Factors characterizing marginal cost of production in bitcoin are many, but only a few seem to impact mining expenses enormously. Therefore, people usually use an online calculator to acquire a complete estimate of cryptocurrency mining profitability.
One of the leading mining displaying the profitability of bitcoin mining with any machine is what to mine. The mining calculator demands you specify the mining machine, and you will know its hash rate, the electricity cost, and the profitability of bitcoin mining.
All the more such miners also help you know the most profitable coin to mine with the acquired mining machine. You can also check profit-secret.com, as it can heavily assist you in cryptocurrency trading. For example, suppose you have one standard graphic card and are confused between ether and Raven coin for mining; the mining calculator will clear all your doubts and demonstrate the most profitable coin based on hash rate.
Mining rewards have lured many people to dive into this business. However, mining rewards are not pure profit as acquiring the mining reward on any hardware requires a magnificent investment capital. For example, mining is verbally latent in the bitcoin network with an ordinary computer, but the profitability is merely gigantic with a custom mining machine. Knowing that block reward of cryptocurrency you are about to mine is mandatory as if the rewards are minor, there is no point in investing such a considerable amount in the mining machines.
Only a few mining calculators display mining hardware profitability on a particular cryptocurrency network, including the difficulty rate aspect. The difficulty rate of a cryptocurrency network usually defines nodes present on that network. Therefore, if the difficulty rate is high, the combined hash rate on an explicit network is also high.
Difficulty rate makes it challenging for miners to get the reward. In short, if the difficulty rate is high, miners will have to spend more time on the network, burning more and more power to bring a positive output. So, yes difficulty rate seems to have a significant impact on mining profitability.
Hash rate is usually referred to as the power of a machine or graphic card in terms of mining. In other words, higher power means a higher hash rate, and the costs of mining machines mainly depend upon the hash rate. Some of the most popular mining machines that generate a considerable hash rate are Avalon Miner S, Antminer S5, and Antminer Bitmain ASIC machine.
If you buy a mining machine with a higher hash rate, it will skyrocket your chances of getting the reward, but no GPU or ASIC miner guarantees any reward as mining is all guesswork. So no guarantee of getting the reward is one of the significant drawbacks of the mining business. But to make sure miners get a reward, they usually become members of a mining pool.
No other factors characterize the productivity of this business like electricity does. If electricity is cheap in your area, mining will be more profitable. The cost of electricity is usually one-tenth of the profit you make with mining. For example, you make $1000 with mining each month, the cost of electricity will be nearly around $100 each month.
But the amount can extend based on your locality. For example, if you try to mine this coin in South Korea, each month’s electricity cost will overshadow your real reward. Suppose you mine BTC worth $24,000 in Korea in a single month; the cost of electricity will be around $23000.
In short, there are few countries where mining is the utmost non-profitable business of all time. On the contrary, the countries where mining is least expensive are Venezuela, Kuwait, China, and Texas. The primary reason is the lower price of electricity and high natural energy source reserve.
You might be thinking if electricity prices impact mining profitability to an exceeding extent, why don’t people use conventional energy sources. However, the use of conventional energy in mining is skyrocketing each day. Today, 50% of mining plants use hydropower and solar energy sources.
The portion mentioned above demonstrates some factors determining the profitability of bitcoin mining.