Can You Make Profits By Mining Cryptocurrency?

Can You Make Profits By Mining Cryptocurrency

Are you are here looking for ways to make a profit out of the cryptocurrency mining? Then the answer is simple, “NO.”

Mining was profitable in its early days when the mining business was only for the small player of the cryptocurrency trade. However, today, Cryptocurrency mining has become a large-scale business. Today, you will find that some of the top companies are providing mining services.

Earlier, Cryptocurrency mining needed only a small setup of the computer configuration. And the pay for a successful Crypto mining was more than enough for your labor. However, today that is not the case. With the halving event, the commission for successful Mining has dramatically reduced.

The little that you can get out of a thriving mining process can quickly be eaten up by the system maintenance costs and consumed electricity, leaving you with zero profit.

There have been many cases where companies have gone bankrupt due to this phenomenon. In the recent report, we have seen that to date, Crypto investors have lost more than $1.7 Billion in Mining.

Evolution of the Crypto Miners

Although Mining is something anew that you might have just recently heard. But this is a process that has been in the market since the existence of the cryptocurrencies. Yes, you are correct. The Crypto mining came into existence with the first Cryptocurrency, Bitcoin, in 2009.

Crypto mining invo0lves using computer systems to solve mathematical puzzles, for which you are rewarded with some of the cryptocurrencies. In the early days of the Cryptocurrency, there was hardly any Crypto miners. The creators of the Cryptocurrency, Satoshi Nakamoto, was also one of the first generations of Bitcoin miners.

Earlier, you would have only needed a workable computer system to mine cryptocurrencies. However, today, this simple process has very complicated, and with the halving events, Mining has also become costly.

With time, Mining becomes popular. And with the increase in the popularity of the bitcoin and the other Cryptocurrency, the puzzles become more complicated. This made the miners increase the power and functionality of their computer system. Hence, the cost of the computer system has also increased by time.

In this past decade, miners have tried and tested many technologies to smooth up their mining process. These technologies include:

  • Graphics processing units (GPU), it helps the computers to boost its processing speed.
  • Field programable gate arrays (FPGA), uses less power than the GPU.
  • Application-specific integrated circuit (ASICs), were created to mine Cryptocurrency exclusively.

Today, the cost of cryptocurrency mining is very high. If you are looking for a Crypto mining career, be sure to look at it in a long- and short-term perspective.

Cryptocurrency Mining profitability

Cryptocurrency mining has been there in the market since he starts. Earlier, the process was simple and easy to execute, but with the evolution of the cryptocurrencies, it has become complicated and convoluted.

Here are the factors that you must consider if you want to make a living out of Crypto mining.

  • Bitcoin halving

The reward for processing one block of the Cryptocurrency hare halved every year. This event is known as Cryptocurrency halving. This method was introduced by the Crypto creator itself, Satoshi Nakamoto. This was done to make sure that the Cryptocurrency last longer in the market. No matter what the reason is, for miners, it means that you will get rewarded half for your 100% effort.

  • It is not an individual job anymore

In the beginning, when the concept of Mining was known to only a few, Mining was done by individuals. But after the increase of popularity, several companies jumped into this business, and it is now no longer individuals’ jobs. Hence, with an increased number of miners, you will get only a portion of the total reward.

  • Increased in Difficulty

As we have said above, the Mining equation becomes harder and harder with every addition of a new member in the network. And as the computing difficulty increases, that means that you will now need to increase the power of your computer. To keep up with computing power, you will need to upgrade your Desktop with the new technology. This can significantly reduce your profit percentage.

Due to the above reason, people are investing time in companies that are providing Crypto trade services. If you are thinking of investing Cryptocurrency then you should forget about Mining and start with the trade directly. You should also know the Impact-of-ransomware-on-Bitcoin-Business before making your first trade.

You might also like our TUTEZONE section which contains exclusive tutorials on how you can make your life simpler using technology.

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About the Author: Ranjit Ranjan

More than 15 years of experience in web development projects in countries such as US, UK and India. Blogger by passion and SEO expert by profession.

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