Why are these mining rig investment becoming very risky ?
I was looking for the best Asic investment to put my crypto trading profit into.
I thought like anyone else not advised, if I get my hands on a antiminer Z15, I should get ROI (return on investment) back in few months.
Let’s do some quick maths and technicals :
Z15 asic miner = 420ksol/s for 1500w (that’s 280 sol / w)
GTX 1070 miner = 400 sol/s for 100w (that’s 4 sol / w)
So a Z15 asic miner is the equivalent of 1050 x GTX 1070 and only need power of 15 of theses GTX.
As profitability of mining is define by the difference between what you earn and what it cost in electricity bill and all other expenses.
So these asic are really killing the GPU mining, that’s a fact and it’s been like this since the first asic came out for bitcoin.
Now you must think, well if these machine are so efficient in mining earnings versus electricity bill, then why not invest ?
Well there’s 4 factor you need to consider when projecting mining profitability plan :
1 . Halving of bloc reward date.
2 . Liquidity of the very few project minable with your ASIC miner (depend on the algorithm).
3 . When is the last ASIC generation have been released.
4 . When will be the next generation be released and what power efficiency ratio to expect.
Once you defined all these details, you can get a better idea of what should be your profitability within the time you actually have the ASIC mining for you.
There’s a Timing to play of course.
The first to buy from manufacturer is the first to stock once new batch is released, then they can resell to retail customers in their own shop, with pre-order money from customers.
The first the run that new generation ASIC miner is the most profitable miner worldwide, as soon as others are turning on units, profit is going down for everyone. The cake is always defined size and the more people come, the less cake on each share.
So why is it so tricky ?
– Because instant profitability of mining depend on the market value of the coin you mine.
– Because if you are not part of the first to grab one of those ASIC, you may see expected profitability been highly declined in matter of days after new batch released. So what should have been a 6 month ROI turns into a 2 year one. Even more if they release too much units on market and that coin market value is dropping with a bear trend.
– Because manufacturer have already too much control of what remains of crypto mining ecosystem. They can delay the release of batch, and actually mine with these for their own account.
They own mining pool, they own exchange, they own ASIC manufacture, they actually own the mining game.
It can all be set like Swiss clock and nothing can stop it.
They limit and control the machine supply and demand is always asking for more units as soon as possible with possibly 2 or 3 batch in advance in preorder already been filled.
This is actually pretty insane ecosystem.
Don’t fall for the easy money fantasy with these ASIC, if you pay your electricity, it’s a very risky investment that could turn into lose within month with a new more powerful unit release on the market.
And it’s a free market.
Perhaps, if you can be part of the manufacturer direct customer with bulk orders, then you can do something reselling these units or just mine with it.
The more you work on the electricity bill plan, the best the risk is.
But it takes a real facility room to run these, you can’t just put it in your bedroom, it’s very noisy and lot of heat is coming out of it. Must use extraction fans system.
That’s is why I won’t invest in ASIC miner and why you probably shouldn’t.
The staking argument just made the POW technology obsolete, ETH is showing the way to swap into staking system rather than mining with very high power consumption.
Staking is way more power efficient and eco friendly.
There’s not much new POW projects and trend is clearly declining.
Time will unlikely, ,not provide more juicy coins to mine.
Better find the good project to support and stake your investment. Who knows, inflation may turn the 6% yearly staking revenue into 60% with chart going up in the sky.
Surf the waves on short & mid term trades.
There’s a lot of noisy waves to ride.