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

[beeph]

I'm one of the newbs who got a bunch of 6870s and have em running.. 3.6 gigahash installed, and im calling newegg monday to see what i can return unopened.  I may keep a small farm going just for shits and grins but at chicago power rates of 15 kWh and 20% difficulty increases every 14 days I will never recover my costs (not even close).

Extra equipment i bought:

700$ electrician work, (individual circuits, breaking out circuits near a window for good airflow, etc)
100$ various fans
50$ tables/benches
80$ 16 port switch
10000$ computer equipment (6870 radeons, motherboards, semprons, 1000w power supplies, PCIe risers, ethernet cables etc)
40 hours work setting it up
(insurance, risk of fire/flood damage, massive heat generated, the 50 flies that are in my house because i opened a window near my set up to deal with heat)

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'

If anyone needs any of this equipment please make me an offer near newegg type prices, I will give advice on how to set it up, etc.  You can pay me paypal, bitcoin, cash, however.  I would like to move this stuff in bulk if possible, if you are planning on starting an operation or are a reseller, etc.  

I can help with running it, I have a about 3.5 gigahash mining right now rest is in boxes, unopened.  If you are in a lower cost state or mooching off a college campus you can probably run this profitably.

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[myrkul]

Take the long view. We haven't hit the actual peak yet. Mine and hold, if you can afford to.

If your electricity costs are too high, cut back mining until you can afford it.

It's going to hurt, in the short term, to eat that $10k of computer hardware, but in the long term, It will be worth it. In the meantime, you could, I donno.. cure cancer with folding@home or something.

[lemonginger]

if you wanted to go through the work, I bet you would actually make money if you bought better processors, installed them and then sold the rigs (with one graphics card each) as souped up gaming computers locally and then sold the extra graphics cards individually on ebay or bitcoin auction sites etc.

No comment on not doing enough due diligence that you wouldn't freak out a couple weeks after you invested >10k in a business though!

[SgtSpike]

Holy crap, you spend 11 grand and are only netting 3.6 ghash?

Still, if your electrical costs are $0.15/kwh, you should be profitable as long as coins don't dip below $4.  And then, increase that number proportional to however difficulty increases from here on out.  Seems a bit premature to call it now... but with deadlines for returning stuff approaching, I can see why you'd want to stop now.

[Chick]

Holy crap, you spend 11 grand and are only netting 3.6 ghash?

Still, if your electrical costs are $0.15/kwh, you should be profitable as long as coins don't dip below $4.  And then, increase that number proportional to however difficulty increases from here on out.  Seems a bit premature to call it now... but with deadlines for returning stuff approaching, I can see why you'd want to stop now.

3.6? Really? I've spent 1.8k and have a good 3 ghash power with 10 5830s.

[myrkul]

Holy crap, you spend 11 grand and are only netting 3.6 ghash?

Still, if your electrical costs are $0.15/kwh, you should be profitable as long as coins don't dip below $4.  And then, increase that number proportional to however difficulty increases from here on out.  Seems a bit premature to call it now... but with deadlines for returning stuff approaching, I can see why you'd want to stop now.

3.6? Really? I've spent 1.8k and have a good 3ghash power with 10 cards.

Doesn't have all the hardware running, most is still boxed. If he brought it all online, he'd have a lot more.

[beeph]

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)

1) some risers are getting here slow i bought from hk
2) my power supplies are missing cables, so buying those from amazon, getting here in a day
3) one power supply blew up, and a few mobos ran out of stock, and one was DOA.  Was missing a few CPU fans
4) only have 14/40 cards up running @ 250 ghash (havent figured out overclocking on ubuntu yet)

So this limited alot of what i could do because i had 6/7 key components, and waiting on bottlenecks.  they're arriving over the next few business days, but im not going to open any boxes due to return policies.  The price drop isnt so much what killed me as the difficulty.  The 55% pretty much skipped ahead 6 weeks in my schedle - assuming 20% increases over 14 days, in 8 more weeks i will not even be able to pay power to break even.

I have a partner in this so i have 6k@ risk but I dont want him to lose $$ either, I'd feel bad.  There's enough gamers/enthusiasts/IT techs/college dorm kids who either dont have to pay electricity, or dont care, to keep the network increasing in size as long as bitcoins are popular.  If bitcoins arent popular, then the value will go back very low, so I'm screwed either way.  This is more of a 'grass roots' thing and I was dumb to try this.

I'm going to end up keeping the 3.5 ghash i have online to recover what i can from the 'dead money', and return/sell whatever is unopened.  At this point i'm 'praying for a miracle' ( a big bitcoin price increase where somehow difficulty doesnt increase at the same time ).  But in my experience miracles are rare and just trying to cut my losses.
 

[skyhigh]

Return what you can on Monday. Mine with the rest until your electricity cost is almost what you making per day. Then stop and sell your rigs for 50% on CL/ebay. This way you will lose maybe $2k. Next catch the cash idea you have .. do the math twice then ask at least 3 other people who seem to understand what is going on before you buy a single piece of equipment.

If you can't even afford $2k loss and you did what you did, idiot isn't the right word for you.

[beeph]

I can 'afford' to flush 2000$ down the toilet, but I dont particularly like it.  Maybe somehow someone else can make this work.
Please see the title ... i was an idiot.. i got caught up in the gold rush.. and got greedy.  LOL.  No need to rub it in, not exactly feeling great right now.

[Chick]

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)

1) some risers are getting here slow i bought from hk
2) my power supplies are missing cables, so buying those from amazon, getting here in a day
3) one power supply blew up, and a few mobos ran out of stock, and one was DOA.  Was missing a few CPU fans
4) only have 14/40 cards up running @ 250 ghash (havent figured out overclocking on ubuntu yet)

So this limited alot of what i could do because i had 6/7 key components, and waiting on bottlenecks.  they're arriving over the next few business days, but im not going to open any boxes due to return policies.  The price drop isnt so much what killed me as the difficulty.  The 55% pretty much skipped ahead 6 weeks in my schedle - assuming 20% increases over 14 days, in 8 more weeks i will not even be able to pay power to break even.

I have a partner in this so i have 6k@ risk but I dont want him to lose $$ either, I'd feel bad.  There's enough gamers/enthusiasts/IT techs/college dorm kids who either dont have to pay electricity, or dont care, to keep the network increasing in size as long as bitcoins are popular.  If bitcoins arent popular, then the value will go back very low, so I'm screwed either way.  This is more of a 'grass roots' thing and I was dumb to try this.

I'm going to end up keeping the 3.5 ghash i have online to recover what i can from the 'dead money', and return/sell whatever is unopened.  At this point i'm 'praying for a miracle' ( a big bitcoin price increase where somehow difficulty doesnt increase at the same time ).  But in my experience miracles are rare and just trying to cut my losses.
  

On the bright side, you have around 2-3 months until Mining is totally unprofitable with electricity costs. You could try looking for a co-location data center.

[killer2021]

The electricity is what is destroying you. 15c/kwh is just way too much. Gotta love those greedy city public utilities.

Going forward the name of the game is going to be whoever has the lowest electricity and most efficient setup for converting that electricity into hashes. The person who has that setup will ALWAYS make money. Why? Because if that person isn't making money then no one else is! There will be people who will run at a loss but they'll eventually wise up and pull out.

When figuring to mine or not the first thing you should look at is the electricity cost. If you can't get less than 10c/kwh, definitely don't mine.

[skyhigh]

beeph, I'm not rubbing it in. I want you to have a reality check and maybe realize its better to go the SAFE WAY and potentially eat $2k loss vs doing something stupid which would cost you even more in the end. If you do everything right, you could get your loss down to a minimum.


killer2021, you are dead wrong in thinking people won't be mining and eating up electricity loss. There is still 14mill coins to be made. If you guys think the bitcoin project can survive and live, it won't be from people running 50 GH dedicated rigs, but it will be from a million of random Joe's running 300 MH who won't mind the extra $10 in electricity per month.

[Raulo]

Unless BTC rate crashes really hard, you are not going to lose money. You may not earn much at all above your costs but mining is still fairly profitable:
http://bitcoin.atspace.com/income.html
The good thing is that if the profitability drops, difficulty increase slows.

[horrorshow]

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.

[stellan0r]

The electricity is what is destroying you. 15c/kwh is just way too much. Gotta love those greedy city public utilities.

you guys must be kidding. we pay around 0.30 US-$ here for 1 kWh. and it's still profitable

[Lightspeed]

As someone who suffers from mental illness, don't let this get the best of you, if you are getting too stressed consider a psychologist. (probably overboard to recommend this but mental health is important )

[beeph]

The electricity is what is destroying you. 15c/kwh is just way too much. Gotta love those greedy city public utilities.

you guys must be kidding. we pay around 0.30 US-$ here for 1 kWh. and it's still profitable

Is there a calculator which will allow u to put reasonable difficulty increases in the formula?

[perfectchoice4u]

Send me a pm with your Skype address, maybe we can work something out. I'm starting mining, and just bought a bunch of equipment and intend on expanding.

I think the power is your main problem, you pay more 2x than i do at peak, my electricity on the west coast is 4-8c at peak

Thank the loving liberals

[skyhigh]

beeph, http://www.alloscomp.com/bitcoin/calculator.php

I think its reasonable to think difficulty will go up lets say 30% until electricity costs will eat up most of the profita, for now we are still far from that. What you need to calculate is the ratio between bitcoin price / difficulty for how long you are still making some profits.

[bcpokey]

Well now I feel bad for yelling at all the people who made those little spreadsheets and proclaimed doom on mining. Some people need to read those things I guess. I also feel bad for laughing a little bit while reading the OP (mostly the bit about flies).

So anywho. Yowza. 10 grand that's an ugly figure. It sounds like you built somewhat inefficiently, but better than most (1.2Mhash/$?) are doing these days (6990s will be < 1Mhash/$, sigh). It's bad to make rash decisions though, as evidenced by where you are now.

Stop, breathe deeply and calmly consider your situation. How much will you eat in terms of return restocking fees and whatnot? How much of your sunk costs are you never going to recuperate unless you mine? As others suggested, can you repurpose some of the things you cannot get a good return on?

I personally wouldn't say mining is dead yet, you might still eek out some returns. I pay 40¢ (yes FORTY) / kWh, and while its true that I built super efficiently and got in months ago, that's still a heavy cost, and I'm still way in the black. And if you can make a modest return (say 50% ROI) and then drop the hardware to cover the rest in a couple months that's not something to panic about just yet. Might even come out ahead.

So stop and calmly analyze the situation and your options. That's my advice.