Notes From A Bitcoin Whale - Part 2

Bitcoin mining has moved on from a few early enthusiasts confirming transactions using their CPUs, into what is now quite a major industry.

I think the easy money was dug out a long time ago, and what we now have is basically buried under the Bitcoin equivalent of lots of hard rock. In addition, BTC’s growing conversion rate makes it ever more attractive to both large corporations and the general public, which attracts lots of new miners, tightening the competition. In theory, anyone can still mine Bitcoin, but only those with specialized and very expensive equipment make any kind of profit.

Most "home" miners spend more money on their electricity bill than is generated through BTC mining. So, unless you’re able to invest big, or have access to a very cheap energy source, profitable BTC mining is totally impossible.

There are other issues which make home mining troblesome; hardware failures, power outages, network issues and BTC price crashes. Thus, given the situation today, Bitcoin mining profitability for home miners is extremely unlikely.

The situation could improve. ASIC mining software is still developing, and cheaper, more sustainable power solutions are emerging. They may not make Bitcoin mining profitable for small home miners again, but they could definitely improve the decentralization of the network, and as such protect it against legislative issues by governments.

If you wish to invest in Bitcoin mining without purchasing your own kit, you may think of getting involved with cloud mining. After all, you don’t need your own hardware, software, you don't need to worry about your electicity bill, bandwidth and other offline problems.

If that is the case, I would strongly urge you to think again. Almost all Bitcoin cloud mining providers are scams. And those that aren't will pay you an absolute pittance.

25 views0 comments

Recent Posts

See All