Find out if it's profitable to mine Bitcoin, Ethereum, Litecoin, DASH or Monero. Do you think you've got what it takes to join the tough world of cryptocurrency mining? Find out what your expected return is depending on your hash rate and electricity cost. Find out if it's profitable to mine Bitcoin, Ethereum, Litecoin, DASH or Monero. Jul 22, · If Bitcoin’s price is crashing, miners with a low profit margin will add selling pressure to the situation: The lower Bitcoin’s dollar price is, the larger the percentage of newly mined Bitcoins Author: Sarah Wiesner. Dec 01, · Bitcoin mining began as a well paid hobby for early adopters who had the chance to earn 50 BTC every 10 minutes, mining from their bedrooms. Successfully mining just one Bitcoin block, and holding onto it since would mean you have $, worth of bitcoin in your wallet in
Mining bitcoins profit marginIs Bitcoin Mining Still Profitable?
The rig might be a dedicated miner when its procured, built and operated specifically for mining. But it could also be a computer that fills other tasks and only mine part-time. DIY Mining Rig. This can be built from your own PC with as many graphics cards that can fit or afford. These are usually made by manufacturers. So, you may need to spend a little extra to get this imported.
Bitcoin mining software is necessary to connect Bitcoin miners to the blockchain and your Bitcoin mining pool, if you are part of a Bitcoin mining pool. The software delivers the work to the miners and receives the completed work from the miners and relays that information back to the blockchain.
The Bitcoin mining software also relays the information back to the blockchain and your mining pool. It also displays the general statistics such as temperature, hashrate, fan speed and average speed of the Bitcoin miner. One of the things that you need to consider is electricity. Mining requires electricity — actually lots of electricity. So, if you want a DIY rig, then be sure to get a great power supply.
I suggest that you check your bill. Once you have set your rig up and it starts working, expect to see an increase in your electric consumption. So, take note of your bill the month before you start bit mining. You can actually do a solo Bitcoin mining.
However, as mentioned, your chance of earning a block reward is slim if you do solo-mining. On the other hand, if you join a pool, you have better chances of earning a block reward. All of the members of the pool will have a share of the coins mined. Solo mining gives you large and irregular payouts. On the other hand, pooled mining result in small and frequent payouts. For the purpose of answering the question: is Bitcoin mining profitable , we will give you two scenarios as shared by BuyBitcoinWorldWide.
This should explain how much Bitcoin mining cost. In this example, we are using the default power cost of 5c. This is a likely rate for a Chinese industrial area or one in which the electricity is subsidized. The fees and rewards structures of various pools are compared in this list. With the given rates above, your S9 would pay for itself with a year.
I understand that the scenario above makes Bitcoining mining exciting for you. But, the next scenario is something that you should consider. In this scenario, the unit will only pay for itself. Bitcoin mining is a tedious activity that requires time and resources.
In the past, this has been an easy job to do and has been a great outlet to earn free Bitcoins. However, over time, this has changed and the process has become more challenging and less profitable. Bitcoin mining requires electricity, hardware and software to make things work. The price of hardware varies from manufacturer to manufacturer and depends largely on how low the energy use is for the machine vs the amount of computing power it produces.
The more computing power, the more bitcoin you will mine. The lower the energy consumption the lower your monthly costs. Longevity is determined by the production quality of the machine. It makes no sense to buy cheaper or seemingly more efficient machines if they break down after a few months of running. One useful way to think about hardware is to consider what price BTC would have to fall to in order for the machines to stop being profitable.
You want your machine to stay profitable for several years in order for you to earn more bitcoin from mining than you could have got by simply buying the cryptocurrency itself. Unfortunately most older machines are now no longer profitable even in China.
The Bitmain S9 has been operational since and interestingly enough they are still being used in Venezuela and Iran where electricity is so cheap that it outweighs the risk of confiscation.
There may, eventually, be more reputable sources of sub 2 cents electricity as the access to solar and wind improves in North America. For the individual miner, the only hope of competing with operations that have access to such cheap electricity is to send your machines to those farms themselves.
Not many farms offer this as a service though. These days, every miner needs to mine through a mining pool. Whether you are mining with one machine, or several thousand, the network of Bitcoin mining machines is so large that your chances of regularly finding a block and therefore earning the block reward and transaction fees is very low.
With one block per 10 mins they may have to wait 16 years to mine that one block. The oldest two pools are Slush Pool and F2Pool. Here comes the science part…. Pool fees are normally 2. Choosing the right mining pool is very important, as you will receive your mined bitcoin sent from the pool payouts every day. An often overlooked facet of mining profitability is the fees one pays to sell the Bitcoin one mines.
If you are a small time miner, you may have to sell your coins on a retail exchange like kraken or Binance. Sometimes your fees are low but sometimes your fees are high - it really just depends on the fee structure of the exchange and the state of the orderbook at the moment. However, if you are a professional miner like F2 or Bitmain, you likely have really advantageous deals with OTC desks to sell your coins at little to no fees - depending on the state of the market.
Some miners are even paid above spot price for their coins. If you think you have what it takes be mine profitably, we suggest you make sure first by using our mining profitability calculator. Bitcoin farms that operate at scale use these advantages to maximize their returns. As the difficulty of mining bitcoin increases, and the price lags behind, it is becoming harder and harder for small miners to make a profit.
It all comes down to scale and access to cheaper prices. When people enter the space, without prior relationships, they struggle to compete with established mining operations. Bitcoin mining is starting to resemble similar industries as more money flows in and people start to suit up.
With increased leverage, margins are lower across the whole sector. Soon, large scale miners will be able to hedge their operations with financial tooling to lock in profits, whilst bringing in USD denominated investments like loans or for equity. As mining becomes more professional , it will make things even harder for DIY miners.
If you have put in the effort to learn about mining, and you have found a location with low cost electricity for your machines, then you still need to consider where to store the bitcoin that you mine. It is possible to mine direct from the pool to an exchange , but we recommend you keep your bitcoin in a wallet where you have access to the private keys.
Mining profits were getting chipped away by expenses like purchasing new computing equipment, paying higher energy costs for running the new equipment, and the continued difficulty in mining.
As discussed above, the difficulty rate associated with mining bitcoin is variable and changes roughly every two weeks in order to maintain a stable production of verified blocks for the blockchain and, in turn, bitcoins introduced into circulation. The higher the difficulty rate, the less likely that an individual miner is to successfully be able to solve the hash problem and earn bitcoin.
In recent years, the mining difficulty rate has skyrocketed. When bitcoin was first launched, the difficulty was 1. As of May , it is more than 16 trillion. The Bitcoin network will be capped at 21 million total bitcoin. This has been a key stipulation of the entire ecosystem since it was founded, and the limit is put in place to attempt to control for supply of the cryptocurrency.
Currently, over 18 million bitcoin have been mined. As a way of controlling the introduction of new bitcoin into circulation, the network protocol halves the number of bitcoin rewarded to miners for successfully completing a block about every four years.
In , this number was halved and the reward became In , it halved again to In May , the reward halved once again to 6. Bitcoin mining can still make sense and be profitable for some individuals. In an effort to stay competitive, some machines have adapted. For example, some hardware allows users to alter settings to lower energy requirements, thus lowering overall costs. The variables needed to make this calculation are:. Profitability calculators differ slightly and some are more complex than others.
Run your analysis several times using different price levels for both the cost of power and value of bitcoins.
Also, change the level of difficulty to see how that impacts the analysis. Determine at what price level bitcoin mining becomes profitable for you—that is your breakeven price.
Given a current reward of 6. Of course, as the price of bitcoin is highly variable, this reward figure is likely to change. To compete against the mining mega centers, individuals can join a mining pool , which is a group of miners who work together and share the rewards. This can increase the speed and reduce the difficulty in mining, putting profitability in reach.
As difficulty and cost have increased, more and more individual miners have opted to participate in a pool. While the overall reward decreases because it is shared among multiple participants, the combined computing power means that mining pools stand a much greater chance of actually completing a hashing problem first and receiving a reward in the first place.
To answer the question of whether bitcoin mining is still profitable, use a web-based profitability calculator to run a cost-benefit analysis. You can plug in different numbers and find your breakeven point after which mining is profitable.