Is Bitcoin mining still worth it in 2019?
Sometimes the concept of Bitcoin mining is wrongly perceived by many people as “printing money out of thin air”. That is not true, because like any other type of business, Bitcoin mining has its own expenditure, which depends on a variety of different factors. To stay profitable one must consider all costs, spent on electricity, new mining devices and maintenance. So the new miners should have relatively big seed capital to start their own business. But should they spend so much money on such risky idea?
The evolution of Bitcoin mining
When Bitcoin first started out there were only a close group of miners, who used their CPUs power to mine BTC. Because of low hashrate they could earn a substantial amount of coins with ease. Around 2011 more people joined the game and mining on CPUs became obsolete. Slowly more miners moved to GPUs (graphics processing units) which mining power is 30 times greater than CPUs.
Around 2013 a new mining standard was introduced — application specific integrated circuit (ASIC). This device serves as a backbone in every Bitcoin mining rig nowadays. Unlike CPUs or GPUs, this type of equipment couldn’t be used to do anything else. In other words, if your ASICs will become obsolete, you are not likely to sell it for reasonable price, because it is hard to find buyer for such item.
Bitcoin Hashrate hits all time high. Everytime
By the end of 2013 Bitcoin network hashrate had risen to almost 10 000 TH/s. Many news outlets speculated that mining cryptocurrency at that time would’ve be unprofitable in the long run. Still, almost 6 years later Bitcoin’s hashrate set a new all time high record at 77.5 million TH/s. In other words, BTC mining constantly attracts more people and they somehow manage to earn money in that business.
But there’s a catch — the seed capital needed to start your own mining facility (even at home) rises from year to year. It’s because of second the most important metric, which depends on hashrate — Bitcoin mining difficulty. The creator of Bitcoin Satoshi Nakamoto set a specific measure, that determines how much BTC one can earn by mining. It is recalculating every 2016 blocks. Considering that mining of one block takes approximately 10 minutes, difficulty changes every two weeks.
High difficulty = no return
Well, yes, but only if your mining rig earns you less than you pay for electricity. This is another threshold for everyone, who lives in area with high electricity costs. Did you know that notable part of BTC hashrate is “located” in China? All because of relatively low amount of money paid for electricity by local miners.
So in everything above in mind is it still worth mining Bitcoin in 2019? Assuming that you already have enough space with reasonable electricity costs (let’s say, $0.05/1 kWh), you will need to buy your first pieces of equipment. Let’s see what main ASIC provider Bitmain can offer us.
Right now we can buy Antminer S9 SE for $622 (let’s ignore shipment costs for simplicity of calculation).
This ASIC generates 16 TH/s with power consumption of 1.28 kWh.
To find our potential profit we will use CryptoCompare BTC mining calculator.
As you can see, your potential revenue (if all the aforementioned conditions are met) will be $95.30 per month. Of course, this number will change in the future because of Bitcoin price movements and changing hashrate. In order to earn at least $1000 per month you will need to buy nine Antminer S9 SE. Simple math: to buy 9 of these ASICs you must spend at least $5598. Add to this number shipment costs to your country and some money for technical maintenance of your equipment.
Is there any alternative?
Yes, there is. You can also earn money with Bitcoin cloud mining. It is much easier way to invest your money — no need to buy and configure any pieces of equipment. But there is also a catch — Bitcoin cloud mining costs much more money in terms of hashrate. In other words, for the same seed capital you get less hashing power.
Let’s use Hashmart.io as an example. To earn almost $100 per month you need to buy only one Antminer S9 SE which will cost you $622. The same hashing power at Hashmart.io with 12 months contract will cost more than $1300!
At first glance, this deal may look quite bad. Imagine, you pay almost double the price of one ASIC! But cloud mining is far more efficient than mining at home. Here you only need to buy one (or more) mining contract. That will save you a lot of headache down the line. With Hashmart you can start earning money far more easily. Imagine, you don’t need to worry about equipment shipment and its configuration. Besides, traditional home mining requires a decent technical skill to deal with a big variety of different problems.
In conclusion, cloud mining can be, by far, one of the best options to diversificate your investment portfolio. Remember, don’t put all your eggs in one basket! Buy Bitcoin and Hashmart.io cloud mining contracts to stay profitable in the long run.
