RealMcafee
Education

Antminer S9 ROI: Bitmain vs Retail over 1, 1.5 & 2 yrs

This is in addition to my previous chart on miner roi for different Antminer models. The S9 is the only model making a profit now and is the only sha256 miner currently used by Bitmain according to news articles. My previous chart only looked at ROI for retail miners. Here I show estimates for Bitmain (area plots) itself who pay less for their mining equipment than their customers. I also compare with retail miners (lines). The three lines/areas represent three different amortization periods for mining equipment: over 1 year (green), 1.5 years (blue) or 2 years (purple). The longer the period over which you spread your costs the less dependent you are on BTC price so long as your miner does not become obsolete before the write off period ends. previously I only considered a 1 year write off period.
Lastly after some research I determine the average lifespan of a miner is just 1 to 2 years (https://www.cell.com/joule/fulltext/S254...(18)30177-6).

Area plot: Bitmain
Line: retail

Elec: 0.06 USD/kWh
Model: Antminer S9
Hrate: 13.5 TH /s
Unit cost: USD 500 (Bitmain), USD 900 (retail)
Operating time: 24 hrs /day, 365 days/year


see: https://medium.com/@sunnyday.james/estim...
see: https://www.cell.com/joule/fulltext/S254...(18)30177-6

Comments

I don't understand completely so the graph is presenting the ROI (in years)? and this decending, so that is a good thing for people who have an asics miner.. Or am I missing your point completely
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RealMcafee joachim.snellings
@joachim.snellings, Don't worry I'm extremely bad at explaining things.

It's a bit of an abstract metric, but I think it's useful. Basically there are 2 parts to expenses: running costs (electricity) and material costs (mining machines). I wanted to work out the where the ratio of income/expenses (ROI) was with respect to the break even level (white line). But to do that we need to agree over what period we pay off those material costs because they are really just one-off expenses and not incurred everyday like electricity costs. So if I want to pay them off within 1 year then, for example, I'll have to put about twice as much of my daily income towards paying the debt than if I decide to pay the machines off over 2 years. The upside is that I will have paid off the debt earlier.

Of course in a bull market I can pay off the acquisition costs much quicker (maybe in just 2 or three months).

The area plots apply to Bitmain. The lines with dotted markers apply to Bitmain's customers who buy their miners (retail). We can see that if you buy an S9 now you won't be able to pay off the material costs in one year at the current Bitcoin price as the green dotted line is under the break even level. But so long as the price doesn't drop further, you can still pay off the debt within 1.5 years.

However the longer you take to pay off material costs, the more likely you mining rig will become obsolete because a newer, much more efficient rig has been released. Or maybe your rig will just die because running 24/7/365 the operational life might be max. 2 years.

Hope that helps. Any questions please ask.



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@RealMcafee, thanks that clearifying, a overviewable legend would cover that to make it more clear. That is an interesting view, I am supprised those asics last only for 1-2 years.. the fact that you are heavily dependend on the short time frame price of the currency you mine togheter that if the coin forks away you are left over with just a piece of metal, really puts pressure on the sentiment of such miners (however I believe bitmain will lower their price if this happens).

If you look at the lifetime of a GPU, that is about 8-10 years if you don't overheat and do a 75-80 tdp. I think investing in a GPU (which would still have value if crypto suddenly totally crashes) is a much safer option here. I believe FPGA's will therefore regain the interest. You just need people that really understand how that programming works. Nontheless, if I got the picture here at these prices it is a sh*t investment to go for s9 antminer atm.

The lifetime of your GPU's is very depending on how you treat them (Temp, not always on, Power limitation, etc....)
Reply
RealMcafee joachim.snellings
@joachim.snellings, Yes. I don't know how big professionals do in practice. That 2 year figure came from a study. I believe though that they basically run nonstop. Apparently temperature is the biggest problem to overcome . I think at the moment it is not wise to invest in ASICs, as the S9 is 2 years old and there may be newer models announced anytime. We need to see a model with a 40 to 50% increase in efficiency, this would be worth investigating imo. It represents a similar increase as previous S-models. The new GMO B2 only has a 20% increase over the S9, which is a bit disappointing seeing as it costs 4x more.
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@RealMcafee, exactly, and then I have to stress that these things have to run on 1800W! like put a rx 580 at work and you'll get 2,5$ net (average) for 100W. Here in belgium, you pay about 0,3$ for a kWh, that puts this general uncertainty of the asic model into a different daylight. If you say you mine 21$ a day of coins, but pay 0,3-0,5$kWh at the same time is making this material less interesting for the random Joe. I heared temperature is a big deal for GPU's at least, I don't know about asics but it would be a Arrhenius equation/dependency no? so I think temperature matters, but i'm open for discussion :D
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@RealMcafee, http://www.ti.com/lit/an/sprabx4a/sprabx4a.pdf this is for the processor in this bigass graphical calculators but they explain the dependancy pretty well/straigtforward for processors in general
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@RealMcafee, I think the algo meshing (like x16r randomly requesting the solvation of 16 algos with varying proportion and an algo could also not occure for hours makes it a quite interesting time to see the mining community evolving right now, especially because the rumors of an ETH asic are widely spread
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