6 ms·

Never mind the energy; think of the capital expenditure. If I have US$1,000 lying around, I could either put it in a mutual fund, getting a certain number of d

by sethg 15y ago

Never mind the energy; think of the capital expenditure. If I have US$1,000 lying around, I could either put it in a mutual fund, getting a certain number of dollars per month (with which I could buy bitcoins), or I could buy a kick-ass GPU card and become a miner, generating a certain number of bitcoins per month (which I could then sell in exchange for dollars). At current interest rates, which is a better investment?

weavejester 15y ago
Currently, mining is considerably more profitable. With $1000 you could probably put together a server that would generate 700 MHash/s, which currently equates to about $1000 in profit per month. You'd repay your initial investment quite quickly. However, a mutual fund represents a consistent and safe income. I very much doubt that bitcoin mining will remain as profitable as it is now for very long.
- tropin 15y ago
  Has anyone tried to generate hashes with an EC2 GPU instance?
  - gwern 15y ago
    Yes. Amazon charges way too much. http://glennfrancismurray.com/cost-defective-mining-with-gpu-clusters-amazo http://glennfrancismurray.com/cost-defective-mining-with-gpu...
Unseelie 15y ago
Paypal's money market yeild is currently .06% per week. At that rate, with $1000, you make .6 dollars a week, and buy maybe a bitcoin each month and a half...the discussion here is about earning a bitcoin a day mining, so I'm assuming you're down under a third of the mining return. Assuming the cost of the electricitiy is 1.26 cents per kwh, and your machine is running at around 800 wats, constantly, that's 720 hours and 576 kwh, seven dollars a month...so the cost of running doesn't seem to be that high either. Edited for bad math. May continue to do so. Please point out errors.
- maukdaddy 15y ago
  Long-term average stock market return is 5-8% depending on who you ask. So an index fund or balanced fund of funds would yield much better returns than bitcoin.
  - rorrr 15y ago
    The (S&P 500) stock market return: 1) Since 1971 (40 years) is roughly 1300%, which is 19.63% annualized (1.1963^40 = 1300). 2) Since 1950 (60 years) is roughly 7680%, which is 16.08% annualized (1.1608^60 = 7680) http://chart.finance.yahoo.com/z?s=%5eGSPC&t=my&q=l&l=on&z=l&p=s&a=v&p=s&lang=en-US&region=US http://chart.finance.yahoo.com/z?s=%5eGSPC&t=my&q=l&...
- jeff18 15y ago
  That's actually 0.06% per year. I wish it was per week... there was a time when it was over 5%!
  - Unseelie 15y ago
    my source said a .06 7 day rate, soo...I dunno. if its just .06% per year...that's horrendous. Banks suck.
illumin8 15y ago
US Treasury Series I Savings bonds are currently paying 4.6% per year (their rate rises with inflation), income is tax exempt until redeemed, and can be redeemed at any time after 1 year. I think you'd be better off going to the nearest bank with your $1,000 and buying an I bond. It's not a popular thing to do (only grandmas seem to like these things), but it's a pretty much slam dunk investment with zero risk.

by sethg 15y ago

weavejester 15y ago

Currently, mining is considerably more profitable. With $1000 you could probably put together a server that would generate 700 MHash/s, which currently equates to about $1000 in profit per month. You'd repay your initial investment quite quickly. However, a mutual fund represents a consistent and safe income. I very much doubt that bitcoin mining will remain as profitable as it is now for very long.

tropin 15y ago
Has anyone tried to generate hashes with an EC2 GPU instance?
- gwern 15y ago
  Yes. Amazon charges way too much. http://glennfrancismurray.com/cost-defective-mining-with-gpu-clusters-amazo http://glennfrancismurray.com/cost-defective-mining-with-gpu...

Unseelie 15y ago

Paypal's money market yeild is currently .06% per week. At that rate, with $1000, you make .6 dollars a week, and buy maybe a bitcoin each month and a half...the discussion here is about earning a bitcoin a day mining, so I'm assuming you're down under a third of the mining return. Assuming the cost of the electricitiy is 1.26 cents per kwh, and your machine is running at around 800 wats, constantly, that's 720 hours and 576 kwh, seven dollars a month...so the cost of running doesn't seem to be that high either. Edited for bad math. May continue to do so. Please point out errors.

maukdaddy 15y ago
Long-term average stock market return is 5-8% depending on who you ask. So an index fund or balanced fund of funds would yield much better returns than bitcoin.
- rorrr 15y ago
  The (S&P 500) stock market return: 1) Since 1971 (40 years) is roughly 1300%, which is 19.63% annualized (1.1963^40 = 1300). 2) Since 1950 (60 years) is roughly 7680%, which is 16.08% annualized (1.1608^60 = 7680) http://chart.finance.yahoo.com/z?s=%5eGSPC&t=my&q=l&l=on&z=l&p=s&a=v&p=s&lang=en-US&region=US http://chart.finance.yahoo.com/z?s=%5eGSPC&t=my&q=l&...
jeff18 15y ago
That's actually 0.06% per year. I wish it was per week... there was a time when it was over 5%!
- Unseelie 15y ago
  my source said a .06 7 day rate, soo...I dunno. if its just .06% per year...that's horrendous. Banks suck.

illumin8 15y ago

US Treasury Series I Savings bonds are currently paying 4.6% per year (their rate rises with inflation), income is tax exempt until redeemed, and can be redeemed at any time after 1 year. I think you'd be better off going to the nearest bank with your $1,000 and buying an I bond. It's not a popular thing to do (only grandmas seem to like these things), but it's a pretty much slam dunk investment with zero risk.