Bitcoin Mining and Buying Bitcoin at a Discounted Rate  

A lot of investors come to us and ask how to invest in crypto, how to buy Bitcoin from Binance, how to trade, and how to profit from it.

One of their biggest concerns is that Bitcoin is currently worth around $63,000, so they ask me how they can get Bitcoin at a lower price. So today, I want to talk about Bitcoin mining and why I believe it can be an interesting opportunity for long-term Bitcoin investors.

Bitcoin Mining Farm in Ethiopia

The Bitcoin mining is done in Ethiopia. If you are a miner connected to the operation, you get access to a dashboard showing the Bitcoin mining farm.

There are around 120 machines in the farm. Some machines belong to the farm itself, while others are owned by individual customers.

For example, one of their customers is based in Dubai and has installed three machines. Whenever you install a machine, there is an ongoing electricity cost of around $200 per machine per month. The daily electricity cost comes to approximately $19 per machine.

Through the dashboard, I can see how many Bitcoins are being mined each day depending on the number of machines installed.

Bitcoin Mining Dashboard and Machine Efficiency

I have shown the mining dashboard because it gives me a clear picture of how the machines are performing. I can see the efficiency of each miner, and because the software is integrated into an automated system, all the machines operate through the software.

For example, the software shows that a particular machine has 100% efficiency. The most important thing for me is the uptime. In this example, the uptime is around 99.76%.

I believe uptime is important because the longer the machines remain operational, the more Bitcoin they can potentially mine. The dashboard allows me to monitor:

• Machine efficiency
• Mining uptime
• Bitcoin production
• Number of machines
• Miner performance
• Overall mining activity

Bitcoin Mining Wallet and Payouts

The wallet tells me how much Bitcoin is being mined per day and shows the payout frequency. If I select a monthly payout, the mined Bitcoin can automatically come to my wallet according to the payout arrangement.

I don’t have to keep asking for my Bitcoin because the payout system handles it automatically. I can also see:

• Total earnings
• Wallet address
• Next payout date
• Previous statements
• Electricity charges
• Payment charges
• Complete transaction history

I can even extract my statement from the dashboard and see the complete record of my previous month’s activity.

Bitcoin Mining Transactions and Invoices

The transaction section is another feature I find useful. I can see my total credit and debit transactions and track the expenses associated with the mining operation.

I can also see electricity charges and other payment-related costs. The platform provides invoices as well, which makes it easier for me to maintain a proper record of my mining expenses and transactions.

Bitcoin Price and Market Trends

I can also see the current Bitcoin price and its market trend from the platform. I don’t necessarily have to use TradingView or another separate software to understand the basic market information.

There is also a BTC predictor where I can see the Bitcoin prediction chart. For someone who is not very familiar with cryptocurrency, these tools can make it easier to understand the market and make decisions.

I can also look at the history of the price and see how it has been moving. This helps me decide:

• How much I should invest
• Whether I should install more machines
• Whether I should continue running my existing machines
• Whether I should stop the machines

Bitcoin Mining Payback Analysis

The most important thing I want to show today is the payback analysis. The price of a Bitcoin mining machine can be around $3,000. Depending on the specifications, the price can also range from $3,000 to $5,000 or $6,000.

The more expensive machine generally has greater power and can potentially mine more Bitcoin.

For me, the key question is not only the price of the machine. I want to know what the effective cost of the Bitcoin produced by that machine will be.

Bitcoin Mining Investment at a Discounted Rate

If Bitcoin is available in the market at around $63,000, but the effective cost of the Bitcoin I produce through mining is around $55,000, I am effectively getting Bitcoin at a lower cost.

So instead of buying Bitcoin directly from the market at $63,000, my mining calculation gives me an effective production cost of around $55,000. That is the main reason I find Bitcoin mining investment interesting.

However, I understand that this is an estimated production cost, not a guaranteed Bitcoin purchase price. Actual mining costs can change because of electricity expenses, machine performance, mining difficulty, downtime, maintenance, and Bitcoin’s market price.

My Long-Term Bitcoin Investment Scenario

Now let’s assume Bitcoin can go above $100,000.

I know Bitcoin can also fall from $55,000 to $40,000 or $45,000. I am not ignoring that risk. But when I look at Bitcoin from a four-year perspective, I personally believe there can be significant long-term potential.

Bitcoin’s previous halving cycles have also attracted investors because, historically, Bitcoin has reached higher peaks after previous cycles. However, I understand that past performance does not guarantee future results.

So, for my analysis, I am simply taking a scenario where Bitcoin goes above $100,000. Even under that assumption, I find the mining calculation interesting.

My Bitcoin Mining Machine Investment Example

We recently did an analysis where we considered adding 20 machines. The value of 20 machines would be around $65,000.

The vendor provides a live operating arrangement for around seven years, but for my calculation, I am only considering a four-year period.

I calculated the investment based on approximately 25 machines and an estimated Bitcoin production cost of $55,000. The monthly electricity cost would be around:

• $200 per machine
• 25 machines × $200 = $5,000 per month
• Four years = 48 months
• Estimated electricity cost = $240,000

In the original calculation, we considered the overall investment at approximately $250,000 over four years.

Bitcoin Mining Returns After Four Years

Based on our calculation, if I invest approximately $250,000 over four years, the total Bitcoin mined could be around 4 BTC under the assumptions used in this analysis.

Now let’s take another assumption. If Bitcoin reaches $100,000 after four years:

4 BTC × $100,000 = $400,000

So, if I invest approximately $250,000 and the resulting Bitcoin is worth around $400,000, the difference would be approximately $150,000.

That is why I see potential in this model as a long-term Bitcoin investment. But again, this is a scenario based on assumptions. It is not a guaranteed return.

Who I Believe Bitcoin Mining Is For

I don’t think Bitcoin mining is for everyone. If someone doesn’t understand crypto, doesn’t know how Bitcoin works, or thinks Bitcoin is simply gambling, I would not recommend them jumping into mining without first understanding the risks.

For me, this opportunity makes more sense for people who are already involved in Bitcoin. I would consider it more suitable for investors who:

• Already invest in BTC
• Understand cryptocurrency
• Understand Bitcoin’s volatility
• Have a long-term investment mindset
• Regularly average into Bitcoin
• Can afford the ongoing mining costs

My Approach to Bitcoin Investment

I personally invest a small amount in Bitcoin every month. I am already averaging into BTC on a monthly basis.

So, for me, the interesting idea is to buy a mining machine and redirect the amount I normally put into Binance every month toward the mining operation.

The benefit I see is that once I have purchased the machine, my monthly operating cost can remain relatively stable even if the Bitcoin price increases.

For example, if Bitcoin goes from $63,000 to $100,000, my estimated Bitcoin production cost could still be around $55,000, based on the assumptions in this example. That is the part I find attractive as a long-term investor.

Exitbase is a business marketplace where we also provide financial advisory services. For me, Bitcoin mining is an opportunity that requires the same approach. I want to understand the costs, potential returns, risks, and assumptions before investing.

Bitcoin Mining vs Buying Bitcoin Monthly

Normally, I put a small amount into Bitcoin every month. My thinking is that instead of simply buying Bitcoin from the market every month, I can potentially use that same monthly investment approach to operate a mining machine.

If Bitcoin’s market price increases, I could potentially continue producing Bitcoin at a lower effective cost, assuming my mining expenses and production remain within the expected range.

This is why I personally find Bitcoin mining worth evaluating alongside directly buying BTC.

Trading of Mature Cryptocurrencies

For investors who are already involved in trading mature cryptocurrencies, Bitcoin mining can be another way to gain exposure to Bitcoin.

However, I don’t see mining as a replacement for understanding the cryptocurrency market.

I still believe investors should understand Bitcoin, market cycles, volatility, mining economics, and their own risk tolerance before committing capital.

My Bitcoin Mining Due Diligence Checklist

Before I invest in any mining operation, I would always carry out proper due diligence.

I would want to understand:

• Where the mining machines are located
• Who owns the machines
• The exact machine specifications
• Electricity costs
• Historical uptime
• Actual Bitcoin production
• Maintenance expenses
• Hosting charges
• Payout terms
• Machine lifespan
• Mining difficulty
• Wallet arrangements
• Transaction records

I would not make an investment decision simply because someone tells me that Bitcoin mining is profitable.

I would want to see the actual numbers.

Why I Find Bitcoin Mining Interesting

If I have conviction in Bitcoin and plan to hold my investment for four to five years, I believe Bitcoin mining is an opportunity worth exploring.

The biggest attraction for me is the possibility of producing Bitcoin at an effective cost below its market price.

But I also understand that Bitcoin can fall significantly, mining difficulty can change, electricity costs can increase, and machine performance can decline. So I would not look at this as guaranteed passive income.

I would look at it as a long-term Bitcoin mining investment where the numbers need to make sense.

For someone who already understands BTC, regularly invests in Bitcoin, and has a long-term conviction in the asset, I believe this can be an interesting strategy to evaluate.

Certified Business Advisor in Pakistan