only makes you a small profit by the end of the year. And be honest, is there anyone in their right minds who believes that will happen? Hashrate/difficulty has never gone down other then a blip here and there, it has always increased and rate at which it increases has always increased as well.

Again, bitcoin exchange rate has nothing to do with it because if you put that money in btc now, it would equally go up/down.

You can say "the hashrate/difficulty has never gone down other than a blip here and there" the same way that I can say the price of bitcoin has never gone down other than a blip here and there over the course of it's lifetime. Every time bitcoin tanks people come out of the woodwork and say the end is near, mining won't be profitable anymore, sell your miners now, and every time they've been wrong. They've always been wrong because bitcoin has always rebounded to reach new all time highs. Whether it takes a month to do so, or a year, it has always happened. Now is no different.

If you don't believe bitcoin will rebound, then yes sell your miners, sell your bitcoin, sell it all, the end is near. If you do however believe in bitcoin and it's future, then of course you would be a fool to sell your miners. It just depends on what you believe will happen, which is why I say you can't possibly think you know what will happen.

I’ve said it in every post now and I’ll say it again: this has nothing to do with the bitcoin/usd exchange rate, which is unpredictable as you say, I totally agree with that.
You need to see it as if your initial investment was done in BTC, not USD. And also your power consumption gets added to that in BTC btw.

It has everything to do with network hashrate/difficulty and that is very predictable, within ceratin tolerances as I have done.
I look after forecasting systems in our business and I can tell you, those numbers are the most forecastable I have ever seen, I wish our products were forecastable like that, we could manage our stock levels a hell of a lot better.

Anyway, you want to bet the network hashrate is not going to increase at those rates, all I can say is good luck, and I would call that wishful thinking at best.

Why does this have nothing to do with the bitcoin/usd exchange rate? Why do I need to see it as if my initial investment was done in BTC, not USD? Who made up that rule, you?

[rizla.plus]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

[kenji]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

$0.20/kWh is widely agreed to be too high to be mining with. Cut that number in half to a realistic number of $0.10/kWh and it still makes $100/mo, I wouldn't call that next to nothing!

[Raymond_B]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

My power rate is $.057 kw/hr. In addition you ignored my posted image

Little more realistic setup https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700&p=1200&pc=.06&pf=2&d=2227847638503.63000000&r=12.50000000&er=12398.68000000&hc=667

[rizla.plus]

Why does this have nothing to do with the bitcoin/usd exchange rate? Why do I need to see it as if my initial investment was done in BTC, not USD? Who made up that rule, you?

NO, of course I haven’t it’s simple maths.
Maybe I’ve confused you with those extra columns so let me explain differently:

Only look at what BTC/USD is right now (around $11500) and look at the first set of 3 columns where I predict how much BTC your miner will make in the 3 scenarios.
Don’t look at the other sets of columns because they make assumptions about the BTC price in the future.
Now,

Scenario 1:
You buy an antminer today for $3000 (incl. PSU, shipping & tax), you get it straight away and start mining.
You’re down $3000 you have an antminer in hand and 0 BTC in your wallet.

Scenario 2:
You buy $3000 worth of BTC which equals 0.2608BTC.
So you’re also down $3000 you have no miner but you have 0.2608BTC in your wallet.

In scenario 1 look at the 3 columns on the spreadsheet that predict how much BTC you make per month (again: THIS HAS NOTHING TO DO WITH WHAT BTC/USD WILL DO ON THE FUTURE)
At which point have you actually made 0.2608BTC in each of the 3 scenarios and can you start getting ahead on scenario 2?
In the standard forecast its September, in the pessimistic one it’s right at the end of the year.
And what we have not done (because we’re ignoring the next 2 sets of numbers) is add in power cost, so it’s actually much worse but we cannot predict that unless we assume today’s BTC/USD exchange rate. Also if we do that we would have to increase the value of the investment in scenario 2 by the same amount every month and add that to those 0.2608BTC, so you would always stay behind.

Now at that point in time (where you’ve reached 0.2608BTC), your miner is making next to nothing unless you look only at the most optimistic scenario where difficulty/ hashrate decrease, so your asset is worth next to nothing at that point as well.

Hence, my conclusion…

[rizla.plus]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

My power rate is $.057 kw/hr. In addition you ignored my posted image

Little more realistic setup https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700&p=1200&pc=.06&pf=2&d=2227847638503.63000000&r=12.50000000&er=12398.68000000&hc=667

Yep sorry, I had that number too high.
$.057 is awesome BTW!!!

[rizla.plus]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

My power rate is $.057 kw/hr. In addition you ignored my posted image

Little more realistic setup https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700&p=1200&pc=.06&pf=2&d=2227847638503.63000000&r=12.50000000&er=12398.68000000&hc=667

Like I said before, if your miner is paid off then sure.
If that $100/month (and decreasing every month) goes towards paying off that miner (at $3000), it's definitely next to nothing in my view.

In any case $100/month can only be seen as a hobby in my view.

[Raymond_B]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

My power rate is $.057 kw/hr. In addition you ignored my posted image

Little more realistic setup https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700&p=1200&pc=.06&pf=2&d=2227847638503.63000000&r=12.50000000&er=12398.68000000&hc=667

Like I said before, if your miner is paid off then sure.
If that $100/month (and decreasing every month) goes towards paying off that miner (at $3000), it's definitely next to nothing in my view.

In any case $100/month can only be seen as a hobby in my view.

I **did** have to pay off my miner. That's what I am trying to get you to see. I bought it, it had a cost, I must recover that cost to be profitable. If you'd look at my posted pic you can see clearly how much it's earning. And again that's why I am questioning your math, that miner, as old as it is, should not be making anything at all. But it is, now you're qualifying what's profit and what is not. That's not math, that's subjective

[kenji]

Why does this have nothing to do with the bitcoin/usd exchange rate? Why do I need to see it as if my initial investment was done in BTC, not USD? Who made up that rule, you?

NO, of course I haven’t it’s simple maths.
Maybe I’ve confused you with those extra columns so let me explain differently:

Only look at what BTC/USD is right now (around $11500) and look at the first set of 3 columns where I predict how much BTC your miner will make in the 3 scenarios.
Don’t look at the other sets of columns because they make assumptions about the BTC price in the future.
Now,

Scenario 1:
You buy an antminer today for $3000 (incl. PSU, shipping & tax), you get it straight away and start mining.
You’re down $3000 you have an antminer in hand and 0 BTC in your wallet.

Scenario 2:
You buy $3000 worth of BTC which equals 0.2608BTC.
So you’re also down $3000 you have no miner but you have 0.2608BTC in your wallet.

In scenario 1 look at the 3 columns on the spreadsheet that predict how much BTC you make per month (again: THIS HAS NOTHING TO DO WITH WHAT BTC/USD WILL DO ON THE FUTURE)
At which point have you actually made 0.2608BTC in each of the 3 scenarios and can you start getting ahead on scenario 2?
In the standard forecast its September, in the pessimistic one it’s right at the end of the year.
And what we have not done (because we’re ignoring the next 2 sets of numbers) is add in power cost, so it’s actually much worse but we cannot predict that unless we assume today’s BTC/USD exchange rate. Also if we do that we would have to increase the value of the investment in scenario 2 by the same amount every month and add that to those 0.2608BTC, so you would always stay behind.

Now at that point in time (where you’ve reached 0.2608BTC), your miner is making next to nothing unless you look only at the most optimistic scenario where difficulty/ hashrate decrease, so your asset is worth next to nothing at that point as well.

Hence, my conclusion…

I'm just not following along with your spreadsheet. Are you assuming in your predictions that the price of bitcoin remain constant, whilst the difficulty continues to rise? That wouldn't make sense if so. You keep saying it has nothing to do with BTC/USD yet I see a bunch of figures in USD.

[rizla.plus]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

My power rate is $.057 kw/hr. In addition you ignored my posted image

Little more realistic setup https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700&p=1200&pc=.06&pf=2&d=2227847638503.63000000&r=12.50000000&er=12398.68000000&hc=667

Like I said before, if your miner is paid off then sure.
If that $100/month (and decreasing every month) goes towards paying off that miner (at $3000), it's definitely next to nothing in my view.

In any case $100/month can only be seen as a hobby in my view.

I **did** have to pay off my miner. That's what I am trying to get you to see. I bought it, it had a cost, I must recover that cost to be profitable. If you'd look at my posted pic you can see clearly how much it's earning. And again that's why I am questioning your math, that miner, as old as it is, should not be making anything at all. But it is, now you're qualifying what's profit and what is not. That's not math, that's subjective

I know, I believe you. You did, indeed have to pay it off, BUT, when difficulty/hashrate was much lower, that miner would have been making much more than it does today no?
Also, your initial investment was much lower as well.
And there is one thing you can be (almost) sure of, it will make less and less as time progresses.

And that is what I am trying to show in this spreadsheet for the S9 specifically, bought today at $3000,
But you could adjust the numbers to an S7, bought today at ~$700 and see what you get.

And to answer your question from before, the reason miners can(will) go from being profitable to non-profitable in such a short amount of time is because the difficulty is increasing at ever increasing rates.
If they were increasing in a linear manner, you would be able to put a fixed "profitability" time on a miner, but the curve is not linear, it's exponential.

[Raymond_B]

Darn close, I'd have to add everything up. Initially I was having so much fun I didn't do much record keeping. Anyway why would the spreadsheet only be for an S9? I mean difficulty and hashrate don't care right? It's simply how much I paid for the machine vs. how much it can produce? I do agree that earnings can and will be affected by difficulty, that is a given. I am just trying to understand how a machine can go non-profitable in such a short amount of time. Because again if that's true then S7's or any old miner for that matter should not be profitable either.

Pretty sure they make next to nothing anymore depending on what you pay for power where you are, see:
https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700.00&p=1293.00&pc=0.2&pf=0.00&d=2227847638503.63000000&r=12.50000000&er=12294.11000000&hc=0.00

My power rate is $.057 kw/hr. In addition you ignored my posted image

Little more realistic setup https://www.coinwarz.com/calculators/bitcoin-mining-calculator/?h=4700&p=1200&pc=.06&pf=2&d=2227847638503.63000000&r=12.50000000&er=12398.68000000&hc=667

Like I said before, if your miner is paid off then sure.
If that $100/month (and decreasing every month) goes towards paying off that miner (at $3000), it's definitely next to nothing in my view.

In any case $100/month can only be seen as a hobby in my view.

I **did** have to pay off my miner. That's what I am trying to get you to see. I bought it, it had a cost, I must recover that cost to be profitable. If you'd look at my posted pic you can see clearly how much it's earning. And again that's why I am questioning your math, that miner, as old as it is, should not be making anything at all. But it is, now you're qualifying what's profit and what is not. That's not math, that's subjective

I know, I believe you. You did, indeed have to pay it off, BUT, when difficulty/hashrate was much lower, that miner would have been making much more than it does today no?
Also, your initial investment was much lower as well.
And there is one thing you can be (almost) sure of, it will make less and less as time progresses.

And that is what I am trying to show in this spreadsheet for the S9 specifically, bought today at $3000,
But you could adjust the numbers to an S7, bought today at ~$700 and see what you get.

And to answer your question from before, the reason miners can(will) go from being profitable to non-profitable in such a short amount of time is because the difficulty is increasing at ever increasing rates.
If they were increasing in a linear manner, you would be able to put a fixed "profitability" time on a miner, but the curve is not linear, it's exponential.

Yes sir, I understand and agree with everything you're saying. However my disagreement is simply with the accelerated rate to 0 you propose. True enough that difficulty is not linear, however it is not as predictable as you lay out either. And that in my noob, uneducated opinion, is the flaw in the math.

[rizla.plus]

Why does this have nothing to do with the bitcoin/usd exchange rate? Why do I need to see it as if my initial investment was done in BTC, not USD? Who made up that rule, you?

NO, of course I haven’t it’s simple maths.
Maybe I’ve confused you with those extra columns so let me explain differently:

Only look at what BTC/USD is right now (around $11500) and look at the first set of 3 columns where I predict how much BTC your miner will make in the 3 scenarios.
Don’t look at the other sets of columns because they make assumptions about the BTC price in the future.
Now,

Scenario 1:
You buy an antminer today for $3000 (incl. PSU, shipping & tax), you get it straight away and start mining.
You’re down $3000 you have an antminer in hand and 0 BTC in your wallet.

Scenario 2:
You buy $3000 worth of BTC which equals 0.2608BTC.
So you’re also down $3000 you have no miner but you have 0.2608BTC in your wallet.

In scenario 1 look at the 3 columns on the spreadsheet that predict how much BTC you make per month (again: THIS HAS NOTHING TO DO WITH WHAT BTC/USD WILL DO ON THE FUTURE)
At which point have you actually made 0.2608BTC in each of the 3 scenarios and can you start getting ahead on scenario 2?
In the standard forecast its September, in the pessimistic one it’s right at the end of the year.
And what we have not done (because we’re ignoring the next 2 sets of numbers) is add in power cost, so it’s actually much worse but we cannot predict that unless we assume today’s BTC/USD exchange rate. Also if we do that we would have to increase the value of the investment in scenario 2 by the same amount every month and add that to those 0.2608BTC, so you would always stay behind.

Now at that point in time (where you’ve reached 0.2608BTC), your miner is making next to nothing unless you look only at the most optimistic scenario where difficulty/ hashrate decrease, so your asset is worth next to nothing at that point as well.

Hence, my conclusion…

I'm just not following along with your spreadsheet. Are you assuming in your predictions that the price of bitcoin remain constant, whilst the difficulty continues to rise? That wouldn't make sense if so. You keep saying it has nothing to do with BTC/USD yet I see a bunch of figures in USD.

No, the spreadsheet does a lot more, I agree, but specifically my last post was just to explain to you why you would always be behind when buying a miner,
I am comparing a scenario where you convert $3000 in a miner to make you BTC, and another scenario where you convert that $3000 directly into BTC (even ignoring power cost)
Hence what only matters is today's exchange rate.

Now it does not really matter that much if you do include the other columns either because the value of your initial investment in BTC also fluctuates but it gets more complicated then, lets keep it simple for now...

[rizla.plus]

Yes sir, I understand and agree with everything you're saying. However my disagreement is simply with the accelerated rate to 0 you propose. True enough that difficulty is not linear, however it is not as predictable as you lay out either. And that in my noob, uneducated opinion, is the flaw in the math.

Like I said, I have quite a lot to do with forecasting in our business and I can assure you, based on the history this is the most predictable set of numbers I have ever had to forecast.
Even excel can do a pretty good job at it using the standard forecast function :-)

Even by hand.
Just look at this chart, draw it on a piece of paper or print it out, and try to predict with a pen & ruler where the next point will be:
https://data.bitcoinity.org/bitcoin/hashrate/5y?c=m&g=15&t=a
It's really not that hard :-) I'm sure you'd have a pretty good idea where that point will be based just on what you see there.

Now that said, just assume your miner's revenue decrease is exactly proportional to that increase, I'm sure you see where I'm getting at.

[kenji]

Why does this have nothing to do with the bitcoin/usd exchange rate? Why do I need to see it as if my initial investment was done in BTC, not USD? Who made up that rule, you?

NO, of course I haven’t it’s simple maths.
Maybe I’ve confused you with those extra columns so let me explain differently:

Only look at what BTC/USD is right now (around $11500) and look at the first set of 3 columns where I predict how much BTC your miner will make in the 3 scenarios.
Don’t look at the other sets of columns because they make assumptions about the BTC price in the future.
Now,

Scenario 1:
You buy an antminer today for $3000 (incl. PSU, shipping & tax), you get it straight away and start mining.
You’re down $3000 you have an antminer in hand and 0 BTC in your wallet.

Scenario 2:
You buy $3000 worth of BTC which equals 0.2608BTC.
So you’re also down $3000 you have no miner but you have 0.2608BTC in your wallet.

In scenario 1 look at the 3 columns on the spreadsheet that predict how much BTC you make per month (again: THIS HAS NOTHING TO DO WITH WHAT BTC/USD WILL DO ON THE FUTURE)
At which point have you actually made 0.2608BTC in each of the 3 scenarios and can you start getting ahead on scenario 2?
In the standard forecast its September, in the pessimistic one it’s right at the end of the year.
And what we have not done (because we’re ignoring the next 2 sets of numbers) is add in power cost, so it’s actually much worse but we cannot predict that unless we assume today’s BTC/USD exchange rate. Also if we do that we would have to increase the value of the investment in scenario 2 by the same amount every month and add that to those 0.2608BTC, so you would always stay behind.

Now at that point in time (where you’ve reached 0.2608BTC), your miner is making next to nothing unless you look only at the most optimistic scenario where difficulty/ hashrate decrease, so your asset is worth next to nothing at that point as well.

Hence, my conclusion…

I'm just not following along with your spreadsheet. Are you assuming in your predictions that the price of bitcoin remain constant, whilst the difficulty continues to rise? That wouldn't make sense if so. You keep saying it has nothing to do with BTC/USD yet I see a bunch of figures in USD.

No, the spreadsheet does a lot more, I agree, but specifically my last post was just to explain to you why you would always be behind when buying a miner,
I am comparing a scenario where you convert $3000 in a miner to make you BTC, and another scenario where you convert that $3000 directly into BTC (even ignoring power cost)
Hence what only matters is today's exchange rate.

Now it does not really matter that much if you do include the other columns either because the value of your initial investment in BTC also fluctuates but it gets more complicated then, lets keep it simple for now...

But you can't base the full value of the miner on today's exchange rate alone, which is why this prediction that "you'll always be behind by mining" doesn't make sense. You assume the difficulty will continue to rise, yet not the price of bitcoin. This prediction is made in an unrealistic vacuum that isn't applicable to real life, at least not the way that I'm understanding it. You're also not factoring in that when you go to resell your miner you will make back a lot of what you originally spent.

[rizla.plus]

But you can't base the full value of the miner on today's exchange rate alone, which is why these predictions don't make sense. You assume the difficulty will continue to rise, yet not the price of bitcoin. This prediction is made in an unrealistic vacuum that isn't applicable to real life, at least not the way that I'm understanding it.\

Yes you can, if you convert that $3000 into BTC TODAY and you hold from that point on in both scenarios you absolutely can. BTC/USD exchange rate is not relevant anymore because we're comparing BTC-BTC at that point.

You're also not factoring in that when you go to resell your miner you will make back a lot of what you originally spent.

I sure was, that's why I said (look at what I put here in bold):

At which point have you actually made 0.2608BTC in each of the 3 scenarios and can you start getting ahead on scenario 2?
In the standard forecast its September, in the pessimistic one it’s right at the end of the year.
And what we have not done (because we’re ignoring the next 2 sets of numbers) is add in power cost, so it’s actually much worse but we cannot predict that unless we assume today’s BTC/USD exchange rate. Also if we do that we would have to increase the value of the investment in scenario 2 by the same amount every month and add that to those 0.2608BTC, so you would always stay behind.

Now at that point in time (where you’ve reached 0.2608BTC), your miner is making next to nothing unless you look only at the most optimistic scenario where difficulty/ hashrate decrease, so your asset is worth next to nothing at that point as well.

Good luck selling the miner at that point in time, once it becomes worthless to you, it is worthless to others as well.

This is exactly why I'm making the case for selling S9 miners now instead of mining.
People are not aware of the numbers presented above, they only look at what they would earn today (on those online calculators), and so they are willing to pay massive prices for miners available today, more than double what you pay for them from Bitmain. Money you can convert into BTC today!
This is the opportunity today but it will not last and your miner will never make you that kind of BTC anyway, that's what the hashrate predictions show.

[kenji]

But you can't base the full value of the miner on today's exchange rate alone, which is why these predictions don't make sense. You assume the difficulty will continue to rise, yet not the price of bitcoin. This prediction is made in an unrealistic vacuum that isn't applicable to real life, at least not the way that I'm understanding it.\

Yes you can, if you convert that $3000 into BTC TODAY and you hold from that point on in both scenarios you absolutely can. BTC/USD exchange rate is not relevant anymore because we're comparing BTC-BTC at that point.

You can't because you won't know what the difficulty will do without knowing how BTC/USD is doing. The two are correlated, we just don't know how. It's like asking which came first, the chicken or the egg. Does the difficulty go up because BTC/USD is doing well, or is BTC/USD doing well because the difficulty is going up?

You can't assume that the difficulty is going to just keep rising without BTC/USD rising with it, or people wouldn't keep plugging in their miners, as mining would no longer be profitable in terms of USD, which is what people use!

You could have made the same spreadsheet and made the same predictions a year ago and said: "Look, the difficulty is predicted to keep rising, it would be better to just buy BTC and not a miner because a couple months from now, your miners won't be making anything". That wouldn't have worked then for the same reason it doesn't work now, because you're not assuming anything about BTC/USD!