
Bitcoin's Price Surge Is Making Hobby Mining Profitable Again - gkrypt
http://www.coindesk.com/bitcoins-price-surge-is-making-hobby-mining-profitable-again/
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aqme28
>Solis bought a Bitmain Antminer S9 on eBay for $2,400. >As of this weekend,
Solis has mined 1.01 BTC, worth a little more than $2,584 in his bitcoin
wallet. >Solis said: >"When I bought the miner, the price per bitcoin was
around $1,200. I thought I’d break even in one year, but actually it’s been
about five months."

So he would have been much better off just spending that 1,200 on Bitcoin
rather than on a mining rig.

~~~
chx
This is hindsight. He would have been best off _staying the fuck away_. As I
mentioned a billion times cryptocurrencies (which are not currencies either)
have zero legal real world use cases, currently the two uses are illegal money
transfers out of China and hype. It's the worst sort of gambling: you do not
even know the odds.

~~~
stale2002
Crytocurrencies transactions are significantly cheaper than wire transfers.

That's a real world use case.

~~~
sireat
Cryptocurrencies are not always cheaper. They used to be but not anymore.

In Europe, I split a 0.36 Euro SEPA fee for a 1000 Euro transaction between
two different banks in two different countries.

Bitcoin would have cost me $3-5 if not more.

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projectramo
This headline is simply not accurate.

It should say: hobby miners barely break even over a year after the rise in
bitcoin prices if they ignore the cost of power.

However, the difficulty of mining has gone up so much that they are unlikely
to recoup the power costs going forward.

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thaumaturgy
For those thinking, "now's a great time to join the party!", the price surge
happened from about March to about May of this year, with BTC more than
doubling in USD price. However, it's been completely flat for over a month now
-- longer than any other point in recent history -- and there are currently
some big questions about the future of BTC that are being addressed next month
and may result in a loss of value for some number of people, depending on how
things shake out.

Smart money right now isn't in BTC, unless you think you can predict what's
going to happen in the next six months and you're willing to keep it for a
longer period. And, even then, you'd be better off selling it back to USD and
re-buying when it likely falls back down to sub-$2000 in a month.

~~~
delegate
> Smart money right now isn't in BTC,

Where is it then ? I too would like to join the 'rich fast' bandwagon !

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tertius
Shorting SBUX since June 4th? Where have you been?

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Cerium
Better off with ISRG since January.

~~~
tertius
You know I should have been on this bandwagon. I did some VR work using one of
their robots.

Tell me more.

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nthcolumn
I am not a financial expert. Some people have maxed their plastic out on
bitcoin. I think that someone somewhere sometime will be left with the bill if
there is no actual resource behind the currency - it is just an IOU after all.
The UK PM talks about terrorists having no place to hide their money today, it
dives $200. Too much feels like an elaborate scam - a silkroad clone goes
completely dark or exchanges 'getting hacked'. I know I know: if I'd kept my
.bitcoin I'd be even richer now...

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drpgq
Wouldn't there be a big advantage to running a bit coin miner somewhere cold
with cheap electricity like Quebec?

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guiomie
Its not cold in the summer, and it probably too cold in winter to not have any
interior climate control. With much lower cost of living and cheap
electricity, China seems like a much better option, the majority of mining is
actually done there.

~~~
flashdance
> it's probably too cold in winter to not have any interior climate control

Trust me, these miners put off enough heat that it's not an issue.

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kartD
I think this article is mistaken. People are mining Ethereum causing GPU
prices to spike 2-3x. Eth is designed to use a lot of memory so GPU mining is
always viable.

GPU prices:
[https://camelcamelcamel.com/search?sq=geforce+1060](https://camelcamelcamel.com/search?sq=geforce+1060)

Mining centric cards are being released as well:
[http://www.anandtech.com/show/11607/cryptocurrency-mining-
ca...](http://www.anandtech.com/show/11607/cryptocurrency-mining-cards-update-
zotac-manli-biostar-products-formally-confirmed)

~~~
astrodust
Using a lot of memory complicates any ASIC design but it doesn't eliminate the
possibility of such a thing being made.

If someone really knows their hardware engineering they could interface with
GDDR5 memory on a custom board and mine as fast or faster than a GPU.

It's just a matter of how much money it will take to develop such a chip. I'd
guess at least $2-5 million given how you'd need to fabricate it at 14nm or
better to get sufficient performance, and that process can be a serious
headache for smaller firms.

~~~
yuhong
Thinking about it, I wonder how much QDR SRAM bandwidth compare with GDDR5.
This would be useful for Monero for example. Nobody is going to care about
spending a few hundred for FPGAs with large amount of memory if a 5x-10x boost
over GPUs is possible, but...

~~~
astrodust
There's a price trap here. The good FPGAs still cost $10K or more each and if
you're intending to ship that hardware, which is how the Bitcoin and Litecoin
ASIC platforms bootstrapped themselves, you're going to be in trouble if your
FPGA solution can't beat the equivalent spend on GPUs. Bitcoin lends itself to
FPGA acceleration extremely well, SHA256 is trivial to implement in an
absurdly parallel way. Scrypt is a bit more messy but not impossibly hard. The
Ethereum one is a beast by design, so it'll be a true challenge for any
implementor.

Ten R580 cards can really crank out hashes for Ethereum. For a GPU to keep up
it's going to have serious memory bandwidth issues as that's one of the
limiting factors in this brand of mining.

What you might see is someone getting a license to make "OEM video cards" and
then produce a line of mining-optimized cards. Given the constrained supply
across the board on any AMD GPU this would be an easy win for a company like
MSI or Gigabyte that's already making GPUs. Strip off the useless ports, tune
the memory bandwidth, and make them work over USB-C instead of PCI-e so you
can really pack a system full of these things.

Making an external GPU that comes in a nice housing with USB-C interconnect
would also sell well in the machine learning market where you wouldn't have to
worry so much about shoe-horning GPUs in your case. You could just stuff them
in a rack.

~~~
yuhong
I am thinking of Monero and CryptoNight not Ethereum for FPGAs for that
reason. I am thinking of ideally something like Virtex-7 or Vertex-8 with
32Mbit or more of memory.

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zitterbewegung
Yes, but the volatility of Bitcoin could make it not profitable again. Instead
of buying a miner what if he took that money and bought bitcoin at that point
of time. Wouldn't he have more money?

~~~
lightbyte
Yes, he'd have about doubled his money instead of breaking even.

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yuhong
What is fun is the Litecoin one, and the fact there are ASICs with crappy
power efficiency like the GAWMiners Fury and any other miners using the
Zeusminers chips.

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Frogolocalypse
The premise of mining bitcoin is not really about being cost effective today,
but taking a long position on its value, and what you perceive the value will
be, for totally anonymous money at some point in the future. Because the
profit earned from mining is pretty close to the definition of untrackable in
a crypto.

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solotronics
would it be better to just buy hold and use Bitcoin?

mining adds slightly to the decentralized nature but I am curious about
comparing buy and hold vs mine.

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ajc-sorin
Because it's super easy to buy and hold Bitcoin, if it becomes more popular
the value of mining rigs will increase. Right now, there's probably no
material difference between buying the coin itself or buying the rig and
mining, but eventually, it may become more pronounced.

There are other benefits as well. Buying the mining rig is a sort of hedge in
that if bitcoin drops to $0, you at least have some hardware that can be re-
purposed/sold.

~~~
saurik
The more people who mine the less valuable your mining hardware becomes, as
the hash rate increase will lead to a difficulty update: it is a lottery that
is designed to give payouts at evenly spaced time intervals.

You also now have a slightly old, very special purpose computer... it is like
owning a three year old graphics card in a world where you decided graphics
cards are not that interesting to own... what exactly are you "repurposing" it
for? If it is some really awesome ASIC-based mining rig it might _only_ be
useful to mine Bitcoin.

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tabeth
I sure hope anyone who's mining Bitcoin isn't also complaining about climate
change. Also, electricity costs and various other externalities (depreciation
of the machine and inevitable waste handling) are never accounted for.

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paulpauper
Is it profitable because the mining is easier or because the price is rising.
It's almost certainty the latter.

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dogma1138
Bitcoin is down like £450 since last month the guy is a little bit late to the
party.

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imron
Time to party like it's 2013

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mtgx
Bitmain is what's keeping Bitcoin from progressing right now. Stop supporting
them with your money.

~~~
projectramo
how so? I've never heard this before.

