4 ms·

If you have to pay $50k in electricity to mine a $40k bitcoin, it would be better to just turn off the mine and buy the bitcoin directly.

mewwts 5y ago
Not if you have all that money tied up in an old mining rig which has close to zero resale value.
- lippel82 5y ago
  No, if you need 50k for electricity, it does not matter how much money you put into the mining rig, you're better off buying 40k bitcoin directly.
- whall6 5y ago
  If all your money is gone because you spent it on a mining rig, how will you pay the electricity bill
- ekianjo 5y ago
  Sunk cost fallacy
- staticautomatic 5y ago
  Can mining rigs be repurposed for anything useful?
  - _joel 5y ago
    Nope, the ones in the article are ASICs, so specifically for bitcoin. There are GPU based ones but the number of coins that you can mine with them is dwindling. You could probably reuse the beaglebone black or whatever little auxillary computer they're using but it's not really worth it. It's just e-waste.
  - rtkwe 5y ago
    Not really they're extremely specialized chips that only do lots of hashes fast. They can't even be used for an different blockchain unless it's block hashing is similar enough and uses the same algorithm.
  - OJFord 5y ago
    Depends what they actually are, some 'mining rigs' are just PCs with lots of beefy GPUs, so yeah. Others are FPGAs programmed to compute the hash for whatever cryptocurrency (e.g. BTC is `sha256(sha256(x))`); they can be re-programmed to do something else instead. Others are ASIC (Application-Specific Integrated Circuits) based, physical chips designed to do nothing else but compute those hashes. So essentially 'no', but 'yes and they'd be very good at it' if you for some reason had another use for that particular hash function (lots and quickly). That's also a progression of cost & performance, by the way. As the difficulty increases GPUs get slower at finding whatever coin, and people (pay a bit more and) move to FPGAs, and then again to dedicated ASIC hardware.
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thinkmassive 5y ago
Some industrial scale miners might have commitments to buy electricity at a certain rate. It could be more expensive to break a contract than to keep their equipment running when the exchange rate temporarily falls below profitability. Also not everyone has easy access to an exchange. Others may prefer to avoid the KYC paperwork, or simply be willing to pay a premium for freshly mined coins.
- gaff33 5y ago
  There's a healthy power market - so the providers can and should work out a way for their clients to exit their contract and for them to sell the electricity elsewhere. Sure the client might be liable for some loss-of-earnings fees but this really should be better for everyone than this.
  - thinkmassive 5y ago
    Sure, but also take into account that a mining operation large enough to enter into electricity contracts probably has other obligations like facilities and staff. Overall it may not be worth the hassle to shutdown for what could be interpreted as typical exchange rate fluctuations.
josefresco 5y ago
This assumes you have a source of income, outside of your mining operation.

mewwts 5y ago

Not if you have all that money tied up in an old mining rig which has close to zero resale value.

lippel82 5y ago
No, if you need 50k for electricity, it does not matter how much money you put into the mining rig, you're better off buying 40k bitcoin directly.
whall6 5y ago
If all your money is gone because you spent it on a mining rig, how will you pay the electricity bill
ekianjo 5y ago
Sunk cost fallacy
staticautomatic 5y ago
Can mining rigs be repurposed for anything useful?
- _joel 5y ago
  Nope, the ones in the article are ASICs, so specifically for bitcoin. There are GPU based ones but the number of coins that you can mine with them is dwindling. You could probably reuse the beaglebone black or whatever little auxillary computer they're using but it's not really worth it. It's just e-waste.
- rtkwe 5y ago
  Not really they're extremely specialized chips that only do lots of hashes fast. They can't even be used for an different blockchain unless it's block hashing is similar enough and uses the same algorithm.
- OJFord 5y ago
  Depends what they actually are, some 'mining rigs' are just PCs with lots of beefy GPUs, so yeah. Others are FPGAs programmed to compute the hash for whatever cryptocurrency (e.g. BTC is `sha256(sha256(x))`); they can be re-programmed to do something else instead. Others are ASIC (Application-Specific Integrated Circuits) based, physical chips designed to do nothing else but compute those hashes. So essentially 'no', but 'yes and they'd be very good at it' if you for some reason had another use for that particular hash function (lots and quickly). That's also a progression of cost & performance, by the way. As the difficulty increases GPUs get slower at finding whatever coin, and people (pay a bit more and) move to FPGAs, and then again to dedicated ASIC hardware.

deleted 5y ago

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thinkmassive 5y ago

Some industrial scale miners might have commitments to buy electricity at a certain rate. It could be more expensive to break a contract than to keep their equipment running when the exchange rate temporarily falls below profitability. Also not everyone has easy access to an exchange. Others may prefer to avoid the KYC paperwork, or simply be willing to pay a premium for freshly mined coins.

gaff33 5y ago
There's a healthy power market - so the providers can and should work out a way for their clients to exit their contract and for them to sell the electricity elsewhere. Sure the client might be liable for some loss-of-earnings fees but this really should be better for everyone than this.
- thinkmassive 5y ago
  Sure, but also take into account that a mining operation large enough to enter into electricity contracts probably has other obligations like facilities and staff. Overall it may not be worth the hassle to shutdown for what could be interpreted as typical exchange rate fluctuations.

josefresco 5y ago

This assumes you have a source of income, outside of your mining operation.