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Author Topic: Is it truly economically beneficial to run to FPGAs right now ?  (Read 5109 times)
jjshabadoo
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May 08, 2012, 01:42:33 AM
 #1

I have to wonder what the logic is here. Have people done a true and thorough economic analysis on these? If you take into account their cost, salvage value and the rapid development of the technology, it looks like people are just paying to be beta testers.

It seems to me that newer boards are coming out almost weekly at this point and some obviously larger players are entering the market. On the current trajectory it looks like we will see boards with 4 chips doing 1000-1200 mhash for probably 600 dollars by year end. Considering the average ROI on most of these is around one year, won't the current boards be obsolete by then ? I can see boards in one year doing 3+ Ghash for around $1000.

Thoughts?
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May 08, 2012, 05:30:15 AM
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If you wait long enough, something better will come around

But, once that comes out, if you wait long enough, something better comes around

Repeat
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May 08, 2012, 05:40:48 AM
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7970: Currently $405USD, ~700Mhash, 250W, warranty 1+ year from many reliable manufacturers available instantly, resale >$200 if sold in 2 years. Also play games and act as GPUs... Return on investment time: Dependent on your local electricity prices. Block reward halving in 7 months...

Fill in the gaps for other devices.

Note: I only have GPUs.

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May 08, 2012, 08:25:24 PM
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7970: Currently $405USD, ~700Mhash, 250W, warranty 1+ year from many reliable manufacturers available instantly, resale >$200 if sold in 2 years. Also play games and act as GPUs... Return on investment time: Dependent on your local electricity prices. Block reward halving in 7 months...

Fill in the gaps for other devices.

Note: I only have GPUs.

No way man. FPGA is the best thing since sliced butter.

Oh and them BFL wonder boxes are tasty as peanuts !

I get the feeling that everybody is saying "GPU is dying" so they can grab them at a cheaper price ...

I will be laughing at the FPGA folks with 20 or so useless boards when the gold dries up here Cheesy
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May 08, 2012, 08:31:21 PM
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FPGAs are a decent investment for someone in my situation.  Central Valley California stuck with PG&E.  Top tier electricity rates are at 0.34/kWh (it was actually 0.40 last summer!).  During summer, I will be locked into top tier pricing just because I have the nerve to set my AC to 75-78F instead of 85F+.

At those prices, GPU mining is a loss for me, even if you don't include the extra power offset the additional heat.

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May 08, 2012, 09:36:19 PM
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7970: Currently $405USD, ~700Mhash, 250W, warranty 1+ year from many reliable manufacturers available instantly, resale >$200 if sold in 2 years. Also play games and act as GPUs... Return on investment time: Dependent on your local electricity prices. Block reward halving in 7 months...

Fill in the gaps for other devices.

Note: I only have GPUs.

Where can you find 7970s for $405?

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May 09, 2012, 02:41:13 AM
 #7

Newegg business and it's more like 550MH/s @ 120W while mining... probably less.

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May 09, 2012, 03:26:58 AM
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Only intermittently as a special offer. Reliably $450.

Most overclocked 7970s will do 700MH, but the power cost consumption rises disproportionately. I've measured about 250W at that speed.

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May 09, 2012, 03:46:50 AM
 #9

This place seems to have plenty available ~$400-415

http://www.gadgetneeds.net/gigabyte-radeon-hd-7970-gv-r797oc-3gd-video-card/

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May 09, 2012, 04:28:51 AM
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This place seems to have plenty available ~$400-415

http://www.gadgetneeds.net/gigabyte-radeon-hd-7970-gv-r797oc-3gd-video-card/


That looks like one of those cookie-cutter sites that gets spammed all over the internet. I'm not sure that I would trust it with my money, but you might get lucky and score.

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May 10, 2012, 09:33:15 AM
 #11

Frankly, it's the best moment to buy non-GPU solutions. The closer we get to the reward-halving
day, the more the demand for non-GPU solutions will grow. After reward is down 50%, most GPU
miners (if not all) are going to be out of business... When this happens, market will be flooded with
second-handed GPUs, which will have a very hard time selling at an appropriate price...


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May 10, 2012, 01:07:12 PM
 #12

I actually have done a fairly in-depth analysis on GPU vs FPGA. Considering things such as initial cost, warranty, resale value, depreciation over time, expected increase in difficulty over time, approximate payout value (and drop in payout). Power costs, General operating costs, and so on.

Regardless of if the solution gets replaced in the short term. My findings came to one conclusion:

In a "Professional" level, large scale mining operation (I was evaluating purely as mining as a business, not as a hobby, with hardware purchase price amortized across 1 year for all options, regardless of payback period). Unless your power costs are EXTREMELY low (ie: under $0.04/kwh round the clock in USD). Then GPU mining is not even profitable at all at a professional level. Now that said this evaluation was done before the release of the 7970, which did increase power efficiency and reduce cost/Mhash a fair bit, so that said it MIGHT be profitable now.

At a hobby level, if you don't count your time in maintaining it, cost of hydro, and hosting space. And you intend to dual-purpose the GPUs in gaming rigs, then yes, GPU is the way to go still.

Otherwise FPGA is a no-brainer, regardless of if it will get superceded, that's not relevant at all (all tech will do that, it boils down to TCO over time of your available options, versus expected mining income).

I should note at the time that I did the full analysis, I was basing it off ZTEX original pricing for his single 1.15x board (which was much more expensive per MHash than current FPGA solutions). But because I was looking at large scale "Mining Business" applications, I was looking at bulk pricing.

Lastly, I should also note that when I say large scale, I was talking about > 250GHash/s clusters.

So as I said, take with a grain of salt, as much has changed since I did this research. But that said, most of it has changed in favor of the FPGA options. The main factors that make FPGAs more cost effective in the long run in my analysis were density and power efficiency. Initial purchase cost had almost zero effect on end profitability until you got into ridiculous pricing (like $3/MHash+).

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May 10, 2012, 01:08:53 PM
 #13

Frankly, it's the best moment to buy non-GPU solutions. The closer we get to the reward-halving
day, the more the demand for non-GPU solutions will grow. After reward is down 50%, most GPU
miners (if not all) are going to be out of business... When this happens, market will be flooded with
second-handed GPUs, which will have a very hard time selling at an appropriate price...


Regards,
BF Labs Inc.
Nonsense. 7970s will be still hot property in December. The next generation of GPUs is miles away and that's what usually causes the price drop. Your up front price for FPGAs is still a rip off at the moment. Come the block reward halving, the goal posts all change, but so will difficulty as the inefficient miners drop off. There is no foregone conclusion here, only a business model as far as I can see. Again if I sell my 7970s for even half their price, the current up front price/return on investment time for FPGAs makes no sense at all - to me. If electricity is ludicrously expensive, things might be different as Eleuthria suffers.

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May 10, 2012, 02:40:43 PM
 #14

IMO, sooner or later, the larger player will be those who control the BTC exchange price (e.g. market maker), unless BTC can find it's own way to get rid of exchange rate dependency, it will still live as a controlled object of market makers

The easiness of use and benefit of BTC must be improved

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May 10, 2012, 11:53:22 PM
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Frankly, it's the best moment to buy non-GPU solutions. The closer we get to the reward-halving
day, the more the demand for non-GPU solutions will grow. After reward is down 50%, most GPU
miners (if not all) are going to be out of business... When this happens, market will be flooded with
second-handed GPUs, which will have a very hard time selling at an appropriate price...


Regards,
BF Labs Inc.
Nonsense. 7970s will be still hot property in December. The next generation of GPUs is miles away and that's what usually causes the price drop. Your up front price for FPGAs is still a rip off at the moment. Come the block reward halving, the goal posts all change, but so will difficulty as the inefficient miners drop off. There is no foregone conclusion here, only a business model as far as I can see. Again if I sell my 7970s for even half their price, the current up front price/return on investment time for FPGAs makes no sense at all - to me. If electricity is ludicrously expensive, things might be different as Eleuthria suffers.

Your entitled to your opinion Grin But BFL is far from a "ripoff".Using that line of thinking,what do call Ztex & X6500 with almost HALF the mh/s??? Yes they are lower wattage,but the difference in mh/s is the breaker in ROI.

As for resale of vid cards,I don't think they'll drop in value by much after the halving,maybe 10-20% from what they are selling for now,on ebay for example.They just use alot more energy & are less profitable......


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May 11, 2012, 12:31:43 AM
 #16

It's a gamble.. and mine is on GPUs being resellable if bitcoin collapses.  I haven't seen anything definitive about FPGAs being resellable or reusable for anything.

(non professional here.. about 2.5G/H)

Frankly, it's the best moment to buy non-GPU solutions. The closer we get to the reward-halving
day, the more the demand for non-GPU solutions will grow. After reward is down 50%, most GPU
miners (if not all) are going to be out of business... When this happens, market will be flooded with
second-handed GPUs, which will have a very hard time selling at an appropriate price...


Regards,
BF Labs Inc.
Nonsense. 7970s will be still hot property in December. The next generation of GPUs is miles away and that's what usually causes the price drop. Your up front price for FPGAs is still a rip off at the moment. Come the block reward halving, the goal posts all change, but so will difficulty as the inefficient miners drop off. There is no foregone conclusion here, only a business model as far as I can see. Again if I sell my 7970s for even half their price, the current up front price/return on investment time for FPGAs makes no sense at all - to me. If electricity is ludicrously expensive, things might be different as Eleuthria suffers.

Your entitled to your opinion Grin But BFL is far from a "ripoff".Using that line of thinking,what do call Ztex & X6500 with almost HALF the mh/s??? Yes they are lower wattage,but the difference in mh/s is the breaker in ROI.

As for resale of vid cards,I don't think they'll drop in value by much after the halving,maybe 10-20% from what they are selling for now,on ebay for example.They just use alot more energy & are less profitable......



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May 11, 2012, 12:48:02 AM
 #17

Medium sized farm here. 16 GH/s from HD5K series GPUs. Efficiency at around 2.4 MH/w right now(damn 5830s dragging me down..). I've spent quite a lot of time considering many different options ranging from expanding on GPUs until the reward drop, expanding just with HD7K series to resell, expanding with a mix of FPGAs and GPUs, or just expanding with FPGAs. In the end expanding with just FPGAs won and maintaining my GPU farm won.

With 16 GH/s of GPUs running, which is mostly paid off with mining proceeds already, I effectively have 16 GH/s + FPGA GH/s paying off the FPGAs. I figure if I can get an unknown amount X GH/s of FPGAs completely paid off by the reward drop I will then be prepared for multiple events.

If GPUs suddenly become unprofitable I then liquidate my GPUs, purchase a few more FPGAs and continue as usual.

If GPUs just barely scrap by on profitability I will likely still liquidate the GPUs and continue expanding with FPGAs.

If GPUs are able to run with every $1 made costing $0.50 or less then I'll keep running the GPUs and use their output to buy more FPGAs.

If Bitcoin tanks then I liquidate the GPUs and attempt to find some money making opportunity with the FPGAs.

Worst case if Bitcoin tanks at the reward drop then I escape with a small overall profit from the sales of the GPUs and a fun experience. If Bitcoin continues after the reward drop with similar earnings levels then I continue to pay off student loans and other debts with my income Smiley

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May 11, 2012, 01:45:35 AM
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You're entitled to your opinion Grin But BFL is far from a "ripoff".Using that line of thinking,what do call Ztex & X6500 with almost HALF the mh/s???
Nothing particularly nice  Wink

I'll use GPUs while they're profitable. If, when the block reward drops, the GPUs stop being profitable, you can ALWAYS sell a GPU (and I was being really conservative saying they'll sell for 50% of the price). Investing in FPGAs on the other hand, despite what anyone says, you are 100% betting on bitcoin being a sure thing long term since there is NO short term profit and NO guaranteed sale of the hardware should bitcoin tank. The return time is absolutely huge. All the so-called other uses for 2nd hand FPGAs are very few and far between, and there is hardly any market for a whole lot of 2nd hand FPGAs unlike GPUs. Difficulty slowly lags behind and parallels BTC value, not the other way around, no matter how much people want it to be, so difficulty will drop somewhat, but perhaps stay above the GPU mining profitability point. If the only way to mine profitably after the drop is with FPGAs, but only with a minimum turnaround of something like 1 year (factoring in reward drop), you can sell all the GPUs then and decide whether you want to bet 100% on bitcoin then and move to FPGAs or jump ship entirely.

In investment, risk should parallel likely gain. The risks of FPGAs are much higher than GPUs, but the potential gains, are they there? Unless bitcoin explodes in popularity and price jumps up dramatically, and you have been hoarding them instead of selling them along the way, they're not. You have to be honest to yourself about the risk here when you're talking potentially tens of thousands of dollars, especially if it's not money you have to burn. Don't get wrapped up in the momentum and not see that it's just another risky venture.

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May 11, 2012, 01:58:40 AM
 #19

Hopefully all those with FPGA information are including those 2 points that a lot of people seem to completely ignore:
1) When you buy an FPGA (or GPU), how long after you pay for it, are you mining with it?
2) When you upgrade/sell/BTC tanks your FPGA (or GPU), how much expected resale do you have later down the track?

1) is mainly relevant for BFL - since 2-3 months of no mining adds up to a lot of $ - so if you buy some other device (GPU) and it mines for a month (or more) you can quite literally subtract that month of mining from the price when comparing the cost price.

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May 11, 2012, 05:32:07 AM
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You're entitled to your opinion Grin But BFL is far from a "ripoff".Using that line of thinking,what do call Ztex & X6500 with almost HALF the mh/s???
Nothing particularly nice  Wink

I'll use GPUs while they're profitable. If, when the block reward drops, the GPUs stop being profitable, you can ALWAYS sell a GPU (and I was being really conservative saying they'll sell for 50% of the price). Investing in FPGAs on the other hand, despite what anyone says, you are 100% betting on bitcoin being a sure thing long term since there is NO short term profit and NO guaranteed sale of the hardware should bitcoin tank. The return time is absolutely huge. All the so-called other uses for 2nd hand FPGAs are very few and far between, and there is hardly any market for a whole lot of 2nd hand FPGAs unlike GPUs. Difficulty slowly lags behind and parallels BTC value, not the other way around, no matter how much people want it to be, so difficulty will drop somewhat, but perhaps stay above the GPU mining profitability point. If the only way to mine profitably after the drop is with FPGAs, but only with a minimum turnaround of something like 1 year (factoring in reward drop), you can sell all the GPUs then and decide whether you want to bet 100% on bitcoin then and move to FPGAs or jump ship entirely.

In investment, risk should parallel likely gain. The risks of FPGAs are much higher than GPUs, but the potential gains, are they there? Unless bitcoin explodes in popularity and price jumps up dramatically, and you have been hoarding them instead of selling them along the way, they're not. You have to be honest to yourself about the risk here when you're talking potentially tens of thousands of dollars, especially if it's not money you have to burn. Don't get wrapped up in the momentum and not see that it's just another risky venture.

Don't worry. Nobody is investing life savings into this FPGA fad.

They are all saying FPGA FTW, GPU dying to secure lower GPU prices for themselves Wink

Just like P4man saying don't hop so he can hop OR the bears saying BTC crashing so they can buy it cheap ...
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