Why am I still mining?

[Biontic]

OK...

Been mulling this over for a while and am curious to hear what folks think - It seems to me that there is no miners available at the moment that will actually make money if it is purchased with BTC. There will be a profit to be made if the purchases are done using Fiat, and the price of BTC increases (like we all hope it will).

So hypothetically, say I pay 6.15 BTC  for a 1TH/s miner, it will eventually make its cost back and a little more, but not much.

The numbers are as follows - from the lovely Coinplorer site https://coinplorer.com/Hardware/Simulate/532347f057ac900afc1d7224 

Outlay = 6.15 BTC ($3899) for miner + Import tax if applicable = total 4699
Operating costs = 650 approx for six months.
So total outlay = $ 5349 or 8.44357 BTC
In the first 6 months the miner will generate 8.931 BTC, less operating costs of 1.029 BTC = Profit of just 1.758 BTC using linear Difficulty jumps. (If you change it to exponential Diff jumps - nothing makes sense or profit)

Right now - I can buy 7.41869 BTC for $5349

Now I understand that there will possibly be some resale value on the miner - but not a lot on a 1TH box in September this year.

What am I missing here. If I use Fiat to purchase miners, it almost makes sense - but not if purchased with BTC.

[Abraxas601]

If you crunch the numbers and use logic you will never find a profitable solution.

Only reason I do it now is just as a hobby.

[ChuckBuck]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

[joeventura]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

[-ck]

If you are betting on buying in fiat and the value of BTC rising, you are always going to be better off just converting the fiat straight into BTC and be done with. But that's boring, and therein lies the answer as to why you're mining.

[ChuckBuck]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

Care to share your current setup? 

If you don't feel comfortable sharing in the forum, perhaps a PM so I can be better informed.   

[cloverme]

I find that it's better to purchase miners with fiat or buy with BTC when it is at a peak against the currency you use (USD/CAD/etc) so that you spend less BTC.

A lot of the profit calculators are wrong so don't put too much stock into them, they do a terrible job of trying to extrapolate pool payment results. You're probably looking at 2 months to get a return on your investment, less if BTC goes up. You also have to balance your investment strategy out and figure out why you want to invest and/or mine.  If you're looking to "mine to get rich" and mine $1M a month, expect to buy about 500TH/s, likely financed with a large debt to begin with as a high risk/high reward. Otherwise you might want to balance out mining with purchasing BTC as a speculative investment hoping that BTC will rise again by another large percentage.

[railzand]

snip

Now I understand that there will possibly be some resale value on the miner - but not a lot on a 1TH box in September this year.

What am I missing here. snip

sell miners after three months

[joeventura]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

Care to share your current setup? 

If you don't feel comfortable sharing in the forum, perhaps a PM so I can be better informed.   

Happy to share,
50 Gridseed miners, pointed at a site like scrptyguild.com or clevermining.com

Mines the most profitable scrypt and pays in BTC

[googlemaster1]

Honestly, we need more hobbyist miners in it for the mindset of "isn't this cool?" rather than "I can't wait to convert all this straight to fiat woohoo!"

People who buy miners and stay in the bitcoin economy help the bitcoin economy and community by creating velocity in the currency, and by not taking fiat out of the bitcoin ecosystem.  Large businesses that dump their earnings on exchanges constantly are hurting the economy more than helping, because they are creating downward pressure on the BTC price AND making it harder for the decentralized mining process to be incentivized.

So buy your miners, buy them smart, because everytime you do, you are making people who think its a good idea to open up massive mining farms think twice.  Having a centralized mining effort across 3-4x datacenters would make BTC that easier to get hurt from centralized failure, government intervention, or natural disasters.

So if you want BTC to succeed, every holder in their mother should be hosting at LEAST 1 miner.

So think of it that way ;P

[joeventura]

Honestly, we need more hobbyist miners in it for the mindset of "isn't this cool?" rather than "I can't wait to convert all this straight to fiat woohoo!"

People who buy miners and stay in the bitcoin economy help the bitcoin economy and community by creating velocity in the currency, and by not taking fiat out of the bitcoin ecosystem.  Large businesses that dump their earnings on exchanges constantly are hurting the economy more than helping, because they are creating downward pressure on the BTC price AND making it harder for the decentralized mining process to be incentivized.

So buy your miners, buy them smart, because everytime you do, you are making people who think its a good idea to open up massive mining farms think twice.  Having a centralized mining effort across 3-4x datacenters would make BTC that easier to get hurt from centralized failure, government intervention, or natural disasters.

So if you want BTC to succeed, every holder in their mother should be hosting at LEAST 1 miner.

So think of it that way ;P

You need to take an economics class.

Just like money, the economy does not blossom unless people spend it and move it around.

That is like saying, I have a tree and I am going to carve it into toothpicks, and store them here, and because I am making toothpicks they will get more valuable.

If no one knows of your toothpicks and they have no perceived value then no one will think they are worth more than you spent making them.
If you have every Bitcoin you ever mined and you havent spent any of them, you are hurting the Bitcoin economy, not helping it. (for example)

[ManeBjorn]

Mining is something you can always do or just buy BTC.
With the Antminer S2 shipping in just a couple weeks there are allot of options out there.
http://www.cryptocoinsnews.com/2014/03/14/bitmain-new-antminer-s2-1ths-miner/

It is always a personal decision on what you want to do.
Personally I do both.  I mine and buy BTC when I can afford it when the prices dip from time to time.

Good luck and Happy Mining.

[googlemaster1]

Honestly, we need more hobbyist miners in it for the mindset of "isn't this cool?" rather than "I can't wait to convert all this straight to fiat woohoo!"

People who buy miners and stay in the bitcoin economy help the bitcoin economy and community by creating velocity in the currency, and by not taking fiat out of the bitcoin ecosystem.  Large businesses that dump their earnings on exchanges constantly are hurting the economy more than helping, because they are creating downward pressure on the BTC price AND making it harder for the decentralized mining process to be incentivized.

So buy your miners, buy them smart, because everytime you do, you are making people who think its a good idea to open up massive mining farms think twice.  Having a centralized mining effort across 3-4x datacenters would make BTC that easier to get hurt from centralized failure, government intervention, or natural disasters.

So if you want BTC to succeed, every holder in their mother should be hosting at LEAST 1 miner.

So think of it that way ;P

You need to take an economics class.

Just like money, the economy does not blossom unless people spend it and move it around.

That is like saying, I have a tree and I am going to carve it into toothpicks, and store them here, and because I am making toothpicks they will get more valuable.

If no one knows of your toothpicks and they have no perceived value then no one will think they are worth more than you spent making them.
If you have every Bitcoin you ever mined and you havent spent any of them, you are hurting the Bitcoin economy, not helping it. (for example)

I think you didn't read this part of my post @joeventura

"People who buy miners and stay in the bitcoin economy help the bitcoin economy and community by creating velocity in the currency, and by not taking fiat out of the bitcoin ecosystem."

Let me know if there is still anything I need to clarify for you...

[daddyfatsax]

If you are betting on buying in fiat and the value of BTC rising, you are always going to be better off just converting the fiat straight into BTC and be done with. But that's boring, and therein lies the answer as to why you're mining.

It is just like the stock market. People hope for a few % gain a year in a stock or CD. That is boring. I know the price of BTC is going to go up, and it can change +/- 30% a day. At least mining I have a say in my returns, not some asshole in a suit.

[kendog77]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

Care to share your current setup?  

If you don't feel comfortable sharing in the forum, perhaps a PM so I can be better informed.  

Happy to share,
50 Gridseed miners, pointed at a site like scrptyguild.com or clevermining.com

Mines the most profitable scrypt and pays in BTC

I could not disagree more with Joe's advice. I ran the numbers over and over again on the gridseed miners, and could not make the numbers work at all. All my calculations pointed to a 9-12 month ROI, and that doesn't even take into account the fact that scrypt coin difficulty is going to explode now that scrypt ASICs are here.

Personally, I think spending 10k on Antminers right now will ROI much faster than blowing it on scrypt ASICs, which are currently VERY OVERPRICED in my honest opinion.

Different strokes for different folks.

[joeventura]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

Care to share your current setup?  

If you don't feel comfortable sharing in the forum, perhaps a PM so I can be better informed.  

Happy to share,
50 Gridseed miners, pointed at a site like scrptyguild.com or clevermining.com

Mines the most profitable scrypt and pays in BTC

I could not disagree more with Joe's advice. I ran the numbers over and over again on the gridseed miners, and could not make the numbers work at all. All my calculations pointed to a 9-12 month ROI, and that doesn't even take into account the fact that scrypt coin difficulty is going to explode now that scrypt ASICs are here.

Personally, I think spending 10k on Antminers right now will ROI much faster than blowing it on scrypt ASICs, which are currently VERY OVERPRICED in my honest opinion.

Different strokes for different folks.

I'd like to see your work.

I can buy 1 Mh of Gridseed mining for $630

[seriouscoin]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

Care to share your current setup?  

If you don't feel comfortable sharing in the forum, perhaps a PM so I can be better informed.  

Happy to share,
50 Gridseed miners, pointed at a site like scrptyguild.com or clevermining.com

Mines the most profitable scrypt and pays in BTC

I could not disagree more with Joe's advice. I ran the numbers over and over again on the gridseed miners, and could not make the numbers work at all. All my calculations pointed to a 9-12 month ROI, and that doesn't even take into account the fact that scrypt coin difficulty is going to explode now that scrypt ASICs are here.

Personally, I think spending 10k on Antminers right now will ROI much faster than blowing it on scrypt ASICs, which are currently VERY OVERPRICED in my honest opinion.

Different strokes for different folks.

I'd like to see your work.

I can buy 1 Mh of Gridseed mining for $630

Which makes $3.7 /day (or 0.215 LTC/day) 

Yeah.... sound like you need to do your math

[joeventura]

Well let me refer you here:

http://clevermining.com/

Per Mh you earn 0.00693 and 0.00930 per day.

Let's say for rounding purposes that's 0.008 BTC per day

Now you buy 50 Gridseeds which gives you 17Mh multiply that by 0.008 BTC a day
which is 0.136 BTC a day which is $85 a day (The upper average is $100 a day)

So my math says the $10k I spent on the Miners break even in 100-150 days.

If I have figured this wrong please point out the flaws in my math.

[kendog77]

This is a very good point.  Right now, mining is a losing proposition unless you have free or cheap electricity and/or data center hosting.  The difficulty jumps definitely don't help the steep price point of entry for these high end miners.

It's not even a race to ROI anymore.  It's a race to come close to even - electrical costs, then sell the miner while it's still in demand.  Only on the resale of the equipment would you maybe see some profit.

Like others have been saying, if you don't have a mining operation like the $8 million dollar a month miner(MBP?) in Washington, then mining is an expensive hobby.

All not true.

What is I told you, you could spend $10k on miners, that would produce BTC0.15 each day ($100), use less than 500w of electricity, produce zero heat, zero noise and you would be guaranteed ROI in no more than 120 days.

And this scales so if you spend $5k you get BTC7.5 a day and if you spend $20k you get BTC0.30 a day

That is what I am doing.

Care to share your current setup?  

If you don't feel comfortable sharing in the forum, perhaps a PM so I can be better informed.  

Happy to share,
50 Gridseed miners, pointed at a site like scrptyguild.com or clevermining.com

Mines the most profitable scrypt and pays in BTC

I could not disagree more with Joe's advice. I ran the numbers over and over again on the gridseed miners, and could not make the numbers work at all. All my calculations pointed to a 9-12 month ROI, and that doesn't even take into account the fact that scrypt coin difficulty is going to explode now that scrypt ASICs are here.

Personally, I think spending 10k on Antminers right now will ROI much faster than blowing it on scrypt ASICs, which are currently VERY OVERPRICED in my honest opinion.

Different strokes for different folks.

I'd like to see your work.

I can buy 1 Mh of Gridseed mining for $630

Which makes $3.7 /day (or 0.215 LTC/day) 

Yeah.... sound like you need to do your math

Agreed. 1 Mh of scrypt miners earns ~.213 LTC per day, or around $3.58 per day. It will take 6 months to ROI not including difficulty increases, power costs, power supply costs, and host computer costs. In my opinion, Gridseed miners are a TERRIBLE buy right now.

You may get a little bit more return by using something like scryptguild, but eventually that extra return will also dry up as other miners do the same thing. I've been using scryptguild for the past couple of weeks, and if you think the returns are that much better than just mining LTC directly you're kidding yourself. They aren't that good...

One Antminer S1 can be purchased for $630 and earns around .0225 BTC per day, or $14.20, making it a much better buy.

If you say LTC difficulty doesn't go up as fast as Bitcoin difficulty, I'll say you haven't seen anything yet. Scrypt coin difficulty is about to explode now that scrypt ASICs are here.

I still believe that the Antminer S1 is the only mining hardware you can purchase right now that will ROI in 3 months or less.

[kendog77]

Well let me refer you here:

http://clevermining.com/

Per Mh you earn 0.00693 and 0.00930 per day.

Let's say for rounding purposes that's 0.008 BTC per day

Now you buy 50 Gridseeds which gives you 17Mh multiply that by 0.008 BTC a day
which is 0.136 BTC a day which is $85 a day (The upper average is $100 a day)

So my math says the $10k I spent on the Miners break even in 100-150 days.

If I have figured this wrong please point out the flaws in my math.

Even if you assume three times the return of just mining LTC, which I think is kind of absurd after my experience at scryptguild, a Antminer S1 is still a much better buy and earns 3-4 times as much per day for the same investment.

What kind of difficulty increases are you using in your estimates? I suspect that whatever you are using will end up being low. You haven't seen anything yet...