Is it Still Possible to Mine Bitcoin and Other Cryptocurrencies From Home?
It used to be incredibly simple to mine bitcoin from home more than a decade ago. You could mine so much bitcoin with just a few gaming machines, or by quietly tapping into your school or office's infrastructure, that you'd be set for life - assuming you had diamond hands (never sold), sold at the proper times, and didn't throw away your hard drive.
Such crazy times are already a distant memory, notwithstanding one in a million outliers like the bitcoin miner who mined a block alone in January 2022. Only mining organisations with entire warehouses full of powerful, custom-purpose mining devices have a chance of making money on the Bitcoin network.
However, there are still opportunities for the regular person to benefit from cryptocurrency mining — and not only from bitcoin. We'll show you how to assess your probabilities of making a profit and which coins are the best in this article.
Is mining bitcoin at home profitable?
Mining - the process of employing computer power to develop a winning code (known as a hash) before anybody else in order to be picked to add a new block to the blockchain – became popular with Bitcoin, the world's first internationally accessible cryptocurrency. Each successful miner is rewarded with newly minuted cryptocurrency as well as any fees associated with the transactions they include in the new block in exchange for their efforts. "Proof-of-work" is the term for this type of blockchain validation mechanism.
When mining a cryptocurrency, you must consider the liabilities that may reduce your income, such as the price of bitcoin, the cost of electricity, maintenance fees, and the cost of your mining equipment, as well as how long it will be able to withstand increasingly powerful miners. Your once-powerful machine may not be able to keep up as more powerful devices enter the market.
Profitability calculators, like as those found on Nicehash, can help you figure out whether your business will make or lose money. Let's pretend you don't have access to a hydroelectric dam and instead rely on the U.S. electricity grid's average residential rate of $0.1411 per kilowatt-hour.
If you are mining bitcoin using one of Nvidia's latest graphics cards, such as the RTX 3080, will net you $139 per month in bitcoin, according to Nicehash. The RTX 3080 costs around $1,400 as of January 2022.
Nicehash states that if you use a custom-built AntMiner S19 Pro, you may expect to make $38 per month. A single S19 Pro miner, on the other hand, costs around $10,000 and is exclusively good for bitcoin mining. Electricity expenditures account for over half of the Antminer 19 Pro's earnings.
Because bitcoin's price is so variable, it's hard to say whether you'll be able to recoup your investment in an RTX 3080 graphics card in 10 months or the S19 Pro mining equipment in 25 months. Bitcoin's price has dropped nearly 10% in the last week alone, as of press time.
The network difficulty, which defines how tough it is to mine new bitcoin (in computing terms), is similarly changeable. Following China's crypto mining crackdown in July 2021, network difficulty dropped by 28%, making it more easier for remaining miners to find new blocks. However, this was just temporary, as the market has now nearly rebounded to earlier highs.
Scale matters in mining, and home miners are likely to make less money per miner than a professional mining firm. Professional mining organisations frequently migrate between jurisdictions with cheap electricity, broker deals with local power networks, manufacture their own electricity, and dump out-of-date mining technology at an alarming pace to meet their expenditures.
What are the most profitable coins to mine at home?
Even then, the weekend tinker has lots of other options for mining bitcoins at home. Unfortunately, there are so many options and factors that making true comparisons is difficult.
There are some universal truths: at a certain point, mining bitcoin rather than ethereum with computer chips is generally more efficient than mining with graphics cards, as Ethereum strongly favours GPU miners. This won't last long, since Ethereum is phasing out miners in preparation for its switch to a "proof-of-stake" blockchain system.
The difficulty of obtaining mining hardware remains a serious issue. The GPU market went insane in 2021, making premium graphics cards nearly hard to find at market value. To further complicate matters, certain networks, such as Chia, rely on hard drives rather than graphics cards or computer chips, prompting some to blame Chia mining for the 2021 hard drive shortage.
However, some profitability calculators, such as CoinWarz, are useful in demonstrating the profitability ratio, assuming that your hash power — the amount of processing power you use to mine a cryptocurrency – remains constant. CoinWarz ranks the following coins as the most profitable, based on a $1,000 hardware budget:
- Bitcoin Cash
- Ethereum Classic.
CoinWarz's calculation claims that a thousand dollars worth of hash power will earn $20.94 worth of ethereum every day at an electricity rate of $0.411 per kilowatt, more than double the $9.63 worth of ethereum classic mining.
Smaller currencies, which face less competition from other miners, may prove to be more profitable. The value of your returns, on the other hand, is significantly less predictable because the values of smaller coins are often more unpredictable than the prices of established coins.
Whattomine predicts a daily profit of $1.21 mining firo, $1.07 mining ravencoin, and $0.9 mining sero if you use three Radeon RX 480 cards.
Participating in a bitcoin mining pool is another option if you want to increase your chances of earning mining rewards. This entails banding together with other miners to enhance your chances of finding new blocks and profiting – but it also means splitting the profits.
Finally, if you don’t have the computing power at home, you can look into cloud mining and weigh the benefits and drawbacks of outsourcing your hardware requirements.