CEX.io GHS Bubble ?

[bomberb17]

I disaggree, you can indeed make profit in cex.io. Its more like an exchange where your shares pay dividend each day.
Assume you buy 1GHS today @ 0.0075BTC.
1GHS makes approx. 0.00003736 BTC/day in today's difficulty. Taking maintenance fee into account:
fee is $0.26/month for 1 GHS
which makes 0.26/660 = 0,00039 BTC/month
which makes 0.000013 BTC/day
So this leaves about 0.0000243BTC/day.
There's also a 0.2% trade fee.

So in order to stay profitable, you could either sell the 1 GHS today for >0.007515 (0.0075 + 0.2%) BTC, or tomorrow for >0.0074907 BTC, or after 2 days for >0.0074664BTC and so on.
Of course these figures will change after each difficulty adjustment, but logic stays the same.
The way I see it, the only thing that makes it a risky investment is the possibility of a website hack/shutdown etc. (think mtgox) since all the coins/ghs are online.

[thresher]

I disaggree, you can indeed make profit in cex.io. Its more like an exchange where your shares pay dividend each day.
Assume you buy 1GHS today @ 0.0075BTC.
1GHS makes approx. 0.00003736 BTC/day in today's difficulty. Taking maintenance fee into account:
fee is $0.26/month for 1 GHS
which makes 0.26/660 = 0,00039 BTC/month
which makes 0.000013 BTC/day
So this leaves about 0.0000243BTC/day.
There's also a 0.2% trade fee.

So in order to stay profitable, you could either sell the 1 GHS today for >0.007515 (0.0075 + 0.2%) BTC, or tomorrow for >0.0074907 BTC, or after 2 days for >0.0074664BTC and so on.
Of course these figures will change after each difficulty adjustment, but logic stays the same.
The way I see it, the only thing that makes it a risky investment is the possibility of a website hack/shutdown etc. (think mtgox) since all the coins/ghs are online.

When your shares start producing negative value everyday, your entire plan goes out the window.  Now your "shares" are losing money every day, and the price of "shares" would have to skyrocket well above what you spent to compensate for the fact they essentially have a lean against them.
Your buying gh/s, that should only decrease in value (cex.io doesn't add new hardware for you, like they should in this type of model), the "shares" are losing value by mining with that ghs, and you are expecting to profit somehow?  Thinking you can make profit on cex.io is the same as thinking your going to buy a brand new car, drive it off the lot, and sell it later for more than you paid, can it happen, yes (maybe the ford gt or something), is it likely, no.

[lowbander80]

As a hero member suggested not a long time ago

GHASH CLOUD MINING PROFITABLE 100% !!!!!!!!!!!!!!!!! for the pool

[beegatewood]

cex.io is always overpriced since the beginning, and you won't ROI on it but might make a profit buying and selling hash.

[bomberb17]

I disaggree, you can indeed make profit in cex.io. Its more like an exchange where your shares pay dividend each day.
Assume you buy 1GHS today @ 0.0075BTC.
1GHS makes approx. 0.00003736 BTC/day in today's difficulty. Taking maintenance fee into account:
fee is $0.26/month for 1 GHS
which makes 0.26/660 = 0,00039 BTC/month
which makes 0.000013 BTC/day
So this leaves about 0.0000243BTC/day.
There's also a 0.2% trade fee.

So in order to stay profitable, you could either sell the 1 GHS today for >0.007515 (0.0075 + 0.2%) BTC, or tomorrow for >0.0074907 BTC, or after 2 days for >0.0074664BTC and so on.
Of course these figures will change after each difficulty adjustment, but logic stays the same.
The way I see it, the only thing that makes it a risky investment is the possibility of a website hack/shutdown etc. (think mtgox) since all the coins/ghs are online.

When your shares start producing negative value everyday, your entire plan goes out the window.  Now your "shares" are losing money every day, and the price of "shares" would have to skyrocket well above what you spent to compensate for the fact they essentially have a lean against them.
Your buying gh/s, that should only decrease in value (cex.io doesn't add new hardware for you, like they should in this type of model), the "shares" are losing value by mining with that ghs, and you are expecting to profit somehow?  Thinking you can make profit on cex.io is the same as thinking your going to buy a brand new car, drive it off the lot, and sell it later for more than you paid, can it happen, yes (maybe the ford gt or something), is it likely, no.

I didn't say its a guaranteed win, yes the ghs price is way overpriced, however if you play it smart you can be on the positive side.
So far by trading and mining at the same time with the ghs my 2.4BTC have grown into 2.65BTC. When the ghs will start producing negative value (i.e. maintenance fee=0.000013 BTC/day > daily mining output)
then one of the following will happen
a) Cex.io will make the fee much lower such that it makes sense to own ghs
or b) ghs price will drop to 0.

[ranochigo]

I disaggree, you can indeed make profit in cex.io. Its more like an exchange where your shares pay dividend each day.
Assume you buy 1GHS today @ 0.0075BTC.
1GHS makes approx. 0.00003736 BTC/day in today's difficulty. Taking maintenance fee into account:
fee is $0.26/month for 1 GHS
which makes 0.26/660 = 0,00039 BTC/month
which makes 0.000013 BTC/day
So this leaves about 0.0000243BTC/day.
There's also a 0.2% trade fee.

So in order to stay profitable, you could either sell the 1 GHS today for >0.007515 (0.0075 + 0.2%) BTC, or tomorrow for >0.0074907 BTC, or after 2 days for >0.0074664BTC and so on.
Of course these figures will change after each difficulty adjustment, but logic stays the same.
The way I see it, the only thing that makes it a risky investment is the possibility of a website hack/shutdown etc. (think mtgox) since all the coins/ghs are online.

When your shares start producing negative value everyday, your entire plan goes out the window.  Now your "shares" are losing money every day, and the price of "shares" would have to skyrocket well above what you spent to compensate for the fact they essentially have a lean against them.
Your buying gh/s, that should only decrease in value (cex.io doesn't add new hardware for you, like they should in this type of model), the "shares" are losing value by mining with that ghs, and you are expecting to profit somehow?  Thinking you can make profit on cex.io is the same as thinking your going to buy a brand new car, drive it off the lot, and sell it later for more than you paid, can it happen, yes (maybe the ford gt or something), is it likely, no.

I didn't say its a guaranteed win, yes the ghs price is way overpriced, however if you play it smart you can be on the positive side.
So far by trading and mining at the same time with the ghs my 2.4BTC have grown into 2.65BTC. When the ghs will start producing negative value (i.e. maintenance fee=0.000013 BTC/day > daily mining output)
then one of the following will happen
a) Cex.io will make the fee much lower such that it makes sense to own ghs
or b) ghs price will drop to 0.

For the options you think would happen,
a) they would need much newer hardware so that they can lower the fees.
b) I can say if that happens, I would be owning Phs of hashpower

[EvilPanda]

I disaggree, you can indeed make profit in cex.io. Its more like an exchange where your shares pay dividend each day.
Assume you buy 1GHS today @ 0.0075BTC.
1GHS makes approx. 0.00003736 BTC/day in today's difficulty. Taking maintenance fee into account:
fee is $0.26/month for 1 GHS
which makes 0.26/660 = 0,00039 BTC/month
which makes 0.000013 BTC/day
So this leaves about 0.0000243BTC/day.
There's also a 0.2% trade fee.

So in order to stay profitable, you could either sell the 1 GHS today for >0.007515 (0.0075 + 0.2%) BTC, or tomorrow for >0.0074907 BTC, or after 2 days for >0.0074664BTC and so on.
Of course these figures will change after each difficulty adjustment, but logic stays the same.
The way I see it, the only thing that makes it a risky investment is the possibility of a website hack/shutdown etc. (think mtgox) since all the coins/ghs are online.

When your shares start producing negative value everyday, your entire plan goes out the window.  Now your "shares" are losing money every day, and the price of "shares" would have to skyrocket well above what you spent to compensate for the fact they essentially have a lean against them.
Your buying gh/s, that should only decrease in value (cex.io doesn't add new hardware for you, like they should in this type of model), the "shares" are losing value by mining with that ghs, and you are expecting to profit somehow?  Thinking you can make profit on cex.io is the same as thinking your going to buy a brand new car, drive it off the lot, and sell it later for more than you paid, can it happen, yes (maybe the ford gt or something), is it likely, no.

I didn't say its a guaranteed win, yes the ghs price is way overpriced, however if you play it smart you can be on the positive side.
So far by trading and mining at the same time with the ghs my 2.4BTC have grown into 2.65BTC. When the ghs will start producing negative value (i.e. maintenance fee=0.000013 BTC/day > daily mining output)
then one of the following will happen
a) Cex.io will make the fee much lower such that it makes sense to own ghs
or b) ghs price will drop to 0.

For the options you think would happen,
a) they would need much newer hardware so that they can lower the fees.
b) I can say if that happens, I would be owning Phs of hashpower

CEX won't last long. If you have high prices in a competitive market you will either be forced to lower or lose clients.
There are much better services coming up, you'll see.

[picolo]

I open CEX.io and find this rather confusing price:

GHS/BTC = 0.00747 which is the equivalent to THS/BTC = 7.47 = 4.487 USD

So you need to pay more than 7 BTC for one TH/s? It does not make sense at all. Here's why:

Currently one TH/s generates BTC 1.12 per month = 667 USD.

Don't forget maintenance. One TH/s costs 260 USD per month, reducing the profit to 407 USD, so it takes 11 months to break even. With difficulty increases it will surely never happen.

Am I right?
 

If you buy a mining contract and hold it, then it probably won't be profitable because you will end up with less bitcoins than the amount you put in. If that is your goal, then I agree it would be better to simply hodl the bitcoins themselves and your calculations seem to support this conclusion.

What you are forgetting is that you can profit by trading the mining contracts themselves.

The worst would be to reinvest your revenue in GHS because you will get a fraction of a fraction of the BTC you had

Also there is a risk of losing all your coins if the site closes

[bomberb17]

I open CEX.io and find this rather confusing price:

GHS/BTC = 0.00747 which is the equivalent to THS/BTC = 7.47 = 4.487 USD

So you need to pay more than 7 BTC for one TH/s? It does not make sense at all. Here's why:

Currently one TH/s generates BTC 1.12 per month = 667 USD.

Don't forget maintenance. One TH/s costs 260 USD per month, reducing the profit to 407 USD, so it takes 11 months to break even. With difficulty increases it will surely never happen.

Am I right?
 

If you buy a mining contract and hold it, then it probably won't be profitable because you will end up with less bitcoins than the amount you put in. If that is your goal, then I agree it would be better to simply hodl the bitcoins themselves and your calculations seem to support this conclusion.

What you are forgetting is that you can profit by trading the mining contracts themselves.

The worst would be to reinvest your revenue in GHS because you will get a fraction of a fraction of the BTC you had

Also there is a risk of losing all your coins if the site closes

The latter is what I'm afraid of. Think Mtgox..

[Bitcoin++]

Funny thing : GHS/BTC price is 0.00754.

If I could sell my Antminer S1 for this price, it would go for 0.00754 * 200 = BTC 1.51. Bitmain stopped selling it at BTC 0.409, and now it would have been even cheaper.

CEX' price is so high I would feel bad for the poor buyer if I could sell at that price. Though buying from CEX is even worse. They charge higher maintenance fees than you pay if you run an antminer at home.

[DrG]

Funny thing : GHS/BTC price is 0.00754.

If I could sell my Antminer S1 for this price, it would go for 0.00754 * 200 = BTC 1.51. Bitmain stopped selling it at BTC 0.409, and now it would have been even cheaper.

CEX' price is so high I would feel bad for the poor buyer if I could sell at that price. Though buying from CEX is even worse. They charge higher maintenance fees than you pay if you run an antminer at home.

Please, we can't be bothered with numbers and statistical facts.  It just feels good buying a overpriced security and passing it off to another unsuspecting fool

[kingscrown]

cex prices are made by.. the people.

[nwfella]

Agree that the price is over-valued per GHS on cex.io but also agree that if your a skilled trader you can more than likely make money trading GHS but you had better know what your doing.  I didn't and ended up losing out overall in the little bit of playing I've done.

[Omikifuse]

Not worth the price at all, the price is higher because people don't need to maintain the hardware.

[bbeesley]

I don't see Cex.io as a profit center in it's own right but rather I use it as a place to store some of my BTC

if I have my BTC sitting in a wallet, it earns nothing

if I use some of my BTC to buy GHS then it makes at least some BTC

when and if I need the BTC, I just sell the GHS and withdraw the BTC back to my wallet

I don't have all of my assets in this primarily because I don't want to trust any entity too much lest I get Gox'd

so far, it has worked out positively for me...your mileage may vary.

[DrG]

I don't see Cex.io as a profit center in it's own right but rather I use it as a place to store some of my BTC

if I have my BTC sitting in a wallet, it earns nothing

if I use some of my BTC to buy GHS then it makes at least some BTC

when and if I need the BTC, I just sell the GHS and withdraw the BTC back to my wallet

I don't have all of my assets in this primarily because I don't want to trust any entity too much lest I get Gox'd

so far, it has worked out positively for me...your mileage may vary.

Oh God no, don't do that.  Look at the graph for the price over the last 6 months.  It will just keep going down faster than anything you might be mining.  You're basically giving money away to the flippers.  If you're going to get into CEX you HAVE to flip to make a profit.  Otherwise just put your money in cold storage.

[bomberb17]

I don't see Cex.io as a profit center in it's own right but rather I use it as a place to store some of my BTC

if I have my BTC sitting in a wallet, it earns nothing

if I use some of my BTC to buy GHS then it makes at least some BTC

when and if I need the BTC, I just sell the GHS and withdraw the BTC back to my wallet

I don't have all of my assets in this primarily because I don't want to trust any entity too much lest I get Gox'd

so far, it has worked out positively for me...your mileage may vary.

Oh God no, don't do that.  Look at the graph for the price over the last 6 months.  It will just keep going down faster than anything you might be mining.  You're basically giving money away to the flippers.  If you're going to get into CEX you HAVE to flip to make a profit.  Otherwise just put your money in cold storage.

By storing BTC in cex.io and use them for mining, we get these 2 values:
X = initial ghs buy value
Y = final ghs sell value + mining profit - maintenance fees - risk of cex.io/ghash.io hack or shutdown

if you think Y will be greater than X, go invest on cex. If not, keep them on offline wallet.
The only certain thing is that noone can say which it will be.

[picolo]

I don't see Cex.io as a profit center in it's own right but rather I use it as a place to store some of my BTC

if I have my BTC sitting in a wallet, it earns nothing

if I use some of my BTC to buy GHS then it makes at least some BTC

when and if I need the BTC, I just sell the GHS and withdraw the BTC back to my wallet

I don't have all of my assets in this primarily because I don't want to trust any entity too much lest I get Gox'd

so far, it has worked out positively for me...your mileage may vary.

If you bought GHS and hold them and you made a profit you must have invested very recently and got lucky because it has been mostly going down for months

[williamj2543]

I lost 25% of my BTC holdings because of GHS. Shouldn't have done that...

[bbeesley]

Look at the graph for the price over the last 6 months.  It will just keep going down faster than anything you might be mining. 

there was a price bubble a few months ago but the price has stayed reasonably stable for a bit now.  I have an upper cutoff for both the amount I will pay for GHS and how many GHS I will own at any given moment

The price seems to fluctuate mostly down during the period after a difficulty change then rise slowly until the next one, but has remained where it is....which is really low currently...for awhile

of course, everyone here is much smarter than me so my positive cash flow must just be a rookie mistake ;-)