Antminer S3 - Profit is Impossible

[ALToids]

As long as BTC goes up, you can certainly make a profit.  You just have to buy with fiat (i.e., either convert fiat to BTC and buy antminers, or buy antminers and then buy back the BTC with fiat).  If you just buy with BTC you already have, it will be difficult.

That's not really making a profit.  That's gaining more fiat based on the exchange rate.

You need to compare how much BTC the miner costs currently as opposed to how much the miner can mine during it's useful life.  Almost every miner will currently return a loss.

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[iglasses]

Here is why I disagree...

round one
@ 18g
495Ghs
.1656 (.0138 per day)

round two
15% increase to 20.7
.144 (.0120 per day)

round three
15% increase to 23.8
.126 (.0105 per day)

round four
15% increase to 27.4
.1092 (.0091 per day)

round five
15% increase to 31.6
.0948 (.0079 per day)

round six
15% increase to 36.4
.0816 (.0068 per day)

round seven
15% increase to 41.86
.072 (.0060 per day)

.7932 after 84 days (2.8 months)


If you look at the last ten difficulty increases they average out to 16%.  If you add the next one which is likely to be 7-8% it comes down to an average increase of 15%.  The numbers above do not account for any hosting or electricity costs but for some of us these numbers do not exist.  If I can break even in the amount of time above and then continue to run the miners for an additional 2-3 months and then liquidate it for ten cents on the dollar (.075BTC) why the hell would I NOT want to do it?

[googlemaster1]

Here is why I disagree...

round one
@ 18g
495Ghs
.1656 (.0138 per day)

round two
15% increase to 20.7
.144 (.0120 per day)

round three
15% increase to 23.8
.126 (.0105 per day)

round four
15% increase to 27.4
.1092 (.0091 per day)

round five
15% increase to 31.6
.0948 (.0079 per day)

round six
15% increase to 36.4
.0816 (.0068 per day)

round seven
15% increase to 41.86
.072 (.0060 per day)

.7932 after 84 days (2.8 months)


If you look at the last ten difficulty increases they average out to 16%.  If you add the next one which is likely to be 7-8% it comes down to an average increase of 15%.  The numbers above do not account for any hosting or electricity costs but for some of us these numbers do not exist.  If I can break even in the amount of time above and then continue to run the miners for an additional 2-3 months and then liquidate it for ten cents on the dollar (.075BTC) why the hell would I NOT want to do it?

iglasses, don't be an asshole.  You know these threads only exist to stop future miners from raising the difficulty so we can have more BTC for ourselves.  WHY YOU GOTTA RUIN A GOOD THING BRO?

[iglasses]

Google your right. Please accept my most sincere apology. Potential miners....please be advised I am known to ingest copious amounts of alcohol and cannot be trusted.

Ig

[CoinsCoinsEverywhere]

As long as BTC goes up, you can certainly make a profit.  You just have to buy with fiat (i.e., either convert fiat to BTC and buy antminers, or buy antminers and then buy back the BTC with fiat).  If you just buy with BTC you already have, it will be difficult.

That's not really making a profit.  That's gaining more fiat based on the exchange rate.

You need to compare how much BTC the miner costs currently as opposed to how much the miner can mine during it's useful life.  Almost every miner will currently return a loss.

As I stated in a more round-about fashion, comparing strictly in terms of BTC, making a profit would be difficult.  So we agree there.  But how is gaining more fiat not making a profit?

[Searing]

the reason these miners are sold so quickly is because of new miners. Every new miner heard of the succes of the s1 and when they hear the new s3 is announced they immediately jump in. As you said, no rational miner will buy this.

yep all newbies buy equip ....(heh me to) I got a knc jupter july 1st 2013 had no problem with 7131.80 usd for the miner..shoulda just got btc instead heh
got 50 btc out of the jupiter eol likely woulda had like 80 if just got btc

a newbie tradition heh

Searing

[TheJuice]

Ummm, haven't we learned anything in bitcoin mining? Never say never.

The diff adjustment this next block will be 2%. In 2 months at that rate you break even.

[Searing]

Ummm, haven't we learned anything in bitcoin mining? Never say never.

The diff adjustment this next block will be 2%. In 2 months at that rate you break even.

You got that right! The more I learn about BTC the less I know!

conundrum

Searing

[googlemaster1]

the reason these miners are sold so quickly is because of new miners. Every new miner heard of the succes of the s1 and when they hear the new s3 is announced they immediately jump in. As you said, no rational miner will buy this.

yep all newbies buy equip ....(heh me to) I got a knc jupter july 1st 2013 had no problem with 7131.80 usd for the miner..shoulda just got btc instead heh
got 50 btc out of the jupiter eol likely woulda had like 80 if just got btc

a newbie tradition heh

Searing

Really mining should only be a small portion of your investment if you are really bullish.  I use mining to hedge, really.  And it makes the MOST sense to get into mining now for that reason because we are getting to the top end of what is possible with current hardware.  A few terrahashes never hurt nobody!

[zvs]

A good calculator for mining:
https://bitcoinwisdom.com/bitcoin/calculator

Play with these inputs and you'll realize that it's almost impossible ever to break even.

I managed to make a profit of 0.65 BTC only by using some very strong assumptions:

Price = 0.75 BTC (I.e. no VAT/customs, free PSU)
Electricity only $0.10/kWh
Only 10% difficulty increment

It implies that no EU resident will ever be able to make a profit. If you live in some parts of the US, you might profit marginally, but not worthwhile given the risk of hardware failure.

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

Nope...you pretty much hit the nail on the head.  Even here in the states the likelihood of recovering your initial investment in hardware is slim to none.  Plus, your also assuming 100% uptime.  Rig's quit unexpectedly for a variety of reasons:
1.) Hardware issue(s) (failed fans, etc.)
2.) Internet connection lost
3.) Pool(s) going down (this can be largely mitigated by having secondary and tertiary pools but you still lose some hash power switching pools)

All and all mining isn't even a 0 sum game at this point.  It's a guaranteed loss!

If you keep them and mine with them, yes.

I don't know if it's still true or not, but people used to offer above the already bloated retail value to buy ASICs "in hand".

and most people talking about mining with their ASICs aren't people that have been on this board for more than a year or two

[Rabinovitch]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

[brian_23452]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

Why do people keep saying this?  What does the exchange ratio have to do with it?  If you purchase a device for .75BTC it either mines more than .75BTC or it mines less than .75BTC.  If it ends up mining less than .75BTC you lost money, regardless of the relative exchange rates.  This should be intuitively obvious. 

[CoinsCoinsEverywhere]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

Why do people keep saying this?  What does the exchange ratio have to do with it?  If you purchase a device for .75BTC it either mines more than .75BTC or it mines less than .75BTC.  If it ends up mining less than .75BTC you lost money, regardless of the relative exchange rates.  This should be intuitively obvious.  

If you just buy with BTC, then yes.  But if you buy with converted fiat, it would be a lot easier to make a profit.  For example, if the USD exchange rate is 600 right now, you could buy a 0.75 BTC miner for $450.  If BTC goes up to $1200 each, then you only need to mine 0.375 BTC to break even in fiat terms (ignoring potential power supply and power costs).

However, it is certainly true that you could skip the whole mining process and simply buy 0.75 BTC instead.  But that's less fun.

[brian_23452]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

Why do people keep saying this?  What does the exchange ratio have to do with it?  If you purchase a device for .75BTC it either mines more than .75BTC or it mines less than .75BTC.  If it ends up mining less than .75BTC you lost money, regardless of the relative exchange rates.  This should be intuitively obvious.  

If you just buy with BTC, then yes.  But if you buy with converted fiat, it would be a lot easier to make a profit.  For example, if the USD exchange rate is 600 right now, you could buy a 0.75 BTC miner for $450.  If BTC goes up to $1200 each, then you only need to mine 0.375 BTC to break even in fiat terms (ignoring potential power supply and power costs).

I don't know how easier to explain it to you.  .75BTC is .75BTC, it makes no difference whether you bought it on an exchange, "converted" it as you say, mined it, stole it, scammed it from someone in the lending section, whatever.  If you purchase this miner for .75BTC and then it mines .375BTC, you just lost .375BTC.  Meanwhile, the person who didn't purchase this miner still has .75BTC.  BTC increasing to $1200 has nothing to do with it you lost 0.375BTC.  If you absolutely insist on thinking in terms of dollars, than the person who didn't purchase the miner now has $900.  You should have $900 too but because you bought the miner instead of keeping the .75BTC, you now only have $450.  You didn't break even.  You mined $450 worth of bitcoin but spent $900 worth of bitcoin to get it. 

I'm not going to keep beating a dead horse.  If you can't understand the simple, intuitively obvious concept that 0.75BTC is always more than 0.375BTC no matter what the fiat exchange rate is, than I don't really know what else to say on the matter.

[Katarina]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

Why do people keep saying this?  What does the exchange ratio have to do with it?  If you purchase a device for .75BTC it either mines more than .75BTC or it mines less than .75BTC.  If it ends up mining less than .75BTC you lost money, regardless of the relative exchange rates.  This should be intuitively obvious.  

If you just buy with BTC, then yes.  But if you buy with converted fiat, it would be a lot easier to make a profit.  For example, if the USD exchange rate is 600 right now, you could buy a 0.75 BTC miner for $450.  If BTC goes up to $1200 each, then you only need to mine 0.375 BTC to break even in fiat terms (ignoring potential power supply and power costs).

However, it is certainly true that you could skip the whole mining process and simply buy 0.75 BTC instead.  But that's less fun.

Save you the trouble, buy the 0.75 BTC with $450 and then sell it when it hit $1200. You now have $900.

[spazzdla]

I like my BTC toys.

[CoinsCoinsEverywhere]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

Why do people keep saying this?  What does the exchange ratio have to do with it?  If you purchase a device for .75BTC it either mines more than .75BTC or it mines less than .75BTC.  If it ends up mining less than .75BTC you lost money, regardless of the relative exchange rates.  This should be intuitively obvious.  

If you just buy with BTC, then yes.  But if you buy with converted fiat, it would be a lot easier to make a profit.  For example, if the USD exchange rate is 600 right now, you could buy a 0.75 BTC miner for $450.  If BTC goes up to $1200 each, then you only need to mine 0.375 BTC to break even in fiat terms (ignoring potential power supply and power costs).

I don't know how easier to explain it to you.  .75BTC is .75BTC, it makes no difference whether you bought it on an exchange, "converted" it as you say, mined it, stole it, scammed it from someone in the lending section, whatever.  If you purchase this miner for .75BTC and then it mines .375BTC, you just lost .375BTC.  Meanwhile, the person who didn't purchase this miner still has .75BTC.  BTC increasing to $1200 has nothing to do with it you lost 0.375BTC.  If you absolutely insist on thinking in terms of dollars, than the person who didn't purchase the miner now has $900.  You should have $900 too but because you bought the miner instead of keeping the .75BTC, you now only have $450.  You didn't break even.  You mined $450 worth of bitcoin but spent $900 worth of bitcoin to get it. 

I'm not going to keep beating a dead horse.  If you can't understand the simple, intuitively obvious concept that 0.75BTC is always more than 0.375BTC no matter what the fiat exchange rate is, than I don't really know what else to say on the matter.

Did you see the part where I said, "However, it is certainly true that you could skip the whole mining process and simply buy 0.75 BTC instead.  But that's less fun."?  (Although I will grant you that I added this to my original comment a minute or two after I posted the first part, so you may not have seen it before you started writing your comment.)

[iglasses]

What if the coin goes DOWN?

Can you profit buying the coin (shorting BTC is very difficult from what I understand) if the exchange rate drops?  A miner can.

[brian_23452]

May someone explain their rationale for investing in Antminer S3? Maybe something I missed?

All that calculators are for them who will withdraw their just-mined coins and axchange it to "usual money". You missed that BTC exchange ratio should and will inevitably grow. That's all.  

Why do people keep saying this?  What does the exchange ratio have to do with it?  If you purchase a device for .75BTC it either mines more than .75BTC or it mines less than .75BTC.  If it ends up mining less than .75BTC you lost money, regardless of the relative exchange rates.  This should be intuitively obvious.  

If you just buy with BTC, then yes.  But if you buy with converted fiat, it would be a lot easier to make a profit.  For example, if the USD exchange rate is 600 right now, you could buy a 0.75 BTC miner for $450.  If BTC goes up to $1200 each, then you only need to mine 0.375 BTC to break even in fiat terms (ignoring potential power supply and power costs).

I don't know how easier to explain it to you.  .75BTC is .75BTC, it makes no difference whether you bought it on an exchange, "converted" it as you say, mined it, stole it, scammed it from someone in the lending section, whatever.  If you purchase this miner for .75BTC and then it mines .375BTC, you just lost .375BTC.  Meanwhile, the person who didn't purchase this miner still has .75BTC.  BTC increasing to $1200 has nothing to do with it you lost 0.375BTC.  If you absolutely insist on thinking in terms of dollars, than the person who didn't purchase the miner now has $900.  You should have $900 too but because you bought the miner instead of keeping the .75BTC, you now only have $450.  You didn't break even.  You mined $450 worth of bitcoin but spent $900 worth of bitcoin to get it. 

I'm not going to keep beating a dead horse.  If you can't understand the simple, intuitively obvious concept that 0.75BTC is always more than 0.375BTC no matter what the fiat exchange rate is, than I don't really know what else to say on the matter.

Did you see the part where I said, "However, it is certainly true that you could skip the whole mining process and simply buy 0.75 BTC instead.  But that's less fun."?  (Although I will grant you that I added this to my original comment a minute or two after I posted the first part, so you may not have seen it before you started writing your comment.)

No, I didn't see that when I replied.  I was speaking strictly in terms of what makes you the most money.  If you enjoy mining then of course you might purchase a miner even knowing that it will lose you money/

[brian_23452]

What if the coin goes DOWN?

Can you profit buying the coin (shorting BTC is very difficult from what I understand) if the exchange rate drops?  A miner can.

Purchase miner for 0.75BTC.  Mine 0.375BTC.  BTC goes down to say $100.  You have 0.375BTC worth $37.50.
Don't purchase miner, keep the .75BTC.  BTC goes down to say $100.  You have 0.75BTC worth $75.00.

No matter what happens with the exchange rate of BTC or whether it goes up or down, 0.75BTC is always more than 0.375. 
At this point I simply refuse to believe that anyone can be this obtuse or ignorant.  You must be trolling.