I really want to set up a mining rig in the new year, but am pretty new to the space and super new to mining. Does anyone have recommendations on how to get started in a cost-effective and easy (relatively speaking) to understand way? Your expertise is greatly appreciated. Would be interested in routing as well.
pull down to refresh
1000 sats \ 10 replies \ @BTCMiner 13 Dec 2022
Are you doing this for entertainment and/or as (an expensive) hobby? Or maybe you are just trying to obtain KYC-free sats (even if it comes at a significant premium over spot price)? Or instead are you considering mining as a profitable endeavor?
Knowing the answer to the above will help in getting responses that might be more helpful.
Many people think mining will earn a profit. But bitcoin mining is a very competitive field, and your ability to compete pretty much correlates to the amount you pay for electricity. You are competing against the miners in Paraguay paying $0.03 per kWh for their power that comes from hydroelectric generation. An (obsolete) S9 rig might not even break even on $0.03 per kWh. Mining on an S9 at $0.14 per kWh (the current "residential average" paid in the U.S.) means you are paying well over $100K USD per bitcoin, unless you are making use of the exhaust heat (e.g., home heating) where the cost for the heat would have expended anyway, thus lowering that marginal spend for running the rig.
reply
25 sats \ 9 replies \ @RedNinja39 OP 14 Dec 2022
Thank you for asking this. I'm not worried about KYC for obtaining sats, but would most certainly like to turn a profit. I really don't know much about mining at all to be honest. Looking to learn as much as I can so this is very helpful, thank you. If I'm understanding you correctly, it sounds like mining for profit will be a prohibitively expensive endeavor unless I can find a way to get the average energy cost down significantly, or offset that cost by using the exhaust heat in a way that reduces another cost. Sounds like cheap energy is the name of the game?
reply
0 sats \ 8 replies \ @BTCMiner 14 Dec 2022
Yes. Cost of electricity for residential use in the U.S. can vary from $0.08 per kWh in areas where there is excess hydroelectric power, for instance, to $0.30+ per kWh in areas like California and Hawaii. And it isn't your "average" cost per kWh, it is your "marginal" cost per kWh that matters. For instance, in many regions, billing for electricity is "tiered", ... so essentially the more electricity you consume the higher you pay per kWh. For example, with So-Cal Edison:
Tiered Rate Plan
https://www.sce.com/residential/rates/Standard-Residential-Rate-Plan
reply
25 sats \ 0 replies \ @RedNinja39 OP 14 Dec 2022
Oh wow, this is extremely helpful. Thank you. It sounds like I shouldn't even be worried about what kind of rig I'd be using until I figure out the energy cost. It sounds like either finding a really efficient way of offsetting the cost, or setting up a rig out of state, may be my only options here. Haha you may have just saved me a lot of money. Thank you!
reply
20 sats \ 6 replies \ @2big2fail 14 Dec 2022
i recommend a futurebit apollo as a great way to learn and have a full node all in one miner.
reply
0 sats \ 5 replies \ @BTCMiner 14 Dec 2022
Surely you jest.
reply
30 sats \ 4 replies \ @2big2fail 14 Dec 2022
ha! no seriously. it doesn't require electrical work. can run a full node, is basically silent and gives a lot of opportunity to learn
reply
30 sats \ 3 replies \ @RedNinja39 OP 14 Dec 2022
Just looked it up, thank you. This looks very user friendly. I would think that it would still be subject to the same energy cost restrictions that @BTCminer was talking about, wouldn't it? Once I get the energy cost situation figured out, this looks like a great place to start. @BTCminer, do you disagree?
reply
10 sats \ 1 reply \ @BTCMiner 14 Dec 2022
That's why I was asking your intention first.
If you want a hobby, then maybe dropping $600 on this device is something you could justify -- maybe even show it off to the visiting relatives over Christmas. But if you are trying to "turn a profit", then this device won't help with that, and depending on your cost per kWh, there might not be any bitcoin mining device available to you that will.
That's why people buy hardware that is operated by a commercial bitcoin mining operator that has access to cheap electricity and that will host and manage your equipment.
HashBranch is a service that matches people with hosting facilities.
view replies
0 sats \ 0 replies \ @BTCMiner 14 Dec 2022
I see that the hashrate for this $600 Apollo is in the range from 2 TH/s (ECO mode) to 3.8 TH/s (Turbo mode).
https://shop.futurebit.io/products/pre-order-apollo-btc-a-bitcoin-asic-miner-and-desktop-class-computer-running-a-full-node-and-much-more-batch-1-ships-in-late-april-to-may?variant=33404745351267
For reference, a $150 Antminer S9 does 14 TH/s.
At the current difficulty level, (which reflects total network hashrate around 250 EH/s), this Apollo device in Turbo mode will produce about 1,400 sats per day (an amount worth about $0.25). Or about $7.50 per month.
Even if you paid nothing for electricity, and difficulty didn't increase from here, and the BTC/USD exchange rate stayed at ~$17.5K, it would take you mining using this for six and a half years for it to return the $600 capital expenditure you made for this device.
The 200W (Turbo mode) will consume 4.8 kWh per day. If you pay the U.S. residential average of $0.14 per kWh, running this device will cost you $0.68 in electricity per day.
So, to EARN $0.25 in bitcoin this device costs you $0.67 in electricity. Thus a NET LOSS of $0.42 per day.
Thus there is NO CHANCE of "break even" (i.e., recovering your Cap Ex spend). You are losing money every single second this device is operating, and the longer you run it the deeper in the hole you go.
Now if you put $600 into buying bitcoin instead, you would have 3.4M sats. If you just sit on that, then six and a half years from now you will still have 3.4M sats.
Compare that to trying to mine using this Apollo for six and a half years where you will simply have just finally recovered the $600 you had spent on the device. And again, those numbers are assuming that the bitcoin network hashrate does not increase from here. As that increases (which it has, year over year, since 2009), this device mines less and less bitcoin per day.
reply on another page
0 sats \ 3 replies \ @Hermit 14 Dec 2022
All these really good responses on how competitive the industry is, and it was not even mentioned the halving event that will occur in only 480 days.
reply
0 sats \ 2 replies \ @RedNinja39 OP 14 Dec 2022
Please forgive my ignorance, but what is this halving event that will occur in a little over a year?
reply
0 sats \ 1 reply \ @Hermit 15 Dec 2022
Every four years the amount of Bitcoin issued every 10 minutes gets cut in half. The reward for the miners suddenly will be half over night, but the amount of energy used remains the same. Less supply, same demand, price goes up, compensates the cut to the miners.
With all due respect. Before thinking in mining, I recommend to put at least 20 hours of study.
Start with the Bitcoin Standard.
Watch at least 6 hours of Micheal Saylor videos, specifically those about Bitcoin as digital energy.
On the website of Arman the Parman you will find very didactic content.
Try to understand every sentence of the rap video of Tip_NZ in Twitter, Down the Rabbit Hole.
Ask questions here, everyone is really helpful
reply
0 sats \ 0 replies \ @RedNinja39 OP 15 Dec 2022
Thank you! I Definitely will!
reply
0 sats \ 0 replies \ @Taranis 13 Dec 2022
start with a used s9 from kaboomracks https://t.me/kaboomracks
reply