Bitcoin Mining: Is It Really Worth It?

Discussion in 'Bitcoin (BTC)' started by pepeg, Feb 28, 2019.

  1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.
  1. pepeg

    pepeg Fully decentralized

    58
    3
    8
    I have to admit that cryptocurrency mining completely confuses me. I don't even understand the term "mining" if there's no physical action here, and everything is digital. Apparently, after reading a little about it, there are many pieces of data that really make sense.

    Featured: Is Crypto Mining Worth It? | AllStocks Network

    What do you think about crypto mining? Do you think it's worth it for you? At which cost?
     
  2. Old Man Crypto

    Old Man Crypto Expert chainblocker

    291
    69
    28
    Retired, can’t remember from what.
    One step ahead
    Depends on your perspective. It’s worth it to anyone who mines crypto and can sell it for more than the cost of the mined coin. That’s the easy part of the equations.

    Is it worth it for the average crypto investor? It’s one factor in determining the price of the trades asset, but many cryptos are either cheap to mine or aren’t mined at all. So it becomes irrelevant.

    To society as a whole, it will become relevant from the environmental standpoint unless addressed somehow. But evaluations need to consider that the current banking system uses power and resources. We aren’t comparing bitcoin’s electricity use to zero. Physical money needs resources, power and personnel to create. Digital money requires massive banking computer resources. So crypto’s power requirements are offset by the reduction it provides in those other systems.

    As a general political answer, bitcoin mining is worth it if it keeps the system decentralized and distributed as failsafe and tamper proof. But if mining becomes dominated by only a few players concentrated in a few geographic areas, then it’s a moot point because tampering and failure then become just as possible as the current banking system it hopes to replace.

    Is crypto mining worth it? Ask us again in 5 years, we’ll know by then. Assuming this Old Man is still alive. ;)
     
    CryptoNow likes this.
  3. Vla

    Vla Fully decentralized

    87
    15
    8
    I see the question about mining almost every day and everyone says that it is not profitable because electricity costs more than you can get from mining, but your answer is complete and I fully agree with your opinion
     
    CryptoNow likes this.
  4. CryptoNow

    CryptoNow Buys the dips

    12
    4
    3
    Yep, this Old Man knows a lot. I also like to read his comprehensive answers.
     
  5. CryptoTC

    CryptoTC Crypto Fat Cat
    Staff Member

    408
    131
    43
    Grooming myself between naps
    Sleeping on a couch, chair, bed, or under a table
    I admit I’m being lazy, but does anyone know the current estimated cost to mine one bitcoin?

    Or put another way, what market price does bitcoin need to exceed for the miners to remain profitable at this time?
     
  6. The CC Forums

    Staff Member

    Here you go. Not straightforward at all.

    This is several months old, so things may be different now.

    [​IMG]
     
  7. Old Man Crypto

    Old Man Crypto Expert chainblocker

    291
    69
    28
    Retired, can’t remember from what.
    One step ahead
    Based on that chart, at today’s price of $5k, it looks to be profitable in several countries.

    If I were setting up shop, and I’m not, I’d seriously look at the countries with the cheapest resources but then also make sure they have crypto friendly governments and regulations. It just takes a few rules changes and a jump in the price of electricity to tip the scale back into losing money.

    A surcharge or tax on electricity used for bitcoin mining would be easy to get passed by most any developing countries’ governments just for the revenue bump.

    Of course, if we get another run back to $20k or more, then never mind. ;)

    And is it really under $600 to mine in Venezuela? With all the turmoil and inflation there? Is that due to the oil rich resources keeping power prices cheap, because you still have to buy and maintain all the hardware. Under $600. Wow! Too bad it sucks to live there. That’s a 900% profit today.

    I’d bet Bitmain would do it but cooling those monster units would be a bear near the equator, and the government instability and all is also a deterrent.
     
    The CC Forums likes this.
  8. Steem Experts

    Steem Experts Starting Investor

    4
    1
    1
    Here are the reasons by buy bitcoin worldwide which are exactly saying:
    • With hashrate shooting up over the years, it would seem blocks would be found by miners ever more rapidly.
    • The current fiat price of Bitcoin; critical for calculating profitability .
    • Difficulty Spikes, Price Crashes, Equipment Failures, Power Cuts, Shipping Delays & More!
     
    The CC Forums likes this.
  9. Michael Kaye

    Michael Kaye Hodls on dips

    8
    4
    3
    Huumm!! Could be either yes or no!
    Actually, comparing to last year,2018, the situation has changed drastically. In 2019, mining competition is much more tight and costly! It needs you know the main factors and parameters around bitcoin mining to decide if you can start and survive in this mining market.
     
    The CC Forums likes this.
  10. The CC Forums

    Staff Member

    What concerns me is the same that concerns most others in the bitcoin world. If mining margins become razor thin, only the big players will remain.

    If only a few players have a large majority of the hash power, then we’re movong towards centralization. I know the system was designed to gradually result in price stabilization which then encourages use rather than hoarding and using it as an investment tool, but a side effect is that stabilization at prices near cost of mining will drive the smaller setups out.

    When a business becomes a commodity and margins drop, only the big players survive. It’s a standard business tendency.
     
  11. Want to read the rest of this thread? Register now.
    Register

Share This Page