Topic: Check those BTC mining cost numbers again (Read 1962 times)

I think you are confused.  My rigs are long since paid off.  I recently bought more 5970s but only so I could sell 6950, 6970, 5870s on ebay.  Took the money from my "motley collection of inferior cards" and bought be those "ancient" 5970s.  Net net it cost a little bit more but my setup is a lot more streamlined now and efficiency is much higher.  3x rigs of 3x5970 and 1 water cooled workstation 3x5970.

Not sure where you get the idea that 5970 is like a FPGA.  It has the lowest cost per MH AND the highest MH/W.  Combine that will high density (6 GPU without any expanders is trivially easy) it is win-win-win.  At $400 it is so discounted it likely will be cheaper per MH (although less efficient) than 7xxx series cards.

You've been saying the same thing since we were at $20/Bitcoin

Less efficient than you, and objectively "horrible", are two different things. So 90% of miners are operating under "horrible" efficiency?
So, according to you, we should see difficulty drop by 90% in the next month or two?

5970s weren't to be had back in June. I had to buy the best cards available at the time.

Those of you who just bought 5970s, because they're so awesomely efficient, better hope that Bitcoin sticks around for another 3 years. Because it's going to *take* you 3 years to make back your investment. It's like like arguments pro/con FPGAs, only on a smaller scale. 5970's aren't as expensive, but they don't save you as much.

However much you think you're making per day with your super-efficient rigs, it's still going to take a while to reach payoff. Sure, you're sitting pretty vs. most of us as far as MH/W efficiency goes, so you don't have to worry *as much* -- unless BTC collapses. Which it might. And since it will take you a year or more to pay off your systems, a lot can happen in a YEAR!

Heck, I was making pretty good money too, up till a few weeks ago. It only took me 4 months for economic issues to arise. You have just as much to pay off as I did -- you're just at the beginning of your marathon, that's all. Good luck when you hit 80% paid off. We'll see what Bitcoin is doing then.

We can't just throw away all our hardware and start over just because we need a bit more efficiency. If that's what it's come to, then Bitcoin's day is over, at least for 90% of miners.

I didn't buy my 5870s, 5850s, and 5830's at the same time you bought your 5970's. That would be a different story. Mine have been paying for themselves for many months now.

How many miners really meet the description some here have given? That is, rigs of 3 or 4 5970 cards with 1200W 80+Gold power supplies and an underclocked Sempron. I'm guessing not many. 90% of miners have setups as "inefficient" as mine, or worse. Anyone with a 6990 is certainly less efficient than my setup, and those cards were sold out most places for many weeks.

Your efficiency is just downright horrible for this late in the game.  1.6MH/W  Yuck.  
Does that include AC costs?  If so then  that partially explains it.  AC is going to consume about 30% more electricity than the rig itself.  So that would put your rigs @ closer to 2MH/W.  The good news is you won't be running AC in the winter right?  It might reach a point where you can only mine 9 months out of the year.  That just might be the reality.

Another possible source of your lower efficiency could be your powersupply.  What effieciency is your powersupply running at?  Not the brand label look at the efficiency chart based on the actual load you are pulling.  Lastly you only have 3 GPUs per rig.  The overhead from other components is cutting into your efficiency.  That is why I like the 3x5970 = 6 GPU per rig.  Far easier to get an efficient rig pushing >2GH/s than one running at 1 GH/s.

Getting low mining cost requires buying the right components to maximize hashes per watt.
1200W 88% efficient powersupply (@ 880W). 2GB DDR3, 45W Sempron (underclocked), 3x 5970s per rig = ~2.5MH/W.


Your higher mining costs are completely explainable by your much lower efficiency.
$2.28 per BTC vs $1.60 per BTC = 42% higher
2.5MH/W vs 1.60 MH/W = 58% higher
The only thing that is saving you is your electrcity is slightly lower than mine.

When BTC was $30 USD ea you could slap any kind of inefficient garbage together, blast the AC to keep it cool and still get paid 500% of electrical costs.  Those days are gone.  If you want to survive you need efficient rigs.   Capital cost matters so you can't go stupid but over the equipment lifetime you are going to spend far more on electrical cost.

The market will only get more competitive. The days where people could make 8000% annuallized profit mining aren't ever coming back.  I don't care if Bitcoin goes to $20,000 per coin those kinds of profits are simply unwarranted.  The most efficient systems will drive the cost down and the inefficient systems will either mine at a loss or quit.

Overall the market will hit equilibrium likely somewhere @ 5% to 10% profit over electrical and ammortized hardware costs.  Since you can control other people's costs the only thing you can do is make your setup as efficient as possible.

So if you want to keep playing next summer (when you will be the least efficient) here are some ideas:[/b][/u]
Do you have 100% CPU bug (if so are you using affinity to keep it to one core)?
Have you gone into bios and turned off all the junk you don't need?  Downclocked the CPU?
Are you overclocking the cards?  If so have you looked at efficiency at other clocks settings (use a kill-a-watt) to maximize your return?
Are you using a usb drive & linux?  If not then you are just burning more money w/ higher non-productive electrical load.
Check the voltage reading at the outlet on full load.  If is within 118-125V?  If not voltage sag is going to kill your efficiency (make power supply work much harder).  Some house wiring especially if it is a long run isn't going to be able to power full load without sagging.  Some local utilities also suck but not much you can do about that.
Is your power supply staying cool.  Preferable you want it <80 deg.  As power supply gets hot efficiency drops.  Can easily cost you 10% more energy consumption.
If you want to get creative can you run a 240V line to power your rigs?  Powersupplies tend to be 3% to 5% more efficient on 240V.

Thank you for your responses.

I feel I should clarify, though -- I am not calling everyone who claims $1.XX per BTC a liar.
I know there are miners Up North, those with cheaper electricity, and even (gasp!) those who have a more efficient setup than me. 

Nevertheless, I believe that quite a few who make that claim might be simply mistaken, from lack of knowledge of how to do proper accounting of their costs.

But I would point out that sometimes you can lose a few W of efficiency, while saving quite a bit on hardware costs. If per-Watt efficiency were everything, we'd all be using FPGAs right now.

  Yes, people really are able to achieve such efficiency.

  Yes, your setup is pretty average, not far off from mine. Save, your cooling efforts could use some tweaking. Most normal 'case' type fans, like my Thermaltake 34cfm ones draw a massive .24 amps at 5v. Thats a whole 1.2w. I can't speak for others setups but I keep mine below 70c and am not using any extreme fans outside of the low amperage case type ones in very specific configurations.


You almost assuredly cannot go by that. Variance plays a HUGE part in the reported network hash. It does not display a combined total of what everyones miners are showing at the user level. It calculates purely based on the difficulty and how quick blocks are found. I.e., There has been a TON of low share rounds at a TON of little known pools lately.

  I agree with your questioning though. Why would so many mine while unprofitable, as likely, a HUGE portion of the network must be?

  My answer, and one I would assume is only shared by a small portion; It is super cheap for me and I am supporting the community with BTC made from it. I have cashed out ZERO, hoarded ZERO and will maintain that as long as I see a worth while cause here. It is MASSIVELY more enjoyable for me to do so in this manner verses just donating cash to some org that I like. I enjoy the hands-on aspect of it. Much the same that I have spent countless clock cycles into Boinic, World Grid, Cure for Aids, Seti@home(before they went Boinic), Human Genome Project, etc, etc, etc.  These are things I can do from my home with what little spare time, resources and capital that I have available. I would love to go do something 'physical' to aid some cause but, as many of us don't these days, I simply do not have the time to spare away from my work and family.

 I am sure there are many reasons for many different miners.. The invisible hand under your skirt will likely remain so, unless you could somehow poll every person that mines.....

Believe it or not, there really are people mining at 1.xx per coin.  I'm one of them.  Where I live, electricity prices are cheap and it's getting cold outside.  It's dipping into the low 30's here (Fahrenheit).  When I go to bed, I turn my two window fans down to their lowest setting.  With the inlet temperature in the mid 30's, the air coming out of the room is in the low 70's.  In other words, I'm now using my mining rigs to heat my house.  When winter hits, I'll have to only run 1 box fan to prevent things from getting too cold.  Winters get into the negatives here.

With my residential rates, I'm currently mining for around $1.80 a coin.  When winter rates kick in, it'll be around $1.60 a coin.  This also doesn't account for the fact that I'll eventually be saving a good $80 on my gas bill for heating.  If I had a commercial service, I could probably shave another 30 percent or so off of a BTC (depending on the amount of electricity consumed).

These rates obviously don't include my time and hardware depreciation as a factor though...  If profit gets too low, I'd be better off selling the cards.  If they depreciate faster than what I get out of them, it would probably be silly to keep them (considering that more efficient cards eventually get released anyways).

i think your forgeting financial constraints

@chodpaba - valid point, but still retarded

Miners can do both - buy coins when they're lower than their operating costs, yet also keep mining so that the difficulty stays prohibitive to others getting into mining.

@ Angeus and you should read The Wal-mart Effect =p anyways were still in agreement on the primary issue here

There is no rationale to mine below profitability b.c. you can simply flip the switch and buy the coins cheaper having a positive effect on the economy.

You think illegality would stop Wal-mart? They make so much money they OWN the government. They can buy however many politicians they want, local or federal.
And those studies might have been paid for by Wal-mart.

You need to watch the video I did about Wal-mart -- very eye-opening.

 

Except for the fact that your essentially paying a premium for your bitcoins, not to mention hardware degradation, heat noise ect.....where on the flip side if you buy bitcoins with that money instead of giving it to amd and the power companies, youll stabalize the economy

@ angelus ... walmart doesnt practice in predatory pricing its illegal, there have been studies showing they maintain lower cost for the duration

I thought of that -- the huge guys, who perhaps made lots of money early on, could have deep enough pockets to operate at a loss until most people give up.

Just like Wal-mart sells things under cost for a couple years, making a negative return for as long as necessary, until all the mom & pop appliance stores, hardware stores, grocery stores go out of business. Then, when they're the only option for the people in the town, they jack up their prices and make back everything they lost, and profit every year after that. (This is absolutely true, sad to say).

The only difference is, it's easier to fire up a miner than to start a mom & pop store. In my analogy, once Wal-mart is in "let's profit" mode and jacks up their prices, imagine if people could start a mom & pop store in a couple hours? They could undercut Wal-mart and mess up their plans.

So I don't know if that is really a concern. Maybe it will just work on "most" people, instead of all?

I've read several posts in the past week (in the "Shutdown point" thread, etc.) where people quoted a mining cost of $1.XX. I have my doubts.
For one thing, the individuals seemed to use a complex mathematical formula, which seems very prone to error.  I prefer to take last month's electric bill, subtract last years' amount due (for the same month), and divide that amount by 30 to get my daily cost. That seems a bit safer, no?  It counts everything from CPU cost to PSU inefficiency, extra AC, fans, the whole nine yards.

Maybe if you keep your PCs in a garage and you live far enough north where it never goes above 60 during the day you could throttle down your onboard fans, turn off all exterior fans, and get below $2. But when you keep mining rigs in your house, and you keep the temp around 70 (=pleasant for human habitation), then Texans and Alaskans are in the same boat. I find that I still need a small desk fan pointed between the cards, on low at least, to keep the top card below 84 degrees. For me, anything over 82 is the red zone. I don't want to damage my cards (remember that when you see my cards up for sale in the Goods sub-forum!  )

I have most of my fans (intake, exhaust) turned off now -- in Texas we finally got Fall. But I'm still using around 90 kWh a day for my 6 GH/s. That's $7.92 for the approx. 3.5 BTC a day I earn. That comes out to $2.26 a BTC. As I type, the current price for BTC is $2.22.

Yes, I'm not in the coolest part of the country, but some Fall weather came in yesterday and the high is 74 today with a low of 43. And while my electricity isn't the cheapest in the country, it's pretty decent at 8.8 cents.

But I'm not at the low end of efficiency, either, as my cards are all 58XX series. True, I have no more than 3 in a machine... but I am using 80+ bronze PSUs, AMD II (dual core) CPUs, 2 GB RAM sticks, and 1 machine runs off a USB drive.

If anything, I'd say my setup is pretty average.

Here's what I don't get:
Estimated 1386207 in 1292 blks
Network total   11.314 Thash/s
Blocks/hour      6.46 / 557 s

And considering that a good chunk of the network is mining on Deepbit, BTCguild, and other NON-MERGED-MINING venues, they are only earning BTC. So how can so many people be earning money (or even breaking even) at the moment?

Remember, there are Mt. Gox fees when you sell the BTC and unless you want to buy Alpaca socks with your earnings, you have to pay a middleman 10% to turn them into gift cards, etc. (I guess you could Dwolla transfer, but then you leave a paper trail.) So we're getting darn close to "below cost" for many people.