Why do I keep hearing mining is unprofitable?

[itayl2]

I'm very new to this game, so excuse my ignorance.

Say I purchase 312GH/s (3 rigs * 104GH/s) for around 13,500 USD. (sounds a reasonable price?)
According to what I know, 1800W consumption sounds about right for these rigs.

Obviously I join a pool before beginning to mine.

If I plug in the data in here: http://www.bitcoinx.com/profit/ with a time frame of 3 months, which I realize is a bit simplistic, but I get about 8390 USD net profits.

I realize difficulty may spike due to next gen ASICs and the fact that I would get the rigs only in Jan-Feb 2014, but what is the missing factor here that would convert profits of 8390 USD to some kind of a negative number?

What I am missing here?

90% of the posts here mention mining as no longer profitable. I'm wondering whether I'm missing something, or this is just a strategy?

Please help!

[Bitships]

13,500 USD are round-about 11.7 Bitcoins (today). With 312 GH/s you will never reach 11.7 Bitcoins, not even in two years.

[Gemminyc]

Say I purchase 312GH/s (3 rigs * 104GH/s) for around 13,500 USD. (sounds a reasonable price?)
According to what I know, 1800W consumption sounds about right for these rigs.

And when you start mining ? Time is everything.

[Martijnvdc]

Say I purchase 312GH/s (3 rigs * 104GH/s) for around 13,500 USD. (sounds a reasonable price?)
According to what I know, 1800W consumption sounds about right for these rigs.

And when you start mining ? Time is everything.

He said Jan/Feb 2014.
Which is too late, ofcourse.

[itayl2]

My question is why

What is affecting the reality of bitoin mining and is not taken into account in the calculator I referenced?

[Damnsammit]

It's not always unprofitable, but most people just look up the profit per day based on the hashrate and then calculate OnlineCalculatorSaidX$perDay*365 = MASSIVE PROFIT

But once you start factoring in electricity expected change in difficulty BEFORE you can actually start mining AND AFTER you start mining, then it becomes less profitable or unprofitable.

If you want profit right now, go get a GPU rig and mine Litecoins. They are at $39.71 a pop and you can get a decent chunk of them with even a 1-2MH/s machine.

[Bitships]

My question is why

What is affecting the reality of bitoin mining and is not taken into account in the calculator I referenced?

Try: http://btcinvest.net/de/bitcoin-mining-profit-calculator.php

You could easily get profit with minig if the difficulty doesn't increase. Bitcoinx.com does not have a option to make a monthly difficult grow. Your 3 months based on a difficult of 707,408,283.

[ChessWhiz]

It has to do with the trajectory of the difficulty chart. Higher difficulty means fewer BTC mined by the same hash rate. http://blockchain.info/charts/difficulty

[pontiacg5]

People that say it is unprofitable to mine have either not done enough reading, or they just want to convince weak hands to stay out of the mining game. Plenty of ways to make money mining right now.

[morrisford]

The projected difficulty for late February 2014 is somewhere around 3 billion on the low side and something like 5 - 6 billion on the high side. 312 Ghs at that difficulty and the current exchange rate for bitcoins would yield about $425 per week with the yield dropping about 15 - 20 % every 12 days or so. The yield for 6 billion difficulty would be about $200 per week. That weekly yield would give about $20,000 or $10,000 earnings WITHOUT any further increase in difficulty which will never happen.

Morris

[cp1]

Getting it in "about Jan - Feb" is what kills you.  And the difficulty increases every 2 weeks.  Check out http://mining.thegenesisblock.com/a/14e963282c

What miner are you buying?  Are you sure you'll even get it in Jan/Feb?

[itayl2]

The projected difficulty for late February 2014 is somewhere around 3 billion on the low side and something like 5 - 6 billion on the high side. 312 Ghs at that difficulty and the current exchange rate for bitcoins would yield about $425 per week with the yield dropping about 15 - 20 % every 12 days or so. The yield for 6 billion difficulty would be about $200 per week. That weekly yield would give about $20,000 or $10,000 earnings WITHOUT any further increase in difficulty which will never happen.

Morris

What causes the yield to drop about 15-20% each 12 days? The difficulty increase?

[morrisford]

Yes. The big factor not addressed in most of the profitability calculators is the difference between mining now and 3 months from now. An eruptor blade (at 10 Ghs) that will pay for itself in about 2 months right now will return just a few dollars a week starting in March. Also, The huge volume of new terahash coming online in the next few months is most likely to skew the difficulty big time.

Morris

[Damnsammit]

People that say it is unprofitable to mine have either not done enough reading, or they just want to convince weak hands to stay out of the mining game. Plenty of ways to make money mining right now.

Or it's because they are still living in a few months ago when Block Eruptors were 1BTC each.

Some of the newer ASICs look priced to profit.  That ASIC Miner Cube looks to be a great option right now, for example, but I'd rather just hold onto my coins.  

[PenAndPaper]

Use the calculator of thegenesisblock and then see how many coins your miners will ever mine. Then compare than number with the bitcoins that you could 've bought instead of the miner. Then regret a little  

[ajax3592]

The projected difficulty for late February 2014 is somewhere around 3 billion on the low side and something like 5 - 6 billion on the high side. 312 Ghs at that difficulty and the current exchange rate for bitcoins would yield about $425 per week with the yield dropping about 15 - 20 % every 12 days or so. The yield for 6 billion difficulty would be about $200 per week. That weekly yield would give about $20,000 or $10,000 earnings WITHOUT any further increase in difficulty which will never happen.

Morris

What causes the yield to drop about 15-20% each 12 days? The difficulty increase?

Yes it increases as time passes by and more coins are in the market.
Honestly, Bitcoin mining is not profitable anymore. Any coin's mining returns good ROI in its initial stages.

[cryptonic]

Well, it will become unprofitable soon. Unless you have cheap or free energy, because the difficulty will increase when the price increases. And there is a delay between the two.

[itayl2]

The projected difficulty for late February 2014 is somewhere around 3 billion on the low side and something like 5 - 6 billion on the high side. 312 Ghs at that difficulty and the current exchange rate for bitcoins would yield about $425 per week with the yield dropping about 15 - 20 % every 12 days or so. The yield for 6 billion difficulty would be about $200 per week. That weekly yield would give about $20,000 or $10,000 earnings WITHOUT any further increase in difficulty which will never happen.

Morris

What causes the yield to drop about 15-20% each 12 days? The difficulty increase?

Yes it increases as time passes by and more coins are in the market.
Honestly, Bitcoin mining is not profitable anymore. Any coin's mining returns good ROI in its initial stages.

I finally get it

Thanks everyone.

So how do people intend to stay in the game? I mean, what kind of a rig would give enough GH/s/J and not cost too much to eat into the revenues?

[Damnsammit]

Honestly, Bitcoin mining is not profitable anymore. Any coin's mining returns good ROI in its initial stages.

Except that it is...

Buy a Cube, run it for 2 months, sell the Cube.  You will end up with more BTC than you started with.  I guarantee it.

[morrisford]

>>So how do people intend to stay in the game? I mean, what kind of a rig would give enough GH/s/J and
>>not cost too much to eat into the revenues?

That is a really hard question. For me it is a keep watching and calculating what the yields would be for the various combinations of mining methods. At the moment some of the group buy/shared plans sound fairly good but the difficulty changes can cause big aberrations because the shared plans all start in March or later.

Morris