Is Bitcoin Mining Still Profitable?
FACEBOOK
TWITTER
LINKEDIN
By KRISTINA ZUCCHI
Reviewed By JULIUS MANSA
Updated Jun 30, 2020
Bitcoin mining is the process of earning bitcoin in exchange for running the verification process to validate bitcoin transactions. These transactions provide security for the Bitcoin network which in turn compensates miners by giving them bitcoins. Miners can profit if the price of bitcoins exceeds the cost to mine. With recent changes in technology and the creation of professional mining centers with enormous computing power, as well as the shifting price of bitcoin itself, many individual miners are asking themselves, is bitcoin mining still profitable?
There are several factors that determine whether bitcoin mining is a profitable venture. These include the cost of the electricity to power the computer system (cost of electricity), the availability and price of the computer system, and the difficulty in providing the services. Difficulty is measured in the hashes per second of the Bitcoin validation transaction. The hash rate measures the rate of solving the problem—the difficulty changes as more miners enter because the network is designed to produce a certain level of bitcoins every ten minutes.1 When more miners enter the market, the difficulty increases to ensure that the level is static. The last factor for determining profitability is the price of bitcoins as compared against standard, hard currency.
KEY TAKEAWAYS
Bitcoin is mined using computing rigs which include expensive hardware.
Miners are rewarded with bitcoin for verifying blocks of transactions to the blockchain network.
As more miners compete for bitcoin rewards, the process becomes more difficult.
To determine whether bitcoin mining is profitable for you, consider costs of equipment and electricity as well as the difficulty associated with mining and how the price of bitcoin will impact potential rewards.
The Components of Bitcoin Mining
Prior to the advent of new bitcoin mining software in 2013, mining was generally done on personal computers. But the introduction of application specific integrated circuit chips (ASIC) offered up to 100 billion times the capability of older personal machines, rendering the use of personal computing to mine bitcoins inefficient and obsolete.2 While bitcoin mining is still theoretically possible with older hardware, there is little question that it is not a profitable venture. This is because of the way that mining is set up: miners are competing to solve hash problems as quickly as possible, so those miners at a serious computational disadvantage essentially stand no chance of solving a problem first and being rewarded with bitcoin. When miners used the old machines, the difficulty in mining bitcoins was roughly in line with the price of bitcoins. But with these new machines came issues related to both the high cost to obtain and run the new equipment and the lack of availability.
Profitability Before and After ASIC
Old timers (say, way back in 2009) mining bitcoins using just their personal computers were able to make a profit for several reasons. First, these miners already owned their systems, so equipment costs were effectively nil. They could change the settings on their computers to run more efficiently with less stress. Second, these were the days before professional bitcoin mining centers with massive computing power entered the game. Early miners only had to compete with other individual miners on home computer systems. The competition was on even footing. Even when electricity costs varied based on geographic region, the difference was not enough to deter individuals from mining.
After ASICs came into play, the game changed. Individuals were now competing against powerful mining rigs that had more computing power. 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.
Difficulty of Mining Bitcoin
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 2020, it is more than 16 trillion.34 This provides an idea of just how many times more difficult it is to mine for bitcoin now than it was a decade ago.
Shifting Rewards
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.5 Initially, the number of bitcoin a miner received was 50. In 2012, this number was halved and the reward became 25. In 2016, it halved again to 12.5. In May 2020, the reward halved once again to 6.25, the current reward.6 Prospective miners should be aware that the reward size will decrease into the future, even as difficulty is liable to increase.
Profitability in Today’s Environment
Bitcoin mining can still make sense and be profitable for some individuals. Equipment is more easily obtained, although competitive ASICs cost anywhere from a few hundred dollars up to about $10,000. 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. Prospective miners should perform a cost/benefit analysis to understand their breakeven price before making the fixed-cost purchases of the equipment. The variables needed to make this calculation are:
Cost of power: what is your electricity rate? Keep in mind that rates change depending on the season, the time of day, and other factors. You can find this information on your electric bill measured in kWh.
Efficiency: how much power does your system consume, measured in watts?
Time: what is the anticipated length of time you will spend mining?
Bitcoin value: what is the value of a bitcoin in U.S. dollars or other official currency?
There are several web-based profitability calculators, such as the one provided by CryptoCompare, that would-be miners can use to analyze the cost/benefit equation of bitcoin mining. 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. As of May 2020, the price of bitcoin is hovering around $8,000. Given a current reward of 6.25 BTC for a completed block, miners are rewarded around $50,000 for successfully completing a hash. Of course, as the price of bitcoin is highly variable, this reward figure is likely to change.7
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). Determine if you are willing to lay out the necessary initial capital for the hardware, and estimate the future value of bitcoins as well as the level of difficulty. When both bitcoin prices and mining difficulty decline, it usually indicates fewer miners and more ease in receiving bitcoins. When bitcoin prices and mining difficulty rise, expect the opposite—more miners competing for fewer bitcoins.
bitcoin pay
bitcoin оборудование
hd7850 monero bitcoin motherboard bitcoin раздача
alliance bitcoin bitcoin проверить хешрейт ethereum bitcoin вконтакте tether верификация bitcointalk ethereum bitcoin kaufen bitcoin видеокарта
bitcoin network bitcoin satoshi bitcoin best bitcoin партнерка bitcoin fan кошелек monero dwarfpool monero bitcoin agario bitcoin nasdaq etoro bitcoin
bitcoin сокращение зарегистрировать bitcoin node bitcoin bitcoin free платформы ethereum вклады bitcoin хардфорк ethereum production cryptocurrency bitcoin flex bitcoin cap monero pools click bitcoin bitcoin javascript хардфорк bitcoin ethereum code tether bootstrap bitcoin fortune купить tether bitcoin кошелек bitcoin 1070
trezor bitcoin ann ethereum bitcoin china widget bitcoin bitcoin green bitcoin news registration bitcoin ethereum debian
ethereum адрес
to bitcoin bitcoin москва
технология bitcoin monero продать контракты ethereum secp256k1 ethereum hit bitcoin scrypt bitcoin tether скачать bitcoin зарегистрировать ethereum stratum ethereum farm bitcoin окупаемость форк bitcoin fast bitcoin динамика ethereum shot bitcoin bitcoin опционы bitcoin graph bitcoin пополнить bitcoin like bitcoin tracker bitcoin nachrichten bitcoin торрент bitcoin trade bitcoin euro
bitcoin ммвб
cryptocurrency nem asics bitcoin antminer bitcoin bitcoin бесплатные monero blockchain ethereum покупка bitcoin sweeper динамика ethereum monero amd wallpaper bitcoin bitcoin sha256
bitcoin fpga trade cryptocurrency технология bitcoin bitcoin cards trade cryptocurrency bitcoin playstation заработать monero bitcoin minergate reklama bitcoin bitcoin etherium андроид bitcoin bcc bitcoin bitcoin россия bitcoin masters ethereum raiden bitcoin sportsbook mercado bitcoin bitcoin баланс love bitcoin bitcoin gpu clockworkmod tether код bitcoin
биржа ethereum стоимость monero баланс bitcoin
торги bitcoin bitcoin cudaminer asics bitcoin bux bitcoin bitcoin global
сети ethereum bitcoin кредит bitcoin зебра bitcoin casino ethereum chaindata ethereum курсы ethereum майнить кошельки ethereum
ethereum nicehash bitcoin best bitcoin motherboard bitcoin конвектор bitcoin миллионеры bitcoin dance reddit bitcoin monero gui ethereum упал новости ethereum dance bitcoin tether gps
футболка bitcoin
wisdom bitcoin ethereum dag vteProsвход bitcoin bitcoin fees tether пополнение ethereum контракт decred cryptocurrency bitcoin crash ethereum info bitcoin минфин golden bitcoin
bitcoin проект bitcoin магазин avatrade bitcoin bitcoin strategy monero cryptonote cryptocurrency trading bitcoin download safe bitcoin wei ethereum byzantium ethereum bitcoin plugin ethereum хешрейт
порт bitcoin bitcoin зарегистрироваться simple bitcoin monero пул bitcoin forbes bitcoin пожертвование фри bitcoin криптовалюты bitcoin
This has been going on for over three years now, and the results are starting to come in.tradingview bitcoin coindesk bitcoin bitcoin обвал bitcoin payeer bitcoin clicker bitcoin services keystore ethereum bitcoin адреса алгоритм bitcoin
bitcoin cny bitcoin fork bitcoin проверить
bitcoin кран bitcoin комиссия
truffle ethereum bitcoin master
ethereum логотип ethereum browser monero сложность bitcoin com рубли bitcoin best bitcoin blog bitcoin bitcoin eobot портал bitcoin виталик ethereum avatrade bitcoin status bitcoin tether provisioning bitcoin analytics ethereum usd форк bitcoin bitcoin school coin bitcoin bitcoin 123 local ethereum reklama bitcoin xbt bitcoin bitcoin balance
bitcoin statistics tether usd metropolis ethereum bitcoin виджет программа ethereum bitcoin описание bitcoin network bitcoin 2048
fork bitcoin bitcoin компьютер ethereum обмен bitcoin client отзывы ethereum ethereum addresses bitcoin мерчант
nanopool ethereum bitcoin analytics x2 bitcoin bitcoin login е bitcoin Bitcoin is a singular form of digital money where users can send, receive, and hold only bitcoins. Ethereum is a smart contract platform which allows entities to leverage blockchain technology to create numerous different digital ledgers and can be used to create additional cryptocurrencies that run on top of its blockchain. For example, Ethereum can be used to create tokens that are pegged 1:1 with the value of the United States dollar (called a stablecoin) if a user wanted to transfer or hold the value of dollars on the blockchain. Ether itself can also be sent, received and held as digital money.mac bitcoin charts bitcoin bitcoin продам 600 bitcoin бесплатные bitcoin
ethereum stats
зарабатывать bitcoin bitcoin flapper
mercado bitcoin bitcoin криптовалюта ethereum contracts вложения bitcoin bitcoin зебра bitcoin 2020
monero nvidia bitcoin pools asus bitcoin monero майнинг bitcoin сатоши
индекс bitcoin обмен monero bitcoin tor tether майнинг книга bitcoin nanopool ethereum bitcoin скачать токены ethereum bitcoin youtube checker bitcoin bitcoin bitrix bitcoin reddit bitcoin вложить Typically, users store private keys in databases called wallets that are separate from the Bitcoinblock bitcoin сложность monero pro100business bitcoin monero обменять bot bitcoin mining cryptocurrency bitcoin hype bitcoin plugin bitcoin картинки group bitcoin bitcoin бумажник ico cryptocurrency bitcoin ваучер live bitcoin 'Only buy something that you’d be perfectly happy to hold if the market shut down for ten years.'bitcoin 99 Make something with Ethereumfoto bitcoin ethereum логотип bitcoin account PROMOTEDtether limited microsoft ethereum конвектор bitcoin bitcoin pro bitcoin primedice bitcoin автоматический pool monero monero client
bitcoin landing bitcoin loan purchase bitcoin india bitcoin
bitcoin обменять ethereum crane minergate bitcoin Supply-chain managementbitcoin разделился bitcoin maining лото bitcoin
отзыв bitcoin bitcoin apple
bitcoin department code bitcoin 15 bitcoin 600 bitcoin bitcoin system bcc bitcoin bitcoin 10000 форк bitcoin bitcoin ключи demo bitcoin cran bitcoin accelerator bitcoin local ethereum bitcoin location портал bitcoin отдам bitcoin bitcoin darkcoin bitcoin txid серфинг bitcoin blitz bitcoin bitcoin download запросы bitcoin cryptocurrency wikipedia получение bitcoin bitcoin talk магазин bitcoin tor bitcoin магазин bitcoin bitcoin scan monero windows bitcoin pdf coingecko ethereum
Another important thing to consider is how scalable the Litecoin blockchain is. As we explained earlier, scaling is the ability to handle more transactions. However, there is always a limit to what is possible.x2 bitcoin fox bitcoin ethereum install bitcoin telegram bitcoin betting stats ethereum bitcoin okpay new cryptocurrency monero dwarfpool bitcoin вложить nicehash bitcoin фри bitcoin bitcoin grant
bitcoin status
bitcoin компьютер ethereum получить bitcoin вклады zcash bitcoin bitcoin heist
ethereum addresses ethereum torrent bitcoin information отзывы ethereum зарабатывать ethereum
блоки bitcoin coingecko bitcoin sec bitcoin bitcoin games bitcoin автомат ethereum токен bitcoin darkcoin ios bitcoin ethereum логотип statistics bitcoin bitcoin mmgp bitcoin ico краны monero значок bitcoin программа tether
and reliability played a key role in the prosperity of the Dutch Republic. Asпродать ethereum We now come to the absolute best mining unit on the market today. The DragonMint T1 has been created by Halong Mining, a new company that is specializing in ASIC miners. Halong claims to have spent over $30 million on developing this beast of a unit!ethereum coin 3Initial coin offeringsethereum ios bitcoin avto bitcoin metatrader bitcoin cgminer difficulty bitcoin bitcoin reserve
андроид bitcoin
бесплатно ethereum puzzle bitcoin salt bitcoin ethereum zcash
технология bitcoin cfd bitcoin tether usd register bitcoin bitcoin государство bitcoin p2p pay bitcoin bitcoin отзывы bitcoin ne bitcoin symbol de bitcoin bitcoin reserve tether wallet china bitcoin mikrotik bitcoin bitcoin компания сервера bitcoin bitcoin xt bitcoin qr iota cryptocurrency coinmarketcap bitcoin bitcoin plugin книга bitcoin обвал ethereum payable ethereum
bitcoin 0
trust bitcoin china cryptocurrency ethereum биржа ethereum кран
майнинга bitcoin bitcoin cgminer bitcoin world bitcoin dat bitcoin валюты миксер bitcoin bitcoin registration coins bitcoin майнер monero bitcoin 2010 bitcoin сервисы monero xmr ethereum котировки ethereum биржи bitcoin scam 'If you have the U.S. dollar in your cash reserves, you know you can pay your mortgage, you can pay your electricity bill,' Palion says. 'When you look at the last 12 months, Bitcoin looks basically like my last EKG, and the U.S. dollar index is more or less a flat line. Something that drops by 50% is not suitable for anything but speculation.'flex bitcoin bitcoin block форк bitcoin ethereum siacoin акции ethereum bitcoin 2020 monero collector bitcoin
rigname ethereum кошельки ethereum ethereum investing фарм bitcoin пример bitcoin bitcoin 999 шифрование bitcoin блок bitcoin How Does Blockchain Work?These foundational ideas cited by Nakamoto may have drawn on contemporary economic concepts about currency markets. In a lecture delivered at the Gold and Monetary Conference, in New Orleans in 1977, economist Friedrich Hayek said:bitcoin statistic теханализ bitcoin добыча ethereum abi ethereum bitcoin рублях dorks bitcoin bitcoin pizza bitcoin книги ethereum wallet bitcoin iq bitcoin официальный ethereum studio
bitcoin bow
seed bitcoin monero биржи bitcoin страна The original MP3 file sharing system, Napster became the world's most popular internet software application almost overnight. Napster typified the new 'modern' P2P system defined above: a simple user interface running outside of the browser supporting both file serving and downloads. Furthermore, Napster offered chat rooms to connect its millions of users and performed a new and exciting (in the sense of 'controversial') service.With this as our frame of reference, Bitcoin looks kind of absurd, doesn’t it. If one compares dollars to Bitcoin, Bitcoin looks like a joke. It’s purely digital? Not backed by any trusty Government? Unregulated? No presidential heads or latin incantations printed on it?! Clearly, it is nothing more than made up magic internet money. An absurd fad. A bubble. Tulip mania. Pets.com. A Ponzi scheme.payable ethereum ethereum транзакции For more information, check out my Blockchain Explained guide.kaspersky bitcoin bitcoin multiplier bitcoin euro ethereum контракт bitcoin sha256
1 ethereum
coinder bitcoin monero dwarfpool mt5 bitcoin new bitcoin
make bitcoin nicehash bitcoin майнер ethereum криптовалюта monero stellar cryptocurrency bitcoin количество bitcoin grant bitcoin приват24 майнинг tether 22 bitcoin bitcoin cli utxo bitcoin bitcoin antminer kraken bitcoin bitcoin расшифровка bitcoin steam tether кошелек
инвестиции bitcoin ann bitcoin почему bitcoin bitcoin weekly bitcoin компьютер
bitcoin окупаемость котировка bitcoin bitcoin mac daemon monero forecast bitcoin ethereum заработок ethereum пул bitcoin boom bitcoin выиграть bitcoin daemon значок bitcoin nanopool ethereum bitcoin окупаемость ethereum blockchain
ethereum install bitcoin взлом tether пополнение bitcoin funding config bitcoin
truffle ethereum bitcoin greenaddress пример bitcoin
exmo bitcoin stats ethereum monero usd bitcoin abc mixer bitcoin algorithm ethereum bitcoin blue currency bitcoin client ethereum games bitcoin bitcoin wallet ropsten ethereum bitcoin хардфорк
bitcoin fpga bitcoin scripting bitcoin kran ethereum transactions bitcoin rt bitcoin видеокарта ethereum org
coinder bitcoin difficulty ethereum bitcoin генератор battle bitcoin bitcoin update ethereum котировки bitcoin supernova ethereum
bitcoin blue ethereum markets
bitcoin технология
pps bitcoin bitcoin planet pizza bitcoin boom bitcoin bitcoin friday bitcoin nyse Or.reddit cryptocurrency bitcoin транзакции
bitcoin airbit masternode bitcoin bitcoin book
bitcoin cranes перспектива bitcoin 60 bitcoin bitcoin fake mining bitcoin 1 bitcoin bitcoin луна flash bitcoin usa bitcoin ethereum логотип bitcoin экспресс habrahabr bitcoin torrent bitcoin bitcoin cracker tether обзор майнер bitcoin bitcoin blue earning bitcoin bitcoin monkey алгоритм bitcoin bitcoin картинки create bitcoin вики bitcoin mempool bitcoin fx bitcoin 16 bitcoin ethereum contract обмен bitcoin bitcoin курс bitcoin office cryptocurrency arbitrage bitcoin tx приложение tether bitcoin япония bitcoin вход майнить bitcoin
bitcoin config
bitcoin qr игра ethereum ethereum получить bitcoin skrill bitcoin btc wikileaks bitcoin tokens ethereum кошель bitcoin bitcoin реклама casino bitcoin bitcoin forums
client bitcoin форум bitcoin faucets bitcoin client bitcoin minecraft bitcoin s bitcoin bitcoin bloomberg monero windows bitcoin journal bitcoin captcha bitcoin динамика bitcoin dance bitcoin forex ethereum news bitcoin 1070 addnode bitcoin
ethereum обменять bitcoin alliance
обмен tether bitcoin paw проекта ethereum bitcoin desk 1080 ethereum bitcoin cranes ethereum pow bitcoin redex micro bitcoin
халява bitcoin script bitcoin pay bitcoin space bitcoin bitcoin yandex ethereum homestead кран bitcoin дешевеет bitcoin bitcoin msigna bitcoin mastercard monero ico котировки ethereum bitcoin кошельки
bitcoin algorithm payeer bitcoin wallets cryptocurrency bitcoin дешевеет bitcoin биржи bitcoin xpub майнер ethereum korbit bitcoin pixel bitcoin ethereum dark bank bitcoin bitcoin plus bitcoin cran bitcoin москва майн ethereum monero dwarfpool бесплатный bitcoin tether курс blacktrail bitcoin polkadot блог sha256 bitcoin
bitcoin бесплатные терминал bitcoin pay bitcoin bitcoin koshelek bitcoin сатоши bitcoin evolution monero sell ethereum
foto bitcoin bitcoin создать bitcoin prominer coinder bitcoin people bitcoin ethereum бутерин
cryptocurrency logo bitcoin purse оплата bitcoin партнерка bitcoin кошельки bitcoin bitcoin spinner ethereum coins