Mindblowing Facts No One Will Ever Tell You About Profitable Bitcoin Mining Mining 3 minutes

Most people are looking for an efficient way into the crypto ecosystem. If trading isn’t your thing, cryptocurrency mining may provide a good alternative. A fundamental question people often ask about bitcoin, generally, revolve around the Bitcoin token itself. People ask about its value, the security of the coin, privacy, history and eventually; where do bitcoins come from? In this post, we will be going over what BTC mining is, and if it’s viable for you.

BTC Mining

Central banks generate traditional fiat currency. Miners mine new cryptocurrency tokens on a blockchain network. Specifically, cryptocurrency miners order new transactions chronologically and add them to the blockchain after they are validated. This counteracts the double-spend problem, where a user was able to spend the same bitcoin twice. By mining crypto, you can earn cryptocurrency without having to purchase it. The only time you’ll be spending money when mining is when you’re purchasing your mining equipment. The reason it’s called cryptocurrency ‘mining’ isn’t that it requires the physical act of digging in order to find gold. Instead, it’s because bitcoin and cryptocurrency alike have their own way of prospecting and recover, the real root of the word ‘mining’. Mining is a computationally intense task that will only get harder as developers increase the difficulty of mining blocks.

Due to the high cost of entry involved, solo BTC mining is only really viable if you have cheap electricity and internet costs. But even with cheap electricity, you’ll still need to purchase a few GPUs to mine with in order to stay competitive. It’s often a good idea to use a bitcoin mining calculator in order to see if you’ll able to make a profit after spending money to get started. Mining calculators take into consideration your hashing power, electricity costs, mining difficulty factor, hardware costs, and your mining pool fees (if you join one).

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Mining Hardware

All bitcoins in circulation have been mined from a block of mathematic calculations on the bitcoin blockchain. For each successful block to the chain, a reward of around 12.5 is given to all miners that participate. Nowadays, these blocks are being slain by the wave of new power-hungry ASIC mining rigs. Application Specific Integrated Circuits (ASICs) have a single, specific use rather than for general all-purpose use. ASICs are solely for cryptocurrency mining, and they do it extremely well. As a result, they are very costly. The Antminer Z9 mining rig will set you back $2000. This is a factor to take into consideration before you begin mining as to make a profit with mining, you will need to make more than your initial investment in your mining rig.

Though specialized mining hardware may be your best bet for efficiently mining bitcoin; it can be done on your personal computer. GPU/CPU mining is the weakest way you can mine bitcoin. Technically, you could use your computer’s CPU to mine bitcoin, but by today’s mining standards, this method is pretty much obsolete. Even if you were to up your hash rate by adding your GPU into the mix, you’d still be a long way off from the recommended specs.

Mining Software

Mining hardware can only interact with a computer once you’ve installed and configured mining software. This software will control the various mining devices you have. It can determine whether it should mine as part of a specific pool, change the fan speeds, and can choose which cryptocurrency to mine. The mining software that is best for you will depend on a few factors. First, are you attempting to exclusively mine Bitcoin? Or are altcoins in your interest too? Also, the hardware you have will determine which type of mining software you need. For the purpose of this post, we will be focusing on BTC mining software.

You can’t stop things like Bitcoin. It will be everywhere and the world will have to readjust. World governments will have to readjust – John McAfee, Founder of McAfee

As Bitcoin mining is extremely popular, the only way to actually make a profit while mining it is to use an ASIC miner. For ASIC-specific mining, the open-source and free software BFGMiner is your best option. BFGMiner is for ASIC mining rigs, making it ideal for BTC mining and other non-ASIC resistant cryptocurrencies. Any cryptocurrencies that use the SHA-256 (such as bitcoin) work even better when using BFGMiner. This software also allows users to connect to multiple mining pools, and it will stop connecting to any pools that are unreachable. This saves on electricity costs when the software can’t interact with a mining pool in order to generate profit.

Is it worth it?

Bitcoin mining can definitely be profitable if you have the right hardware. If you’re concerned about the risks associated with cryptocurrency mining, you should check out our blog post on mining the top 10 cryptocurrencies. We go over the disadvantages and advantages of mining as well as the different ways in which you can accrue new crypto tokens.

As Bitcoin is the biggest cryptocurrency on the market, the mining world is highly competitive. Due to this, many people have resulted in cloud mining in order to have a shot at earning some BTC by purchasing server space on a powerful computer system. Be that as it may, investment returns are very slow due to mining difficulty increases.

Is Mining Bitcoin Legal in South Africa?

So long as you’re paying your taxes, the use of cryptocurrency is totally legal in South Africa. As you may already know, SARS announced normal income tax rules for cryptocurrency . Though cryptocurrency is not legal tender in South Africa, it is still subject to taxation. South African crypto investors have to declare all losses and profits to SARS in order to receive the correct tax rates. If you are doing BTC mining, so long as you declare your profits, you are good to go.

Will you be mining bitcoin? If not, Why? We think that if you have the correct setup and configuration, even with the price of crypto being fairly stable this year, it’s still possible to make a profit. But of course, if mining doesn’t work for you, you can always trade on our cryptocurrency exchange instead. Let us know your thoughts in the comments below!