Is Bitcoin Mining Still Profitable?

This question makes me laugh.

Of course, Bitcoin mining is profitable. Bitcoin is not some charity trying to free the world from centralized fiat currency that governments can use to steal from its people.

No, Bitcoin is a business with real economics involved. The day Bitcoin mining becomes unprofitable, it all stops… but I don’t imagine that happening.

Bitcoin is being mined because there’s an economic incentive!

What people mean when they say you can’t mine Bitcoin anymore is that there’s no computer powerful enough that could mine Bitcoin and make a profit.

The Bitcoin mining has evolved to a point where businesses are creating ASIC’s to mine Bitcoin.

An ASIC is a computer chip that is optimized to do one thing only and that is mine Bitcoin. The most popular ASIC to mine Bitcoin is AntMiner.

If you would buy AntMiner S9, which costs around $3500 and you have cheap electricity you could be looking to make $400 a month and payback for the miner in 9 months and after that profit $400 a month. If you ask me that’s freakin profitable.

One thing to keep in mind though is that Bitcoin mining difficulty continues to increase so, over time the revenue can slightly drop and obviously Bitcoin price has a lot to do with profitability.

When you sell your BTC can also affect your earnings a lot. If you were holding BTC and sold it when it crashed a month ago at around $2000, then you earned only half as much, if you would have sold it right now.

If you have the capital it’s best to sell enough to recoup electricity expenses and hold the BTC and cash out at the peaks.

So, yes Bitcoin mining is profitable and will continue to be even after all the coins are mined. What will happen then? Miners will no longer receive extra BTC rewards, but they will receive all the fees that are paid for the transactions, chances are the mining profitability might drop then, but it won’t cause the system to break because Bitcoin has self-regulatory mechanisms to adjust mining difficulty.

Is Ethereum Mining Still Profitable?

Ethereum is a different bird than Bitcoin. There are no ASIC’s created to mine Ethereum and there won’t be because Ethereum has stated a long time ago that it will change its mining algorithm from Proof of Work to Proof of Stake.

The difference between proof of work and stake is that with proof of stake you don’t need miners. There are different POS implementations, but I won’t go into them.

So, because Ethereum is planning to get rid of mining in the future companies aren’t risking the capital to create ASIC miners, because they can quickly become obsolete.

This means that Ethereum can be profitably mined with a computer that has powerful graphics cards or GPU’s.

You can read a ton of articles about GPU’s selling out faster than they are made, thanks to Ethereum. People were completely crazy when ETH was at its peak of $400, the profitability was through the roof and when the price dipped to $200, the same GPU’s flooded the market again.

Right now with Ethereum price of $350+ it’s still very profitable and just like with Bitcoin if it wasn’t profitable no one would mine it and the same goes for any cryptocurrency out there if you can mine it, it has to be profitable.

Yes, the profitability can vary from one coin to another and it also varies in time as the price of the cryptocurrency rises.

  1. November 8, 2017 | Reply
    • Liudas Butkus
      November 16, 2017 | Reply
  2. December 13, 2017 | Reply

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