Mining Vs Buying Bitcoin with DCA strategy

[tabas]

The cost of electricity really matters where you're living. And aside from that, being an enthusiast and just doing it through mining gives not only those mined bitcoin but also satisfaction.

For me, I love to setup a mining rig but with my country's expensive electricity, DCA is best fitted for me.

The same goes for me but I think if the time comes that Bitcoin reaches another high price and it's allowing me to purchase some miners, I'd do that. But only for the passion and a bit of extra earning when it happens because the mined bitcoins will for sure go to the cost of operations.

[Churchillvv]

One thing you must also consider is the longevity of the mining, when you invest mining you can mine long enough and make more profit than just within a given number of years but dca you have to keep stacking up frequently to achieve that, in DCa you will probably be more profitable with minimal effort just as your op says but some in my opinion too mine before of the love they have for bitcoin and the processes of bitcoin than just making all the profit even though the core idea is profit making.

[tbct_mt2]

One thing you must also consider is the longevity of the mining, when you invest mining you can mine long enough and make more profit than just within a given number of years but dca you have to keep stacking up frequently to achieve that, in DCa you will probably be more profitable with minimal effort just as your op says but some in my opinion too mine before of the love they have for bitcoin and the processes of bitcoin than just making all the profit even though the core idea is profit making.

Mining is not as easy and smooth as you said because the ASIC minning rigs can have technical problems after a while of mining operation. You need to maintain your ASIC like cleaning it, replace thermal grease in your ASICs and many other things. The last risk is your ASICs can be completely dead and you will have to replace them with new ASICs. If until that time, you don't have profit from mining, you have to capitulate from mining or have to sell your bitcoins with accepted loss selling price for keeping your mining operations by buying new ASICs.

I only describe some simple challenge with Bitcoin mining operations and even so you can see that it's more easily by simply purchasing bitcoins with your money.

[adaseb]

Mining hasnt been attractive to home miners for years. The last coin which was somewhat profitable to mine was ETH but when it went POS, it put a stop to GPU mining. GPU mining was always better because the equipment could always be re-sold. With BTC ASICs is a different story because they become obsolete in a few years.

With computer equipment such as GPUs, processors, motherboards, PSU, etc. That equipment can last almost a decade. Even right now those RX 470 GPUs which were used to mine ETH back in 2016 or so can still be had by gamers. And most ASICs from 2016 are long obsolete. I think it was the Antminer S5/S7 which was popular back then. Now a days even with free power those arent worth using.

[Eclipse01]

If mining is not profitable why lot's of farm still choosing to mine bitcoin?

Whether mining activities are profitable or not is conditional, therefore, we can't generalize it. I guess, you know that Russia & China were big hotbeds of miners in the early days of Bitcoin (BTC), right?

The reason is simple, it's because the cost of electricity per kWh is so cheap there, let me share the list:
1. Germany: $0,35 - $0,45
2. Western Europe: $0,25 - $0,40
3. USA: $0,13 - 0,18
4. China: $0,07 - 0,11
5. Russia: $0,05 - 0,08

For countries with low electricity costs, mining is certainly more profitable than DCA. For countries like Germany & most Western European countries, mining isn't a great way to maximize profits, so they're better off using DCA. Given all these unique aspects, I believe everyone benefits from their own unique approach, not all equally & therefore, they can synergize well.

That is to say, using a green energy power supply no matter the location will be more profitable in the long run

[Outhue]

Recently I saw a content on my feed , it was about bitcoin mining. The guy on the video was claiming that he purchased 2 Asic S9 pro with $5000 and give electritcy bill over 2year which is cheapest electricity bill in his statement cost 285$ per month bill and he was able to mine 0.22 BTC if he extract everything he's investment he still had left with $11908 profit.

But I've recalculated with his equation with a DCA strategy and I find out that if he would initially invested $5k in btc two years ago and just DCA his monthly electricity bill he would have ended to acquire 0.3084 BTC (I used DCA calculator for this calculation) which could give him $21,455 profit . That is $9547 outperforms by his mining rig. He could have earned this amount extra.

So I ain't stopped here, thought about it more broader. Like if the Bitcoin price is stable at $100k , I just assume it for a clear view . He would have +$10,148 profit which isn't possible in buying and holding the BTC asset.

So this leads me a question , If mining is not profitable why lot's of farm still choosing to mine bitcoin?
 How you guys seeing this DCA vs Monthly electricity bill?

For the average person, it’s better to buy BTC, that’s the simplest way to acquire it. However, if you have an investment budget for infrastructure or green energy, mining could become really profitable.

Not just average person anymore, if your electricity bill is high it will be a dumb decision to start mining Bitcoin, using Asic miner to DCA into Bitcoin is easier said than done, there are few things that can kill that dream of yours, what if the Asic miner develop a fault after a year? What if to repair it will cost extra money?

Mining Bitcoin right now should be an hobby, not a good way to DCA because miners across the world are barely making profit from Bitcoin mining, I don't care about what OP calculated, I also have my own miners running, if you have money it is better to buy Bitcoin unless you have free electricity or very cheap electricity fee.

Mining is also not for everyone, many people found it annoying to run 24/7, I know someone who sold all his asic miner weeks later after purchasing because I doesn't see himself as capable, he complained about the insanely noise and also heat, later after he sold he finally said mining isn't for him.

[BlackBoss_]

Mining is also not for everyone, many people found it annoying to run 24/7, I know someone who sold all his asic miner weeks later after purchasing because I doesn't see himself as capable, he complained about the insanely noise and also heat, later after he sold he finally said mining isn't for him.

Bitcoin is for people can manage technical things that are essential for mining farm setup, operation and maintenance, and it's not for everyone.

History of Bitcoin mining industry shows that mining rigs have to be upgraded with time and if you as a miner can not do it, you and your outdated, less efficient mining rigs will be out of the mining party.

Bitcoin Mining History.
Cambridge Digital Mining industry report.

[atookz]

From your calculations, it's clear that the DCA strategy yields greater returns than mining. This makes sense because DCA is passive and doesn't require capital expenditures like electricity, device maintenance, and the technical risks typically associated with mining. With DCA, investors simply consistently purchase a certain amount of bitcoin each month without worrying about short-term fluctuations. While some may view mining not only as a strategy for acquiring bitcoin, it also serves a strategic role in building the infrastructure of the digital economy and future energy. This means miners play a role as producers of new bitcoins in the ecosystem. Therefore, both DCA and mining have their own value and function. DCA excels in investment efficiency, while mining plays a crucial role in maintaining the network's sustainability and decentralization.

[Oasisman]

So this leads me a question , If mining is not profitable why lot's of farm still choosing to mine bitcoin?
 How you guys seeing this DCA vs Monthly electricity bill?

Well, I guess because miners can afford to invest in hardware or just because they simply can, in which mining could give them an almost guaranteed profit and stable earnings regardless of Bitcoin's value, as long as the bills and maintenance are sustainable in the long run.
Most people who opt for DCA are those average people who aim to have a good amount of Bitcoin in the long run. Both can be good investment practices, and nobody knows which investment can get you more profit in the next 5-10 years.

[MAAManda]

That is to say, using a green energy power supply no matter the location will be more profitable in the long run

Yes, green energy is the absolute solution. There are many sources that can be utilized, such as: solar power, hydro power, wind power & geothermal. But it's difficult to implement if miners are just individual miners, let me tell why.

1. Unstable
Mining activities require high uptime, for that stable power is needed, while on the other hand, natural power is not always available or unstable for 24 hours, that is solar & wind power.

2. High Initial Costs
Individual miners have their limits on money, while building green energy facilities requires high initial costs or investments.

[Eclipse01]

That is to say, using a green energy power supply no matter the location will be more profitable in the long run

Yes, green energy is the absolute solution. There are many sources that can be utilized, such as: solar power, hydro power, wind power & geothermal. But it's difficult to implement if miners are just individual miners, let me tell why.

1. Unstable
Mining activities require high uptime, for that stable power is needed, while on the other hand, natural power is not always available or unstable for 24 hours, that is solar & wind power.

2. High Initial Costs
Individual miners have their limits on money, while building green energy facilities requires high initial costs or investments.

True, these two points are very valid, but I think, if we think long term maybe start from small(low power miners, resulting to low electrical/green power cost) and then scale, it will be better and even sustainable

[henry_of_skalitz]

If you have electricity - you have the way out to make it profitable.

Otherwise, solo-mining is not as good for me as just going without it.

[lizarder]

So I ain't stopped here, thought about it more broader. Like if the Bitcoin price is stable at $100k , I just assume it for a clear view . He would have +$10,148 profit which isn't possible in buying and holding the BTC asset.

So this leads me a question , If mining is not profitable why lot's of farm still choosing to mine bitcoin?
 How you guys seeing this DCA vs Monthly electricity bill?  

If you're mining small amounts using inadequate equipment, it may be true that mining is not a better option. Instead, it's much better to choose DCA for the Bitcoin purchase process, so you don't have to worry about machine maintenance costs or other fixed costs that miners incur. Buying Bitcoin is also the easiest way for someone to get involved in building a financial base, avoiding the complexities that miners face. I prefer buying Bitcoin by any means, such as the methods we often discuss in this forum, to mining, which is much more difficult.

Building a mining machine is not cheap, and of course, it requires significant costs for maintenance and other unexpected expenses. If buying offers convenience, I personally prefer the easy option, as the investment can be run independently without anyone's knowledge, while a miner has the potential to become widely known if built on a large scale.

[fikrett]

True, these two points are very valid, but I think, if we think long term maybe start from small(low power miners, resulting to low electrical/green power cost) and then scale, it will be better and even sustainable

It has a big cost on the start, imo.

I would rather put these money in BTC itself rather than waiting for a small farm of miners to keep working toward working itself out (regarding the prices and costs..).

[Donneski]

I’ve seen a few similar comparisons before and most times, simple DCA still performs better than small-scale mining, especially when you consider factors like noise, heat, maintenance and hardware value dropping over time.

The big mining farms that are still doing well usually have super cheap industrial electricity or use surplus renewable energy that costs almost nothing. So yes, for most retail users, mining isn’t really about making huge profit, it’s more like stacking sats directly or contributing to network decentralization.

But purely from an investment side, I think your DCA math definitely makes a lot of sense.

[doomloop]

It could be not profitable if electricity cost in your area is so high.

But if you are in country that electricity cost is cheap there's really a good chance that you can earn on Bitcoin mining. Also consider to have buy those high efficient hardwares so that they would get more higher chance to earn if they pursue this Bitcoin mining plan.

Well it depends on the priority of the person since they can do DCA or either mining and everything may vary depends on the capabilities also current status on their places.

Indeed. After all, it still boils down to the capability of the person because the factor for Bitcoin mining is not only limited to electric billing but there is also maintenance here and then the capital that will be used to buy a mining hardware to keep adding further. For sure not all are capable of that and if it is, then all or most of the people living on a said country are now involved in bitcoin mining, but I think I haven't heard of it yet.

There are countries that are known to have more miners but I think these countries didn't have a cheap electricity either but generating through hydro planets. Like that, if you have unique advantage than others then you may go for it, otherwise ROI would be too lesser. I guess that in near future, we could expect corporates joining in bitcoin mining, who knows?

[BlackBoss_]

Indeed. After all, it still boils down to the capability of the person because the factor for Bitcoin mining is not only limited to electric billing but there is also maintenance here and then the capital that will be used to buy a mining hardware to keep adding further. For sure not all are capable of that and if it is, then all or most of the people living on a said country are now involved in bitcoin mining, but I think I haven't heard of it yet.

There are countries that are known to have more miners but I think these countries didn't have a cheap electricity either but generating through hydro planets. Like that, if you have unique advantage than others then you may go for it, otherwise ROI would be too lesser. I guess that in near future, we could expect corporates joining in bitcoin mining, who knows?

The easiest thing is spending your money and buying bitcoins, while Bitcoin mining is not as easy as such. You can spend your money for buying ASICs, but this purchasing step is not enough because you need location to set up your Bitcoin mining farms, then actually set it up technically with many requirements too. When it comes to mining operation, you will need human resources to watch over your mining rigs, handle technial problems and as all digital devices, there will be unavoidable maintenance procress.

With this simple description about Bitcoin mining, it's easily to see how Bitcoin mining is more complicated than Bitcoin investment. If you feel it is hard and you can not manage resources for Bitcoin mining, let's only do Bitcoin investment by purchasing bitcoins on the market and hold them.