Never make a ROI

[djtriggz]

I have come across this site:

http://mining-profit.com

and its basically saying with the miners you buy you will never make a ROI

Spondoolies-Tech SP10 Dawson 1.4TH Bitcoin Miner *Backordered till 6/6/14*
$3,099.00 USD


How many bitcoins will I earn with   Calculate
 Gh/s miner?
You will mine 3.7452 bit coins.


3.7452 = $2,452

So you pay $3,099.00 to make $2,452

hm...

[DolanDuck]

Recently mining at home became more and more difficult, the maximum expectation of a miner is to breakeven the investment,
I think it's better to buy btc from exchanges instead of triyng to mine them to pay the hardware.

[Fireblade]

Recently mining at home became more and more difficult, the maximum expectation of a miner is to breakeven the investment,
I think it's better to buy btc from exchanges instead of triyng to mine them to pay the hardware.

If everybody will buy coins instead of mining gear, the purchaged coins will not be converted to fiat money. Win-win situation for everybody, price rises.

[taipo]

Miners generally make lousy bitcoin day traders. Soon as the fiat value of BTC goes up enough, were buying miners again with the bought BTC. If you are into mining and not punching out 10+ TH/s then you are an amateur in it for kicks, overpriced winter heating bills and you just like things that flash blue and red in the dark.

[Parazyd]

You're so better off buying Bitcoin. It's really better for everyone, even for non-miners.

[jimmothy]

http://shop.rockminer.com/goods.php?id=35

[KimNam]

forget mining at this time
better to buy BTC instead mining

You're so better off buying Bitcoin. It's really better for everyone, even for non-miners.

not good for mining hardware company

[ScaryHash]

I love these threads, because they are usually total nonsense, with just some random new website calculator to put in some assumptions into, leading to some set in stone conclusion which never changes.

You won't make ROI, ever, blah blah blah blah.

Please. Your assumptions are totally invalid.

Here, I will give you a real world example. I'm a small-time home miner, mostly do this for a little fun and a little profit.

I bought an S1 AntMiner in December 2013, and one in January of 2014. Total cost for the 2 S1 AntMiners was 5.35 BTC.

Here were are in June of 2014, and I'm looking at a wallet balance of about 6.6 BTC.

Net profit = 1.25 BTC, or (1.25/5.35 invested)*100 = 23.36-ish %.

Electricity cost per day is about 35 cents, to that's about 65 bucks worth of electricity for 180ish days.

This is not a boast, or a calculator, or a set of assumptions.

The price of BTC in $$, or rubles, or yuan doesn't matter, since I paid with BTC.

If you want something done right, do it yourself, and don't worry about the price spikes or price dips. Averaged out over 6 to 9 months, you will almost always make a small profit (assuming you don't have an excessive electricity costs).

[Dalkore]

I love these threads, because they are usually total nonsense, with just some random new website calculator to put in some assumptions into, leading to some set in stone conclusion which never changes.

You won't make ROI, ever, blah blah blah blah.

Please. Your assumptions are totally invalid.

Here, I will give you a real world example. I'm a small-time home miner, mostly do this for a little fun and a little profit.

I bought an S1 AntMiner in December 2013, and one in January of 2014. Total cost for the 2 S1 AntMiners was 5.35 BTC.

Here were are in June of 2014, and I'm looking at a wallet balance of about 6.6 BTC.

Net profit = 1.25 BTC, or (1.25/5.35 invested)*100 = 23.36-ish %.

Electricity cost per day is about 35 cents, to that's about 65 bucks worth of electricity for 180ish days.

This is not a boast, or a calculator, or a set of assumptions.

The price of BTC in $$, or rubles, or yuan doesn't matter, since I paid with BTC.

If you want something done right, do it yourself, and don't worry about the price spikes or price dips. Averaged out over 6 to 9 months, you will almost always make a small profit (assuming you don't have an excessive electricity costs).

I think you may be understating your power price if you pay for it.  By your math you have .01/kwh power (.35 / 24 hrs = .01458).  Can you please pull out your power bill again or if you want to disclose your state and county, I can look it up. 


-D

[ScaryHash]

You are right, I did miscalculate my power costs.

700 W for 2 antminers (measured using KillOwatt meter),  24 hours a day, that's 16800 W or 16.8 KW.

At $ 0.10 / KW, that's $1.68/day * 180 days = $302.8 for half a year.

Subtract that from the profit, and that knocks it down to roughly 11% profit.

Still, profit is profit. You're not getting 11% by investing in treasury bills, and AntMiners are way safer than the stock market (Nothing exciting happens in my basement, heh).

Those Antminers are still running, and will be profitable until roughly October/2014.

Thank you for pointing that out.

[XScrypt]

I bought an S1 AntMiner in December 2013, and one in January of 2014. Total cost for the 2 S1 AntMiners was 5.35 BTC.

Here were are in June of 2014, and I'm looking at a wallet balance of about 6.6 BTC.

Net profit = 1.25 BTC, or (1.25/5.35 invested)*100 = 23.36-ish %.
---------
You are right, I did miscalculate my power costs.

700 W for 2 antminers (measured using KillOwatt meter),  24 hours a day, that's 16800 W or 16.8 KW.

At $ 0.10 / KW, that's $1.68/day * 180 days = $302.8 for half a year.

Subtract that from the profit, and that knocks it down to roughly 11% profit.

Still, profit is profit. You're not getting 11% by investing in treasury bills, and AntMiners are way safer than the stock market (Nothing exciting happens in my basement, heh).

Those Antminers are still running, and will be profitable until roughly October/2014.

Thank you for pointing that out.

You're not profitable. At least not if your using USD.

BTC Cost: 5.35BTC*$900 = $4800 (Average of December and January BTC prices)
Power Cost: $300
Current Value: 6.6*$650 = $4290
Profit/Loss: -$810

That's better than if you had bought BTC and held it.

BTC Cost: 5.35*$900 = $4800
Current Value: 5.35*$650 = $3477
Profit/Loss: -$1323

But what if instead you had split that $4800 over 6 months and just bought straight BTC(dollar cost averaging)?
(Buying .892 BTC at the beginning of every month for 6 months beginning in December)

Cost: $1000*.892 + $800*.892 + $800*.892 + $550*.892 + $450*.892 + $450*.892 = $3612
Current Value: $3487
Profit/Loss: -$125

That's better than the $800 loss from mining. But an ever better situation is if you bought at a low point like April.

Cost: $4800 = 13.71BTC @ $350
Current Value: $8914
Profit: $4114

With mining, you're accepting a loss out of the gate and hoping that at some point in the future you can not only make back what you paid for the hardware but also make a profit. In other words, your hoping that:

1. BTC prices don't drop.
2. Difficulty doesn't increase to the point that renders your hardware unprofitable to run before you reach break-even.

With buying BTC, you just hope the price goes up. In addition, you can employ various investing strategies (such as dollar cost averaging) to reduce losses and improve profits. And unlike mining, if the market starts plummeting you can just cash out.

Better for small timers to just buy BTC or set up a regular investment strategy than to mine.

[ScaryHash]

Forget USD. It's a dying currency, and soon it will be completely worthless, only good enough for kindling and toilet paper.

I used to think like you, honestly. I always converted stuff to USD, and calculated profit/loss that way.

However, once I've used BTC for about a year, I've started thinking in BTC. There is no need to think of stuff in other terms.

If I paid in BTC, I calculate my profit in BTC.

I could care less about fiat, worthless currencies. Yes, my power bill is in $$, but that's chump change in my book. $300 over 6 months is going to the movie theater twice a month with another person and buying popcorn and a drink. I don't even think about it.

Yes, the price of BTC was high in December/January 2013/14, but that's irrelevant also.

The price of USD to Yen, Euros and Pesos goes up and down too, but you don't see people calculating and saying "OMG, I had more Euros in December than I did in May, if I converted my USD to Euros!"...

What's the point of conversions to other currencies, if you don't really care about the other currencies?

I use BTC as much as I can, other currencies be damned.

Yes, your analysis makes sens XScrypt, as long as you pick and choose which data points for USD/BTC conversion you use. But, I respectfully disagree with your conclusion, since it is based on hindsight.

I don't really care if  BTC goes up or down in terms of fiat currencies, because I'm minimizing their use. Hell, you can buy just about anything you want nowadays in BTC, even cars and groceries.

Plus, if all small time miners gave up and bought BTC, then BTC would be controlled by HUGE centralized mining farms, which is just like the Federal Reserve/Central Bank system. The whole point of BTC is to have a decentralized currency creation system, that cannot be brought down if one or more nodes go down.

The whole theory of "You should have bought BTC instead of mining because of ...blah blah blah" goes completely AGAINST what a decentralized cryptocurrency with no central control stands for.

[david123]

I bought an S1 AntMiner in December 2013, and one in January of 2014.

Yeah, I think few people deny that if you bought the right miner at the right point of
time from the right company, it was possible to make a profit.

So, may I ask: Was this your first and only mining project?
Or did you just pick the example with the best outcome?

[murraypaul]

If you are into mining and not punching out 10+ TH/s then you are an amateur in it for kicks, overpriced winter heating bills and you just like things that flash blue and red in the dark.

And how exactly does that change if you have more than 10TH/s?
More kicks, more heat and more flashing lights.
If mining is unprofitable, having more miners means losing more money.

[feina24h]

IMO its very hard to make ROI now better buy bitcoin directly.

[DeathAndTaxes]

If mining is unprofitable, having more miners means losing more money.

Maybe it is dotcom type thinking.  We are losing money on every order but we are going to make it up with volume.

[RoadStress]

Spondoolies-Tech SP10 Dawson 1.4TH Bitcoin Miner *Backordered till 6/6/14*
$3,099.00 USD

It seems that some people didn't agree with those calculations and they bought all SP10 miners available Now only the SP30 is available for order (see affiliate sig)

[ScaryHash]

I bought an S1 AntMiner in December 2013, and one in January of 2014.

Yeah, I think few people deny that if you bought the right miner at the right point of
time from the right company, it was possible to make a profit.

So, may I ask: Was this your first and only mining project?
Or did you just pick the example with the best outcome?

No, actually I picked an example that has not fully played out. That was just the "6 months" checkup. Final tally for ROI is actually at 9 months.

I'm not really going to get into specifics, because frankly, I don't want to seem like any kind of boasting asshole. Suffice it to say that I owe a lot of stuff that I learned to people on these forums, who have tried to help other people, like myself and others. Those people are very nice and helpful, and have helped me a lot, so I try to pass on a little of what I have learned.

Cryptomining is like a box of chocolates, you never really know what you're going to get. Sure, everybody can have hindsight, and say "You should have bought BTC at price XXX, instead of buying mining hardware", but that's like saying "You should have bought Apple at $11/share back in 1995-6". That kind of advice is absolutely worthless. Kind of like the advice you get from a broker, who just wants to make his commission.

My advice, forget calculators (They have their uses to see mainly when you should unplug stuff). Physics is tough to argue with.

Buy with a 6-9 months window, and do your own thing. Try a few things out. I'm not going to get into specific amounts, because the IRS could be trolling these boards, but here is a few "projects" of mine that have turned quite well.

1) May 2013, bought a 7850 and a 7750 Radeon. Everybody was saying GPU mining was dead, blah blah blah. Kept mining with GPU's until August, Now those GPU's are mining Scrypt. ROI made beyond my wildest dreams, let's just leave it at that.

2) July and August, added 5 block erupters. ROI made, because I kept the BTC and waited for the top.

3) Bunch of K16's that I ordered finally came in early November 2013, mined with them for a month and a half,  sold them in December  on E-bay for basically what I paid for them. Net profit enough to pay my wife's student loans and mortgage one month. Wife stays off my back now on cryptomining and computers (priceless).

4) Some jally preorders came in about the same time as I got a 30Gh/s little single off E-bay (October 2013). That thing has made the money back on it in spades, and then some. Butterfly labs stuff is still going, although I will have to pull the plug soon, according to my calculations.

5) Made enough to get the Antminers, which are still going.

6) Just got an SP10 Dawson in, we'll see how that works out. The next power bill might be interesting however. That thing sucks power.

So, my point is, stop stressing about ROI for the next 6 months, and don't listen to the naysayers who say you should buy BTC and hold it. Yes, you have to hold BTC, but hold the BTC you mine yourself, until there is the right time to either re-invest in mining equipment, or sell them.

Hope this helps somebody.

[ScaryHash]

IMO its very hard to make ROI now better buy bitcoin directly.

I disagree with that assessment.

You sound just like a broker who says "Invest in these mutual funds from our company, they are better", and then gets paid commission for it.

Anybody that says to just buy BTC and hold it is just advising people to buy BTC so that more demand is created, so that they can sell the BTC they already have mined at a higher price.

[Harley997]

I have come across this site:

http://mining-profit.com

and its basically saying with the miners you buy you will never make a ROI

Spondoolies-Tech SP10 Dawson 1.4TH Bitcoin Miner *Backordered till 6/6/14*
$3,099.00 USD


How many bitcoins will I earn with   Calculate
 Gh/s miner?
You will mine 3.7452 bit coins.


3.7452 = $2,452

So you pay $3,099.00 to make $2,452

hm...

Now-a-days most miners will not be able to ROI every. If they can time the market right they can possibly buy a miner, and put it up for sale right away and let it mine until it sells. Hopefully you can mine more then the value it looses.