Topic: If you are thinking of mining... READ THIS! (Read 831 times)

Well you know I've dumped in a lot more than that Phil, I'm not saying anyone else should dump 30 or 40 BTC but I have a nice stockpile of coins so I look at it as hedging my investment. I calculated a % of BTC I was willing to reinvest into the market with and that's what I did buy buying all the hardware to start mining.

EBITDA isn't super accurate for crypto mining but it painted a good enough picture that break even point should be reached, and at the end of the day that's all good.

Going from zero invested to twenty thousand is not the way to go about it when it comes to mining.

First rig should only be a two card rig. That is easy to expand up to four or five cards.

Many are full out going for it.

I completely agree that mining is a hobby. The relationship between miners, their hardware, and popular coins, however, is much more complex. Just look at LTC vs ETH, where LTC was created as a GPU-miner's safe haven against BTC's ASIC revolution. Once scrypt ASIC's put GPU-LTC mining out of business, it faded. Now the new, popular coins (ETH, Zcash) are the GPU-friendly coins again. Entering crypto with a mining rig is a great way to support the network, learn something about crypto, and take some risk. I can agree with OP that individuals should not go forward with mining as a profit-seeking endeavor.

or there's a nuclear holocaust and all technology is rendered worthless   

Or SEGWIT tension causes a large dip to the BTC price approaching Aug 1 and everything else craters.

Or it takes off and trlples in value by dec 1

If you don't have any risk tolerance, you have no business investing, no matter what vehicle it may be in.

Just get out, put your money in a mattress and put on your tin foil hat and be merry.

Or, do your research, sack up and do what you need to do.

Been there and done that. Back when I started mining early in 2014 there was an influx of new coins, almost diaily. Mining was good, but not as profitable as it is now. Then ASICS took over Scrypt and X11 and megapools started mining the most profitable coins, just to dump them in to BTC and depressing the price. By the end of 2014 every coin had a negative return when you factored in electric costs or making a few dollars a month. The only way to make a profit was to mine new coins with a low difficulty. The good news is I held on to most of the coins I mined and I'm glad I did.

To me the fact that even with all the new GPU miners, ASICS and farms out there, MUCH more than in 2014, and mining is more profitable now than ever, is a sign the Crypto market is in a growth phase. The new highs, exploding marketcaps and BTC at close to $3K is getting everyones attention and the party is just getting started!

It's human nature to believe what we most want to believe.  It is the stuff of dreams.

Hearing tales of huge profits and massive ROI, we all want to get involved and get rich. 

"If I invest $30k now, it will pay for itself in a few months, and then I can quit my day job!" seems to be on some people's minds when they look to see what all the hype is about.  But maybe it's time for a little...

REALITY CHECK

The profits you see on whattomine.com are what you might earn today.  NOT what you can expect to earn next month.  The huge profits can only continue as long as the coins prices keep rising.  When they stop rising, profits will plummet.  This is inarguable.  You might think that you can get around this by switching to other coins that are rising.  But that's exactly what everyone else will be doing so any reprieve will be very shortlived.  If difficulty increases fast enough, even a rising price will not be enough and profits will plummet.

The boom started a couple of months ago, and might last another couple of months.  But when it inevitably comes off the boil, the devastation will be massive.  Consider how many new miners there are compared to before.  Some will resist the inevitable and hang on until they are making only cents per day on their 6 gpu rigs.  Not much point selling the hardware; ebay will be awash with the junk.  By xmas this year, I expect to see:

1. A glut of RX470/480/570/580's on ebay for less than $50

2. A glut of disgruntled ex-miners with an "ahh the little guy gets screwed again.  I just can't win" mindset.

The bust is going to be bad.  A few months ago, the early adopters were doing well making a few dollars a day.  I think when it goes bust, it will go down way further.  Only those with the cheapest electric will make any profit at all.  There are just too many people in it now, and dreams do not die easily.

Do not be seduced into thinking this is a path to riches.  There lies only despair.

Do not be tempted to think of it as any more than a hobby, mainly for those technically minded who like to tinker and fiddle.  It is too late now to build your first rig with any confidence of ever getting a return on your investment.  You might be lucky, you might not.  But even if the former, forget about massive profits.  The end is nigh.

If you really want to make money with less risk, buying and holding the coins themselves or trading (if you really know what you doing) is by far a better use of your money than building rigs.  Both strategies do well as long as the price keeps rising.  If the price plateaus, you are not losing anything holding the coins but you will lose big time on your rig investment.

It's a hobby, NOT a business!  Do not imagine it can ever be otherwise.