Is it worth me starting (in my particular case)?

[Graham1982]

Dear all:

Apologies, this is my first post and whilst I understand the fundamentals of Bitcoin mining and what I need to do to get myself going in principle, I may make a few mistakes. Anyway, on with the post:

My name is Graham and I am based in the UK. I have been looking at purchasing a mining rig for some time but each time it seems when I have a model in my crosshairs, I do not have the cash available in time and then the model is superseded or is not viable in terms of ROI.

Anyhow, I am faced with two options at the moment:

I have 350 pounds immediately available of disposable income to throw at this project. By the 22nd I will have closer to 500. Would either of these amounts provide me with enough cash to buy a rig that will generate a small ROI over the coming year or have I once again missed the boat?

If a sensible rig is available could you provide links and tell me if anyone else ha had success with them - I hae heard in some cases that the manufacturer gets enough orders to fund the manufacturing costs and then when you finally get the unit they become non-viable - I want to avoid this situation if possible.

Thanks in advance

Graham

[ChuckBuck]

If you're thinking about ROI, first question you have to ask is electrical costs.

What is your kw/Hour costs or is it free electricity included in your rental agreement?  If it is free, what is the total watts allocated for you in this rental agreement?

$500 + few more for a PSU and you should be able to get the best deal on the block:

http://www.spondoolies-tech.com/products/holiday-special-sp20-jackson-shipping-from-stock

[Graham1982]

Hi:

Thanks for the reply. Based upon my calculations, running that machine for 365 days a year on my current energy tarif would cost around 1051 pounds (sorry pound sign not working). Is it likely that the machine would make that back over the same period?

Thanks

Graham

[stonerider]

If I had #500, I'd go ahead and purchase BTC directly. From what I have gathered so far, the maxim is "Buy BTC when BTC is cheap, buy miners when BTC is expensive." BTC, in my humble opinion, is cheap right now.

[ChuckBuck]

Hi:

Thanks for the reply. Based upon my calculations, running that machine for 365 days a year on my current energy tarif would cost around 1051 pounds (sorry pound sign not working). Is it likely that the machine would make that back over the same period?

Thanks

Graham

If you have a pay that much for electrical costs, then I think you've answered your original question.

Right now, you can buy 2 BTC, that you probably wouldn't ever mine back (factoring the electrical costs).

[hedgy73]

Hi Graham I'm in the UK too and the cost of our electricity is the biggest problem.

For example, for £350 you could get mining hardware second hand on ebay for around 1TH of hashing power (possibly more if you did some shrewd deals). This will generate about 0.01btc - 0.015btc a day depending on which pool you use. At current btc price that equates to about £1.80 - £2.70 a day which is less than the electricity the hardware will use even on the cheapest domestic tariff.

Of course this is at the current price, btc could of go up in the future meaning that your mined coins will be worth more but so will they if you just bought them now instead. But the value could also go down. Btc is a massive gamble, no-one knows what the value will be in 6 months, 6 years or 60 years, they could be worthless or could be worth £10,000 each who knows.

However, there is some good news! Miners do give off a substantial amount of heat so at this time of year they can heat a room or part of a property to off-set some of that electricity cost .

[Graham1982]

Hi everyone:

I was therefore thinking of getting a couple of these and then just running the whole thing as an experiment - as they are significantly cheaper, perhaps this is the best option, especially as the power consumption is much lower and therefore I would feel happier leaving them on all the time.

Thanks

Graham

http://www.amazon.co.uk/NEW-Rockminer-R-Box-110-110GH-ASIC-Black/dp/B00NFQEHE6/ref=sr_1_2?s=computers&ie=UTF8&qid=1420555672&sr=1-2&keywords=bitcoin

PS What are people's opinions on this?

[hedgy73]

If its just for a hobby they're fine but they will never ROI and will cost more to run than mine. One will only mine approx. 0.001btc a day though so will take 1000 days (nearly 3 years) to mine 1 btc and that's if the difficulty were to stay the same which it most definitely wont. Also factor in btc reward block halving at the end of this year or the start of next.

I've put the details into coinwarz it will give you an idea of what to expect, you'll notice every coin is marked red which means negative return:

http://www.coinwarz.com/cryptocurrency/?sha256hr=100&sha256p=110&sha256pc=0.2500&sha256c=true&scrypthr=1000000.00&scryptp=280.00&scryptpc=0.0000&scryptc=false&scryptnhr=450.00&scryptnp=500.00&scryptnpc=0.1000&scryptnc=false&x11hr=15000.00&x11p=500.00&x11pc=0.1000&x11c=false&x13hr=6500.00&x13p=400.00&x13pc=0.1000&x13c=false&keccakhr=500.00&keccakp=500.00&keccakpc=0.1000&keccakc=false&quarkhr=5000.00&quarkp=500.00&quarkpc=0.1000&quarkc=false&groestlhr=10.00&groestlp=500.00&groestlpc=0.1000&groestlc=false&jhahr=3000.00&jhap=300.00&jhapc=0.1000&jhac=false&blake256hr=3.20&blake256p=300.00&blake256pc=0.1000&blake256c=false&neoscrypthr=20.00&neoscryptp=200.00&neoscryptpc=0.1000&neoscryptc=false&lyra2rehr=3300.00&lyra2rep=825.00&lyra2repc=0.1000&lyra2rec=false&e=Coinbase

[Graham1982]

Hi:

OK so in summary the consensus is that at the moment buying rigs of the type I suggest most certainly will not generate ROI and will in-fact cost me in electricity consumption. That said, buying bitcoins and sitting on them/trading them like commodities is probably the best way to go?

If that is the case can people please answer these rather nubish questions:

1. If I buy coins I understand they need to be stored in a e-wallet of sorts and that a computer that is offline other than when trading is best for security. Is this the case? Is it as simple as all that?

2. I have heard about coins being stolen etc if this is the case, how do you avoid that from happening?

3. Is 2. more a case of people that are silly making silly mistakes and losing their coins?

Thanks

Graham

[hedgy73]

Hi Graham,

Unfortunately you've missed the boat for home mining same as I did, I started mining about a year ago and it was hard even back then. Its just not profitable here in the UK and many other countries where electricity is expensive. My miners are running to earn a small amount of btc a day and to keep the chill off part of my house but they are still running at a loss. This is until it gets warmer in the spring and then they'll be turned off and probably sold unless btc rises dramatically between now and then.

You've got 2 choices with storing your btc. You can either store them on exchanges and split it between them just in case anything happened to one of them you've not taken a complete hit. Or you can keep them in cold storage by transferring them onto a physical coin, paper wallet or electronic wallet like a trezor.

I've never had that many so have just kept mine on crypsty and bittrex until I need them for something then its easy to transfer them out. If you get quite a few then it would be worth putting them into cold storage same as I would.

[ChuckBuck]

Hi:

OK so in summary the consensus is that at the moment buying rigs of the type I suggest most certainly will not generate ROI and will in-fact cost me in electricity consumption. That said, buying bitcoins and sitting on them/trading them like commodities is probably the best way to go?

If that is the case can people please answer these rather nubish questions:

1. If I buy coins I understand they need to be stored in a e-wallet of sorts and that a computer that is offline other than when trading is best for security. Is this the case? Is it as simple as all that?

2. I have heard about coins being stolen etc if this is the case, how do you avoid that from happening?

3. Is 2. more a case of people that are silly making silly mistakes and losing their coins?

Thanks

Graham

1)For small amounts (think less than 1 BTC), use BlockChain.info web wallet with 2 FA.  For a desktop based wallet, use Electrum, Armory, or Bitcoin Core.  For a tightest security possible, use a hardware wallet like Trezor or Ledger, or worse case a Paper Wallet.

2)In the case of Gox and Stamp, traders left alot of coins in their exchanges hot or web wallets.  If you don't plan to be an active trader, you can use the desktop or offline wallets I suggested above to secure your wallets.

3)Partially the people, partially the operator.  It's like leaving a ton of your deposit money and winnings in a Full Tilt Poker account, only to find out, the site operator is a bunch of crooks.  So sorta half and half.  These things (if the entity is trustworthy and competent) should never occur under any circumstance.  Think of the fallout if the NYSE or NASDAQ lost billions of funds out of the blue, it wouldn't be pretty.  Bitcoin exchanges have a lot of growing up to do in that sense (technology, regulatory, and security wise).

[BTCish]

Hi:

OK so in summary the consensus is that at the moment buying rigs of the type I suggest most certainly will not generate ROI and will in-fact cost me in electricity consumption. That said, buying bitcoins and sitting on them/trading them like commodities is probably the best way to go?

If that is the case can people please answer these rather nubish questions:

1. If I buy coins I understand they need to be stored in a e-wallet of sorts and that a computer that is offline other than when trading is best for security. Is this the case? Is it as simple as all that?

2. I have heard about coins being stolen etc if this is the case, how do you avoid that from happening?

3. Is 2. more a case of people that are silly making silly mistakes and losing their coins?

Thanks

Graham

1)For small amounts (think less than 1 BTC), use BlockChain.info web wallet with 2 FA.  For a desktop based wallet, use Electrum, Armory, or Bitcoin Core.  For a tightest security possible, use a hardware wallet like Trezor or Ledger, or worse case a Paper Wallet.

2)In the case of Gox and Stamp, traders left alot of coins in their exchanges hot or web wallets.  If you don't plan to be an active trader, you can use the desktop or offline wallets I suggested above to secure your wallets.

3)Partially the people, partially the operator.  It's like leaving a ton of your deposit money and winnings in a Full Tilt Poker account, only to find out, the site operator is a bunch of crooks.  So sorta half and half.  These things (if the entity is trustworthy and competent) should never occur under any circumstance.  Think of the fallout if the NYSE or NASDAQ lost billions of funds out of the blue, it wouldn't be pretty.  Bitcoin exchanges have a lot of growing up to do in that sense (technology, regulatory, and security wise).

Thanks, very usefull.