When it comes to making money with crypto a couple things come to mind you have trading it you have staking it
… well actually thinking about now you have a lot of ways to make money with crypto but if you’ve been in the space for a minute you’ve probably heard of something called Crypto Mining.
Maybe you’ve seen those crazy mining farms in china with warehouses filled to the top with miners or maybe you’ve seen people making videos on it on youtube, testing out and seeing how much they can make for mining but i’m almost guaranteed that you’ve heard of it in some way shape or form.
You’ve also probably heard of the costs associated with mining as well ranging from a couple hundred dollars to over ten thousand dollars to get the proper equipment just to start mining so you start to wonder is it even worth mining crypto at this point or should i just buy a coin and hold it ?
Hello, welcome to Megacrypto and on this blog we will be answering the dire question is crypto mining even worth it anymore ?
We are going to go over what crypto mining is how it works then going into if it’s worth it then we will discuss a couple cryptos that you can mine.
What is crypto mining?
Now we think this is a question that is very hard to answer because there’s hundreds of different things that go into answering this one question.
Mining is a process that bitcoin and several other cryptocurrencies use to generate new coins and verify new transactions and in return for miners contributing processing power and hardware we’re rewarded with new coins.
Think of it like a big cycle the miners maintain and secure the blockchain, the blockchain awards them the coins and the coins provide an incentive for the miners to maintain the blockchain.
The thing is cryptocurrency mining is very tedious requires a lot of patience a lot of money and rewarding only sometimes, nonetheless there’s still many people that go into mining because of the fact that miners receive rewards for their work we are positive it ties back to the entrepreneurial sense where people see this as a way to make some extra money and escape the rat race as they call.
If this is a good thing because we need these miners because without them there essentially is no bitcoin, there is no crypto they are the backbone of everything that happens.
that was a brief explanation of what crypto mining is.
The answer to the question “Is mining worth it” is that it depends.
A decade ago anyone with a decent home computer could participate in mining crypto but as the blockchain has grown and the power required to maintain it has increased as well it requires about 12 trillion times more computing power to mine one bitcoin than it did when the first blacks were mined in january 2009.
Not to mention there are huge companies and groups that are able to buy millions of dollars of equipment just to mine crypto now the largest mining farm is in china and it mines 750 bitcoin a month and spends about 1.2 million dollars on electricity a month and mines about three percent of all of bitcoin
Because of the cost and the huge competition of other people it’s become difficult for individuals like you and i to start mining bitcoin or any other crypto on our own and make it worth our while.
Now, if you plan on mining it’s best to keep these four things in mind before, you start the first is the cost of power what is your electricity rate keeping in mind that rates change depending on the season the time of day your location and many other factors then looking at efficiency. the amount of power your system uses to mine is it feasible to have in your home will impact your day-to-day living then it’s the time what is the anticipated length of time you will spend mining crypto and does it make sense for you to mine for that long as well which leads into profitability you’re essentially mining for one reason to make money, so will you be making money from what you’re mining does the future outlook look promising for that coin is it worth the upfront cost that it’ll cost you these are all some great questions you should have answered before you start mining crypto.
One more thing, in order to mine bitcoin or ethereum or any other coins you need special equipment in order to do so because you’re basically solving very complex mathematical problems our basic computers can’t handle so you need to go out and buy gpus a cpu miners.
We are aware that you’ve seen other people talk about this as well as in the past two years we’ve seen the prices of these computer parts skyrocket GPU prices have gone through the roof and now costs at least a thousand dollars for a decent one, one you used to be able to get one for half the cost and you’re looking to spend anywhere in between a couple hundred to over ten thousand dollars just for a basic mining rig so you have to ask yourself is it worth the investment and if you do plan to make the investment one good thing about this is because your parts are always in demand if you ever want to sell your rig you can pretty much make your money back unless the resale market for those items fall. then you’re in a bad position.
If that upfront initial cost seems too daunting what you can do is join what is known as a mining pool which is a group of miners who work together and share the rewards now this can increase the speed and reduce the difficulty of mining making it more profitable for people like you and I.
A lot of people are choosing to participate in these pools nowadays because it just makes more sense even though the overall reward decreases because it’s shared amongst multiple people the combined computing power means that mining pools have a better chance of actually completing a problem and receiving a reward.
So with all this being said we are sure you can get the idea that mining crypto is not the most rewarding but we don’t want you to think crypto mining as a whole is unprofitable because you can make money from it but is it worth your time and money.
What coin should you be mining now?
The most profitable coin to mine right now is ethereum, and you might be thinking to yourself well that won’t be much longer because they’re moving to a proof of stake model and yes you’re right but we don’t know exactly when this will happen.
It is set to happen sometime in the summer of this year (2022 at times of writing) but there’re rumors out there that it’ll get pushed back even further maybe for another year so that means you have another year of mining crypto.
When we’re looking at the profitability of mining ethereum it really depends on the GPU you have but to make things realistic let’s say you have a solid GPU that costs about fifteen hundred dollars with that you’ll probably be making around five dollars a day from what we are seeing online.
So if you did this for a year’s time you would make around eighteen hundred dollars and have three hundred dollars in profit from your fifteen hundred dollar investment, which is a pretty good return on your money
The real money comes from buying multiple GPUS and these are the big rigs people create that make them a lot more money.
There’s more risk because there’s more upfront costs but there’s also a lot more reward with it as well.
The concern here is we don’t know when ethereum will be gone for miners and i don’t want you guys get stuck with an expensive GPU so just keep this in the back of your mind when you’re researching that ethereum mining will not be around forever.
YES you could just start mining something else once the merge happens but you don’t know if it will be nearly as profitable as ethereum was .
Another coin to look into mining is ravencoin now we have been hearing a lot of people talking about ravencoin and for good reason ravencoin is actually a fork of the bitcoin code so it’s pretty much very similar to bitcoin it’s open source it’s decentralized and has havings but since ravencoin was launched in 2018 it has had some upgrades that make it very interesting to us.
The first is its algorithm called Cap Wow which sounds really funny but fixes a huge issue this new algorithm is going to be ASICresistant meaning it helps from all the mining farms out there that dominate something like in the bitcoin world today.
Being resistant to these farms also helps decentralization because one farm can’t control majority of the hash power this is going to help a lot of the little guys at home like me and you mining on our GPUS and allows us the ability to mine without competing with these large farms and thousands of computers basically evening out the playing field
We also heard complaints of ravencoin’s algorithm however, running computers really hot which could be a concern more heat is not just bad for an individual that has a rig in their house because their house might become a sauna but it can also lead to computer failures and fires
The worst thing any miner can do is burn down and all that hardware becomes useless so keep an eye out for that if you plan on moving forward with ravencoin and make sure your rigs can handle all that computing power.
Next up we have helium, it’s a decentralized wireless network that is setting out to change the whole process of getting wireless connection to low-power devices
You’ve probably heard about or seen these helium miners which have been getting a ton of buzz lately where you sometimes you just set it up and you can start making money from it now these miners are also called hot spots and they can cost about 500$ which is a lot cheaper compared to the cost of mining bitcoin or ethereum and the cool thing is with helium it doesn’t require any fancy setup all you have to do is buy the miner and plug it into any regular outlet and you’re good to go.
What’s the profitability on mining helium well the truth is it’s not that great anymore helium has grown so much in the past year where it’s now in 170 countries over 55 000 cities and big names like dish network are getting behind the technology helium hot spots have just been popping around everywhere like wildfire which is reducing how much hnt or its native token you’re actually getting because you’re getting paid for transferring data and now you’re competing with so many other people back in the day mining helium.
if you were one of the early adopters you would be making about a hundred dollars a day but now it’s sitting anywhere in between a dollar to five dollars a day, this is just what happens to a saturated market the people who got in from the jump usually make the most money and those that get in later make less.
Honestly a lot of cryptos you can mine right now are probably just not worth your time and risk there are a lot of new options coming up where you don’t need huge upfront investment like how helium is there are a couple coins out there that you can mine straight from your phone but because of this convenience and low risk you won’t be making as much either, so you just have to ask yourself would you rather have the daily payouts and making money every single day or would you rather just buy the coin at the price it’s at right now and just wait for it to go up.