...

[Ron~Popeil]

You are not missing an indicator. You simply are not looking at the numbers that you have.

You have not attempted to answer the most important question: If you invest now, how much will you make? Look back a few posts, you may find an answer.

You also haven't validated your assumptions. Let me help you. If you bought 1 GH/s on January 2, 2014:

Buy on 1/2/2014	-0.0417
Revenue	0.0258
Sell on 6/3/2014	0.0072
------------------------	-----------
Profit	-0.0087 (-20.1%)

Also, the graph has not "bottomed out". That is a horrible misinterpretation. The price will continue to drop as the difficulty rises. It only looks like it has bottomed out because it has dropped so much.

Hmm.  Ok.  I get what you are saying... and can read the numbers clearly... but something in me still doesn't agree...

Take this example for 1GHS:

Buy on 4/29/2014	-0.006313
Revenue	(I am too lazy to do the mining math but even at a 50% fee, revenue is still positive)
Sell on 6/3/2014	0.0072
------------------------	-----------
Profit	0.000887 + mining gains (however small)

In this case, the buyer makes BTC.  To me, it seems like your argument was offering the standard don't "buy high and sell low." But again, perhaps I am missing something.  This is why it looks like to me, the market has consolidated and has accounted for future increase in difficulty, etc.  At .0072/GHS/BTC * 670$/BTC is $4.82/GHS. On ebay, the cheapest ASIC i saw was $400 for 180GHS ($2.2/GHS), but that is invalid because of economies of scale. The average was ~$5-8/GHS for 2-4GHS ASICs. Which is to say, CEX.io is cheaper then actually buying an ASIC miner for small fries, and it offers them liquidity, which physical ASICs can't--e.g. it becomes a high volatility savings vehicle for diversifying.

I imagine that unless there is a massive run up in BTC price soon, it will quickly become unfeasible for companies to make ASIC miners as electricity cost make them not worth buying, limiting supply, and stabilizing the price--actually I am pretty sure this has already happened--as cex.io no longer offers futures contracts. Again, it seems like CEX.io has consolidated and bottomed out to me. And no, to me, it looks like the graph has bottomed not because it has dropped so much, but because the rate at which it dropped was decreasing, indicating that is was nearing a limit/equilibrium.

But... I guess that is the ultimate trump card isn't it? We are all in this game because we think BTC will go "TO DA MOON." in which case, "To Da Moon" will be followed by massive and very temporary GHS mark ups and then more massive ASIC creation and steep GHS mark downs.

My two sats at least.

Anyway, thanks for your thoughts!

The herd mentality there is amazing. It wasn't that long ago when GHS were going at .12 in their market. 

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[SecureErase]

You are not missing an indicator. You simply are not looking at the numbers that you have.

You have not attempted to answer the most important question: If you invest now, how much will you make? Look back a few posts, you may find an answer.

You also haven't validated your assumptions. Let me help you. If you bought 1 GH/s on January 2, 2014:

Buy on 1/2/2014	-0.0417
Revenue	0.0258
Sell on 6/3/2014	0.0072
------------------------	-----------
Profit	-0.0087 (-20.1%)

Also, the graph has not "bottomed out". That is a horrible misinterpretation. The price will continue to drop as the difficulty rises. It only looks like it has bottomed out because it has dropped so much.

Hmm.  Ok.  I get what you are saying... and can read the numbers clearly... but something in me still doesn't agree...

Take this example for 1GHS:

Buy on 4/29/2014	-0.006313
Revenue	(I am too lazy to do the mining math but even at a 50% fee, revenue is still positive)
Sell on 6/3/2014	0.0072
------------------------	-----------
Profit	0.000887 + mining gains (however small)

In this case, the buyer makes BTC.  To me, it seems like your argument was offering the standard don't "buy high and sell low." But again, perhaps I am missing something.  This is why it looks like to me, the market has consolidated and has accounted for future increase in difficulty, etc.  At .0072/GHS/BTC * 670$/BTC is $4.82/GHS. On ebay, the cheapest ASIC i saw was $400 for 180GHS ($2.2/GHS), but that is invalid because of economies of scale. The average was ~$5-8/GHS for 2-4GHS ASICs. Which is to say, CEX.io is cheaper then actually buying an ASIC miner for small fries, and it offers them liquidity, which physical ASICs can't--e.g. it becomes a high volatility savings vehicle for diversifying.

I imagine that unless there is a massive run up in BTC price soon, it will quickly become unfeasible for companies to make ASIC miners as electricity cost make them not worth buying, limiting supply, and stabilizing the price--actually I am pretty sure this has already happened--as cex.io no longer offers futures contracts. Again, it seems like CEX.io has consolidated and bottomed out to me. And no, to me, it looks like the graph has bottomed not because it has dropped so much, but because the rate at which it dropped was decreasing, indicating that is was nearing a limit/equilibrium.

But... I guess that is the ultimate trump card isn't it? We are all in this game because we think BTC will go "TO DA MOON." in which case, "To Da Moon" will be followed by massive and very temporary GHS mark ups and then more massive ASIC creation and steep GHS mark downs.

My two sats at least.

Anyway, thanks for your thoughts!

Hey b2f, Its all in the timing and having a plan. If you just buy GHS sit back and wait for the mega profits to roll in then you won't be happy, because difficulty rises, total hash power rises negatively impacting your situation. But if you have a plan in place to trade and mine then CEX offers that opportunity to profit from both. Even CEX themselves advise such http://blog.cex.io/the-secret-of-ghs-price/
You are right in your calcs, you are looking at the here and now and calculating profit is possible if you at least approach it with a plan.

[Harley997]

Cex.io: the largest Bitcoin cloud mining service, not a profitable investment - an article by The Cryptocurrency Times http://www.usacryptocoins.com/thecryptocurrencytimes/uncategorized/cex-io-the-largest-bitcoin-cloud-mining-service/

Mining in general is not profitable unless you can command discounts from the manufacturers of the mining equipment (you would also need to be able to order enough equipment in order to get them to ship to your first).

Cloud mining is even more unprofitable because people are willing to pay a premium that is not deserved.

The article was correct to say that the price is GH/s decreased substantially from last year, however it failed to take into consideration the rewards that were earned from mining during this period.

[AceWallen]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

[Ron~Popeil]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

New people to the bit coin world are particularly susceptible. I know I made the same mistake when I got in. Luckily my math inclined wife helped me break down the numbers and realize they were not a good deal.

[leezay]

Some people just want to try it out before committing larger capital for ASIC miner.

[ejinte]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

Yes this is so true. Everyone most me smart and do their own calculations when they choose to invest in something like mining.

Some people just want to try it out before committing larger capital for ASIC miner.

That's the stupidest thing I've heard.

[Ron~Popeil]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

Yes this is so true. Everyone most me smart and do their own calculations when they choose to invest in something like mining.

Some people just want to try it out before committing larger capital for ASIC miner.

That's the stupidest thing I've heard.

Avoiding cloud mining altogether works for me. I don't have to trust anyone but myself. 

[jeffersonairplane]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

Yes this is so true. Everyone most me smart and do their own calculations when they choose to invest in something like mining.

Some people just want to try it out before committing larger capital for ASIC miner.

That's the stupidest thing I've heard.

Avoiding cloud mining altogether works for me. I don't have to trust anyone but myself. 

That's so stupid. There are plenty of trustworthy cloud mining operations going.

[makebitcoin]

I recently fell into the trap of investing there. I got eaten up in maintenance fees. Stuff like this is really working against Bitcoin. There have been a ton of big scams. I'm thinking pirate, Gox, BFL etc.

[Ron~Popeil]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

Yes this is so true. Everyone most me smart and do their own calculations when they choose to invest in something like mining.

Some people just want to try it out before committing larger capital for ASIC miner.

That's the stupidest thing I've heard.

Avoiding cloud mining altogether works for me. I don't have to trust anyone but myself. 

That's so stupid. There are plenty of trustworthy cloud mining operations going.

Throwing good money after bad is even more stupid. Basic math tells you that cloud mining is a very poor investment.   

[Ron~Popeil]

I recently fell into the trap of investing there. I got eaten up in maintenance fees. Stuff like this is really working against Bitcoin. There have been a ton of big scams. I'm thinking pirate, Gox, BFL etc.

Yeah. You are better off finding some investment opportunities or just holding. 

[Harley997]

it's true. it's a terrible investment. i can see why people get duped into it, since they don't want to buy/build/operate their own rigs. but they must not do the math....

Yes this is so true. Everyone most me smart and do their own calculations when they choose to invest in something like mining.

Some people just want to try it out before committing larger capital for ASIC miner.

That's the stupidest thing I've heard.

Avoiding cloud mining altogether works for me. I don't have to trust anyone but myself. 

That's so stupid. There are plenty of trustworthy cloud mining operations going.

Even if a cloud mining operation is trustworthy, you would not have control over your mining power.

Cex is probably the most trustworthy (and biggest) cloud mining operation however you can not do anything but sell your GH/s when they start to get close to 51% of the hashpower.

[sukamasoto]

you are right
I've tried mining cloud over there and I felt no benefit at all because too many fees

[ShakyhandsBTCer]

you are right
I've tried mining cloud over there and I felt no benefit at all because too many fees

It is not just the fees, it is that the price that most cloud mining companies sell their contracts are at a level where the rate of difficulty increases would need to slow substantially.

[bigbeninlondon]

The way I see it, if a cloud mining service can make more money mining then what they're charging, then they'd just mine.  Having me pay them to mine for me seems like I'm losing out.

[ejinte]

The way I see it, if a cloud mining service can make more money mining then what they're charging, then they'd just mine.  Having me pay them to mine for me seems like I'm losing out.

If they can sell their GH for BTC and buy more GH for those BTC they might make more money than if they just mine them self.

[FlyForFun]

The main point of them providing cloud mining service is for them to profit not the customer

[ljudotina]

The main point of them providing cloud mining service is for them to profit not the customer

It goes like this:
First they buy hardware and mine for temselves while its profitable. Once it gets to barely profitable they offer it to market on ridiculous price. They sell their hardware for GOOD money so they earn twice. For that money they buy mor hardware and cicrle starts again.
In adiditon to that, they dont need to care about hardware economics asthey take BTC for electirc bill, and they will keep it going on as long as you are willing to pay the bill. They take some extra too so they profit on that too.
It's win / win / win situation for them.

[odolvlobo]

The way I see it, if a cloud mining service can make more money mining then what they're charging, then they'd just mine.  Having me pay them to mine for me seems like I'm losing out.

If they can sell their GH for BTC and buy more GH for those BTC they might make more money than if they just mine them self.

Please provide an example of how that might work. I think you will discover that it only works if the customer loses money.