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Author Topic: Buy and sell bitcoins -- or mine and sell. What one is better?  (Read 870 times)
David_Benz
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May 04, 2012, 11:09:48 PM
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I find that it is rather expensive to mine bitcoins.  Best deal I can find is 600 dollars to get 832 mhash (with waiting 4 months to get the item) or pay a crazy amount of money for a rig that does not suck up 1000 dollars a month power.

I also find that I can buy bitcoins from an exchange and sell them on eBay for much more.

Why do people even mine?

Thanks, just a newbie trying to learn.  This bitcoin stuff is amazing.

I am the Bitcoinica Hacker.
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May 05, 2012, 12:59:33 AM
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Because if you live somewhere where electricity is cheap, then mining is profitable. Mining bitcoins in an area where electricity is expensive makes about as much sense as growing bananas in the desert, and in that case you're better of buying your bitcoins (and bananas) from someone who can produce them cheaper than you can. People wanting something that they can't produce as cheaply or as easily as someone else is pretty much the whole reason trade exists.

Will pretend to do unverifiable things (while actually eating an enchilada-style burrito) for bitcoins: 1K6d1EviQKX3SVKjPYmJGyWBb1avbmCFM4
David_Benz
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May 05, 2012, 01:48:12 AM
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Because if you live somewhere where electricity is cheap, then mining is profitable. Mining bitcoins in an area where electricity is expensive makes about as much sense as growing bananas in the desert, and in that case you're better of buying your bitcoins (and bananas) from someone who can produce them cheaper than you can. People wanting something that they can't produce as cheaply or as easily as someone else is pretty much the whole reason trade exists.

What is considered 'cheap' electricity? 

I am the Bitcoinica Hacker.
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May 05, 2012, 01:55:36 AM
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What is considered 'cheap' electricity? 

Electricity that costs less than the value of the bitcoins produced from it (the exact break-even point varies a lot depending on the efficiency of your mining rig).

Will pretend to do unverifiable things (while actually eating an enchilada-style burrito) for bitcoins: 1K6d1EviQKX3SVKjPYmJGyWBb1avbmCFM4
David_Benz
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May 05, 2012, 01:58:51 AM
 #5

What is considered 'cheap' electricity? 

Electricity that costs less than the value of the bitcoins produced from it (the exact break-even point varies a lot depending on the efficiency of your mining rig).

My rate is 6 cents per kwh ... is that good?

I am the Bitcoinica Hacker.
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May 05, 2012, 03:21:03 AM
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My rate is 6 cents per kwh ... is that good?

That's very good. At that rate, you'd need a hashing efficiency at least 0.42 Mhash/J to be profitable (without taking into account the capital cost of your hardware), which you can get from any high-end ATI card. It makes me wonder why you're complaining about how expensive it is.

See also:
Bitcoin mining profitability calculator
Mining hardware comparison

Will pretend to do unverifiable things (while actually eating an enchilada-style burrito) for bitcoins: 1K6d1EviQKX3SVKjPYmJGyWBb1avbmCFM4
David_Benz
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May 05, 2012, 03:31:29 AM
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My rate is 6 cents per kwh ... is that good?

That's very good. At that rate, you'd need a hashing efficiency at least 0.42 Mhash/J to be profitable (without taking into account the capital cost of your hardware), which you can get from any high-end ATI card. It makes me wonder why you're complaining about how expensive it is.

See also:
Bitcoin mining profitability calculator
Mining hardware comparison

Interesting stuff.  Thank you.

I am the Bitcoinica Hacker.
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