Most important aspect in Bitcoin mining

[Tessnik]

Lately l picked interest in bitcoin mining and i have purchase my pre-own Asic mining equipment that will be shipped in the next few days, am curious know, aside from electricity which other factors should i consider before setting up my mining farm.

[NotFuzzyWarm]

Read this 1st It pretty much covers everything. One big key point many folks forget is,

Location

This is something that is often overlooked to the headache and frustration of many would be miners. These machines are loud and hot. You essentially have an electric heater that also uses an industrial fan to keep it from melting itself. This space will need to have the electrical requirements as discussed previously.

So make sure you have a space that is well ventilated with a plan to exhaust heat, and bring in fresh dust free air. I say this as using AC to cool the room will eat into your profits and may even make mining unprofitable. The noise issue is a consideration you can sort out depending on whats available. (garage, basement, remote building)

Since you said you are getting a pre-owned miner you need to do a few things to make sure it has not been infected with malware:
  Download a fresh copy of the miner firmware from the manufacturer's website
  Load it into the miner

How to do that all depends on who makes the miner and what model it is. There are lots of posts in the Forum about how to do it, just look at posts dealing with your miner.

[Tessnik]

As regard to space to set up the mining farm, I already reserved a farm house vacant for quite some space with large meters of space and electricity is quite cheap in my location but I plan to go in for 100% solar before the end of 2021.

[darmin]

Lately l picked interest in bitcoin mining and i have purchase my pre-own Asic mining equipment that will be shipped in the next few days, am curious know, aside from electricity which other factors should i consider before setting up my mining farm.

What about your pc specifications sir? Do you meet the minimum calculation standards to benefit from mining?

[darmin]

As regard to space to set up the mining farm, I already reserved a farm house vacant for quite some space with large meters of space and electricity is quite cheap in my location but I plan to go in for 100% solar before the end of 2021.

I think it's great to be a source of power, rather than relying on power sources from power companies.

[NotFuzzyWarm]

As regard to space to set up the mining farm, I already reserved a farm house vacant for quite some space with large meters of space and electricity is quite cheap in my location but I plan to go in for 100% solar before the end of 2021.

Then next on the to-do list is setting up the airflow system into and out of where the miners are located. Remember, all of the power the miners use is directly converted into heat. Output is just as much heat as conventional electric heaters set to max pulling the same amount of power 24x7x365.

[cabron]

Read this 1st It pretty much covers everything. One big key point many folks forget is,

Location

This is something that is often overlooked to the headache and frustration of many would be miners. These machines are loud and hot. You essentially have an electric heater that also uses an industrial fan to keep it from melting itself. This space will need to have the electrical requirements as discussed previously.

So make sure you have a space that is well ventilated with a plan to exhaust heat, and bring in fresh dust free air. I say this as using AC to cool the room will eat into your profits and may even make mining unprofitable. The noise issue is a consideration you can sort out depending on whats available. (garage, basement, remote building)

Since you said you are getting a pre-owned miner you need to do a few things to make sure it has not been infected with malware:
  Download a fresh copy of the miner firmware from the manufacturer's website
  Load it into the miner

How to do that all depends on who makes the miner and what model it is. There are lots of posts in the Forum about how to do it, just look at posts dealing with your miner.

There was an article that suggested using the heat to be a water heater, it must feel good to dip into a hot tub next to a mining farm.
Maybe extend the heat sink under the tub or a jacuzzi and you can sit there along with your hot chickas, now I think this is the most important aspect of mining. Forget about location and high electricity bill, rent your jacuzzi to girls working on OnlyFans. It's profitable.

[Queentoshi]

which other factors should i consider before setting up my mining farm.

As you conider the location, also consider security. Your equipment are expensive and certainly you would not want to put them in an environment where the rate of stealing is high. Ask questions and do your research about your location to know if the area is safe first before you decide on which security measures to employ in securing your mining farm from criminals.

[Derivatives888]

The Bitcoin price !
They are all speaking about electricity costs and prices of hardware but never about the bitcoin price wich is the most important aspect.
With derivatives like options and futures you can make the bitcoin price stable or do your risk management and make a construction at your  bitcoin price break even point.
Last year when the price was less then 20k most of the miningfarms went bankruptcy, they did nothing at all to cover the bitcoin price.
Even small export companies are hedging their valuta risks. How strange is it that big miningsfarms dont do anything about hedging bitcoin prices !!

[philipma1957]

The Bitcoin price !
They are all speaking about electricity costs and prices of hardware but never about the bitcoin price wich is the most important aspect.
With derivatives like options and futures you can make the bitcoin price stable or do your risk management and make a construction at your  bitcoin price break even point.
Last year when the price was less then 20k most of the miningfarms went bankruptcy, they did nothing at all to cover the bitcoin price.
Even small export companies are hedging their valuta risks. How strange is it that big miningsfarms dont do anything about hedging bitcoin prices !!

bitcoin price comes in and out like the tide.

but if you have 3 cent power for the next 5 years in a contract you will make money.

[Derivatives888]

The Bitcoin price !
They are all speaking about electricity costs and prices of hardware but never about the bitcoin price wich is the most important aspect.
With derivatives like options and futures you can make the bitcoin price stable or do your risk management and make a construction at your  bitcoin price break even point.
Last year when the price was less then 20k most of the miningfarms went bankruptcy, they did nothing at all to cover the bitcoin price.
Even small export companies are hedging their valuta risks. How strange is it that big miningsfarms dont do anything about hedging bitcoin prices !!

bitcoin price comes in and out like the tide.

but if you have 3 cent power for the next 5 years in a contract you will make money.

So and where are 5 years contract for the same electricity costs ?? wowww a contract for the year 2028 for 3 cent electricity 
Max is one year. As i told you with derivatives you can make stable bitcoin prices. You can hedge them etc.

[mikeywith]

So and where are 5 years contract for the same electricity costs ?? wowww a contract for the year 2028 for 3 cent electricity 
Max is one year. As i told you with derivatives you can make stable bitcoin prices. You can hedge them etc.

What contracts? this is probably only the U.S, most countries have fixed electricity prices, where I live, they need a legislative decision to change the power rate, but anyway, if you are able to get a 3-cent contract in the U.S which is below the world average, chances are even if for whatever reason they raise it to 4 cents the next year, you are still going to be below average.

The price of BTC is the least relevant aspect here, bull markets don't last for more than a few months, then the price stabilizes, difficulty catches up, and the final sayings goes to your power rate, during the main phase everything and everyone can be profitable, but that doesn't mean they will hit ROI or continue to mine the next month.

It's also important to stress the fact that the exact cost per KwH doesn't matter, what matters is, what tier are you on compared to the rest of the miners, 5 years from now, the average power rate could be 10 cents, and thus anyone with 9 cents will be doing great, if the average drops to 3 cents, then 3 cents won't save you, so the exact number doesn't mean much, but as long as you are paying below average -- you are more likely to be profitable.

[philipma1957]

yeah price of btc has no meaning to miners.

price of watts burned

vs price of watt earnings is the two part calculation.

derivatives888 talks about non mining in the prior post.

closer to trading not mining.

And in the usa various commercial deals can stretch for as long as three years.

also if you are in the proper states and have large solar arrays you have a essential cost of zero once you paid the array.

We have three arrays

280k
110k
  40x

they do 2 megawatts of “free” power once paid off.

the 110 and the 40 are paid off.

my rates are pretty much set for years to come.

but expansion of the arrays are not going to happen that easy.

[Derivatives888]

yeah price of btc has no meaning to miners.

price of watts burned

vs price of watt earnings is the two part calculation.

derivatives888 talks about non mining in the prior post.

closer to trading not mining.

And in the usa various commercial deals can stretch for as long as three years.

also if you are in the proper states and have large solar arrays you have a essential cost of zero once you paid the array.

We have three arrays

280k
110k
  40x

they do 2 megawatts of “free” power once paid off.

the 110 and the 40 are paid off.

my rates are pretty much set for years to come.

but expansion of the arrays are not going to happen that easy.

Wowww mining Bitcoins and the bitcoin price is not important at all. 
Thats why so many miningscompanies went bankruptcy when the price was at 16k

[philipma1957]

yeah price of btc has no meaning to miners.

price of watts burned

vs price of watt earnings is the two part calculation.

derivatives888 talks about non mining in the prior post.

closer to trading not mining.

And in the usa various commercial deals can stretch for as long as three years.

also if you are in the proper states and have large solar arrays you have a essential cost of zero once you paid the array.

We have three arrays

280k
110k
  40x

they do 2 megawatts of “free” power once paid off.

the 110 and the 40 are paid off.

my rates are pretty much set for years to come.

but expansion of the arrays are not going to happen that easy.

Wowww mining Bitcoins and the bitcoin price is not important at all. 
Thats why so many miningscompanies went bankruptcy when the price was at 16k

the spread of earnings and burning is what matters

Ie $100,000 BTC with 60cent kwatt vs $10,000 with 1 cent power.

the 10000 coins with 1 cent power work better.


If you look at Satoshi his idea is power into wealth.

So yeah price of coin to sell has some part but price to mine has a lot.

if you go to viabtc.com they will pay you

 0.0711 $ per th of mining. 

so the 0.07110 is price of earnings.

my cost of mining is 50% of that ie 0.03555

so  0.07110 - 0.03555 = 0.03555 dollars a th

you are only listing the left side of the profit caculation

ie the 7.11 cents a th. earnings

the right side is equally important. ie 3.555 cents cost.

So you are incomplete.

Now I did leave out my repair cost and my gear purchase cost.

but at this time all the gear is paid for.
as for repair cost it it is likely just under ½ cent

so   7.110 cents earned
and 3.555 cents burned
and 0.445 cents repair and housing and salaries and buying the gear.

thus

  7.11 cents
- 4.00 cents
3.11 cent profit per th

I have 3500 th so $108.85 a day profit.

your price only
would be 7.11 cents x 3500 = $248.85 earned with no cost calculation at all. So it would be incomplete.

Ie what does mining $250 a day in btc mean if you spend 255 a day to earn it = it means a loss
or what does mining $250 a day in btc mean if you spend 50 a day to earn it  = it means a gain

you can't just use the left side ie btc coin price.

you need the expense side. ie power cost, housing cost, gear cost, cooling cost, labor cost.

The mining companies that go broke do not get a good income side as compared to their expense side.



But yeah when price skyrockets it hides expense problems. Some times for a few years in a row.

[stompix]

Wowww mining Bitcoins and the bitcoin price is not important at all. 
Thats why so many miningscompanies went bankruptcy when the price was at 16k

You're trying hard to not get it!

Electricity is the most important thing because with basically zero cost you can stay in the game till everyone else collapses. You don't pay for the electricity as you're in some kind of program where you have excess capacity that you can't feed into the grid, you have the generator but you don't have a next-door consumer as your biggest one has moved away or something else, then you don't really give a damn if it goes to 5k!

It's a matter of survivability, Bitcoin can go now back to 40k and you will still see miners losing money as more farms with cheap running costs will push you out of the market. It easily can turn into a  situation where the same guys that were making profits at 20k could go bankrupt at 30k.

As for derivatives, yeah, how about no!

[philipma1957]

At the moment price is low and $$ per th is low.

viabtc pays $5.99 for a 100th machine


now if price was 2x say 52k not 26k

viabtc pays 11.98 for a 100 th machine

I pay 17 cents a k-watt  in my home so .17 x 80 = $13.60 power cost

I pay 5 cents a k-watt in my mine so .05 x 80 = $4.00 power cost.

So at a price of 26k and 5 cent power a machine makes $1.99 at my mine.

So even if price goes to 52k at my house on 17 cent power I still lose

as $11.98 - 13.60 = - 1.62

So the gross earning - cost expense is  a 2 sided equation

and it is that simple.

If btc went from 26k to 78k we as miners would be helped out. as the earnings side went up quickly.

then the cost side would try to catch up.

At the moment we are in trouble as the cost side has gotten very close to the income side.

[mikeywith]

Electricity is the most important thing because with basically zero cost you can stay in the game till everyone else collapses.

Electricity is indeed the most important thing, but just because you have cheaper electricity than the next guy doesn't mean you will necessarily survive longer than him, your operation cost, efforts, capital, ability to main the same hashrate and expand, can you fix gears or not? how much tax do you pay? how far away do you have to drive to get to the farm? how much cheap/free electricity do you have?

I would argue that the guy with $1m capital paying 6 cents will survive longer than the guy paying 3 cents but can only afford 2 mining gears of the old generation, you see, it's a whole package that needs to be better than the average in order to survive, the package has a dozen elements in it, electricity being at the top of the list doesn't make it the only thing that matters.

You also need to keep in mind that wherever power is free or dirt cheap it will be somewhat limited per person/business, You get to the point where stacking more gears is no longer doable, and now you have to stay on top of the game by always getting the latest gears out there just to get an overall high income from that farm, so you get into buying-loop and never see ROI while the other person who pays slightly more for electric has 20 times the capacity and 30 times the money, it gets even worse when that money is not "his", it makes competing with those folks even more difficult.

[stompix]

Electricity is the most important thing because with basically zero cost you can stay in the game till everyone else collapses.

Electricity is indeed the most important thing, but just because you have cheaper electricity than the next guy doesn't mean you will necessarily survive longer than him, your operation cost, efforts, capital, ability to main the same hashrate and expand, can you fix gears or not? how much tax do you pay? how far away do you have to drive to get to the farm? how much cheap/free electricity do you have?

I would argue that the guy with $1m capital paying 6 cents will survive longer than the guy paying 3 cents but can only afford 2 mining gears of the old generation, you see, it's a whole package that needs to be better than the average in order to survive, the package has a dozen elements in it, electricity being at the top of the list doesn't make it the only thing that matters.

Hihi, but the guy with two S9s doesn't need a 1000sqm datacenter, no security guys, and no technicians, he will most likely fly under the radar so no income tax, and so on!
Of course, I know what you're saying but when I was pointing that out it was for a leveled scenario, two companies in the same country with the same capital and same plan, the one with 1 cent over the other will flop first unless he magically finds some angel investors willing to lose money! I find electricity costs to be the ultimate barrier, you can have everything else ready to go and dirty cheap or even free if you pay 17 cents/kwh you're going to go bankrupt!  I think you've guessed why I mentioned exactly 17 cents, lol!

[dansus021]

Simple term is

1. The Price of hardware
1. Electricity
2. The Next Bitcoin difficulty <-- you might need a calculator out there ex. https://www.coinwarz.com/mining/bitcoin/calculator

I think this was others trying to say if you can check 3 of them I think you are good to go.