Bitcoin Mining VS just buying Bitcoin and HODLing! Which one is more profitable?

[Pashalis Pietris]

BTC

I am the VP of a Bitcoin Mining facility and i come across this question ALL THE TIME!!!!

Here is why i thing Bitcoin Mining is better option than just buying and HODLing and below is an article by me about it.

1. Long-term, you accumulate more BTC
2. Daily cash flow instead of stagnant holding
3. Greater flexibility when selling your BTC
4. Purchase of real, tangible assets
5. Combined value of machines and cash flow
6. Tax benefits from purchase and operation
7. Connection with experienced miners and OGs
8. Resale of machines at a good price
9. Opportunities for profitable strategies
10. Limited options if you only hold BTC

Link: https://bitmernmining.com/why-bitcoin-mining-is-a-smarter-investment-than-just-buying-it/

Let me know any takes on the subject that i can use to defent my position, but also if you think that BUYing and HODLing it makes more sense, give me reasons please!

[mikeywith]

1. Long-term, you accumulate more BTC

That's only a speculation, no fact -- your gear may die or become unprofitable to run long before you accumulate the BTC or the equivalent of what you bought it for.

2. Daily cash flow instead of stagnant holding

BTC is too liquid; it makes this argument wrong. If you bought BTC for the same amount of cash you spent on the gear , you can sell BTC daily and have the cash flow you want.

3. Greater flexibility when selling your BTC

How?

4. Purchase of real, tangible assets

Irrelevant, your mining gear is directly related to BTC, if BTC falls, your gear drops with it, a very weak point.

5. Combined value of machines and cash flow

Same points you mentioned earlier

6. Tax benefits from purchase and operation

Limited to certain countries, doesn't apply for me.

7. Connection with experienced miners and OGs

Useless.

8. Resale of machines at a good price

Assumption.

9. Opportunities for profitable strategies

How?

10. Limited options if you only hold BTC

Not worse than owning mining gear.


This topic gets discussed endlessly here, with everyone having their own take. Personally, based on my own experience, nothing beats buying and holding BTC, especially if you dollar-cost average your way in and out slowly.

[philipma1957]

1. Long-term, you accumulate more BTC

That's only a speculation, no fact -- your gear may die or become unprofitable to run long before you accumulate the BTC or the equivalent of what you bought it for.

2. Daily cash flow instead of stagnant holding

BTC is too liquid; it makes this argument wrong. If you bought BTC for the same amount of cash you spent on the gear , you can sell BTC daily and have the cash flow you want.

3. Greater flexibility when selling your BTC

How?

4. Purchase of real, tangible assets

Irrelevant, your mining gear is directly related to BTC, if BTC falls, your gear drops with it, a very weak point.

5. Combined value of machines and cash flow

Same points you mentioned earlier

6. Tax benefits from purchase and operation

Limited to certain countries, doesn't apply for me.

7. Connection with experienced miners and OGs

Useless.

8. Resale of machines at a good price

Assumption.

9. Opportunities for profitable strategies

How?

10. Limited options if you only hold BTC

Not worse than owning mining gear.


This topic gets discussed endlessly here, with everyone having their own take. Personally, based on my own experience, nothing beats buying and holding BTC, especially if you dollar-cost average your way in and out slowly.

I still mine. and in the USA you do get tax breaks.  I make profits mining.

But looking backwards in time from 2012 to 2025. 
I would have made millions with simple buy and hold.

I have not made millions mining.

Mining in the USA is less profits but less risk. Assuming you have cheap power.
It is far more work than buy and hold.

As of now I have

6 s21xp's
1 modded t21
1 L7

they earn about 3300 worth of coins each month
they cost 1850 in power to run

profit of 1450usd a month which I hold as coins.

[mikeywith]

@Phill.

We have both mined for a long time -- at small and medium scales -- so we know how things actually play out. But trust me, to someone on the outside relying on online mining profit calculators, nothing we say makes any sense. It's gotten to the point where someone claimed I only say hodling BTC is better than mining because I don't want others increasing the difficulty. 😄

What people need to understand is that mining, at its core, is like giving the market a loan and hoping it pays you back with interest. But the market is neither honest nor kind.

[philipma1957]

@Phill.

We have both mined for a long time -- at small and medium scales -- so we know how things actually play out. But trust me, to someone on the outside relying on online mining profit calculators, nothing we say makes any sense. It's gotten to the point where someone claimed I only say hodling BTC is better than mining because I don't want others increasing the difficulty. 😄

What people need to understand is that mining, at its core, is like giving the market a loan and hoping it pays you back with interest. But the market is neither honest nor kind.

thats funny.

way way way back in the day.

i did 21gh in gpus

the whole network was 21th

this means in my home in new jersey on and off in the fall of 2012 i was running 1/1000 of the entire worlds hashrate.

about 11kwatts of power .  my garage was smoking hot.🥵

now the network is 1000eh

so i need to mine 1 eh

which is 1000ph
which is 1,000,000 th

a s21 is 200 th

so i need 5000 s21s to be equal to what i was doing back in 2012

that is  17  forty foot containers

burning 3 megawatts each or 51 megawatts  which is 51,000 kwatts vs the 11 kwatts I used.

It was a fun trip and the few hundred thousand i earned in 13 years was nice.

but yea the labor I did was far too much

[mindrust]

Buy&hodl beats mining in every way possible imo. You’ll keep your time for you that way, you’ll generate big returns with minimal effort. You won’t spend money on miners and miners take physical space to be stored and they are noisy. When you think about all aspects of mining, one must needs to be crazy to choose it over hodling. You can try it with a miner or two just to feel what it is about and you’ll quickly understand what I have been telling you.

[philipma1957]

I can also say if you really understand mining you kind of can do like 15% return on investment

but you can not compound like hodl compounds.

here is an example of mining.

8x 6500 =52,000  in s21xp's
1x 4000 =4,000    in L7

56,000 out of pocket

1 year power is about 26,000

so 82,000 out of  pocket

returns for a year about 0.4btc or 48k

so 82k in

you still have the 56k in gear.

your return on 82 k is 48k or

48/82=0.585  58%

second year.

26k in for power maybe .3btc or 48k more or less.

you still have the 56k in gear. 

you spent 82+26=108 got back 96k

so 96/108k=0.889 K          so 88.9% over 2 years time

third year

26k in maybe .25 btc which is around 48k more of less

now you did

134k in and maybe 144k back for 3 years.

you still have the gear but it is old and is very likely not worth 56k

144/134=1.0746 or 7.46%  over 3 years

putting in

134k

82+26+26=134  you put in

and you have

144 plus the older gear.


the other way you have

a 56k buy in of btc then 2600 a month for 36 months all in btc

so much easier to do and for 3 years so much more likely to be a profit.

I am certain a buy in of btc and then a dca would be good if you did it for 10years time

much more so than mining