Is Bitcoin Mining Worth It?
Is Bitcoin Mining Worth It?– Are question that might seem simple but it has a complex answer. There are various factors which can be helpful in deciding whether it is worth it or not. The primary factors that affect bitcoin mining are:
- Mining difficulty and reward
- Hash rate
- Operational costs
Bitcoin is a cryptocurrency which runs on a blockchain method. When the transaction is done a block is formed which has the encrypted code of the transaction. The work of the miner is to decrypt that code and add it to the chain. For this bitcoins are given as rewards to the miners.
Is Bitcoin Mining Worth It?
Here are the few factors that can make you decide Are Bitcoin Mining Worth It?
Mining the bitcoin for the blockchain process is not a simple method. While decrypting the block computer has to go through 2 256 algorithms. This is a very complex problem to solve. People who are doing it are setting up whole new systems. This process can even take days to solve one block. If you are not interested in setting up a whole new system just to do the bitcoin mining or to give the countless hours in solving the blockchain problem. Then you should not do it.
The first person to mine the bitcoin got the reward of 50 bitcoin. But the reward for the mining is decreasing day by day. At present, the reward for the mining a block is 12.5 bitcoin. This price should not fool you because of the value of bitcoin in 2009 but at present its worth a lot. The reward also depends upon the number of miners working on a block as the more the miner
lesser the chance of doing it first.
Hash rate can be defined as the rate at which mining rig can solve the algorithm to mine a new block. It might seem good to have a high hash rate but they cost significantly more to purchase and operate. Before setting up the rig for mining you should decide on how long you are going to step up the mining business. If you are looking for the short term then you should buy a less expensive one. This will help you to cover the initial purchase value of the machine.
You need to create a set up that is going to consume a lot of electricity to decrypt a block. As there are multiple graphics cards are running at the same time this will create a lot of heat so you have to maintain the temperature also. This electricity might end up bigger than the profit you are getting from the bitcoin mining.
The price of the bitcoin is very volatile. It is because it does not have any regulatory body which controls the price of the bitcoin. This can play an important role in deciding if it is worth it. If the price of the bitcoin keeps on rising then it is well and good but when it falls then you may end up being bankrupt.
If you are a moderate coder and want to enter the bitcoin mining world then the answer to your question- Are Bitcoin Mining Worth It? is NO. And if you are a good one and want to do it then it can be considered as a matter of luck.