Buy BitCoins with $ or Rent a Mining Rig?

[Slimquick]

I'm interested in playing with these BitCoin things – I saw the article in Forbes. I gather certain folks "mine" them, analogous to precious metals.

Assuming I only had a small amount of dough to fool around with, (in the $500 range), what would be the best way to get into these coins?

Should I just buy them from the Mt. Gox Exchange…

or

Should I rent a mining rig from http://www.bitcoinrigs.com/products/Rig-Rental-Service.html? Are these guys even reputable? Has anybody used the rental service with success?

Being really new to this, I appreciate any insights. Thank you.

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[Anonymous]

It's generally cheaper to mine Bitcoins while recouping the cost of the rig than to buy them second-hand. At least that's the case for now.

[rezin777]

I would suggest reading about Bitcoin for 3-4 days (in your spare time obviously) at least, before making a decision.

It's more profitable to buy Bitcoins if you are betting on the exchange rate going up.

It's less risky to build a mining rig if you are betting on the exchange rate going up. (You have the hardware to sell if Bitcoins are worth 0 in the future)

The cheapest mining rig that can achieve the fastest hash rate is the best. This is usually one that you build yourself. If you already have a computer with pcie slots, it's possible to add a new video card (AMD) and mine with your existing hardware.

Again, I suggest you read, read, and read some more before you make any decisions.

[lacedwithkerosene]

If you aren't mining them yourself, then I suggest just buying them on the market. Reason being, if btc crashes, you own a computer if you did it yourself, but if you rent, you own nothing but btc. And much less (even after a whole year of mining) than you would have gotten with purchasing outright for the same money. The thing about mining is that it gets more difficult over time, and is compounded when more people join in.

[xf2_org]

It's generally cheaper to mine Bitcoins while recouping the cost of the rig than to buy them second-hand. At least that's the case for now.

Um, no, it's the exact opposite.  If you bought a mining rig 2/4/6 months ago, you would have less bitcoin-value than if you had simply bought bitcoins on the open market.

[Littleshop]

It's generally cheaper to mine Bitcoins while recouping the cost of the rig than to buy them second-hand. At least that's the case for now.

Um, no, it's the exact opposite.  If you bought a mining rig 2/4/6 months ago, you would have less bitcoin-value than if you had simply bought bitcoins on the open market.

This is true.  If you purchased $500 worth of bitcoins two months ago you would have more then $2000 worth today.  If you would have purchased a rig you might have $500 worth of coins and the rig (which is still producing) but that is half the amount if you would have just purchased the coins. 

Try to do your own research and understand bitcoin and where the price of bitcoin would be in two months, six months etc. 

[Anonymous]

My mining rig only cost me $480 with a 6870 and 5770. I will recoup my costs in less than 6 months. It is still profitable.

[xf2_org]

My mining rig only cost me $480 with a 6870 and 5770. I will recoup my costs in less than 6 months. It is still profitable.

Sure it's profitable.  Not disputing that.

Just noting that it has historically been more profitable to simply buy bitcoins, especially if you add the cost of your time to hardware and electricity costs.

[lacedwithkerosene]

My mining rig only cost me $480 with a 6870 and 5770. I will recoup my costs in less than 6 months. It is still profitable.

but what would $480 of bitcoins bought when you bought your rig be worth today?
how many more btc would you own today if you had bought btc instead of mined? and current value of that 'btc gap' ?
add electricity costs and subtract current value of the equipment to determine if you're in the red or black.

no one's saying that you can't make a profit - just that the more the price goes up, you more you have lost 'potential revenue'.
it's as if you are betting that price won't increase much if you buy gear instead of btc in the market.

the good side is that if the btc are worthless tomorrow, you still own a computer and only lost some of its value.

[Anonymous]

Hm, I see. I would be better off if I had bought bitcoins but I needed a computer anyways.

[lacedwithkerosene]

Hm, I see. I would be better off if I had bought bitcoins but I needed a computer anyways.

great thats good! Sorry I didn't want to offend you. It's people like you that got the market started and help with demand. I also don't get any btc handouts every day, so I just have to wait idly by and hope my investments pay off.

we are all tied to btc success no matter how we got in to it.

[tomcollins]

Hm, I see. I would be better off if I had bought bitcoins but I needed a computer anyways.

If you are getting value out of the computer, it's probably a worthy investment.  If you already have a computer and just need to upgrade graphics cards, you do fairly well as well.

Renting a rig was the worst choice from the rates I saw.  You are only profitable for about half of the time you rent it for the shortest term I saw.  A mining rig I saw I could buy came close to buying the coins, but I anticipated even with my pessimistic difficulty increases was not enough.

Mining difficulty could get a ton harder just with gamers getting involved who already have the equipment and just need to pay electric bills.  Electricity is such an insignificant cost.