A case study in entry-level mining

[razorfishsl]

Current profitability is 60 mBTC per day. I was hoping for 70,

It is already a failure...
If you were smart you would have re-sold the  BE's on Ebay, because they are not likely to mine with profit....

Profitability is something that is above and beyond your current expenses for a given endeavor.

If I spend $1000USD on setting up a business then find $10USD it is not  profitability...
It is an offset against costs.

Your costings are WAY off and do not give a true depiction of the situation.
(electrical/cooling costs)

This is why so many businesses fail in the first year....



Second point...

Neither works. The eBay one only outputs 500mA @ 5V

The hub is working 100% correctly, the USB standard CLEARLY defines that 500MA is the maximum current a device can draw.

The fact that this USB miner draws more, is a testament to the poor design in using the USB port beyond its spec.

[1715067372]

1715067372

[1715067372]

1715067372

[1715067372]

1715067372

[1715067372]

1715067372

[1715067372]

1715067372

[1715067372]

1715067372

[LogicalUnit]

Current profitability is 60 mBTC per day. I was hoping for 70,

It is already a failure...
If you were smart you would have re-sold the  BE's on Ebay, because they are not likely to mine with profit....

The rig is operating at 85% of what I estimated. With proper cooling this will increase, further improving the accuracy of my prediction.

Profitability is something that is above and beyond your current expenses for a given endeavor.

If I spend $1000USD on setting up a business then find $10USD it is not  profitability...
It is an offset against costs.

You are technically correct on this one point of business. I will rephrase my statement: revenue is 60 mBTC per day

Your costings are WAY off and do not give a true depiction of the situation.
(electrical/cooling costs)

The Raspberry Pi model B draws 700mA @ 5V. This is 3.5W of power. The 5 USB Eruptors each draw 500mA @ 5V. This is 12.5W of power. The USB fan will draw another 2.5W. This is 18.5W in total. This is slightly more than a modern light globe. My costings are accurate.

This is why so many businesses fail in the first year....



Second point...

Neither works. The eBay one only outputs 500mA @ 5V

The hub is working 100% correctly, the USB standard CLEARLY defines that 500MA is the maximum current a device can draw.

The fact that this USB miner draws more, is a testament to the poor design in using the USB port beyond its spec.

The cheapo ebay hub can draw 500mA for all seven USB ports. This is enough current to power one Block Eruptor, which does conform to the USB standard. The D-Link hub I am using can deliver 3A, enough to power six Block Eruptors.

[razorfishsl]

Congrats.....
Now all the info is clearly explained.... and nicely done too.

[LogicalUnit]

Big problem this morning: cgminer reported all 5 Block Eruptors hashing at 250MH/s, amd all five BEs had their green LED illuminated. This could be a heat issue; I'm not sure. I've unplugged everything for now to let it cool.

[Pt0x]

Big problem this morning: cgminer reported all 5 Block Eruptors hashing at 250MH/s, amd all five BEs had their green LED illuminated. This could be a heat issue; I'm not sure. I've unplugged everything for now to let it cool.

Ups, lets hope it's nothing big.

[bcpokey]

Just for fun and giggles, do you have a kill-a-watt running for all those badboys? and if not, get one

[ScaryHash]

Very cool !

I didn't go with the block erupters (a lot of them), because the ROI on them is not good.

I just bought one for the hell of it, just to play with it. We will see how it works out.

[LogicalUnit]

Just for fun and giggles, do you have a kill-a-watt running for all those badboys? and if not, get one

Yep, I've ordered one! 

I can tell you now that the rig will draw a max of 20 Watts. 5V x 3A = 15W for the USB hub, plus 5V x 1A = 5W for the USB power supply for the RPi.

[LogicalUnit]

Big problem this morning: cgminer reported all 5 Block Eruptors hashing at 250MH/s, amd all five BEs had their green LED illuminated. This could be a heat issue; I'm not sure. I've unplugged everything for now to let it cool.

Ups, lets hope it's mothing big.

The rig is running normally now, but I'm worried this instability issue might happen again. I don't want any downtime. NEED USB FAN!!

[LogicalUnit]

The USB fan is here, but I couldn't fit it into the USB hub along with the Eruptors. Instead, I used a second USB power supply, and it's working great. Very quiet. However, my hashrate fell again. You can see two dips in the weekly graph:



Hopefully the fan will stop this.

[STT]

This will make an interesting read 5-10 years from now.

It might appear prehistoric just by year end.   How long will it take this rig to earn back 13 BTC.    Depends where prices go but it could good or bad depending where btc price goes.

Because these miners use less electricity its possible BTC price in dollars falls even though the hardware cost is higher short term

[LogicalUnit]

This will make an interesting read 5-10 years from now.

It might appear prehistoric just by year end.   How long will it take this rig to earn back 13 BTC.    Depends where prices go but it could good or bad depending where btc price goes.

Because these miners use less electricity its possible BTC price in dollars falls even though the hardware cost is higher short term

You are absolutely correct that this project will succeed or fail depending on the price of BTC.

I've come to realise that I underestimated the challenge posed by rising difficulty. Also, the price of the hardware was rather high. However, BTC interest rates are also high -- around 25% per annum -- so I can offset these losses by purchasing Certificates of Deposit. The plan is to keep the currency in Bitcoins, NOT cash out to fiat.

[STT]

25% wow, where would that be.    Ive never heard of virtual savings, we are far down the rabbit hole now.    If this is correct and other financial innovations, there is hope yet

[LogicalUnit]

25% wow, where would that be.    Ive never heard of virtual savings, we are far down the rabbit hole now.    If this is correct and other financial innovations, there is hope yet

https://www.coinlenders.com/interest

[Kake]

Any idea how much electricity cost the setup is per day/month?

[LogicalUnit]

Any idea how much electricity cost the setup is per day/month?

My energy provider is ActewAGL, and my bill has 2 components: a flat fee of AUD$0.605 per day, plus AUD$0.179 per kWh. The rig draws 20W at most. So to run for thirty days is 30 days * 24 hours * 0.020kW * AUD$0.179 = AUD$2.58

[bcpokey]

25% wow, where would that be.    Ive never heard of virtual savings, we are far down the rabbit hole now.    If this is correct and other financial innovations, there is hope yet

https://www.coinlenders.com/interest

Dawg, I tried to warn you before about the ASICs, but you had already ordered them, so I didn't really want to get into it too much, but seriously, BE-WARE of this coinlenders nonsense. Anyone offering 25% APR is suspect.

Anyone whose website was registered March-22-2013, set to expire March-22-2014 is more suspect.
Any "business" that is run by "whoisguard" is suspect (imho).

Put all those together and you get... super suspicious.

Maybe you've done your due dilligence, I dunno, but I would really hate for this to all end as the tragic story of a guy who got scammed from A-to-Z by the bitcoin world.

[LogicalUnit]

25% wow, where would that be.    Ive never heard of virtual savings, we are far down the rabbit hole now.    If this is correct and other financial innovations, there is hope yet

https://www.coinlenders.com/interest

Dawg, I tried to warn you before about the ASICs, but you had already ordered them, so I didn't really want to get into it too much, but seriously, BE-WARE of this coinlenders nonsense. Anyone offering 25% APR is suspect.

Anyone whose website was registered March-22-2013, set to expire March-22-2014 is more suspect.
Any "business" that is run by "whoisguard" is suspect (imho).

Put all those together and you get... super suspicious.

Maybe you've done your due dilligence, I dunno, but I would really hate for this to all end as the tragic story of a guy who got scammed from A-to-Z by the bitcoin world.

I appreciate your candor, and will take your advice. Yes, I got swept up in the whole "cryptocurrency is super-cool" bubble, and didn't fully understand everything before diving in. Rising difficulty is killing me here, and the ASICs were overpriced.

What do you suggest I do? Keep mining and hope the price of BTC will go up, or sell the damn things on eBay before they becomes worthless?

[🏰 TradeFortress 🏰]

25% wow, where would that be.    Ive never heard of virtual savings, we are far down the rabbit hole now.    If this is correct and other financial innovations, there is hope yet

https://www.coinlenders.com/interest

Dawg, I tried to warn you before about the ASICs, but you had already ordered them, so I didn't really want to get into it too much, but seriously, BE-WARE of this coinlenders nonsense. Anyone offering 25% APR is suspect.

Anyone whose website was registered March-22-2013, set to expire March-22-2014 is more suspect.
Any "business" that is run by "whoisguard" is suspect (imho).

Put all those together and you get... super suspicious.

Maybe you've done your due dilligence, I dunno, but I would really hate for this to all end as the tragic story of a guy who got scammed from A-to-Z by the bitcoin world.

I run coinlenders.

The domain is only for 1 year because it was one of the many names I was considering (I snapped up half a dozen domains, all 1 year).

25% APR is not suspect - it is possible to get this return. We lend at multiples of the rates we're offering.

[bcpokey]

I'm not saying coinlenders is a scam, so don't misinterpret me that way. It certainly could be possible for you to be running a legitimate and thriving business, I simply said beware. Bitcoin is an irreversible transaction, and so deposits are a huge leap of faith. Akin to sending someone a bunch of cash through Western Union. If you don't imagine yourself being comfortable doing that, why would you do it with bitcoin?

That said, no risk, no reward, perhaps it's a good investment. Just make sure to do your homework, protect yourself as much as you can, and be prepared for both sides of the risk-reward continuum.

As to what you should do OP, I would not presume to tell you what to do, but if you think that you might not break-even on the units, I would certainly find something like http://www.ebay.com/itm/BitCoin-ASICMINER-USB-BLOCK-ERUPTER-333MHash-ASIC-Black-IN-HAND-READY-TO-SHIP-/300921840079?pt=LH_DefaultDomain_0&hash=item461056e1cf an appealing alternative.

As I said in my original post though, I personally would ride the hobbyist enjoyment train. If you enjoy tinkering and displaying and toying with the hardware, that's great, and if you take a small loss, it's not the end of the world.