Bitcoins and My Personal Experiences
First off, let me say I have been watching Bitcoin and other crypto-currency things really since their invention. I have poked and prodded it and found myself always coming to the same conclusion. That conclusion has always kept me out of the market.
My conclusion is simple, and comes in two parts. The first is that the always increasing difficulty in getting the next coin means that the value is a one way ladder. The more processing you need, the more energy you have to use, and thus the minimum value is reflected in those costs. At the moment that the value of bitcoin falls below the cost to mine it, the whole thing grinds to a halt.
Secondary to that is the question of real value. If everyone who had a bitcoin today tried to sell it, it’s value would be headed directly to zero unless there are an equal number of buyers. So in many ways, the value of bitcoin is only in those people who choose never to sell them. Sub to that is the concept that there isn’t anywhere near as much actual money in the market as their is value in the coins, which means at the moment everyone decides to sell them, it will be an instant crash.
That said, my first conclusion bangs solidly up against my second conclusion, and says “there is some space here to make money”. With that in mind, I looking into mining.
Why mining? Well, my theory holds that only a fool would be buying bitcoin at this point. It’s up 1000% in a year, it’s nutty expensive, and without a true value to work from, it’s like investing in pork bellies without the pork. Mining on the other hand is much more of a small investment, reasonable return time, profit after that.
I looked at mining gear and what would be involved, and the local costs of electricity and such. BZZZT! Wrong answer, I would basically be taking any income and paying for power – and then paying some more. Power costs are out of line here, so there is no chance. So then I considered what other alternatives I have. That is where I started to look into mining “hosting”. You have to understand that I have had hosted servers for almost 20 years now, the concept of remotely hosting something isn’t new to me. Sure enough, there are a few crypto minter companies out there that offer some reasonable prices to get in the door and try your hand at it.
To detail out my experiences, I think I will be starting up a new blog to cover all my crypto stuff. I already have more than a couple of good stories, it turns out that much of the crypto world is shady as it comes, very convoluted, and pretty much messed up end to end. Just the process of trying to get a mining rig up and running properly has consumed a week of my time, and has got me learning about all sorts of crap I should never need to know. It’s been a real experience to pull back the covers and have a peep.
I will be updating this post or making a new one to announce my new blog shortly, for now I need to put all my energy into dealing with some truly mind numbing problems of getting the whole thing going.
Have you considered mining? The choice I am trying out first is called Hashflare Cloud Mining for Bitcoins. Come check it out.
Want to read about all of my mining experiences? Check out my new Bitcoin Mining Blog at Blog4Coin.com