[Repost] Bitcoin mining, a huge trap - a lesson learned from a miner who lost all his money[Copy link]
Yes, just as the title says, Bitcoin mining is a huge trap. This is my personal experience. I get angry when I see some nonsense articles on online forums. I think no one can be as convincing as those who have experienced it. Note that I said "Bitcoin mining", not "Bitcoin". As for whether Bitcoin itself is a huge trap, I am not sure. Maybe Bitcoin is indeed a future direction, but it is clearly wishful thinking to expect to make money by buying mining machines. As a believer and participant of Bitcoin, I once had a very big dream, as if I saw a new opportunity to get rich, an opportunity for ordinary people to turn over in the new era. In January this year, after thinking for a while, I decided to invest in Bitcoin mining. Since the decision was made, I quickly purchased 25 (twice) Antminers that were highly praised by mining enthusiasts and started mining. After a few months, let alone making money, I didn’t even get back a quarter of the cost. As the difficulty of mining increased, it became increasingly difficult to mine, and there was no hope of getting back the money. It was certain that I would lose all my money. This is really a lesson of blood and tears. In order to warn more friends who have the same dream of getting rich as me and take out their old capital, I wrote this article and analyzed the reasons in it. First, don’t be idealistic. This was the biggest mistake I made. When I decided to invest in mining, I also did some analysis and calculations, but all the calculations were based on theory. But you can never reach the theoretical state in reality, and it is even far from it. (1) Cost. The cost is not just the cost of buying a mining machine. For batch operations like mine, it is far more than that. The cost of the mining machine only accounts for about 60%-70%. First of all, I have to find a place to put the mining machine. Because the power consumption of the mining machine is very large, the power supply load of ordinary residential buildings is only 4000W to 5000W, so I have to rent a separate site and supply power. I can only find a commercial site. The rental fee is very expensive, and the electricity bill is more than doubled (this will be discussed later). In addition, all the lines, wires, network cables, hubs, etc. must be built, and the shelves for placing the mining machines must be purchased. These costs a lot of money. In the end, these other costs except the mining machine almost reach half of the mining machine cost. (2) The number of coins mined. The amount of coins you mine will never reach the ideal number you had at the beginning. You always imagine that it is calculated according to the theoretical numbers of mathematics, but in reality you will find that various problems will occur in the operation, such as network problems, mining machine abnormalities, power failure, etc., which make your mining impossible to be perfect as imagined. These problems will reduce your mining income a lot. Even if your mining machines start to work smoothly over time, you will find that the mining machines seem to be unable to reach the theoretical computing power value most of the time. In addition, you will find that the mining pool will deduct 3%-4% of the coins you mine (this is the statement of the mining pool, according to my own calculations, the actual fee is higher than 4%). In short, the income from mining coins is much less than your initial ideal income. (3) The horror of increasing mining difficulty. Why do people have the illusion that it is easy to make money from mining? It is because people subconsciously use the value of the coins mined by today's mining machines to compare with the price of mining machines. Although everyone knows that the number of coins mined will decrease over time, they do not have such a direct concept. Let me tell you, it decreases every week or so, sometimes by 15%, and sometimes by 30%. The cumulative decrease over a few months is geometric, which means that the mining machine that was very capable a month or two ago is now almost useless. (4) The power consumption is much higher than ideal. I calculated the electricity cost very clearly at the beginning. Each Antminer consumes 400 watts of power. I even used a power meter to test the power consumption of an Antminer, which was about 392W to 400W. So the total power consumption is the power consumption of a single mining machine multiplied by the number of machines? Wrong, totally wrong. After the mining farm was built, the total power consumption was about 1.2 times the theoretical power consumption I calculated! The extra nearly a quarter of the power consumption is line loss, etc. Incredible! This is because I have a completely independent meter to measure all mining machines, so I can see it clearly. If you have one or several mining machines connected to your home or connected to other electrical appliances, you can't even notice how much electricity you have consumed! Second, let's take a look at the loss with my actual experience. Because I was operating in batches, residential areas could not meet the power supply needs, so I found a place with commercial electricity, and the electricity fee was 1.1 yuan per kilowatt-hour, which was twice as expensive as residential electricity. When I bought the mining machine, it cost more than 10,000 yuan. The mining machine was delivered very quickly, and my mining farm was also built very quickly. It only took a few days to adjust and solve various problems before I started mining with all my strength. When I found that I had not officially mined many coins, the price of the mining machine dropped. Of course, this was because the price of Bitcoin fell. The price of the mining machine fell to more than 6,000. I calculated that the coins I mined were sold at the price at that time. The money I got for the discount is not enough to cover the loss caused by the price drop of the mining machine. In other words, I spent a lot of time mining, but it was better to buy a mining machine and start mining when the price dropped to more than 6,000. After that, the price of mining machines also dropped to more than 4,000, more than 3,000, and now more than 2,000. I calculated that if I bought it when it was more than 6,000, it would be better to do nothing and wait until it was more than 4,000 to start mining. By analogy, it is even worse to buy a mining machine when it was more than 3,000 or 2,000. What kind of business is this? The earlier you do it, the more you lose! The price of these mining machines in my hands has dropped by almost 200,000 yuan, and it is only tens of thousands of yuan according to the current market value. Then I also have about 30 bitcoins that I have mined from the beginning to now, which are only tens of thousands of yuan according to the current market value. It is really a loss. Now the mining machine consumes nearly 300 yuan (400W*25/1000*24 hours*1.1 yuan/kWh*1.2=316 yuan) of electricity every day, but can only mine 0.4 bitcoins equals about 1,000 yuan, and after deducting the daily rent, the profit is even less. However, the difficulty of mining is still rising. In a few days, the coins mined are not enough to cover the daily consumption cost. At that time, the mining machines bought for hundreds of thousands of yuan will become a pile of scrap metal, and I will only have these scrap metals and dozens of bitcoins whose prices are still falling. I really want to cry but have no tears. My friends around me saw that I was in a bad mood and advised me that if I couldn't mine coins, no one else could either. It was so difficult to mine, so the price of Bitcoin would not fall. I smiled bitterly. Can't I see that there are new T-level mining machines coming out? A new round of games has begun. In the future, there will be mining machines with 3T computing power, 5T, and 10T. In short, this is a game that depends on whether you can see it clearly or not. Of course, because I paid for my electricity, the cost is there. If you can find free electricity and free places, then you are great and you can keep mining without cost. But even so, you will find that according to the current decay rate of Bitcoin prices and the number of coins mined, according to my situation, I still need to mine for about 1.5 to 2.5 years to recover my investment even if all costs are free. Oh my god, if there is a free place and electricity (10 kilowatts of free electricity!), why can't I make back this little money in two years? So, this is a false proposition, which is what I call a trap. Third, about several false propositions that are easy to confuse people. Based on my own thinking and feelings, and discussions with friends, I feel that the so-called mining is a lot of false propositions. Let me talk about it. 1. Individual mining. This is the easiest thing to confuse people, because it is easiest to only see the bitcoins mined, and it is also easy to only regard the mining machine fee as the only cost, but not see the related costs of expenditure (yes, anyway, the electricity bill is included in the total electricity bill of the family and paid every month, so it is not felt). Smarter people may take the electricity bill into consideration, but even such people will only use theoretical power consumption and theoretical mining number to calculate. 2. Bitcoin appreciation. My friend advised me that I didn’t lose money. If the value of your Bitcoin increases in the future, if it rises to 10,000 yuan per coin, you will make money. This is another extremely false proposition. What is a loss? The current price of Bitcoin is more than 2,000 yuan. If the coins I invested in mining are not enough to cover the cost, I have already lost money. If I have great confidence in the appreciation of Bitcoin in the future, and I expect the appreciation of Bitcoin to pay for my mining investment, then why should I mine? I can just spend money to buy Bitcoin now. If it appreciates to 10,000 yuan in the future, I will make 4 times more money, and I will make more money. Why should I mine? This is a false proposition! Fourth, the truth about the so-called mining. I lost money, I didn't make any money, I couldn't make money from mining, so who made the money? I thought about it, in the entire mining industry chain, investing in mining can't make any money at all, it's good enough if you don't lose a lot of money, all the money is earned by the mining machine production and sales chain, this is the truth of the so-called Bitcoin mining, which is what I call a huge trap. If we open the pages related to Bitcoin mining machines, you will find that they are all positive news about Bitcoin, all about making money from mining, why, it's nothing more than luring people to jump in and donate money. Just imagine, the price of the mining machine I bought has dropped from more than 10,000 to more than 2,000 in just a few months. What do you think the cost of this mining machine is? The cost must be very low, much lower than more than 2,000, so the price it was sold at before was a complete profit. So how do they set the price of mining machines? I calculated that the price of a mining machine is basically the price of Bitcoin when you buy it, and you keep mining until you can't mine anymore. The coins you mine just make you back your investment, and this is without calculating the surrounding costs. This is the rule for setting the price of mining machines. So once the price of Bitcoin falls during the mining process, you will lose all your money; and if the price of Bitcoin remains stable, you will have worked in vain and may even lose a little; of course, if the price of Bitcoin rises, you may make a little profit, but as I said, this profit is not earned by mining, but by the rise in Bitcoin prices. In other words, why do you mine? You use the money invested in mining to directly buy Bitcoin. If the price rises, you will make much more than mining. Now you understand what I mean, Bitcoin mining is a huge trap. Five, let me tell you about a big trap I heard about. This is a statement I heard. I don’t completely agree with it. I just relayed it to you for your own thinking. Some people say that the core purpose of the current Bitcoin model is actually to sell mining machines. It is said that the mining machine industry has reached a scale of tens of billions or even tens of billions. The transaction price of Bitcoin is artificially controlled and maintained to stimulate the sales of mining machines. I used to speculate in stocks. Some small-cap stocks can be manipulated and hyped with hundreds of millions or even tens of millions. I went to the major Bitcoin trading platforms and took a look. My God, the real-time transaction volume is thousands of yuan. This is probably much easier to operate than the stock market. Moreover, if you communicate well with the Bitcoin trading platform, the trader may not need to pay the transaction fee at all. It is too easy to manipulate the market. Multiple accounts can be traded back and forth. It is estimated that millions of funds may be able to control the price. Control the Bitcoin transaction price, use it as a value reference to determine the price of mining machines, and let miners buy mining machines at high prices... No matter what the truth is, I have written down my own painful lessons, thoughts and calculations, and the results of my thinking. I hope that more people will not fall into it. Bitcoin appreciation. My friend advised me that I didn’t lose money. If your Bitcoin appreciates in the future, if it rises to 10,000 yuan per coin, you will make money. This is another extremely false proposition. What is a loss? The current price of Bitcoin is more than 2,000 yuan. If the coins I invested in mining are not enough to cover the cost, I have already lost money. If I have great confidence in the appreciation of Bitcoin in the future, and I expect Bitcoin to appreciate to make my mining investment back, then why should I mine? I can just spend money to buy Bitcoin now. If it appreciates to 10,000 yuan in the future, I will make 4 times more money, and I will make more money. Why should I mine? This is a false proposition! Fourth, the truth about the so-called mining. I lost money, I didn't make any money, I couldn't make money from mining, so who made the money? I thought about it, in the entire mining industry chain, investing in mining can't make any money at all, it's good enough if you don't lose a lot of money, all the money is earned by the mining machine production and sales chain, this is the truth of the so-called Bitcoin mining, which is what I call a huge trap. If we open the pages related to Bitcoin mining machines, you will find that they are all positive news about Bitcoin, all about making money from mining, why, it's nothing more than luring people to jump in and donate money. Just imagine, the price of the mining machine I bought has dropped from more than 10,000 to more than 2,000 in just a few months. What do you think the cost of this mining machine is? The cost must be very low, much lower than more than 2,000, so the price it was sold at before was a complete profit. So how do they set the price of mining machines? I calculated that the price of a mining machine is basically the price of Bitcoin when you buy it, and you keep mining until you can't mine anymore. The coins you mine just make you back your investment, and this is without calculating the surrounding costs. This is the rule for setting the price of mining machines. So once the price of Bitcoin falls during the mining process, you will lose all your money; and if the price of Bitcoin remains stable, you will have worked in vain and may even lose a little; of course, if the price of Bitcoin rises, you may make a little profit, but as I said, this profit is not earned by mining, but by the rise in Bitcoin prices. In other words, why do you mine? You use the money invested in mining to directly buy Bitcoin. If the price rises, you will make much more than mining. Now you understand what I mean, Bitcoin mining is a huge trap. Five, let me tell you about a big trap I heard about. This is a statement I heard. I don’t completely agree with it. I just relayed it to you for your own thinking. Some people say that the core purpose of the current Bitcoin model is actually to sell mining machines. It is said that the mining machine industry has reached a scale of tens of billions or even tens of billions. The transaction price of Bitcoin is artificially controlled and maintained to stimulate the sales of mining machines. I used to speculate in stocks. Some small-cap stocks can be manipulated and hyped with hundreds of millions or even tens of millions. I went to the major Bitcoin trading platforms and took a look. My God, the real-time transaction volume is thousands of yuan. This is probably much easier to operate than the stock market. Moreover, if you communicate well with the Bitcoin trading platform, the trader may not need to pay the transaction fee at all. It is too easy to manipulate the market. Multiple accounts can be traded back and forth. It is estimated that millions of funds may be able to control the price. Control the Bitcoin transaction price, use it as a value reference to determine the price of mining machines, and let miners buy mining machines at high prices... No matter what the truth is, I have written down my own painful lessons, thoughts and calculations, and the results of my thinking. I hope that more people will not fall into it.
I read a news report that a miner had hundreds of mining machines and cooperated with a small hydropower plant to generate electricity to supply mining machines. Or you can try to invest hundreds of thousands of dollars to build a small hydropower plant. Even if the mining machine fails, you can still sell electricity to the State Grid
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