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The Setup

Back in May, I decided to dip my toes into Bitcoin mining. Bought a Bitmain Antminer S21 PRO (234 TH/s) for 0.04659424 BTC (€4,315 including shipping) and arranged hosting in Dubai. The numbers looked decent on paper - 0.075 USD/kWh advertised rate, professional hosting facility, what could go wrong?

The Numbers Don't Lie

Purchase: 0.04659424 BTC (€4,315 including shipping) Setup & Deposit: 0.00504895 BTC ($522.87) June Power Bill: 0.00160614 BTC ($171.85) for 1,937.52 kWh Total Mined: 0.00218297 BTC Net Profit for June: 0.00057682 BTC (36% of hosting costs)

What Actually Happened

The problems started immediately:
  • Delivery delays: Almost a month to get delivered and plugged in due to "no hosting spots available"
  • Hidden costs: That 0.075 USD/kWh rate? They add a 10% margin on factory wattage specs (3,510W becomes 3,861W or 0.075 USD/kWh becomes 0.082 USD/kWh)
  • Temperature issues: Hosting site probably runs hotter than the advertised 35°C
  • Payment friction: Monthly invoices payable in USDT only (shitcoin²)
  • Management fees: Additional $12/month on top of everything

The Hardware Failure

Three weeks in, one board stopped working. Went from 234 TH/s to about 67% capacity, then completely died. Now I'm waiting 2+ weeks (and counting) to get it shipped to Bitmain for warranty repair.

The Math Reality

Even before the hardware failure, ROI in Bitcoin terms was looking grim. Just ahve a look at Smoking Hopium calculator.
It's hard to compete in Bitcoin terms with people that are just looking for profitability in USD.

The Silver Lining

At least I get to use my own pool (Ocean with Datum, so my Bitcoin node builds the blocks). That's pretty cool and my main motivation for having some decent hashrate.

Lessons Learned

  • Stay humble, stack sats
  • Hosted mining has way more friction than advertised
  • If I ever mine again, it'll be a home setup with solar (thinking Avalon Q or similar)
  • The hosting company's incentives aren't aligned with yours
  • Hardware failures happen

Would I Do It Again?

Nope. The complexity, hidden costs, and lack of control make hosted mining a poor choice for most people. You're better off just stacking sats directly.
If you're considering hosted mining, factor in:
  • 10-15% higher power costs than advertised
  • Inevitable hardware failures
  • Payment processing friction
  • Management fees
  • Shipping delays and logistics headaches
The only scenario where I'd mine again is with my own equipment, my own power (solar), and my own facility. At least then when things go wrong, I can fix them myself.
this territory is moderated
As a customer of compass mining for about 4 years now everything you explained I been through and then some.
Getting into mining has definitely made me much poorer but something are more about principle than making profits. So I stubbornly still mine with compass.
Will it pay off? Probably not but I don’t really care. Supporting the industry is my number one priority across the board!
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80 sats \ 0 replies \ @Scoresby 19h
Great write up and thanks for sharing your experience. It seems like hosted mining is not so different from cloud mining. I had toyed with using one of these hosted services and I probably would have if I hadn't decided to DIY my own mining setup (which I then promptly procrastinated on and so did neither).
The search for an easy, self-sovereign way to get some hash power continues...
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That’s quite a “dip my toes” haha thanks for the write up though. Ive never done hosted mining
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50 sats \ 0 replies \ @klk OP 19h
I think it's actually some no-man's land. Home mining with a BitAxe is a lot of fun and enough to learn. And then getting 100s of full sized ASIC miners must be nice as well. But getting just one is having all eggs in the same unreliable basket and ends up being like playing the lottery.
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27 sats \ 1 reply \ @megaptera 19h
I made the exact same experience. Its just not worth it if you cannot do everything on your own.
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0 sats \ 0 replies \ @klk OP 19h
F
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0 sats \ 0 replies \ @anon 24s
How could you use your Datum gateway? I'm assuming you have it running in your home, so were you allowed to connect to your miner in the hosting company somehow?
I have been investigating about hosted mining too but haven't still pulled the trigger. Thanks for the writeup.
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