Please bail me out - I'm an idiot bought mining gear at the peak

[Gameover]

Your statement reads to me as confusing. If the OP had bought in @ $30 and watched the coins plumet to $15 he'd have $5000 worth of coins now. Bitcoin prices can go... anywhere. Back to 30, up to 10000, or down below 1. OP doesn't sound like the patient optimistic type with $10,000 he can have lying around without regards for months or whatever potential time it would take to get back above $30.

Perhaps you bought in around march? In what way would you have made triple? In march prices were about $1 per coin? Let's say that. And prices were $30 per coin around Jun7th right? Difficulty was around 70,000 I believe.

So lets say you bought a mining rig on whenever and got it running march 7th, and you bought some coins on whenever around march 7th as prices were pretty flat until around april.

You could build mining rigs for about 1.7Mhash/$ pretty easily back in march, so let's compare a $10,000 buy:

$10,000 -- 10,000 coins vs 15GHash (bein generous with overheads other than rigs to compare to OPs costs), and use 15¢/kWh like OP, $26.64/day costs.

March 7th: Miner 0BTC $10000Debt , Buyer 10,000BTC $10000 Debt.

2 difficulty changes, both minor, avging to 80k difficulty generates 5,733 bitcoins in a month

April 7th: Miner 5,733BTC $10799Debt, Buyer10,000BTC $10000 Debt.

2 difficulty changes, both reasonable, averaging 90k difficulty generates 5,096 bitcoins in a month

May 7th: Miner 10,829BTC $11598Debt, Buyer10,000BTC $10000 Debt.

Here is where things got crazy, 4 difficulty changes, ending at 400k difficulty. for ease of my lazy brain will calculate whole month at 300k to be generous again.  Generating 1528 coins in a month.

June 7th: Miner 12357BTC $12397Debt, Buyer10,000BTC $10000Debt

If the buyer cashes out on June 7th smartly surmising the $30 bubble line, he is still $70,000 behind the miner. If you assume the miner cashed out to cover his costs each month the miner still has 11292 coins on june 7th, putting him $40,000 ahead of the buyer. This is a far cry from making 1/3rd as much. Not to mention even at todays difficulty rate a 15GHash machine produces 125BTC/wk

Your scenario is only true if you assume a miner must cash out immediately the moment he has generated coin all the time. Which doesn't make sense. If you have $ you can just let sit in the market, why couldn't you let your $ sit in easily resalable machines? If you were so finnicky about money that you need to see it recovered INSTANTLY would you really have been able to see bitcoin prices surge up, then make huge drops and not sell off? In the optimum scenario of a terrified miner vs a super bold coin investor maybe your statement makes sense, but otherwise not.

Your scenario relies on perfect information and predicting the market, which no one has and no one can do.  "If the buyer cashes out on June 7th smartly surmising the $30 bubble line"  that is ludicrous, no one predicted $30 as the bubble line, and being smart has nothing to do with it, you cannot predict it.

Your scenario is only true if you assume a miner must cash out immediately the moment he has generated coin all the time. Which doesn't make sense. If you have $ you can just let sit in the market, why couldn't you let your $ sit in easily resalable machines?

If you are not cashing out immediately you are only trying to predict the market and that it will rise, which is not a given fact by any means.

[1714052031]

1714052031

[1714052031]

1714052031

[AngelusWebDesign]

Look, this guy really provided no proof he's even in this predicament and can't you all agree we've given him enough attention already?

Good point. I was wondering the same thing. We had some guy on here that was an obvious troll with a less sophisticated post -- but it was along the same lines.

OP -- if you could send pics of your rigs, unopened packages, etc. it would take you miles in establishing the credibility of your story. Many wonder if you're a troll -- I hate to say it, but myself included.

Doesn't have to be notarized, doesn't have to be taken by a professional photographer. You can't tell me you don't have a digital camera (if you did claim that, I wouldn't believe you!) 99.9% of people have cell phones these days. Most of those have a crude camera function.

Anyone with $10,000 to invest in PC hardware has a smartphone and at least one digital camera. They're like $50 on sale these days!

Sincerely,

Matthew

[skyhigh]

LOL are you guys for real?!  LOL why would he provide a proof of what he is saying??   If you think he is full of shit, just don't bother reading this thread. You keyboard commandos make me laugh.

[Synaptic]

LOL are you guys for real?!  LOL why would he provide a proof of what he is saying??   If you think he is full of shit, just don't bother reading this thread. You keyboard commandos make me laugh.

I'm just tired of seeing this stupid thread, so just thought I'd draw attention to all the attention this guy's been getting with little attention paid to his real intentions.

I call bullshit.

That is all.

[Chucksta]

If you really want to look at the long term, think of it this way. Eventually, an equilibrium will be reached between the people who can't maintain profitability and back out, or people discouraged with the btc values and back out, and those who stay in. Difficulty will level off, and eventually profitability will return with you at an advantage. This is in the long hall. Bitcoin has had one boom so far and I don't believe this is the end for it. I'm at about 1ghash/s and I'm satisfied to hold it out.

I totally agree with you. I keep on thinking this is over, and telling people on the forums not to bother building a new rig because there's no way they'll get their money back, but this BTC and NMC just will not give up. It just seems to keep on going and going.

The last week and a half was very nice, as I went to the NMC side, and was making a LOT of money per day (compared to BTC that is), but the good times ended with that, and we are now back to a more realistic level of income, on both NMC and BTC.

Today, again, I thought nuts to this, there's no way I'm making enough profit to warrant the hassle... I have to move the machines between rooms morning and night, but on running a test I found that my income was potentially $60 per day, with electricity @ $4 max per day, so definitely still worth mining

To the originator of this thread, you should just get down and mine with all that gear. You never know, you may do well.

[Karen Palen]

Chicago electricity:  15c/ kWh (this is my #1 cost and its MAJOR)

These days most electric utilities have "time of use" rates. Here in the Phoenix area we pay US$0.20/Kwh from 1pm-8pm weekdays and US$0.06/Kwh.

Just shutting down for 35 hours/week saves me a huge amount on the electric bill - even more because I have to pay HVAC to move the heat out into 100deg+!

Our house has a lot of things that shut down for peak hours - like our water heater (US$12/mo savings!)

A simple cron job should do the trick.

[Mageant]

You could sell or even rent out the computers as "mining rigs".

[rograz]

the total hashing output should be around 12 ghash, but it would be coming online in the next few days (and im sure for others too)

Can't say that I'm impressed, mining was always about building efficiently to break even and subsequently making a profit asap. I live in Sweden and have to deal with a lot higher hardware prices (around 20-30% over the US in a lot of cases) partially due to our stupidly high VAT and I have still managed to sit at around 800-900$/Ghash.

[beeph]

I was kind of in a panic earlier, based on what i've seen here I think the solution is to mine full blast until difficulty gets too high, then in a month or so go into real-time power pricing (thanks for this info) and shut down during peak hours, then finally just sell off all rigs to gamers/miners with better power situations than me in approx 2 months.

downsizing the operation from 10 rigs to 6 based on whats open and whats not, selling the rest soon probably... obviously pics will be included as that increases the sellability.

Hoping to break even

[myrkul]

I was kind of in a panic earlier, based on what i've seen here I think the solution is to mine full blast until difficulty gets too high, then in a month or so go into real-time power pricing and shut down during peak hours, then finally just sell off all rigs to gamers/miners with better power situations than me in approx 2 months.

Sounds like a good plan.

[Tim the Magician]

...
Another very large unknown is security, with no government to create laws and more importantly enforce them with regards to stealing bitcoins, it is just like the wild west, people are stealing them and then the victims are creating lynch mobs and trying to go after them, except with absolutely no recourse as there are no laws pertaining to bitcoins.  People tout the decentralized nature of bitcoin as its greatest attribute, that may be true, but is also its greatest weakness.

Come on now.  Are you suggesting that if you lived in say Texas and invested in Euro and someone stole your Euro that you would need to call up the police in Europe to deal with the crime?

Bitcoin are covered by the same laws which safeguard any other thing of value.  Although I do agree that the police are probably just as likely to recover stolen Bitcoin as they they would be for cash stolen from your home.  Most people use Bitcoin mainly as a sort of transfer currency.  They see something they want and then purchase enough bitcoins to purchase the item. Just treat it like cash. You don't carry huge amounts of cash into bad neighborhoods so don't keep your huge bitcoin wallet on a general use computer connected to the internet.

[CanaryInTheMine]

Hmmmm...

Why don't you switch to a different power supplier and cut your cost in half?

Can you check into that?

[imperi]

Find a river and construct an aqueduct. Run it through your house with a simple turbine. Problem solved.

[newguy05]

stop feeding the troll, noone is that stupid and 3.6 ghash does not cost $10k even if the graphic cards are made out of gold...

[Cluster2k]

Chicago electricity:  15c/ kWh (this is my #1 cost and its MAJOR)

Basically I'm in hell.. I'm praying for a miracle and all i see is MORE posts about people buying 6990's and other cards that are even LESS efficient than mine.. and I now realize that i'm basically up against a bunch of enthusiasts who really dont care about the economics of this at all, they just think its 'cool'

You're competing with five groups of people:

1: Those that pay 8c/Kwh and maybe even less.  They will continue to employ $1000 worth of hardware even if it makes $3 per day.
2: Those living in dorms and other places where electricity is not metered per user.  Hey, it's free!
3: Those living with their parents.  Free power!  Until dad comes along and rips them a new one for eating money alive.
4: Those that sneak PCs into work.  Priceless power.... as long as the boss doesn't find out.
5: Those that will mine bitcoin for higher ideals and on principle, even if it loses money.

[rograz]

stop feeding the troll, noone is that stupid and 3.6 ghash does not cost $10k even if the graphic cards are made out of gold...

maybe you should start reading past the first post, he clearly stated 3.6 is what he has up and running right now while in total he would end up at around 12.

[bcpokey]

Your statement reads to me as confusing. If the OP had bought in @ $30 and watched the coins plumet to $15 he'd have $5000 worth of coins now. Bitcoin prices can go... anywhere. Back to 30, up to 10000, or down below 1. OP doesn't sound like the patient optimistic type with $10,000 he can have lying around without regards for months or whatever potential time it would take to get back above $30.

Perhaps you bought in around march? In what way would you have made triple? In march prices were about $1 per coin? Let's say that. And prices were $30 per coin around Jun7th right? Difficulty was around 70,000 I believe.

So lets say you bought a mining rig on whenever and got it running march 7th, and you bought some coins on whenever around march 7th as prices were pretty flat until around april.

You could build mining rigs for about 1.7Mhash/$ pretty easily back in march, so let's compare a $10,000 buy:

$10,000 -- 10,000 coins vs 15GHash (bein generous with overheads other than rigs to compare to OPs costs), and use 15¢/kWh like OP, $26.64/day costs.

March 7th: Miner 0BTC $10000Debt , Buyer 10,000BTC $10000 Debt.

2 difficulty changes, both minor, avging to 80k difficulty generates 5,733 bitcoins in a month

April 7th: Miner 5,733BTC $10799Debt, Buyer10,000BTC $10000 Debt.

2 difficulty changes, both reasonable, averaging 90k difficulty generates 5,096 bitcoins in a month

May 7th: Miner 10,829BTC $11598Debt, Buyer10,000BTC $10000 Debt.

Here is where things got crazy, 4 difficulty changes, ending at 400k difficulty. for ease of my lazy brain will calculate whole month at 300k to be generous again.  Generating 1528 coins in a month.

June 7th: Miner 12357BTC $12397Debt, Buyer10,000BTC $10000Debt

If the buyer cashes out on June 7th smartly surmising the $30 bubble line, he is still $70,000 behind the miner. If you assume the miner cashed out to cover his costs each month the miner still has 11292 coins on june 7th, putting him $40,000 ahead of the buyer. This is a far cry from making 1/3rd as much. Not to mention even at todays difficulty rate a 15GHash machine produces 125BTC/wk

Your scenario is only true if you assume a miner must cash out immediately the moment he has generated coin all the time. Which doesn't make sense. If you have $ you can just let sit in the market, why couldn't you let your $ sit in easily resalable machines? If you were so finnicky about money that you need to see it recovered INSTANTLY would you really have been able to see bitcoin prices surge up, then make huge drops and not sell off? In the optimum scenario of a terrified miner vs a super bold coin investor maybe your statement makes sense, but otherwise not.

Your scenario relies on perfect information and predicting the market, which no one has and no one can do.  "If the buyer cashes out on June 7th smartly surmising the $30 bubble line"  that is ludicrous, no one predicted $30 as the bubble line, and being smart has nothing to do with it, you cannot predict it.

Your scenario is only true if you assume a miner must cash out immediately the moment he has generated coin all the time. Which doesn't make sense. If you have $ you can just let sit in the market, why couldn't you let your $ sit in easily resalable machines?

If you are not cashing out immediately you are only trying to predict the market and that it will rise, which is not a given fact by any means.

I don't think you read the conversation:

This scenario was a prompted response to someone who said "I would have made 3x as much money if I had bought coins instead of mining them! "

Implying because of the price rise buying coins would have been more profitable. That statement already has the idea of perfect knowledge built into it. I merely created a parity situation between mining and buying, nothing additional on top of that. How people ACTUALLY act when they buy coin or mine coin is entirely up to them of course.

[grod]

Seems to me a lot of your costs are over and above the actual mining hardware.  Even if you return the mining hardware you'll be out a bunch.

Me, I've shut down my miners.  Yeah, I'm small scale -- 561 Mhash/sec, cost me $209.  Not mining at this difficulty until I know if BTC will be > $4 or under .01 once the smoke from the MtGox fireball settles.  =)

[Karen Palen]

Seems to me a lot of your costs are over and above the actual mining hardware.  Even if you return the mining hardware you'll be out a bunch.

Me, I've shut down my miners.  Yeah, I'm small scale -- 561 Mhash/sec, cost me $209.  Not mining at this difficulty until I know if BTC will be > $4 or under .01 once the smoke from the MtGox fireball settles.  =)

I was at an earlier stage in my mining - about ready to order some hardware.

My plans too are on hold until I see just how this all plays out.

My concern is that we may have provided a whole new generation of script kiddies with superb password cracking machines!

This may yet be the main legacy of BitCoin.

[AngelusWebDesign]

This guy still hasn't given us the slightest shred of proof that he's real and not a troll.

A grainy phone pic, please. That's all we ask. Don't tell me you don't have a digital camera. You have $10,000 to spend on mining hardware. You can afford a $50 camera. And don't tell me you're such a luddite you don't have a cell phone.