How to start a crypto mining business?
by Maryna Trifonova, Head of Content at Jax.Network
With the growth of blockchain and cryptocurrency sectors, crypto mining lures more and more people seeking to make a good profit. As Ethereum switched to PoS, all eyes are on Bitcoin now. Is it easy to start a Bitcoin mining business?
Inputs
Ethereum has recently changed its consensus protocol from Proof-of-Work to Proof-of-Stake, meaning that there is no more mining going on. Thus, most people are focused on mining the first cryptocurrency. As with any other business, Bitcoin mining requires initial investments for starters. The size of funds may vary depending on a number of factors, including equipment, cost of electricity, current hashrate, mining pool fees, etc. As the general rule of thumb suggests, the higher the investment, the higher the return.
Despite the current bear market with BTC struggling to find support around $20,500, hashrate and difficulty hit new all-time highs, decreasing miners’ profit margins. So, in the best-case scenario, a profitable mining farm should have the latest equipment such as Antminer S19 Pro, Antminer T9+, and WhatsMiner M30S++. Certainly, there are older models that have already been used at half the price but returns will be significantly less.
Once you have acquired the necessary equipment. It’s time to think about where will you host it. Look for places with cheap electricity and a cold climate. Thus, the largest mining farms are located in Canada, the USA, Norway, and Kazakhstan. A good thing is that a mining farm doesn’t need lots of employees. For starters, you can manage it yourself, provided you have the necessary knowledge, or hire a technician, who will supervise the processes.
Mining pools
To increase the chances of finding a proof-of-work and winning a block, miners unite their efforts in a pool. The industry has been operating for over 10 years now, so you can find a wide variety of different mining pools and choose the one that suits you best. It goes without saying that each mining pool offers a customized deal for its clients but on average they charge around 1–3% for Bitcoin mining as a part of the pool.
We recently launched our own mining pool and are the first to offer negative pool fees on Bitcoin mining. Thus, if you have been considering whether to start a Bitcoin mining business or not, now is a good time to do that. Not only the equipment is much cheaper now, as its price correlates with the price of Bitcoin, but also you can take advantage of our JaxPool offer. So on top of negative pool fees on BTC mining and a 1% bonus for every 1 Phash/s, miners get extra JXN coins and JXN transaction fees in addition to their 6.25 BTC block reward and BTC transaction fees. Certainly, that’s a unique opportunity to maximize your profits, especially in the times when we can’t know how harsh this bear market will be.
Conclusion
Bitcoin mining is definitely one of the most profitable crypto businesses, where your risks can be kept really low. Bear markets provide a good entry point thanks to cheap prices for practically any type of equipment and service.
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