Topic: If you're thinking buying mining hardware, read this first - page 3. (Read 92726 times)

Not only is he dead serious, you're overlooking the fact that a lot of people are doing literally that. His figure comes from reasonable projections based on averages and such. The fact is the Bitcoin network does pour out 20ish TH/second, and has roughly for months and months and months. This is literally millions of dollars in op costs, and a lot more than that in fixed costs.

To ease the point into a "low information voter" sort of mental context, think of it in terms of television: you buying ten or twenty television sets does not make you "one of the top 20%" people in television. Even if they are all top notch plasma screens or something.

Wow, after read this i wont buy minning hardware.

Well for starters, yes almost anything that has a CPU can mine Bitcoins. People have actually compiled CGMiner to run on their android phones, and they have even gotten a few KH/s. Not really worth it, but interesting nonetheless.

When I say that computers will be useless for Bitcoin mining by summer, I mean that several vendors will be shipping ASICs by then. ASICs designed to mine Bitcoins have actually been in development for quite a while now, and will be the last step in the evolution of mining hardware. It's basically a device that you plug into a computer's USB port, and has a chip inside whose sole function is to mine Bitcoins. It can't do anything else except mine Bitcoins, but it does that one job exceptionally well.

People started mining Bitcoins years ago by using CPUs. Then they figured out how to mine Bitcoins 10x faster by using a video card (GPU). Now, ASICs will be 100x faster than a GPU, or 1000x faster than a CPU.

3 different manufacturers have offered pre-orders for ASIC hardware for Bitcoin mining: Butterfly Labs, BTCFPGA, and Avalon. Each device has their pros and cons, but they will all be leaps and bounds of any hardware that is out today.

So that's why I said that if you aren't even planning on buying anything until the summer, you should really just wait and see which of those 3 ends up being the best deal for you. Right now, it's a lot of speculation about which is going to be the most profitable, but in 6 months when you decide to order, you will have a lot more information to be able to make an informed decision.

So you're saying computers will be useless by summer time? Some kind of super computer or mining machine is going to be created that will replace computers? I could see that happening, but as soon as summer time? It would take months and months, if not years to create it. Can Bitcoins be mined with anything that contains GPU or CPU? So say, could you mine with your phone if the right software is created? I'm not sure what you mean when you say something will replace computers.

Thanks for the info 

I know of people that have preordered 4 SC MRs from BFL, which would be ~$120,000. So yes, people do have that much money to invest in BTC.

As I said, wait until the summer to decide what hardware you should buy. By the time June or July comes, you will see that mining with a computer (CPU or GPU) will be completely worthless, regardless of free power or what kinds of computer it is.

Lol nobody is stupid enough to spend $126,000 on a set-up when BTC are so unstable, are you serious? I'm thinking of having 5-10 Computers, because my powers free I won't need to worry about the power bill. Also, does it matter what kind of computer you buy, or does it just matter about the graphics card? Would it be better to buy a Mac, or a PC?

Btw, do you mean like one computer set-up would cost $126,000? Or do you mean the entire set-up (Comps, Power, Hardware, etc.)?

$146,500

And in 6-12 months time if you we're still mining with the hardware you bought today, you would probably be in the bottom 10%.

Good idea? A good idea is typically defined by the results, which cannot be foreseen ahead of time. As in "is it a good idea to go swimming with leadweights tied around your feet? Not if you drown, but if you become a world champion olympic swimmer because you got so strong at swimming it is.

That not being a terribly helpful answer, I'll say that no one really knows when and where bitcoin investment is good, it's all very volatile, and therefore very risky. For example, many people, last summer invested thousands or tens of thousands of dollars into ASIC pre-orders. for mining. Since then, pretty much every company stalled out on their promises of delivery, and bitcoin more than doubled in value. By next summer, things might shift that radically again.

What I can tell you is that you will almost certainly not be in the top 20th percentile, nor will it really make sense to run your own pool, on a $6000 investment, barring some very large happening between now and then. As said by another poster, much will be different, so just keep checking in to see where things are by then, and make a decision based on the facts at the time.

That's really hard to answer, because I don't know of any place that shows an average user's hashrate. You said you won't be getting the hardware until the end of the summer? I'd say wait until then, and see what your options are. A lot will change between now and then.

Okay, how much do you think a set-up that mines BTC in the top 20 percentile would run me?

Ah ok. Powering computers at your own personal house is ok. As far as purchasing software goes, you really don't need to. Any mining software you need is already free and open-source, it's the hardware that's expensive.

It'll be my money that I've worked for during the summer, and I'll be using the power at our house so I won't be stealing anything. By mining software I meant the software I need to buy in order to start mining. I guess it's to early to start speculating as I can see how much the bitcoin world has changed in the last 6 months. Thanks for the information.

A few questions:

1) What do you mean by "my mom's a teacher so I'll have free power" ? You're not thinking of stealing electricity from any schools, are you? Yes, it is actually stealing, and yes, you can't actually get in trouble for doing it.

2) By "Invest $6,000 in mining software" do you mean hardware? I don't know of any mining software that you have to pay for, but the hardware can be quite expensive. If you're asking about $6000 worth of hardware, that's 4-5 SC Singles, or ~270GH/s worth of BFL hardware. But that's sort of speculation, as who konws what mining will look like 6 months after ASICs hit.

3) "Have however many computers set-up, running 24/7 (Free-power)" Again, similar to point 1 above, these are all your computers, right? Mining on (and consequently degrading their hardware) on someone else's hardware while they pay for the power is stealing.

4) "Paying around $75 /month for internet" One small computer can run all 5 of the BFL equipment I mentioned in point 2, and not require a heavy internet connection. With stratum and varrdiff on a pool such as OzCoin, network and internet requirements really shouldn't be that high. You don't need a $175/month internet bill.

Where do your grandma live? Can I stay there all year and make $60.000? Is she married?

Just work for Grandma, buy coins, hold some and spend some on things you want.  This will likely be the best monetary outcome.

I have an idea that I want to pursue, but I have no idea if it will be profitable at all. I really need some opinions on the matter.

Alright, so this summer I'll be heading to my grandma's for the whole summer, where I'll be working making about $15,000 the entire summer. When I go back North for the school year, my mom's a teacher so I'll have free power. I'm looking to invest about $6000 in computer software, and upgrade to the fastest internet speeds at my location ($175/month). So my only cost monthly would be about $70 for the internet bill (my mom would cover the rest). Would this be a good idea, I know profitability is decreasing and difficulty is increasing, but I think I can make this work since I'm paying minimal bills every month.


Here's cliff notes on what I want to do

1) Go to my grandmas this summer, make $15,000

2) Invest $6,000 in mining software and head back North

3) Have however many computers set-up, running 24/7 (Free-power)

4) Paying around $75 /month for internet



Would this be a good idea? Would I be able to create my own pool with just my own computers?

Then you're taking money from your father. Also you run into a moral hazard because once the money you are generating from bitcoin is less than the power cost, if you were paying for power, you would simply sell the rig. Here you would continue because even though it nets your family negative.

It's not really clear what card your system could handle. Does it have PCI 16x? How big is the Power Supply? Are there any PCI-E connectors. These things will help you determine if you can mine profitably. Pretty much to get any decent extra money, you would need to drop in a 6990.

This may change things a bit: My father owns the company

I think it is simple to ROUGHLY determine how much Bitcoins you can expect from a new to build mining rig. Make a configuration overview and calculate the expected number of Ghashes you would get by using https://en.bitcoin.it/wiki/Mining_hardware_comparison#20_Popular_Mining_Cards and call this number MYHASHES.

Now go to http://bitcoinwatch.com/ and look at the lower left and read the Network Hashrate Gigahashs/s number, call this TOTALHASHES.
On that same page you also see Blocks last 24h, call this TOTALBLOCKS.

The number of Bitcoins in a block is currently 50, call this BLOCKSIZE. This will drop to 25 in 2013 and halve again every next 4 years.

The average number of Bitcoins you can expect to mine on a day is then:

MYHASHES / (TOTALHASHES + MYHASHES) * TOTALBLOCKS * BLOCKSIZE

Now that you have a ROUGH idea, calculate the hardware cost and estimate the energy (http://www.coolermaster.outervision.com/index.jsp)  you're gonna use to run the rig and to keep it at a reasonable temperature (AC ?). Is the place you want to put the rig capable to supply this amount of energy ?

You can go to https://mtgox.com/trade/history to get an idea of the US$ <-> Bitcoin exchange rate.

After all this, you should have a rough idea of your bright or not future ;-)

Any suggestions and improvements are welcome :-) Don't shoot me right away, this is my first post and I am a miner since a few days *grins* after reading a lot about Bitcoins, mining, etc.

The above formula gives a good value for my own situation.

Oh, and also take into account if you really want all the noise of the high rev fans of the graphics cards.....

The number of coins per block is cut in half every 210,000 blocks.  We are currently around block 136,746 so it will drop to 25 coins per block in about 17 months from now.