Lets assume a hypothetical situation where you have half a million USD from investors that want to get into mining and are asking your opinion/technical partnering.
Given :
The rise in popularity → More miners → Spikes in difficulty
GPU sourcing lead times → By the time capacity is up 100% difficulty would have caught up.
POW future in general.
Many other things you would know having mined for quite some time
Assume you have access to cheap electricity (globally competitive) and can locate in a coolish climate, would you still recommend an ‘industrial’ scale mining operation to them ?
First of all this is a hypothetical situation, more of a what if to get a gist of the general ethos from experienced miners.
Second, i do have my opinion on the matter and i believe it is rather a complex subject that depends on a lot of factors.
That said I do not pretend to know all the unknowns and thus my post to get the collective wisdom as i’m sure there are people much smarter than I who can shed light on angles I missed.
So thank you for your reply and would appreciate useful insight if you care to share. If not…
I believe buying the coin directly is almost always more profitable in BTC terms.
But forgetting that and focusing on a stand point of just ROI on mining equipment for someone who for whatever reason cannot buy the coin directly, do you think it is feasible?
It’s one thing to have a few mining rigs running and home, but for an ‘commercial’ grade operation, the overheads + depreciation cycle of the GPUs , compounded with the future of the industry in terms of POW and the herd coming in… I wonder if someone would get their money back (in BTC terms, NOT fiat) if they enter now…
I am not running a big operation , but from what I saw on youtube from few of such operations . the ROI after deducting all expenses (energy - salasries - maintenance - replacement parts …etc ) was in range of 5-6% monthly .
that will render you bringing back 60 up to 70% of your initial investments in a year .
if I would start something like this I will consider selling hashing power as genesis mining , just to limit the risk and bring the 100% investment back in one year .
solo mining is on the table here and creating a pool both could add extra 2-4% to the ROI
I am no pro by any mean in this , I am a home mining guy . just trying to give ideas .
I f you have equipment, let it run as it is recently most profitable at the moment in the last 3 Months. It also was profitable to keep them. I sold most after some trading gains @ 17000 BTC.
If you don’t → wait for new GPU’s to arrive or buy used.
I bought a 1070 recently because I found one cheap and I still mine most with 900’s but Pascal now hashes allmost half of it. But my Rig is now payed off around 60-70% in three months. This is very nice. I never thought that. The 900’s are sought after by Gamers and will still be until there are 200$ 4K displays available I think, Eveen then the 980 Ti will still get a respect. The Hardware can still be sold for at least the same price I bought it then.
Yeah buying coins would have been more profitable, but I could use the heat and still sleep well.
To me it seems best if you can use the heat in this cold climate. Those common Industrial mining operations seem to waste the heat.
So you wouldn’t even need the newest hardware.
Volta is to expensive and kinda useless for mining. I would be amazed if cards get more than 1.2K/sol and for the cost (3000$) it’s simply not worth it. Volta cards are designed for AI applications and not for mining…
@4590
The people who can give you the right anwser are not going to be in this forum, people who can invest 1 milion or more don’t just “waste” time in a community forum
In any case:
Mining right now has just got very profitable and ROI is down to 5 months. If you’ve got the knowledge (mining is pretty simple) than you should consider giving it a try. Any investment in this field will give you returns in a really reasonable time, find the money and go buy some GPUs!
Absolutely I would invest if I had it to do it. Mining is the long game and in this pricing environment it is a guaranteed profit and ROI in a short time, IMO. Buying and selling crypto is riskier. Mining is not.
If you know anyone that has that kind of money and wants to put it to work then I will be more than willing to speak with them, just PM me.
Commercial mining at scale is a far cry from running a few rigs at home. You’re in for all kinds of pain you don’t seem to know about, from supply chain logistics to electrical debugging. If you’re not an expert, and you have to ask here for help, I would highly recommend you find something else to do. $500k is small-time and you’ll be lucky to even find a hoster willing to take you in.
Electrical and heat are serious issues. An electrician can pipe what you need, the electrical inside the rig can cause all kinds of havoc. Shorts and other issues. You will burn at least a few cards, boards and PSUs.
Heat: If your not a bonified IT guy, that has data center experience get ready for a world of pain. Never put your rig in your closet, and if you have a room, you better figure out air flow. 1 rig will heat up 600 square feet quite quickly, and a 1 ton aircon from costco aint going to cut it.
My short answer is yes its profitable for sure, your basically banking on the crypto rising in price, the higher it goes up, the more you make the faster your payback. Physical hardware will have a 1 year pay back, i’m talking all in here, the whole rig, networking, shelving etc etc… Then you have run it for 2 more years, as long as the difficulty does not go up too high. Then you will need more rigs, or abandon your current video cards and buy new ones to mine the same stuff.
Its all a game of speculation, and never forget that, never never never.
@dbfusion Thank you so much for sharing that video , very insightful.
For everyone else thank you all for your replies.
This thread is not one pertaining on advice on how to build a rig/farm. What i’m trying to understand is why would you not simply buy the under lying asset ?
It seems to be that if you are banking on the appreciation of the asset for you to make your ROI then might as well buy it.
@tim_olson@darkrider I agree with you guys, I think it’s one thing to have a few mining rigs and at home to heat/geek out on them while making some profit (maybe) but it’s another to go into this on an industrial scale, which is also what i stated in the message starting this thread.
If someone is wanting to invest half a million (hypothetically) why not just buy zcash or whatever high to mid cap ? Why would you start a farm now.
I am a data center guy by trade so its a no brainer for me to go the hardware route. Its what I know, heat, power, racks racks racks.
If you have zero ability to build a computer and want to learn 1-2 rigs is a good learning step, then you deal with heat and power after that as you scale.
If you have 500k your not usually a tech head per se. I mean typically…If you have tech head friends it makes sense to partner.
Because buying the currency direct is much higher risk, you risk losing 100% of the investment, if the currency you buy has a terrible thing, terrible hacked, tanks, goes to almost 0, you lose 500,000.
If you mine - and that happens, you still have your mining assets and should be able to sell them for 50-75% of the purchase cost, so much much much less risky as you always have ~250,000 worth of assets no matter what happens to the currency you mine.
