Reliable comparison between mining vs. buying and holding

[Dobmader]

TBH i will preferably Buying and holding bitcoins, because now a days Mining need too much investment needed best hardware with highest Hash rate for eg. Antminer. Mining is also difficult because it needs electricity, proper maintenance of hardware that makes hardware too expensive.

if we compare mining with buying and holding than buying and holding is very easy, just bought and hold and sell when price will high.
but buying and holding is involved risk always.

I am agree with you because the mining needs the proper equipments to buy and those equipments are very expensive and it takes a lot of the time as well, on the other hand the buying and the saving of the bitcoin is the best option because a lot of the people are buying the bitcoin and they are saving it for the long time because the value and the price of the bitcoin is increasing more and more.

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[Rahar02]

It's a good question obviously, but the answer will vary due to there are some factors to be considered for holders and miners such as:
- unpredictable bitcoin price in the future (even though it's more likely increases over time
- electricity costs for mining
- difficulty adjustments
- taxes
Mining isn't for layman without sufficient funds and skills obviously, it takes months and even years to get ROI.
That's why most people going into holders instead of miners.

[odolvlobo]

Oh, let's say you had purchased $4800 in Bitcoin at the beginning of this year and held it rather than putting it into this MLM scheme as you did.  You would have purchased around 5 Bitcoin which would be worth US$28,000+ today - 9 months later.  TL;DR What did you make again? So where does the money come from?!?
Again, people who don't understand bitcoin and bitcoin mining make this mistake time and time again. Yes, I could have purchased 5 bitcoin at the start of the year. And that's what I did. And I paid BCN another $5,000 (in the form of 5 bitcoin) to get started in mining. A total of 10 BTC. There is a big difference between the two. Bitcoin is both a product and a service. The former serves as a store of value, the latter as a payment method. After their own analysis, people who want to invest in a bitcoin mining programme will buy into a mining programme for whatever reasons, for whatever returns, for whatever time frame, for whatever risks, whether it is paid in cash (USD) or cryptocurrency (BTC). BCN allows people at an individual level to find bitcoin mining viable. Otherwise, it will be left only to the big players who have millions of dollars to invest in tens of thousands of mining rigs at a go. Individual miners will eventually be phased out as the mining difficulty increases, and your chances of profiting from this industry will only be limited to being part of a large mining pool. If everyone thought the way you did and preferred to just buy bitcoin and hold, no one at an individual level would be doing bitcoin mining. Without the growth of the bitcoin network by people investing into mining hardware and contributing it to the network, it wouldn't cost as much as US$30 billion to hack the bitcoin network today and far easier to achieve more than 50% of the computational power of the network for a successful hack. As it is today, any hacker with that sort of resources would be better off doing mining himself than trying to hack the network. The bitcoin network looks after itself, so to speak.

It isn't that hard to figure out. If you invested 5 BTC into BCN mining and you ended up with less than 5 BTC, then you have lost money.

You seem to feel that your support of the bitcoin network justifies that loss and I have no problem with that; however, there is a problem when the money losing aspect of BCN mining is hidden from people.

[lordquanta]

I constantly hear people arguing for mining as opposed to buying and holding or vice versa as better investment strategy - is there any reliable source of information that compares the two over an extended period of time?

End goal of possessing the bitcoin at cost effective way has two main ways to achieve. One is mining and other is purchase-hold. Lets look at the mining and its cost:
* price of miner being used. Based on the which type of miner you are using price will vary.
* Electricity charges applicable in you area or area of interest (The area where you will set up the miner rig)
* Price for place of operation. Either place would be on Rent  thus rent on monthly basis or trimonthly basis.
* AC and or miner place maintenance

profitability of mining based on above factors could calculated fairly accurate with coinwarz calculator. Check following link for the calculation:

https://www.coinwarz.com/cryptocurrency

From a laymans point of view mining is a lot of hassle. For ease of possessing coins purchasing and holding is fairly easy. Above requires in depth knowledge of mining or at least some understanding along with previous experience in mining will be helpful.

If person is technical or is willing to go to great length then mining will be profitable. Or you should focus on purchasing on the coins from market.

[SixOfFive]

Mining and Hodling both are totally different practices in my opinion.
Mining require both capital and patience, Miners need to invest a lot of money initially and it takes some time(around 7-8 months to recover the investment and get favourable Return). Also good technical knowledge is required and it also involve maintenance cost in long term.
On the other hand, you can buy or sell BTC at any point of time without any such problem. Not much technical knowledge is required.

[ivrynx]

I see mining to be more practical during the early years of bitcoin since we can get bitcoin for the same cost as our electricity and maintenance of cpus, however in the long run, bitcoin miners were developed and it did cost much more.since it needed much electricity and it needs to run for hours, however if you hodl during that time up until now, you'll see that it is worth it, but i do not suggest mining at this point, and just let the real miners do their job, since minig machines had developed through time and it is much harder to mine these days.at home, since you could only mine fewer bitcoins, well as for buying, it is practical before up until now, but with the value of bitcoin today, you need to know when to buy, and for holding, i still suggest to hold on to your bitcoins and wait until it reaches it peak value.

[guoyu78]

I see mining to be more practical during the early years of bitcoin since we can get bitcoin for the same cost as our electricity and maintenance of cpus, however in the long run, bitcoin miners were developed and it did cost much more.since it needed much electricity and it needs to run for hours, however if you hodl during that time up until now, you'll see that it is worth it, but i do not suggest mining at this point, and just let the real miners do their job, since minig machines had developed through time and it is much harder to mine these days.at home, since you could only mine fewer bitcoins, well as for buying, it is practical before up until now, but with the value of bitcoin today, you need to know when to buy, and for holding, i still suggest to hold on to your bitcoins and wait until it reaches it peak value.

If we make a comparison in between mining and holding of bitcoins, then we’ll get to know that at the very present moment, it is buying and holding of bitcoins which is having more advantages than that of mining. Mining requires super computer along with huge consumption of power and electricity. You should go for playing a safe game. Buy your bitcoins and keep on holding them for as long as you can.

[tweetbit]

I constantly hear people arguing for mining as opposed to buying and holding or vice versa as better investment strategy - is there any reliable source of information that compares the two over an extended period of time?

There is none because most miners hide information regarding profitability of mining rig in reality because of lesser miners means more profit to them. When it comes to mining cryptocurrency the country, the area, the electricity, the hardware and a great coin to fork is the bigger issue. If you think you have that solved mining is better than buying bitcoin.

[justspare]

I see mining to be more practical during the early years of bitcoin since we can get bitcoin for the same cost as our electricity and maintenance of cpus, however in the long run, bitcoin miners were developed and it did cost much more.since it needed much electricity and it needs to run for hours, however if you hodl during that time up until now, you'll see that it is worth it, but i do not suggest mining at this point, and just let the real miners do their job, since minig machines had developed through time and it is much harder to mine these days.at home, since you could only mine fewer bitcoins, well as for buying, it is practical before up until now, but with the value of bitcoin today, you need to know when to buy, and for holding, i still suggest to hold on to your bitcoins and wait until it reaches it peak value.

Well as compare to you I do the saving and for me the bitcoin saving is the best and the price worthy process. Because it is very important to save the bitcoin for the long time as if you will buy the bitcoin today and you will hold the bitcoin for the long time you will know the value of the bitcoin is increasing and you will be able to sell your bitcoin at the high price while you did not buy at the high price so it is the profit.

[immunity]

Would it have been better if I had held onto 10 BTC instead of holding half and putting the other half into mining? I don't know, and neither do you. This is my way of diversifying investments. The earnings from mining alone could surpass this if we continue to mine long enough in the future, and the people who get into mining are eyeing on this. It is a calculated risk with cryptocurrency investments at a different level, compared to buying and holding. Likewise, trading cryptocurrencies has its risks at another level. Maybe I didn't enter at a suitable time (close to the start of a new halving era and bitcoin price). As the price of bitcoin climbs to what it is today and a founder pool costs only 0.62 btc at today's rate, mining becomes a viable alternative for accumulation of bitcoin in the long term. But you would have to be part of a large sustainable pool with mining done correctly in the right conditions to have a chance to succeed at this, not mining on your own pointing to a known pool and bearing pool fees and electricity costs and other overheads at your own expense. There are synergistic advantages to being an inherent part of running your own pool, provided it is large enough. Just keep track of BCN's hashrate in the next few months, and if you don't take everything you see at face value and can see the underlying reasons, you will understand why the referral commissions matter. Without a referral incentive in place and without new members contributing hashrates, the crowdfunded setup that BCN is would have failed in its very first few months in 2014.

[zarados]

I see mining to be more practical during the early years of bitcoin since we can get bitcoin for the same cost as our electricity and maintenance of cpus, however in the long run, bitcoin miners were developed and it did cost much more.since it needed much electricity and it needs to run for hours, however if you hodl during that time up until now, you'll see that it is worth it, but i do not suggest mining at this point, and just let the real miners do their job, since minig machines had developed through time and it is much harder to mine these days.at home, since you could only mine fewer bitcoins, well as for buying, it is practical before up until now, but with the value of bitcoin today, you need to know when to buy, and for holding, i still suggest to hold on to your bitcoins and wait until it reaches it peak value.

Well as compare to you I do the saving and for me the bitcoin saving is the best and the price worthy process. Because it is very important to save the bitcoin for the long time as if you will buy the bitcoin today and you will hold the bitcoin for the long time you will know the value of the bitcoin is increasing and you will be able to sell your bitcoin at the high price while you did not buy at the high price so it is the profit.

I  am still unsure of this, but I realize that mining can be more profitable if we can get ROi less than a year. so, once ROi is obtained, the next result becomes fixed income. Holding bitcoin is also profitable, but you will not know whether the price will continue to move like this year.

[waynechong1995]

I would say it's all about preferences and strategy, it's a solid fact that you would be more profitable if you already start mining early and where ROI had been already break-even, rest are just mere profits which is very stable compare to trading - buying/holding counts in this case. Investment on the other hand could generate higher profits in short amount of time if the trend is spotted early or you dipped at the best position.

Comparison? Do a google and you could see everything, but more mining you could visit cryptocompare.com and calculate accordingly, as for charts it's available everywhere and what i can say pros and cons are very subjective to different person. Mining - less risks, long term, guaranteed ROI over a certain period while investing is the opposite if you engage high risks alts trading.

[bitctrimor1]

I constantly hear people arguing for mining as opposed to buying and holding or vice versa as better investment strategy - is there any reliable source of information that compares the two over an extended period of time?

Assuming you have a situation where you can mine bitcoins profitably, then mining may give you a better return than simply buying them. On the other hand, mining is much more risky.

To determine mining returns in the past, you can use past equipment and electricity costs to determine mining costs, and compare those to mining income determined from historical difficulty data.

I would agree that mining can be promising; however, the operative statement is "if it's still profitable." Many long time miners have tried their hands in trading because the saturation of mine-able coins has decreased greatly, not to mention that the capital you need like electricity, good PC specs, etc. are just as expensive before you can formally mine. On the other hand, trading may be a good way to boost your profit, if you have lots of extra coins to invest. It also has its risks. It actually depends on your gut and your experience.

[diouf67]

I don't think you will ever find such a study but it is not too hard to figure out, mining generates bitcoin whereas holding simply grows the value of your bitcoin, therefore if you mine and hold you will always generate more than if you just hold.

[jatin729]

now a days bitcoin mining is less profitable because difficulty will increase with increase in price,
buying and holding will be the best option for us, because i see so many people get profit from bitcoin trading.
TBH mining needs  maintenance expenses and electricity expenses also. but in holding we won't have to worry about other expenses instead internet expense.

[xhomerx10]

I don't think you will ever find such a study but it is not too hard to figure out, mining generates bitcoin whereas holding simply grows the value of your bitcoin, therefore if you mine and hold you will always generate more than if you just hold.

 Well if you read the OP, the comparison to be made is mining vs buying and holding not simply buying one time. 
Mining?  Yes, when the price fell for nearly a year from late 2013 to late 2014 it might have been an option but it's no longer a good idea when the price of Bitcoin quadruples in 6 months time.  It's much better to buy and hold in the current situation.  Sorry I don't have time to post all the maths.

[DrGuns4Hands]

Buying and holding is more profitable and advisable than mining. nowadays mining rig is so expensive so much better if you buy a coins instead of generating bitcoin since the price of GPU's today is so expensive because it is in demand today. and Mining is not profitable if you only have one mining rig you must have a lot of mining rig and also low cost electricity.

[odolvlobo]

I don't think you will ever find such a study but it is not too hard to figure out, mining generates bitcoin whereas holding simply grows the value of your bitcoin, therefore if you mine and hold you will always generate more than if you just hold.

Not if mining costs more bitcoins than it generates.

[The Alchemlst]

I constantly hear people arguing for mining as opposed to buying and holding or vice versa as better investment strategy - is there any reliable source of information that compares the two over an extended period of time?

I think Bitcoin mining and holding/buying will both earn almost the same profit in the end but have different pacing and initial investments. I haven't came across any article comparing the too but based on the factors to start either of the two I think I would prefer to buying/holding than mining because it is costly to start and maintain itself.

[digger888]

I don't think you will ever find such a study but it is not too hard to figure out, mining generates bitcoin whereas holding simply grows the value of your bitcoin, therefore if you mine and hold you will always generate more than if you just hold.

Not if mining costs more bitcoins than it generates.

IMHO, I believe that it depends on your personality, technical aptitude, and other environmental factors.

- personality: if you don't want to spend any efforts and prefer not to get your hands dirty, then buy and hold is better.

- technical aptitude: if you are not good with a computer, and not very good at innovation, then mining is not for you.

- environmental factors: access to cheap electricity, cold environment where you live, able to import equipment directly from Bitmain, access to reasonable price GPUs, and etc, then mining is for you.

The more efforts that you put into mining, there are more opportunities to maximize your profits with mining.