Is mining still worth it?

[jd421]

Hey guys, I'm brand new to the forums and still pretty new to the whole bitcoin thing. Ever since I first heard of bitcoins it really intrigued me, I've never heard of a e-currency before so it was and still is a pretty crazy idea to me but I also think that it's a great idea. After looking around on the forums and youtube and seeing peoples mining setups, it made me want to be a part of the movement.

 When I was choosing the name of this topic, at first I was going to make it " is mining still profitable?" but the thing is I don't want to make a ton of money off bitcoins, I would be happy just to learn the ropes, do some mining and let other people know about bitcoins to help get the word out. I'm a young broke student so I wanted to know if I put a few hundred dollars towards a mining rig, would I be able to make enough money to pay for the rig atleast? Like I said I'm broke so even a few hundreds of dollars is alot for me and isn't something I can really afford to throw away.

I've been doing research over the last couple days and I read that the amount of coins you get from 1 block is going to go down from 50 per block to 25. Will it still be worth it then? I live in Ontario, Canada, the electricty rates during peak times are 8.8 cents per kWh and 7.5 cents per kWh.

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[Bitcoin-Dice]

If you already have some useful mining hardware (GPU etc) its definitely worth it.

If you need to buy some hardware first you should take a closer look, but your electricity is quite cheap, so i think yes it could become profitable.

[jd421]

Well I do have 1 old desktop and 2 newer desktops along with 1 personal laptop and 1 that is my sisters. Can you use old computers or do you need a newer one? From what I understand I could use an older computer but it could possibly take me years to break one block right?

[Epoch]

Start here: https://en.bitcoin.it/wiki/Mining_hardware_comparison

This will give you an idea of the hashing rates of the various cards. Hint: only ATI cards are useful; avoid nVidia for mining. Then you then can go here to calculate how much BTC or $ you can expect to make with that hash rate:

http://www.alloscomp.com/bitcoin/calculator.php

Even with an efficient ATI GPU, at current difficulty, current BTC/$ exchange rates, and your electricity rates, you will be losing about 1/3 of your mining profits to pay for electricity. You will likely not be able to break even on any GPU investment prior to the block reward reduction in December (when the block reward will be cut in half from 50 BTC to 25 BTC).

Another option is to invest in an FPGA miner. Something like a BFL Single (http://www.butterflylabs.com/). There are several others. It is initially more expensive than a GPU but it has a lower electricity cost and should remain a viable miner longer than a GPU.

For reference consider this:

800 megahash/s will earn ~0.5 BTC/day. That's $2.50.
2 overclocked ATI 5870s have a combined hashrate of 800 megahash/s
2 overclocked 5870s and host PC use 500W. That will eat about $0.90/day out of your $2.50 daily profit, leaving you with $1.60.

Keep in mind that the above numbers assume you are running your mining hardware 24 hours/day.

[Stephen Gornick]

I live in Ontario, Canada, the electricty rates during peak times are 8.8 cents per kWh and 7.5 cents per kWh.

That's about half the average for U.S. residential rate.  You would probably do well mining, though there is an upfront investment and it willl be some time before future mining revenues cause there to be profit that exceeds that investment, likely well more than a year out for that to happen.

[jd421]

Even with an efficient ATI GPU, at current difficulty, current BTC/$ exchange rates, and your electricity rates, you will be losing about 1/3 of your mining profits to pay for electricity. You will likely not be able to break even on any GPU investment prior to the block reward reduction in December (when the block reward will be cut in half from 50 BTC to 25 BTC).

I don't understand, did you mistype? You said I wont be able to break even prior to the block reward reduction, doesn't this reduction mean that one would be earning less per block?

[jd421]

One more question, I've been looking through the guide/tut's on this forum, is this the best place to learn or is there another better or equally good place I should check out? I like being able to do my research from multiple places.

[Epoch]

Even with an efficient ATI GPU, at current difficulty, current BTC/$ exchange rates, and your electricity rates, you will be losing about 1/3 of your mining profits to pay for electricity. You will likely not be able to break even on any GPU investment prior to the block reward reduction in December (when the block reward will be cut in half from 50 BTC to 25 BTC).

I don't understand, did you mistype? You said I wont be able to break even prior to the block reward reduction, doesn't this reduction mean that one would be earning less per block?

I don't believe I mistyped. Let's look at it like this: Assume you had 2 5870s @ 800Mhps. The daily net profit (after paying for electricity) would be about $1.60. Let's say you bought them for $200 apiece, with the host PC being another $300 ($100 mobo, $100 psu, $40 cpu, $60 for case and RAM) for a total of $700. You would need to mine for $700/($1.60/day) or 437 days (11 months) in order to make back your initial investment.

Let's make it better: assume you already have the PC and all you need is to buy the GPUs. So $400 for 2 5870s. You would need to mine for $400/(1.60/day) or 250 days (8.3 months) to pay for them. Again, that wouldn't happen before December.

The block reward coming this December will mean that, given the same difficulty, you would be earning 1/2 of what you earn now. So your $2.50/day gross income would only be $1.25/day. Now subtract your fixed $0.90/day for electricity and you are down to $0.35 net profit per day! That's $10/month! You may never break even past this point. And that's with 2 of the most efficient mining GPUs available today! This is exactly why GPU mining is really risky at this point.

The good news is that many GPU miners will quit when the difficulty is cut in half so the difficulty should decrease significantly. Exactly how much it will decrease is the question.

[Epoch]

One more question, I've been looking through the guide/tut's on this forum, is this the best place to learn or is there another better or equally good place I should check out? I like being able to do my research from multiple places.

Well, one more post and you will be out of Newbie Jail, so you'll have the entire forum to explore and post in. There are many people here who can provide good tips and advice to point you to other useful resources.

Check out the mining/hardware and mining/hardware/fpga boards while you are here.

[weex]

This is a good list of guides so you can get a broader picture. https://bitcointalk.org/index.php?topic=83146.0;topicseen

Last in the list is my Introduction to Bitcoin Mining eBook available here

[geffaxiv-532]

This question IS SO IMPORTANT, by next year 1 terahash will only be worth $500-750k USD instead of 1.4 million due to the block split to 25 coins.

That is like a 1:1 ratio between equipment costs to 1 year profit. In the 2012 year it is actually more like 2:1.

[qwsxc]

Hi everybody.
I'm new here as well.
Can anyone suggest any alternative to BTC that I have any chance of sucessfully mining with a decent CPU?
I've read how microcash is a scam but I dont know about any others enough to start.
Thanks

[Gabi]

There is none. Yup, microcash is scamcoin with another name. Litecoin was a "cpu coin" but now it is not.
Also mining is not a "get rich quick scheme", in these days it's mostly done by professional people, maybe with FPGA and, in the near future ASICs

[qwsxc]

Ojay Thanks
Is it worth trading BTC as a stock?
Or investing in some mining hardware?

[jade087]

Technically not really. I just mine because I'm curious and my machine wouldn't be doing anything anyway...

Three weeks in, I've almost mined a whole BTC. Woo

[weex]

It's easy to dismiss something that is only worth $5 or so. Then again you are now part owner in the kind of technology many venture capitalists wish they could find just once in their careers. And that's before most anyone else knows about it.

[hoseen]

yes if you have free electricity

[Lorguir]

I wish mining hardware was much cheaper than it is now so that people like me can jump into mining more easily.Other than that I'd say maybe due to recent price rises.

[AndrewBUD]

Try local classifieds....... I purchased a lot of my gear second hand from people trying to offload locally....


I have purchased a few 5850's for 100 or less... 5870 for 130.....

[Jim Rockford]

As a financial investment - probably not. As a nerdy pastime it can be quite absorbing.