Simple Question For Experienced Miners Only...

[Sage]

... What does it take currently to make mining profitable?

[ShadesOfMarble]

Basic math skills

[MagicBit15]

Basic math skills

Wow, I love you

[Sitarow]

... What does it take currently to make mining profitable?

Source out hardware that is cheap preferably used in good condition. Try to trade up you're hardware with minimal cost. This involves you staying ahead of future hardware trends. Next have them operating at under clock setting that will give the best return.

and remember to keep your overhead cost low.

oh and yes use a spreadsheet and have a good plan.

[Isokivi]

Basic math skills

This is correct. If you add the skills to find process and evaluate information to it you are set. For example someone considering starting now should know what miming hardware exists and in what quantity. Secondly you will need to know what is being made and in what quantity, evaluating this information can be hard. For example I would consider anyone stating absolute facts about BFL's upcoming gear an unreliable source untill said equipment actually exists and works.

Other things you need to be on top of include:
Understanding difficulty, atm I myself would do math with 10-25% rises in difficulty every week.
Electricity price, take it in to account if you need airconditioning to run your gear 24/7/365
Exchange rates, is your plan plausible if they fall a third.

Being a pessimist when estimating things helps.

[Sitarow]

Basic math skills

This is correct. If you add the skills to find process and evaluate information to it you are set. For example someone considering starting now should know what miming hardware exists and in what quantity.

Other things you need to be on top of include:

Exchange rates, is your plan plausible if they fall a third.

Being a pessimist when estimating things helps.

if your going long on your crypto currency of choice.
then try not to be ultra conservative.

as recent events have shown going long would have given greater return.

[Isokivi]

if your going long on your crypto currency of choice.
then try not to be ultra conservative.

as recent events have shown going long would have given greater return.

Because if you feel like that then you should invest directly in to the currency, not produce it at over the market price costs.

[jwzguy]

Assuming you want to mine BTC on GPUs, it takes two things:

Existing hardware, because you'll never break even on new investments.
The ability to search the forums for information on how to manipulate your GPU settings and mining software configurations.

[Entropy-uc]

All of the above.

Plus you should be a decent electrician, be expert with computers and ideally programming, understand enough about network protocools to configure your routers to give priority to bitcoin traffic, and understand enough thermodynamics to include heating and the required cooling in your profit calculations.  Being a trained HVAC tech wouldn't hurt either.

[Sage]

Thanks for the input guys.

To summarize everything (if anything is missing or wrong let me know):

- Get your hardware cheap, likely used (ebay???).  New hardware will take too long to pay off.

- Optimize hardware settings and prioritize traffic to mining hardware.

- Get electricity cheap.  Find ways to keep the hardware cool on the cheap. (Setup in a cold location with cheap electricity.... and likely fast internet too.)


Current variables I see I need to work in my spreadsheet:

Calculating potential coin harvest and worth:
- Current mining difficulty now and projected difficulty in 30,60,90,120 days
- Hardware speed
- Internet speed
- Price of Bitcoin

Use those numbers to calculate potential 30, 60, 90, 120 day coin harvests per rig, and worth scenarios based on the price of Bitcoin.

Unknown variables here:  The effects of tweaks on coin harvest and electricity cost, and of course the future price of Bitcoin.

Calculating maintenance costs:
- Electricity
- Bandwidth cost
- Hardware maintenance

Question here:  How big a variable is internet speed?  And how much bandwidth would I need to plan for?

Calculating upfront costs:
- Initial hardware cost
- Any monthly payments

Calculating ongoing upgrade costs:
- Projected updates of mining technology (i.e. potential lifespan of current equipment).
- Potential of premature failed equipment costs.

Use those numbers to calculate key metrics:

The key metric I see that matters for scaling is:

- The number of days until breakeven on upfront hardware cost. 
- The potential return on new hardware investments in 30,60,90,120,365 days.

So far the game seems to boil down to getting the fastest return on new hardware investment, and getting the most out of it during its lifespan.

(Spoken from someone who has never mined a single Bitcoin...Yet.)

Am I missing anything?

[Entropy-uc]

Uptime becomes a major factor.  If your network is down you are down.  Consider having 2 network connections.  I have that plus a cellular internet connection I can bring on in emergencies.  The same goes for power.  How often does the power go out where you are?  If it goes out will your rigs come back up and hash right away or will they sit idle until you get home?  If your software crashes how long will it be until you know, and can get to your gear to fix them?

Since I outed myself as a large miner in the photos thread, I will tell you a sad story from my start up times.

At the time I was traveling every week, and it turned out that the FPGAs I have were incredibly fussy about USB connections.  There is no way to correct this other than physically power cycling the boards.  Once, shortly after I left from setting up about 30 new boards, half of the existing boards dropped their connections.  Plus one set of 24 boards went offline and I was unable to SSH into the controller computer for them.  It turned out that the new controller computer had a power setting to Hibernate on no activity for 5 hours that I hadn't noticed during setup.

I had a trusted neighbor with my key who I got to stop in a couple days later to restart the computer, but dealing with the other problems were far beyond his skills.

I was out for 2 weeks, and that was before the block reward halving.  I think I lost out on something like 25 coins per day.

[crazyates]

- Get your hardware cheap, likely used (ebay???).  New hardware will take too long to pay off.

I think you're wrong on this point. I don't like buying used hardware, as your chance of failure is higher. I buy a brand new 7950 off Newegg with a 3 year warranty, and I know that thing is gonna last 3 years, minimum. I buy a used 5970 off ebay, that's been mining nonstop for the past 18 months in 80+C conditions, and I can't guarantee it'll last more than a year.

With the new hardware, it might take longer, but I can guarantee it will pay itself off.

[GernMiester]

Basic math skills

and FIAT.. BTC doesn't just grow on the interwebs you know

[Gator-hex]

... What does it take currently to make mining profitable?

A bitcoin price above your hardware and electricity running costs! http://www.bitcoinx.com/profit/