Mining vs Holding

[peroksid90]

I have developed a project
https://github.com/peroksid90/crypto_calculator

to compare mining vs holding. Contributions and comments are welcome.

For example,
you have 2500 $.
You can buy a miner or just invest this money to BTC.
Which is better in the long run?

https://github.com/peroksid90/crypto_calculator/raw/main/demo2.png?raw=true

So at the end we see:

the worst case: do mining and sell mined profit every day (red line) (7300$)
the better: just buy and hold (olive line) (8200 $)
the best: do mining and don't sell. (magenta)  (12500 $)

magenta and red doesn't include the miner market price. So actually we should add it to the profit, because the equipment price is also rise(even used).

[Saidasun]

In almost all instances investing for the average person would be more worthwhile unless you can fill a warehouse full of miners with cheap electricity and then you would be earning a lot more over the long run. The thing is with investing it bares a lot of risks and you have to time it correctly with mining its generated passive income all the time.

[Upgrade00]

The thing is with investing it bares a lot of risks and you have to time it correctly with mining its generated passive income all the time.

Mining also has its fair share of risks, most shared with the average investor and some risks of its own; such as stead source of affordable electricity, change in difficulty level overtime, competition from more modern mining gear, maintainance, drops in coinbase reward etc. If one does not know what they're are doing an has a limited capital, investing directly would be the best bet, and is more passive than mining.

[Saidasun]

Mining also has its fair share of risks, most shared with the average investor and some risks of its own; such as stead source of affordable electricity, change in difficulty level overtime, competition from more modern mining gear, maintainance, drops in coinbase reward etc. If one does not know what they're are doing an has a limited capital, investing directly would be the best bet, and is more passive than mining.

I would say that frequently investing in Bitcoin and taking out would probably mean that you would either be waiting a lot of time or would make multiple bad investments and end up losing money. Mining while it does have issues with difficulty rising and electricity costs at least electricity costs are stable and you would know in advance if the electricity was going up. The government usually let us know at least 3 months in advance but it has not changed in many years.

[Pmalek]

I would pick investing/buying bitcoin over mining. You need time and patience to pay off the costs for your mining equipment to start generating profits. But if just buy bitcoin and it goes up by 2%, you are already making gains minus any fees you might have had. Not to mention that mining gear isn't that easy to come by and the producers can't produce enough to meet the demand. Your equipment can become faulty, break, overheat. Your software can crash in the middle of the night or during the weekend while you are away from home. You need some technical knowledge to mine while any computer-literate person can buy a coin on an exchange.   

[Desmong]

There is a huge difference between mining and holding and it's also depends on what you are mining if it's Bitcoin or altcoins. If you are mining Bitcoin, you will need to be patient and get all necessary tools that are needed to scale through because to mine Bitcoin at this stage, it will require sophisticated softwares, adequate power supply and other tools to really mine some profitable coins. Remember mining would require a lot of funds compared to holding and there is no guarantee that you are going to be profitable from it at the end and when you substrate your expenses from what you have mined, you might not be that profitable if you are new to it.

[tabas]

The two can't be compared if you have a different view about mining and holding. If you're for the profit then for sure you'll be choosing the one that can generate you much profit no matter how much the capital is needed. Mining isn't just all about profit, there's expenses, maintenance while holding, you really do hold it and do nothing except adding more and selling.

[Vaskiy]

There'll be difference of opinion. I'll go with the buying, holding and trading. When we talk of mining it gives regular earning, but it has got more risk and other complications. We need to have stable electricity, separate cooling system and more other sources to make the miner run without issues. If something goes wrong or if there is a need for service. At times we are supposed to replace completely. You need to find a hosting service, and you need to pay for them. Rather than overcoming all this issues and risks it is good to buy, hold and trade to increase the capital.

[hatshepsut93]

I'm pretty sure that in many jurisdictions mining at home would be illegal, because it's misuse of residential electricity that is sold cheaper than commercial. It's also a fire hazard, there have been reports of house fires caused by mining equipment. So, if you don't want to have problems, you should rent some place for your miners, which also increases the costs. This means that the barrier of entry for mining is quite high, while with hodling you can chose any amount.

[sheenshane]

Bitcoin mining and investing are quite different, not all places mining is profitable and it depends on how much your electricity bill in your place that should be cheaper one.  Another factor is if in your place crypto mining is allowed because there are some countries that mining is strictly prohibited.

Whereas investment in Bitcoin is all you have to do is wait when the market price goes up and when your profit was there, but honestly they had different actual ROI.

If I were you, you can calculate and analyze which better them, because all of these kinds of investments are very risky.

[GreatArkansas]

(....)
the worst case: do mining and sell mined profit every day (red line) (7300$)

I believe that this is extremely worst, especially for those miners who started during a bear market.
And another worst thing is a miner who is new but chooses to hold their mined Bitcoin instead of selling it just to get back first the investment, which if I will to choose to mine, I will do it, sell it everyday just to get first my investment and also consider the bear market/bull market.

[Dave1]

And for sure holding will be the majority of choices here.

In Mining there are a lot of factors to consider, obviously you should live in a country wherein electricity is quite cheap, and then the space itself and the mining gear, as far as I know it's hard to acquire the hardware currently.

So in the long run it's better to invest and then hold for long term. Less hassle on your part. In any case, this tool might be helpful for those who want to try mining.

[mindrust]

Mining is not worth your time. Those miners can become unprofitable easily when the prices go south and then you'll have to stop mining and your hardware price will also go down.

Sure, the investors will also lose money in that scenario but unlike you that hold both the coins and the hardware, they only hold coins which are more liquid, which means less headache.

Really, mining is just a way to torture yourself. I wouldn't touch any miners unless I got some "free" electricity.

[Anonylz]

Buy and hold still the best, with $2500 is a good amount to buy btc and hold for the time duration you intended, but with that amount i doubt you can get all you need to mine btc, the most pressing part of mining is the constant usage of electricity which is inevitable in this situation, depending on what you are getting in return, i don't think it is necessary to go through all that stress, the only thing you need in holding is '^patience' it may sound simple but not very many people possess it, no need for hardware or electricity.  

[traderethereum]

I prefer to buy and hold than mining because your calculations can not work in many countries, especially if they have a high electricity fee.
Unless you have a lower electricity fee, you will hard to make a profit, and that will giving you a high fee for electricity.
If you have $2,800, I suggest you buy and hold and do not use that money in bitcoin to trade, especially if you do not have skills in trading.
But if I can install solar panels at my home and do not use my current electricity energy, I will try to mine bitcoin and see how big the reward I can get.
That will depend on you because you know how much electricity fee that you should pay.

[Ararbermas]

For example,
you have 2500 $.
You can buy a miner or just invest this money to BTC.
Which is better in the long run?

on this situation probably mining is more profitable than investing in bitcoin, but when it comes mining it's too expensive because like what you said before you can build miner you need to complete first those requirements in order to mine bitcoin..unlike investment wherein effortless.  Infact if your plan is for long term then perhaps it's still a good idea to invest than to build miner because it's too expensive and for sure there's no big difference when it comes profits that you will earn on it after all.

[MrcMrc]

If you have the mining tools, then mining is more profitable than holding because while you earn profits from mining you can keep holding the profits in bitcoin so you are a bitcoin miner and a bitcoin holder, which gives you double income.

[Wexnident]

I'd go for Holding. It's like skipping the entire process of steps that Mining has and just straight-up buying, then hodling. There's a lot of setup and prior costs that you'd actually need to spend when trying to set up mining rigs, not to mention that it'd be close to a farm if you actually want to profit off of it. There's also the issue of permissions and whatnot since you'd be sucking up a LOT of energy from whatever source your place currently has.

It's all dependent on how much effort you want to spend, but even then, I'd honestly recommend holding more than mining just because of the effort time and money mining needs before you actually profit.

[Weber45]

The two can't be compared if you have a different view about mining and holding. If you're for the profit then for sure you'll be choosing the one that can generate you much profit no matter how much the capital is needed. Mining isn't just all about profit, there's expenses, maintenance while holding, you really do hold it and do nothing except adding more and selling.

Yeah, I actually think the same. Mining isn't always only about profit

[maxreish]

With the expensive electricity bill consumption, I would rather go cobaider buying and investing bitcoin which I am doing since 2018. Not all can afford the mining machine + time and effort + electricity. But if one will just invest their money  which you will just wait for the good opportunity to rise which many are doing.

But then, we have different point of views when it comes to investing. Other may still prefer mining as bitcoin's value is worth enough to mine and to sell in a perfect time.