Topic: I have $500k and I want to get into mining! (Read 1052 times)

Strato - thanks for sharing your experience with us.

My advice would be to save yourself the headache of setting up a farm of that scale; regardless of whether it's ASICs or GPUs; and simply invest in Bitcoin either by means of buying BTC direct and holding; or perhaps putting that money to use in creative ways (not going to be specific as the list would be endless), but rather consider a business model based on or around blockchain technology.

I personally ran a mining farm which was both ASIC and GPU about 1/10th that scale for about a year, and all I can say is it is a full time job. You will run into problems you can't even imagine, you will have setbacks which will eat into your profits, and you will have to be constantly "running" the operation not simply from a day to day operations standpoint; but from a technology ROI, month by month, standpoint. This includes equipment lifespan; return on investment of hardware, factoring which technology to buy, when to sell, replace, upgrade- as Bitcoin's difficultly will continue to rise you will face an ongoing uphill battle to either re-invest any profit you see (which you may not) in either adding hashpower to your farm or upgrading to faster and more effecient mining hardware.

The only way I would personally invest in that kind of start up in this day in age is if aside from your up front capital which you seem ready to risk; would be do you have an absolute advantage over other miners in some way (such as zero to low cost electricity; commercial space that is current locked up that is not in use which can handle not only the electrical requirements but also the heat output, ventilation; etc, or you have a deal no one else can get for the hardware. I say this because it's a different game now. I started my farm after the major crash, when there were months when difficulty was stagnant or actually backtracked; when Bitcoin's price was in decline- (when I ran my farm I "believed" in BTC when so few had even heard the term 'Bitcoin'); so it was more of a leap of faith and I didn't risk more than I could afford to lose. Today's landscape is much different...

The waters are bloody, it's no longer a blue ocean strategy at least in terms of mining BTC for profit... (unless you are already doing so); the coin has halved; difficulty is sky high; and it's still a very risky investment.

I'd recommend you write out a formal business plan, including a SWOT Analysis at the very least, and determine if you even have the edge you would need to even reach a level of profitability. Factoring all aspects that could affect the Bitcoin economy; including changes in technology; political influences and government interventions on a global scale; power costs, labor costs, including procuring that much hardware, assembly; upkeep, turn-over, teardown, and disposal or sale on the back end. And last but not least, taxes need to be considered depending on your country of residence and how they will tax any BTC generated.

Mining BTC will put you under the microscope when it comes to taxation. Trust me on that. I think today it's the biggest Red Flag out there.

Strato

Since you got a Master at Stanford University, we should hold you to a higher standard. What are the pros and cons of mining? What are the pros and cons of investing instead of mining? How much time are you willing to dedicate yourself to mining or investing? Thinking outside the box, there are lots of things you can do with $500K. You can buy Asics, GPUs and resell them. Have you consider performing the SWOT analysis, Porter's 5 forces, and determining your core competencies?

In my opinion, you should go for gpu mining. If you buy asic miners, you can use that only for mining bitcoins. But if you get GPUs, you can mine almost all coins of your choice. You can easily mine altcoins and if you want btc, you can simply exchange the mined altcoins to btc in any exchange. so if you are planning to invest in mining, try to invest in gpu mining ,also its less costly than asic miners.

As another user said, one of your major concerns is power draw, if you are planning for the long term, might be a wise idea to invest in wind or solar energy. As for mining, ASIC miners are pretty much the gold standard for mining BTC, however there hasn't been a generational update for ASIC miners since the Antminer S9, so I'd probably wait for Antminer to produce their next gen miner with a better fab process.

As for GPU mining, you certainly stand in a strong position to get a foot in the crypto world, however it would probably be best to mine altcoins for now until you build up a nice stash, then trade up to whichever coin has the most accumulated difficulty at the time. With that kind of capital you may want to group up with others to get bulk rates on GPUs, or purchase your mining hardware from China where it was recently banned.

You should invest into me and I would mine for you 

I saw your post here, and i saw it on reddit, You say here that you have money, and there that you have found investor that will help you... But it doesnt matter.

In order WHAT you want to mine, first you need decide with what you want to mine BTC or any other currency, if you are interested into investing into mining, you should check your electricity price, and find the best rate that you can get into your country, think about space with very good ventilation, dust, temperature, condensation.

In order to come up with best price for ASICs - with that kind of money - My advice would be > Go to China > Bitmain > and in person try to order as much as you can, since thats the way to get best deal for THAT AMOUNT OF MONEY.

Other thing that you need to think of that kind of equipment, is VAT(if you are in EU), custom taxes, if you are in USA, you need to think of income taxes. Maybe i have missed something here, but other people will add it... Good luck in your project!

I'd say put the majority of your money into ASIC miners but build a few GPU miners, if only for the experience and the possibility that they will be a lot better in the future

So many replies, and nobody gave you the advice you really need to hear (IMHO).

Everything stands and falls with your electricity price. It doesn't matter if you're investing $0,5M or $5000... If you pay to much for your power, you're not going to mine BTC profitably.
If you're willing to dip your toe into altocoin mining, i'm told the electricity price can be a tad higher and you'll still be able to turn a profit, but don't expect to ROI quickly if you're paying 20 cents/kwu, even if you're altcoin mining. For me, the maximum power price to even think about mining BTC would be around 10 cents/Kwu. You can still mine with little higher prices, but the ROI gets to long (IMHO) and with the rising diff and the short guarantee of ASIC's, i'd personally not take the risk.

Offcourse, with a bankrol of $0,5M you have a little bit of leverage with your local power company, or you'll be able to get a better deal when you're looking for hosting in a datacenter, but $0,5M isn't sufficient to build your own datacenter and really put a vice on the power company when negotiating... So you're still at their mercy to get a good deal.

Before you decide anything, ask yourself the following questions:
- Will you be mining from home? If yes, how much does your power cost, do you have a suitable mining room, can you place A/C units, how's your wiring, what about security, what about fire hazards,...

- If you won't mine from home, all these factors will be taken care off by the hosting provider, but he'll add those (hidden) costs to your final bill, and there is a chance you pay more than you'd pay if you did everything yourself (so it would take a bite out of your profits).

youve got lots of degrees and specialization so i dont think u really need to ask here,knowing that all ur degrees are conputer related courses ,but i can suggest that you must not get involved into mining directly u should learn first the ins and outs of crypto world.try all the sides little by little.play gambling made some trade,do some deeper research,digest all the learnings by then u will be ready for mining..just my opinion you can take it or not

Do research on the profitability of your current options as well as future prospects of all coins.
It's known that Ethereum will go PoS and will not be mined in the future.
There are also many other things that you need to take into consideration such as power, space and cooling.

Where do you plan to mine? Can that place handle all the power?
Use this website for profitability calculations: https://www.coinwarz.com/cryptocurrency

I agree with the posts above. Learn the ins and outs of crypto first before investing. It may take you a month or two to know the basics. And when you do and you think you are ready, start small to get the feel of it. You have a big capital, i should say diversify it. As many would say, do not put all your eggs in one basket. Get a few ASICS and few set of GPU's. Set it up and start from there. Im sure soon enough when you get the hang of it, you learn already, then that is the time to expand.

Its good you have a good degree but knowing the know how how cypto and mining works are different than those degrees. Firstly you should know the basic and I would suggest you start investing in some of the coins before you directly start into mining. Over a period of time once you get familiar you will learn more and will get idea exactly if its fits you or not and then you can take a decision.

It depends on which coin you want to support and use. Also, Mining is pretty much speculation. GPUs are low-risk compared to ASICs. So there is that. If you are not a true believer in cryptos and you just wanna make some profits off mining: you're gonna have a bad time since the profit margins when factoring in diff and infrastructure is pretty much less than what you get just putting it in a trust fund. So please, before you mine, get a bit into crypto first. Read about them, try to use different ones, see which ones you like. Fundementals will ultimately guide your decision.

Helle hope all is well! I have exactly $500,000.00 ready to go and I want to get into mining digital currencies! I wanted the peoples opinion if I should get into ASIC mining or stick with GPUS. Everyone in other treads are saying I shouldn't get into this if I don't know anything about it but everyone starts somewhere right?

My background in in computer science and cyber security. I got my bachelors in CS from Chapman University and my Masters at Stanford University... so I know a think or two but I'm new to crypto!

Back to my question.. should I get into ASIC mining or GPU? Should I focus on mining BTC or other coins? I'd love some opinions from fellow Crypto users!
Thanks in advanced!