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I am planning to get into BTC as I have some PC with xfire (7970's) laying around here and I am currently trying to learn more about it; what I would like to first understand is BTC pricing to make sure the energy I will spend with this PC can be paid off with it.

At https://mtgox.com/ the last price is at USD$249.99900: is that the current value of 1 BTC? If not, how is that calculated in order to know how 1 BTC is worth?

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2 Answers 2

up vote 4 down vote accepted

Market price is market price, which is what people are willing to pay for it. You can pick any market out there (mtgox, bitstamp, etc). No different to the price of gold, if you wish.

Although an average price across multiple exchanges might be useful in a theoretical sense, the reality is that when you come to sell you will sell in a single exchange at a single price. Added to that the exchange rate of BTCxUSD is fluctuating so rapidly right now that attempting to use it to calculate what you might obtain even a week from now is probably not a sound basis on which to generate a financial calculation.

If you want to work out if mining for coins is worth it, then the general answer is "no". A more detailed answer can be found by using a mining calculator

Until now, it has has always been the case that purchasing bitcoins is a wiser way of spending your money than putting it in to hardware or even power to generate your own. Unless you're buying an ASIC-based miner I would suggest that this is the best way to approach bitcoins right now.

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Hi jgm, I was reading at the forums that with 2x7970 I would be able to produce around 2+ BTC/d which would worth around 10~20$USD and in energy I would pay less than 2$USD where I live to keep it running, however I am not familiar with the several markets out there for BTC which is why on an avg price of the BTC against the current quote of the several markets out there I would like to know how much it is worth or how do I calculate it myself against one or each of them. –  Prix Apr 10 '13 at 11:21
    
Using the above site you sent me (where I have removed the hardware cost as there are none as of now) and changed the energy price and watts and nothing else as I was not sure of what else I would need to change, the result was Revenue per time frame less power costs 25291.69 USD even reducing it to 2 BTC per block it says 1485.69 USD –  Prix Apr 10 '13 at 11:30
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A pair of 7970 generates just north of 1,000MH/s with a power usage of ~400W. However, what you need to consider is that we're approaching a step change in bitcoin mining with the creation of ASIC-based minders. These will increase the difficulty 10-fold pretty much immediately, and go to 100-fold if they are successful. Plug the above numbers in and even with the 10-fold increase you'll be making cents rather than thousands of dollars. –  jgm Apr 10 '13 at 12:00
    
So to put it simple due to the capacity of mining the ASIC hardware have based on their cost a normal computer with 2x7970 would be thrown out of the loop once the difficulty increases ? +1 Your replies are being of great information to me. –  Prix Apr 10 '13 at 12:38
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Taking the Avalon machine as an example, as this has been seen in the wild, you're looking at 60GH/s for the basic model. That's 60x the rate of your PC with a similar power usage. Non-ASIC miners just won't be able to keep up. –  jgm Apr 10 '13 at 12:47

If you want a more accurate representation of the current market price, I suggest you use something like a 24h weighted price, which takes into account the price over time and across multiple exchanges, giving you a more consistent view of what people value a BTC at.

Instead of doing all the calculations yourself, an easy way to see this is to leverage the Bitcoin Charts API.

Shameless plug: For those curious, I created BTCimg that takes those values and generates PNG images, which people can include on their website to see a relatively stable price.

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