I think the overall attitude about mining ROI is predicated on a lot of assumptions that aren't necessarily valid.
There are many reasons to want to hold Bitcoin. If the goal is short-term fiat gains, then yes, mining is completely mentally retarded.
The endgame of Bitcoin is not something like buying at $180 and dumping at $350. Frankly that's chump change.
Let's get real about how this sort of thing could actually play out in real life, assuming that we're not strictly talking about pump-and-dump speculators. If a person's goals fall into that category, Bitcoin is the same as oil future is the same as pork bellies is the same as frozen concentrated orange juice, it's just a number on a ticker that you buy low and sell high for marginal fiat gains.
If the goal is to hold and grow a position predicated on believing in the value of this technology and not as a shady get-rich-quick scheme, mining makes perfect sense. It would be nice if hardware prices dropped for sure, but it still makes sense.
Imagine hypothetically you wanted to build a very modest position by mining for several months on some 5 GH/s Jalapeno unit or something of that power that you acquired today. Suppose you paid the full retail price of like $275 or whatever that unit is supposed to be, and after factoring in power consumption by the time you decided to take that hashing offline in several months, you accumulated something like 0.3 BTC.
Now say instead you bought a position outright on an exchange at ~$350, immediately holding something like 0.78 BTC.
Yes, of course, if your concern is rapidly cashing in for fiat, the miner is all manner of epithets: greedy, delusional, idiotic, incompetent at math, just construct your litany of disdainful remarks, all would apply.
But consider if your reason for getting into BTC is to be involved in the long-term potential, imagine several years down the line BTC hits the $100,000+ mark. Are we really going to cry about the difference between making $30,000 versus $78,000 fiat off of a $275 investment? Both of those long-term returns are completely outside the pale of anything except a revolutionary emergent technology. Furthermore, in the long-term scenario, how do we know that these two individuals know to cash out at exactly the same time? Wouldn't it be plausible to imagine the 0.78 BTC holder might be tempted to cash in at say $50,000 or even just $5000 because their decision-making process reveals a desire for fiat?
If the endgame for all of this is to build a position as a store of value in an emerging revolutionary technology, then these differences are nonsensical, because the person with that mindset is really only going to cash out to fiat to support living expenses or re-investment or whatever, because the ideal scenario for Bitcoin involves that person wanting Bitcoins.
If Bitcoin really takes off as far as say what Forex market share estimations would indicate if it hit critical mass in just that market, why should some aggressive Bitcoin holder really care if their holdings end up being worth say $30 million versus $50 million or whatever? Are we financing space programs here?
I'm really on board with what you're putting down here. Yes we have seen time and time again that simply buying the coins at the time the miner was purchased would result in higher BTC gains, I guess, usually.
But.
(1) This economy is very psychological. Do buyers of flat, large amounts of BTC hold? DO THEY? Probably not as often as the slowly trickling miner. There is something about the steady, relaxing growth of the mining income that keeps you from falling victim to speculative sell offs.
(2) More importantly, I have done both, and admittedly have had higher gains off buying. But nothing gave my friends more of a jolt that "holy shit, bitcoin is insanely cool, efficient, omg I want it" than a money printing machine. They thought this was fabulous. The excitement generated made me profits.
(3) When you mine, you learn. Now I offer consulting to people who want to mine. It's nice.
(4) I have been successful as an investor, but I owe this completely to my strategy of "convert USD to BTC on a schedule - ignore the fucking price." It has worked, obviously. I sold bitcoins on an exchange ONCE and regretted it right away.
(5) Become a well rounded bitcoiner. Mine a bit. Just do it. Because we need well rounded coin experts of the future. And we need them in pretty good numbers. We don't want a small collection of people who understand, and a vast majority who knows nothing.
I believe so strongly in (5) that when I sell on local bitcoins, I give buyers hours of my time just to tell them GET THE HELL OFF THIS ONLINE WALLET. Most buyers show up with no fucking idea how to safely store bitcoin, and are handing me a thousand dollars. I owe my knowledge of coin to all my experience, including mining, and it makes me valueable - it rubs off on others, and is all around great.
But fuck yes. These ASIC prices need to fall. And they will, really they will. I really hope the eventuality is cheap .68 USD cent asics that texas instruments sells so basically everyone has got them. I think that is what must happen ... ASICS are not a secret, and the several GIANTS of the asic industry have not even turned their heads to bitcoin yet.
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