How to Calculate the Profitability of Bitcoin Mining – Bitcoin Market Journal

The popularity of cryptocurrency mining has enlargened substantially since bitcoin went mainstream ter 2018. Today, graphics cards needed for CPU mining are sold out at many online retailers and bitcoin mining hardware producers can hardly keep up with the request for mining equipment.

Te this guide, you will detect how much money you can make through bitcoin mining, the different ways you can go about mining, and whether it is even worth pursuing for an individual.

What is Bitcoin Mining?

Mining bitcoin refers to providing your computing power to verify and process bitcoin transactions on the Bitcoin blockchain. To prize miners for keeping the Bitcoin network up and running, miners receive freshly mined bitcoin for each fresh block they mine.

The block prize for each fresh block is presently 12.Five bitcoin and halves every four years. Miners challenge with their computing power to solve complicated equations that lead to the creation of fresh blocks. The more computing power a miner has, the more of the block prize he or she will be able to receive.

For this reason, specialist bitcoin mining hardware, known spil ASICs miners, has bot developed and deployed by large-scale mining operations that run entire factory buildings utter of miners.

Hardware Mining vs. Cloud Mining

When bitcoin very first launched ter 2009, users were able to mine bitcoin on their laptops and desktop computers. However, spil the bitcoin network grew, so did the digital currency’s mining difficulty. The number of large mining operations proliferated. This continued until the point where mining using a huis laptop wasgoed no longer feasible and specialized bitcoin mining hardware wasgoed introduced.

Today, there are two ways you can profitably mine bitcoin. You can either set up a bitcoin mining operation by purchasing bitcoin mining hardware, such spil the AntMiner S9 or the Avalon6 and join a mining pool, or you can purchase a bitcoin cloud mining contract.

Cloud mining refers to the renting of someone else’s bitcoin mining hardware te exchange for a toverfee so that you can profit from bitcoin mining without needing to invest te any physical bitcoin mining hardware yourself. Instead, you can purchase bitcoin mining contracts from reputable cloud mining providers such spil Genesis Mining and let thesis companies treat the mining while you receive your mining income minus their maintenance fees.

Due to the plainness of purchasing cloud mining contracts, cloud mining has gained massively te popularity overheen the years. On one palm, this has led reputable cloud mining provider Genesis Mining to fight to expand its mining operations to keep up with request. On the other mitt, it has also attracted a substantial amount of fraudulent cloud mining sites that voorkeur to sell mining contracts but te reality are nothing more than Ponzi schemes. Te fact, the majority of supposed bitcoin cloud mining providers that you will find online are scams. So it is very significant to only use reputable providers and to conduct thorough research on the provider before purchasing a cloud mining contract.

How Profitable is Bitcoin Mining?

To look at how profitable bitcoin mining is today, you can make use of a bitcoin mining profitability rekenmachine. However, it needs to be stated that there are certain assumptions that go into profitability calculations, such spil where the price of bitcoin will trade and how the mining difficulty will evolve. Hence, any bitcoin mining profit calculation is only a rough estimate and will not accurately predict mining comes back te the future.

Mining with Your Own Equipment: Let’s assume you purchase one Antminer S9 with a hash rate of 13.00 TH/s and power usage of 3825 watts at a cost of $0.Ten vanaf kWh (toughly the U.S. average) with a mining pool toverfee of 0.Five procent. Let’s say the total cost of your mining set up, composed of the Antminer and power supply unit, will cost you about $Trio,500.

Should the price of bitcoin stay stable at its current level of $11,000 and should the bitcoin mining difficulty remain stable at Two,874,674,234,416 GH/s, according to the CoinWarz Bitcoin Mining Profitability Rekenmachine, it would take you 372 days to pauze even and 879 days to mine one entire bitcoin. The annual income, using the above-mentioned assumptions of price and mining difficulty stability, would be 0.415 BTC or around $Four,550 at today’s market rate.

Spil the example shows, bitcoin mining is rather costly to set up and has several variables such spil bitcoin price, mining difficult, and violet wand costs that come into play. Hence, it is difficult to accurately predict the profitability of mining.

Mining te the Cloud: The math for cloud mining is actually very similar to that of hardware mining. The key differentiating factors are that you have to pay a maintenance toverfee to the provider and that your contract can be canceled should bitcoin mining no longer be profitable due to a prolonged druppel te the price of bitcoin.

Having said that, the comeback on investment periods are very similar. According to 99Bitcoins, if you have 1.Nineteen TH/s of hash power with Genesis Mining, which would cost you about 0.139 BTC spil a fresh customer, you would make around 0.00035 BTC each day after the incurred mining fees. That would mean it would take you around 400 days to pauze even on your bitcoin cloud mining contract.

The benefit of cloud mining is that it is much lighter to get commenced spil it incurs less startup capital and requires zero technical skill about bitcoin mining.

Before beginning a mining venture, weigh the cost vs. the benefits.

Should You Mine Bitcoin ter 2018?

If you can afford to purchase numerous bitcoin miners, such spil the Antminer S9, you can set up a petite bitcoin mining operation, join a mining pool, and embark earning bitcoin. However, this will only be profitable if you have low electric current costs. Ter reality, for most individuals, mining bitcoin using hardware ter their huis will likely not be a very profitable venture due to violet wand and maintenance costs spil well spil enhancing mining difficulty.

Spil an individual with little investable capital, your easiest option to get involved te bitcoin mining is by purchasing a bitcoin cloud mining contract. Provided the price of bitcoin does not druppel and stay below a price level where mining is no longer profitable, the mining contract should run indefinitely. That means you purchase a mining contract and can receive passive mining income “forever”. The payback period for cloud mining contracts, which is dependant on bitcoin price fluctuations, will likely also take around one year.

However, it needs to be said that ter latest years buying and holding bitcoin has generally bot more profitable than mining bitcoin spil an individual, regardless of whether you purchase a cloud mining contract or mine using hardware.

At the end of the day, the decision or mine or not comes down to what type of investor you are. Do you choose to receive a puny but constant weekly/monthly income ter bitcoin or do you choose to benefit solely from bitcoin’s appreciation te value? The historical gegevens points to the latter being the better choice but some investors may choose the regular income option.

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