Okay everyone, as planned, I wanted to do a post that showed the earnings from my miners. My experience thus far has been pretty positive and I’ve had no issues out of my miners. I have had issues out of my mining room but those have since been temporarily resolved. It just had to do with no air intake into the room mostly (oops).
Anyway, We’ve been running for 8 days now and things are going pretty well. Here are my results:
On day 1, we didn’t make much but that is because we weren’t able to run the miner for a whole day before the payment was made. These miners were all connected to NiceHash.com for their pool. They pay out at roughly 6 AM Eastern in the US. I made sure to pull the actual price of the coin at the same time so the figure would be static each day. The .5 entries mean that during the day, another miner was configured but didn’t run the whole day so the number was skewed a bit. But from the majority, you can see that a single miner averaged between $30-$32 for the bulk. But on the 13th, the price of the coin started it’s skydiving impression so profits started to take a hit as well.
We now have 3 miners going full time and they’ve been running for a full day now, but I think with this fall, the number of bitcoin transactions have flooded the network due to the fall in the price. As a result, I think the system is a little overloaded as I’m still waiting on my last payment (it’s usually here by now).
[Update] I’ve updated the image to show the profits of 3 miners running for the full $24 hours. The drop in price (more than 25%) has really affected the numbers. [/Update]
So let’s look at this from the “should I get into mining?” or “is mining profitable?” standpoints. First, how much does it cost? When I bought the first one, the price of a miner was $1250 (more like $1800-$2000 now) from Bitmain.com. However, even though you buy it right then, don’t expect to get it for 2-3 months as that’s their current wait time for delivery. The power supply that goes with it (APW3+) is $105 through the same company. Then you pay for shipping, $120 (roughly). So let’s call it $1500 to get it to your door after taxes. Then you need to make sure you have at least a 220V outlet. You can get the APW5 which can run on 110V, but it performs better and more reliably at 220V. If you don’t have one installed, add in a cost for that from an electrician. And then factor in how much it costs to run your machine. I think mine is about $80/mo for 1 machine.
From the numbers above, you can figure your ROI is roughly 50 days ($1500/$30d=50d). That’s really not all that bad. For now, you’re really looking more like 56 days to account for the electricity.
There is one VERY crucial part we’re missing through. Difficulty! As a miner owner, the difficulty is easy. As a miner itself, the work is not. Sure, it can process transactions all day long, but hashing that algorithm to start the next block in the blockchain and get that reward, that’s VERY hard work. And the more miners out there, the harder it gets.
Think about about if you had a $100000 dollars to give out for every person who can guess the word you have in your mind. The game HAS to last at least 10 days (no more, no less). It starts with 10 people. Well, there are a ton of words out there so you decide to keep it easy. You start with 3 letter words. One person guesses right. That person earns a $100. You change your word and they start again. Sure enough, every few minutes someone guesses it right. Word spreads that people are guessing words and earning $100!!! Another 100 people come. They keep guessing right and now they are guess faster than you thought. A little head math and you figure out that at this rate…you’ll blow through your $100k before the 10 day mark. So what do you do? You make it harder. Now it’s 4 letter words. Sure enough, it’s hard for them to guess. The rate of the payouts start to slow down again. More people come, the payout rises. So you increase the difficulty.
This is exactly how Bitcoin works. The more miners that are put on the network, the harder it is to earn the reward. How does this affect you? This means you’ll slowly see your daily intake dwindle as the weeks / months go on. My initial calculation doesn’t take that into consideration. How fast does the difficulty increase? “It depends.” If your game started to come to a standstill and nobody is getting payouts or people start to leave, your only choice to stay in your window is to lower the difficulty. The rate of reward is what drives the difficulty. Typically, it goes up, but how much fluctuates. In some instances (rarely) it goes down. Either way, your ROI (Return on Investment) is actually quite a bit higher than your initial estimation. Even though you run a calculator on the day of purchase and you like the results, do NOT expect those results 2-3 months down the line when you actually get your miners.
Are you okay with that? If so, hop on board and give it a whirl. Are you okay with possibly never getting your ROI due to coin price collapse or a difficulty increase to the point where you’re making $2/day vs $30/day? If not, stay away.
For the moment, I’m excited for the venture. If you have any success or horror stories, comment below. If you have more questions, do the same. Until next time. . .