they need to know. But, you can roughly estimate it based on the equipment you have a few more factors. One thing that needs to be mentioned is that mining has changed a lot over the years.
Even if it is essentially the same thing, it has become harder to manage and more expensive for some coins. Nowadays, it's hard to find the proper hardware that will make it profitable, but the 2020 bull has increased the profitability.
Types of Hardware You Should Use
When you know how it worked in the past and now, you will know what to expect in the future. In the beginning, it was so easy to do that even your old laptop could participate in the process by only using the CPU, which is the processor. Individuals were able to earn 50 BTC per year this way but the popularity changed everything.
Because more people wanted to join the community and take their part, GPU mining was introduced and crushed the competition. In 2010, everyone started combining multiple units that led to 10 times more profits compared to CPU. The pinnacle of this era didn't last long because ASIC or application-specific integrated circuits is the best from the start. Only a supercomputer will be able to do something compared to ASIC or if you don't have to pay the electricity bill.
Is Bitcoin Mining Profitable?
Trying to do it with the computer you are using is never recommended because you lose a lot of power. Your graphics card will lose its power faster and your PC will be under pressure constantly. There are two ways you can be a part of it, including having a mining rig and the other is cloud mining. For more information about providers, visit this website.
Having a rig doesn't always mean that you will make profits because it takes a lot of time to even pay for the equipment you bought. The cheapest thing that you will need is a shelf where you will place the units and the most expensive will be the electricity. So, finding hardware isn't the only thing you should look for.
These units make a lot of noise and tend to heat up fast so find larger fans. You can make a soundproof room but it's not necessary for a smaller rig. If you are not buying the equipment made for this process, for example, you can get NVIDIA GeForce RTX 3080 or 90. It's very hard to find it because it was immediately sold out at the price of $700.
So, with RTX 3080 you can get around 95MH/s of mega hashes per second. This doesn't mean anything for beginners, but when you put it in the calculator, you will get around $8 per day. This sounds great, but there is the electricity bill and other details.
If you are spending $0.10 per kWh, you are looking at $2000 per year. Of course, the market price can influence the outcome the most. So, if you are getting a certain number of Bitcoin worth $60k when it drops to $30k, it's proportional to the amount you will lose.
Mining Software
If you own a great PC but don't use it all day, you can download software and start to mine occasionally. There isn't a single program used, so you can expect some to have more features and be more efficient. However, you should always try a few because it can impact the profits you can make.
The first thing you need to look at is the operating system that supports that program. Algorithms also differ depending on which cryptocurrency you can mine, so for Bitcoin, you would want SHA 256. Most of them will support every type of hardware but check this option because it can happen that only ASIC or GPU is supported.
If you don't want to expand and you are satisfied with using your PC, you won't need any additional features. Automatic coin switching can be one thing you might need and schedule if you want to use the PC for something else. But, some providers that offer these features won't be free.
What Are Mining Pools?
In simple terms, it's a group of miners that are working together to mine 1 BTC successfully. You will be combining the power to discover more blocks and the amount you get will be split depending on how much energy you provide. Don't ever try to do it solo because there's a chance you will ever get anything. You will have much better odds when you are in a big pool of miners.
There aren't any requirements for joining one, but the bigger it is, the better. You can check a few things that will help you determine the best, like transparency, fee schedule, and minimum payout threshold. People who know what potential Bitcoin has and those willing to go all the way are the ones you should join.
Changes in 2021
The biggest news in 2021 was that Bitcoin hit the new record at $69k, which only brings more good news. More profits for the hash rate invested is only one of the things that changed in the past couple of years. Some people have excellent equipment and software and make five times more than in the past year.
The overall mining network didn't grow too much because we lacked the equipment. There are over-demand and supply constraints, so some manufacturers are trying to make better and cheaper equipment. However, even they have sold out the first batches they made.
At the current state of the market, it would be wise to wait for the drop and then start mining. But, this isn't the case if Bitcoin continues to grow. Either way, the profits are still there, and it can work for you if you calculate everything correctly.
