hardware for bitcoin: is it worth it in 2021?

[NiHaoMike]

I'm under the impression Bitcoin was meant to replace online payment services like Paypal. I think that use case is better covered by Ethereum, been a while since I last looked at the "inefficient" mainstream cryptos.

I wonder if there's a reason why energy efficient cryptocurrencies are generally unsuccessful in the long run apart from the problems altcoins face in general. That sometimes happen because the assumption that something other than compute power becomes the limiting factor turns out to not be true. Maybe things will be different for a coin that's limited by bandwidth by its very nature? Apart from sharing bandwidth, perhaps there could be other altcoins that revolve around resources other than compute power? One example could be SDR receivers, where users could bid for priority use of (control over the tuning of) receivers. "Desirable" receivers get paid more so that would encourage putting up decent setups as opposed to just plugging in a random piece of wire and leaving it. Could be done for transmitters as well, although it would be a lot more complex to prove that the end user would have the license to operate such a transmitter in the area. Maybe it could work for ISM bands only, if there's a system in place to make sure the transmitter is always operating within the rules. (A distributed network of transmitters and receivers where end users pay the owners of the equipment to use them, that's starting to sound like a decentralized version of a cell network!)

I think cryptocurrency in general is a good idea, now make some that are not limited by compute power (which in turn is limited by energy use) and one big problem would be solved.

[Mechatrommer]

~700kWh per bitcoin? Holy hell.

yeah but, 1 bitcoin now is $34K in value (the moment i see it) https://www.coindesk.com/price/bitcoin is that legit and accepted by all banks/countries? the stock value fluctuates like crazy too. if you happen to buy something in Jan 12th, you could lose $1K or more already

I'm under the impression Bitcoin was meant to replace online payment services like Paypal.

i'm not sure adding another currency will solve problems thats already existed... such as money laundering etc.. i'm not expert in financial/currency/economy area though so i'm not debating any further, let the discussion to the experts, but if its going to replace online payment, who the hell can afford $34K for a single bitcoin? can i buy 0.001 bitcoin? how much a Rigol DS1054Z going to cost? 0.01183221913269833757321185588357 bitcoin? we are going to need new unit. 1.18 bitcents? no! somebody is going to lose 0.003221913269833757321185588357 bitcents, thats equal to 22.5534 Wh of energy, urgh my brain hurt. and then if i buy it, where do i put it? paypal? or bitpocket? what if i lose password as other mentioned? imho its just a redundant currency to what already existed, and the problem that came with every single one of them. i will stick to conventional method, until this thing go viral and generally accepted/established by banks/universities/countries/people. (but then, thats the sentiment)

[SVFeingold]

(A distributed network of transmitters and receivers where end users pay the owners of the equipment to use them, that's starting to sound like a decentralized version of a cell network!)

Seems like this will suffer from all the same problems as other "How hard can it be?" endeavors succumb to. Currency is one thing. An open-source collaborative cell network? Good luck with that!

I've got nothing against cryptocurrency in general. It really seems like a solution in search of a problem. The main problems it's trying to solve are already better solved by traditional fiat currency and banks.

Is it...untraceable? No. Anonymous? No. Instant? No. Decentralized? Not really, and this isn't a benefit in and of itself. I'm struggling to see the practical benefit for like 99.9% of people. As I mentioned, the entire crypto world is slowly reinventing modern banking as naive people lose tons of money. "Oops mistyped the destination address." Too bad, money's gone forever. "Oops someone hacked my account." Too bad, money's gone forever. "Oops, lost my password." Too bad, money's gone forever. "Oops, the online service storing my Bitcoin was shut down and the owner stole all the wallets." Too bad, money's gone forever. Sensing a pattern?

Something like ~20% of all Bitcoin is currently stored in lost or inaccessible wallets.

[tszaboo]

~700kWh per bitcoin? Holy hell.

yeah but, 1 bitcoin now is $34K in value (the moment i see it) https://www.coindesk.com/price/bitcoin is that legit and accepted by all banks/countries? the stock value fluctuates like crazy too. if you happen to buy something in Jan 12th, you could lose $1K or more already

No, it is 700kWh per transaction. That's when you want to transfer money or pay for something.
It's worth noting that this is about 300Kg of CO2 emission. With a press of a button.
Mining one bitcoin is about 1.5GWh. You can calculate it from the yearly 78TWh consumption, the system gives you 1 bitcoin every 10 minutes.
It's madness, there is no justification for it. Stop it.

[Mechatrommer]

yes i sort of agree, its waste of energy, time and money in the name of fancy mathematics. not really sure why people, or even companies/investors buy the idea. it doesnt really solve any unsolvable problem with existing currencies, i still can buy goods with existing system. its probably just a big pool of uncrackable crypto experiment. i wont be entertained if someone sell to me even at 1/10X of market value, and i will stay away if a store try to enforce the currency, not that i cant find it somewhere else. i remember one store selling mp3 songs (snort) tomorrow it can go poofed to zero value, so i wont take the risk until it really established and accepted by experts. but then, this is just a sentiment and speculation. fighting from each side to decide if the price is to go up or down. i was a saleperson for some stock market long time ago, did some research and its enough for me with this gamble, i'm not part of it. i'd rather going red or blackened skin under the burning sun work hard to search for big fishes than this nonsense.

[DiTBho]

No, it is 700kWh per transaction. That's when you want to transfer money or pay for something.
It's worth noting that this is about 300Kg of CO2 emission. With a press of a button.
Mining one bitcoin is about 1.5GWh. You can calculate it from the yearly 78TWh consumption, the system gives you 1 bitcoin every 10 minutes.
It's madness, there is no justification for it. Stop it.

The perfect and almost clean energy-maker machine is our star, the sun. It produces a lot of death radiation and sometimes has solar storms, this is a big problem and it's making hard to build a permanent station on the Moon, but hey? Its radiation per hour is hundred hundred hundred times what why can generate on the Earth planet in a whole year with our neanderthal-technology.

We are not Homo Neanderthalensis, We are supposed to be Homo Sapiens, so we should stop using fire to warm up, cook and get things moving, and start making better use of resources!

I have a friend who is installing solar panels and photovoltaic cells everywhere, and ... these panels should be "somehow" clean energy.

Why somehow? Because you have to build these solar panels and photovoltaic cells, and the process is not exactly clean, but ... less dirty than what happens burning fossil fuel.

I am  not expert but I see a gain for the health of the planet and people, so maybe the new digital economy would make sense if entirely powered by solar panels?

OT:
If I was a tales writer, I would describe a world where all the big-irons, big and power hungry servers and computers for the weather forecast and digital economy are all located underground in a Caveau in the desert, with thousands and thousands of photovoltaic panels installed around on the surface where the sun radiation is the best achievable.

(maybe a similar place already exist, with less panels, but maybe it already exist)

[SVFeingold]

not really sure why people, or even companies/investors buy the idea.

It lets people "take the power back," so to speak, so they're not beholden to financial institutions. Which is fine, if that's what you want, but it also means you now have the responsibility of doing all those other things that banks do. Like remembering where your money is.

tomorrow it can go poofed to zero value, so i wont take the risk until it really established and accepted by experts.

Sure...it could. So could the US dollar. In theory. I'm not sure what "experts" have to do with it. The legitimacy of a currency doesn't hinge on the buy-in of experts. There's no cabal of lizard-people at the center of the earth deciding what our money is worth. It's worth what it's worth, which is what people generally agree that it's worth. Same as Bitcoin, which is basically our normal currency with extra steps. For it to "poof" vanish everyone would have to decide it's worthless all at once. And that isn't going to happen.

i wont be entertained if someone sell to me even at 1/10X of market value...i'd rather going red or blackened skin under the burning sun work hard to search for big fishes than this nonsense.

That's just...making an instant 1,000% profit? Silly thing to say no to. I suppose that works for those who take a moral stand that there's some kind of inherent nobility in poverty, or in doing hard work for pennies. Ah for the days when you could tie up your money for 5 years at a time in a "high yield" COD with a 2% interest rate. If only those fools who made millions off BTC had done that instead, they'd be much happier. I'm sure there is a type of person out there who, if they could go travel back in time to talk to their former self a year ago, would still tell them "nah, Tesla is too risky! Better invest in mutual funds instead!" I haven't met someone like this but I'm sure they exist...

The one legitimate use case I can see is for those who live in countries that aren't exactly "free," and also those living in countries where the local currency is unstable/unreliable/worthless. Bitcoin being off the grid, so to speak, would make sense. Even with the price fluctuations. For those in developed countries it's more of a hobby IMO.

[Mechatrommer]

It lets people "take the power back," so to speak, so they're not beholden to financial institutions

what power? each country will formulate some kind of tax anyway if this currency going viral. bitcoin is not free, you'll exchange it with real money anyway, buying mining tools, rent a space and pay electricity, so you cant run away from government and banks. it probably make your life even more miserable (or forever in the dream land waiting for "too good to be true" things to happen).

I'm not sure what "experts" have to do with it

as i said i'm not expert but i sense this is bigger than you thought. economist, financials, socio-economy, lifestyle etc. imagine you walking on the street with 2 currencies in your pocket. 1 currency is everybody can support, 1 is not so you want to keep exchanging to the other. with ever changing value like that, good luck. but as said i'm not the expert but i dont want to get to the mess yet, even if you ask me to keep both USD and MYR in my pocket, there is no point, unless if i want to go to USA anytime soon. if you want to keep bitcoin separate to online transaction only, then thats fine. but conventional way already have infrastructure for that, paypal, credit card etc. i prefer the more stable way. ymmv.

There's no cabal of lizard-people at the center of the earth deciding what our money is worth. It's worth what it's worth

how much worth making pcb in your place? and how much worth it is in China? national bank can produce money to boost local economy, but not with bitcoin. they are not simply the same. with rapid fluctuation in market value, imho its not suitable enough yet to be exchange with real money in everyday use. its more suitable with stock market players, you wait until its yearly low and you buy and wait until its decades highest and sell.

That's just...making an instant 1,000% profit? Silly thing to say no to..

there is a risk of it being lower than 1/10X next day, as i said, i'm not going into the game. i better do real work and get real hard earned profit. ymmv.

[NiHaoMike]

Seems like this will suffer from all the same problems as other "How hard can it be?" endeavors succumb to. Currency is one thing. An open-source collaborative cell network? Good luck with that!

It would be simpler to start out with a network of RTL-SDRs. Note carefully that the main value is in the receiving location that's rented out, not the RTL-SDRs themselves. The main market is for users to receive signals from a location other than their local location, particularly for those who cannot get decent radio reception.

One problem cryptocurrencies have solved is the "I have some spare compute resources, what to do with it?" problem. Replace "compute" with something that doesn't take much energy to scale up and we'll have an even better cryptocurrency if done right. (The last bit is the hard part.)

[Mechatrommer]

One problem cryptocurrencies have solved is the "I have some spare compute resources, what to do with it?" problem.

it "WAS" a valid statement.

[SVFeingold]

what power? each country will formulate some kind of tax anyway if this currency going viral. bitcoin is not free, you'll exchange it with real money anyway, buying mining tools, rent a space and pay electricity, so you cant run away from government and banks. it probably make your life even more miserable (or forever in the dream land waiting for "too good to be true" things to happen).

To tax it they have to know about it. If you live in Venezuela I can see the benefit of using an outside currency that you can make direct payments to other people with, which isn't tied to the crumbling economy of your own country that has had 20,000% inflation in the past year. There are valid use cases here. The less trust in government and the banking system there is, the more appeal these kind of systems have. In high-trust systems (like most developed countries) it's simply not a concern that tomorrow your bank account will be worth 5% what it is today, or that someone at the bank will steal all your money.

economist, financials, socio-economy, lifestyle etc.

None of those things matter. What matters is what people mutually agree a given currency is worth. Without that it makes no difference how many economists say otherwise.

national bank can produce money to boost local economy, but not with bitcoin. they are not simply the same. with rapid fluctuation in market value, imho its not suitable enough yet to be exchange with real money in everyday use.

Funny enough this is probably something that Bitcoin enthusiasts would argue as a positive. The government can't manipulate the currency quite so easily. As for being suitable to exchange with money I'm with you. It's a pain in the ass to use it day-to-day. But enough people are willing to try it, apparently.

there is a risk of it being lower than 1/10X next day, as i said, i'm not going into the game. i better do real work and get real hard earned profit. ymmv.

There are degrees of risk. Not just "risk vs no-risk." The risk you describe is tiny. In any case it doesn't matter, this is just a hypothetical. But I think it highlights the difference in mentality pretty nicely between people who do all these newfangled internet computer bitcoin things and people who put their money into 60 month CODs with 0.25% interest rates because "it's safer than stocks." With a wide spectrum in between of course.

[NiHaoMike]

it "WAS" a valid statement.

Still true for the altcoins that haven't went to ASICs.

[Mechatrommer]

it "WAS" a valid statement.

Still true for the altcoins that haven't went to ASICs.

right! Ethereum is currently at $1K, must already costs something to generate one. how about reinventing another cryptic$ (lets call it Deutery) while its still cheap and we can make thousands of coin in a day using my Atomic PC here. whats the plan?

[DiTBho]

How much do you for 1K Watt per day?

[Bassman59]

The one legitimate use case I can see is for those who live in countries that aren't exactly "free," and also those living in countries where the local currency is unstable/unreliable/worthless. Bitcoin being off the grid, so to speak, would make sense. Even with the price fluctuations. For those in developed countries it's more of a hobby IMO.

One can imagine that in countries where the local currency is unstable/unreliable/worthless, so too is the local internet service, without which (as I understand it) a cryptocurrency exchange cannot happen.

[SVFeingold]

One can imagine that in countries where the local currency is unstable/unreliable/worthless, so too is the local internet service, without which (as I understand it) a cryptocurrency exchange cannot happen.

You'd think so, but it's a lot easier (and less hassle) to wait for the internet to come back on, or use your phone, than to wait for the local currency to un-inflate itself 10,000%, or transform into whatever currency the new government has decided is valid.

[NiHaoMike]

Cryptocurrency transactions can run over P2P wireless networks as well. Just one connection to the worldwide network is enough to keep everything in sync. Any valid transaction is spread to the whole network, then put into a block to start the process of making it complete.

Here's a project to broadcast the blockchain using satellite, putting Bitcoin a bit closer to an independent P2P network:
https://blockstream.com/satellite/

[Mr. Scram]

Those would be the ASICs that have become cheap because they're not profitable to *most*. Likewise, the servers would also be extra cheap because they're inefficient. It wasn't too long ago when it was profitable to mine earnhoney on a Sandy Bridge, if I could get electricity at a flat rate or surplus electricity that would go wasted if not used, I would still be mining it.

You're saying it's profitable if someone else picks up your bills and you don't value your time.  False economy is just that. Again, flipping burgers likely is a more worthwhile approach and probably better for the environment too.

[SVFeingold]

Well yes, using old obsolete and inefficient hardware is only going to be profitable if you have effectively free power. New technology crunches more numbers faster using less power. News at 11.

As for time, it's a relatively low maintenance way to make money, if you have the starting capital to set it up properly. But then that's true of many things. The days of turning a crank to push the 1s and 0s through the electronium machine are long gone, I'm happy to report to those of you who need to hear it.

However I will be sure to tell the next Bitcoin millionaire I meet how irresponsible they are and that if only they'd done the "right" thing and gone for a "high yield" 3% investment like their grandpappy they could have made the same amount in only 50 years. That'll really grab the attention of those going after quick BTC money, I'm sure...

[NiHaoMike]

You're saying it's profitable if someone else picks up your bills and you don't value your time.  False economy is just that. Again, flipping burgers likely is a more worthwhile approach and probably better for the environment too.

The rent increase to get electricity included (back when I was looking for apartment housing while I was in college, 10 years ago) is enough that you actually have to be running at least two typical ASIC boxes just to break even, otherwise you'll spend more on the rent increase than if you paid for electricity separately. (After crypto mining became popular, the difference probably widened a lot.) Those schemes create a paradox where saving energy actually allows those wasteful schemes to continue. Outright wasting energy is one way to break them, so go to the next step of mining crypto so that it's not all waste. You could even go with an altcoin like Curecoin or Foldingcoin that does useful work like medical research so it's even less of a waste.

Nowadays, a common source of "free" electricity is surplus from solar panels and other on site renewables. That's the case when net metering is either not available or there's enough surplus to go over the cap so the extra is "lost". In that case, a cheap used ASIC box can be operated during those times to get back what would otherwise be wasted.

If you're spending hours per day maintaining your mining setup, you're doing it wrong unless you truly have a massive operation. Back when I had 7 cheap smartphones and tablets mining various altcoins, the time I spent maintaining them averages to minutes per day at most.

[DiTBho]

As far as I understand, Bitcoin Mining is not profitable unless you have access to very cheap electricity, and modern mining hardware.

I have a contract for 4KWatt domestic power, plus 1Kwatt of extra power taken from the solar cells I installed on my roof.

I was thinking of using this "free" (free because taken from the sun, but it's not really "free", you have to maintain the cells, clean them often, etc) 1Kwatt electricity to mine something with a couple of dedicated ASIC-units on a couple o low cost motherboards.

So, here answer to the topic seems: No! The average "home miner" (like me) is unlikely to recoup the cost of mining hardware and electricity, and profiting on your own "seems" highly unlikely.

I think solar farms coupled with dedicated modern ASICs may help make mining more profitable, and respectful of the health of the planet; however, if proper accounting is crucial to profitable Bitcoin mining, well ... I have to admit that I have several difficulties in understanding the system, in terms of hardware, software, electricity and money to invest to do some valuation estimate 

[Mr. Scram]

The rent increase to get electricity included (back when I was looking for apartment housing while I was in college, 10 years ago) is enough that you actually have to be running at least two typical ASIC boxes just to break even, otherwise you'll spend more on the rent increase than if you paid for electricity separately. (After crypto mining became popular, the difference probably widened a lot.) Those schemes create a paradox where saving energy actually allows those wasteful schemes to continue. Outright wasting energy is one way to break them, so go to the next step of mining crypto so that it's not all waste. You could even go with an altcoin like Curecoin or Foldingcoin that does useful work like medical research so it's even less of a waste.

Nowadays, a common source of "free" electricity is surplus from solar panels and other on site renewables. That's the case when net metering is either not available or there's enough surplus to go over the cap so the extra is "lost". In that case, a cheap used ASIC box can be operated during those times to get back what would otherwise be wasted.

If you're spending hours per day maintaining your mining setup, you're doing it wrong unless you truly have a massive operation. Back when I had 7 cheap smartphones and tablets mining various altcoins, the time I spent maintaining them averages to minutes per day at most.

One can apply all kinds of reasoning to it but the fact remains that it's only profitable if someone else picks up the bill. It's also likely you'd be mining very inefficiently. Unless you're willing to overplay your hand by using ridiculous amounts of energy liable to get you kicked out of your appartement it's not going to be anything more than a hobby. Running a few mining rigs isn't going to get you a sound return on investment nowadays, especially if they're outdated machines behind the curve.

Mining with 7 mobile devices very definitely is hobby territory. It only makes sense if you consider it a fun activity, not as a means to earn money.

[NiHaoMike]

Those "electricity included in rent" schemes are basically "take advantage of it or it takes advantage of you" schemes. The only way to win appears to be going all out with a sizable setup. Or don't play it and pay for electricity separately (in return for a much lower rent) like most people do.

Nowadays, a common source of "free" electricity would be from your own solar panels when your own usage is low, most likely during spring/fall if you don't have net metering. If you can't find anything better to do with the surplus, might as well mine some altcoins with hardware you already have. The efficiency might be low, but it's going to be a lot better than the zero you would get if you didn't.

Those 7 mobile devices were making something like $150/month back when the difficulty was low. Call it a hobby if you like but it's not something the average hobbyist would call insignificant.

[DiTBho]

Those 7 mobile devices were making something like $150/month back when the difficulty was low. Call it a hobby if you like but it's not something the average hobbyist would call insignificant.

Which 7 mobile devices?

[DiTBho]

Bitcoin Mining Profit Calculator here