Is it profitable buying and selling USB miners?

[Lorenzo]

For example, on eBay.

I've seen auctions where a single Block Erupter was sold for $20. The AntMiner USB ones tend to be a bit more expensive per unit but cheaper per gigahash. I've also seen Block Erupters being sold as low as $9 each - usually when they're being sold as a group. Say, for example, if I could consistently buy Block Erupters (BE) for $10 each and resell them for $15 each, by the end of only 20 trades, I should have:

$0 (1 BE)
$15 (0 BE)
$5 (1 BE)
$20 (0 BE)
$0 (2 BE)
$30 (0 BE)
$0 (3 BE)
$45 (0 BE)
$5 (4 BE)
$65 (0 BE)

$5 (6 BE)
$95 (0 BE)
$5 (9 BE)
$140 (0 BE)
$0 (14 BE)
$210 (0 BE)
$0 (21 BE)
$315 (0 BE)
$5 (31 BE)
$470 (0 BE)

So that would be a profit of $470. Not only that, but these Block Erupters could also be used for mining when they're not being bought or sold, which should give me a couple of cents worth of BTC at first but possibly a couple of dollars after the first 15 or so trades.

What am I missing here?

[bigasic]

One thing for sure. It wont be profitable to mine with them. So, since there is a lot of hype with bitcoin mining, it might be worth it. The only way to find out is to do a test. buy 20 of them and see how they sell..

[Mobius7]

You would get profits from buying low and selling high for everything, but there are 2 problems here.
1. You have to include shipping costs
2. For those BE, the electricity cost will be larger than the bitcoin you can mine with them.

[notlist3d]

Don't forget ebay/paypal fees + shipping.  That will eat some up there.

That model is no longer made so cant really buy in huge bulk.  Unless someone is hording a stash (which i dont see much reason on these).  There is a chance of profit just make sure to subtract fees.

[BigMac]

And don't forget the ASIC price will keep going down with uprising difficulties and newer generation ASIC keeps rolling out.

[dothebeats]

Haha. I think it wouldn't be profitable to that. Fees from paypal and shipping will eat up your sale. Plus, as the bitcoin difficulty increases, miners value would decrease because of the fact that they can't keep up with the change in difficulty. Because of that, it won't be profitable to mine with them and I don't think people would be interested in buying them

[OptimusPrime7]

I am actually surprised people still buy USB miners, cant even pay for its electricity

[Velkro]

One thing for sure. It wont be profitable to mine with them. So, since there is a lot of hype with bitcoin mining, it might be worth it. The only way to find out is to do a test. buy 20 of them and see how they sell..

Risky stuff, better buy BTC ale hold

[monbux]

You forgot to calculate the shipping fees, and you'll have to find that many buyers first.

[ALToids]

You would be better off buying small physical crypto coins and reselling those as novelties.  Novelties always command more than they're worth, you just need to release them slowly so as not to glut.

[fatguyyyyy]

Just hope for a sucker on ebay, and your fine lol.

[Farmer17]

Just hope for a sucker on ebay, and your fine lol.

That's true lol. I have seen a lot of ridiculous prices on ebay.

[Kprawn]

Looks like, when the buyer receive the USB miner, it's already obsolete. Tech is growing phenomenally fast.

But there are still people buying it, so if there is a market for it, why not capitalize on it. 

[BTCisthefuture]

after ebay, paypal, and shipping fees (if you offer shipping, which most do). It's a very small profit, but still a profit.  The question to ask though is how fast can you sell them at $15 when others are offering $10 or less. It's also a product that's going down in value rapidly.

My personal opinion is that you wont be able to unload them fast enough to make money. Not trying to be negative or a downer, but I've sold a lot of things on Ebay over the years and I don't think this will be a profitable venture for too long.

[InwardContour]

You forgot to calculate the shipping fees, and you'll have to find that many buyers first.

What you essentially need to do is to know the market well and know what the USB miners are worth. From there you simply need to watch the market closely and buy when you see an offer that is below the market price and sell when someone is offering a price above the market price.

[boymilk]

For example, on eBay.

I've seen auctions where a single Block Erupter was sold for $20. The AntMiner USB ones tend to be a bit more expensive per unit but cheaper per gigahash. I've also seen Block Erupters being sold as low as $9 each - usually when they're being sold as a group. Say, for example, if I could consistently buy Block Erupters (BE) for $10 each and resell them for $15 each, by the end of only 20 trades, I should have:

$0 (1 BE)
$15 (0 BE)
$5 (1 BE)
$20 (0 BE)
$0 (2 BE)
$30 (0 BE)
$0 (3 BE)
$45 (0 BE)
$5 (4 BE)
$65 (0 BE)

$5 (6 BE)
$95 (0 BE)
$5 (9 BE)
$140 (0 BE)
$0 (14 BE)
$210 (0 BE)
$0 (21 BE)
$315 (0 BE)
$5 (31 BE)
$470 (0 BE)

So that would be a profit of $470. Not only that, but these Block Erupters could also be used for mining when they're not being bought or sold, which should give me a couple of cents worth of BTC at first but possibly a couple of dollars after the first 15 or so trades.

What am I missing here?

Just out of interest, I tried using your formula for 20 further trades and this is what I got:

$0 (47 BE)
$705 (0 BE)
$5 (70 BE)
$1,055 (0 BE)
$5 (105 BE)
$1,580 (0 BE)
$0 (158 BE)
$2,370 (0 BE)
$0 (237 BE)
$3,555 (0 BE)

$5 (355 BE)
$5,330 (0 BE)
$0 (533 BE)
$7,995 (0 BE)
$5 (799 BE)
$11,990 (0 BE)
$0 (1,119 BE)
$17,985 (0 BE)
$5 (1,798 BE)
$26,975 (0 BE)

That's almost 2,000 miners. Definitely doesn't seem sustainable. What you might be better off doing is buying the miners in bulk lots of 10+ and reselling them individually for a small profit. This should save shipping costs and people are usually willing to buy more for an individual miner.

[Lorenzo]

The only way to find out is to do a test. buy 20 of them and see how they sell..

What you might be better off doing is buying the miners in bulk lots of 10+ and reselling them individually for a small profit. This should save shipping costs and people are usually willing to buy more for an individual miner.

Yup, this is what I intend to do. Just buy a whole bunch of them for cheap and resell them individually. Saves on fees and shipping costs as well. Because people who are selling them in lots of 10+ tend to want to get rid of them as quickly as possible so they sell them for cheap (per unit). And people who want to just experiment with one or two don't want to buy 10+ so there is an opportunity to profit.

2. For those BE, the electricity cost will be larger than the bitcoin you can mine with them.

Really? But these are ASIC chips inside these miners. And a USB slot uses very little power. If true, then I didn't know the situation was this bad.

[arbitrage001]

Cheap way to try out ASIC mining.

This beat some miners buying from the pre-order big boy and losing even more by the time the miner is delivered.

[notlist3d]

The only way to find out is to do a test. buy 20 of them and see how they sell..

What you might be better off doing is buying the miners in bulk lots of 10+ and reselling them individually for a small profit. This should save shipping costs and people are usually willing to buy more for an individual miner.

Yup, this is what I intend to do. Just buy a whole bunch of them for cheap and resell them individually. Saves on fees and shipping costs as well. Because people who are selling them in lots of 10+ tend to want to get rid of them as quickly as possible so they sell them for cheap (per unit). And people who want to just experiment with one or two don't want to buy 10+ so there is an opportunity to profit.

2. For those BE, the electricity cost will be larger than the bitcoin you can mine with them.

Really? But these are ASIC chips inside these miners. And a USB slot uses very little power. If true, then I didn't know the situation was this bad.

Power on these are very little but you will have to have powered hubs.  If you search there is a great thread on how many can go on certain models.

But i would really look into fee's.  I think by the time you add up shipping, ebay, paypal.  Profit will be very very small if any.

[Bitcoin Magazine]

No.  And they never will be.  Just hold as Physical Proof of Bitcoin wealth.  Just treat them as $20 bills.  Nothing more, nothing less.