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Another evolution came after on with FPGA mining. FPGA is a piece of hardware that can be connected to your computer in order to run a pair of calculations. They are just like GPUs however 3100 times quicker. The downside is that theyre harder to configure, and this is why they werent as commonly utilized in mining since GPUs. .
Finally, around 2013, a new breed of miner was introduced: the ASIC miner. ASIC stands for application specific integrated circuit, and these were pieces of hardware manufactured only for the purpose of mining Bitcoin. Unlike GPUs, CPUs, and FPGAs, they couldnt be used to perform anything else. Their function was hardcoded into this machine. .
Today, ASIC miners would be the current mining standard. Some early ASIC miners even emerged in the form of a USB, but they became obsolete fairly quickly. Even though they began in 2013, the technology rapidly evolved, and new, stronger miners were coming out every six months.
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After about three years of the crazy technological race, we finally reached a technological obstacle, and things started to cool down a bit. Since 2016, the speed at which new miners are released has slowed considerably.
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Assuming youre just entering the Bitcoin mining game, youre up against some heavy competition. Even in the event that you buy the best potential miner on the market, youre still at a massive disadvantage when compared with professional Bitcoin mining farms.
Thats why mining pools came into existence. The notion is simple: miners team together to form a pool (i.e., combine their mining power to compete more efficiently ). Once the pool manages to win the competition, the payoff is spread out between the pool depending on how much mining power each of them contributed.
Now there are over a dozen big pools that compete for the chance to mine Bitcoin and upgrade the ledger.
When calculating Bitcoin mining profitability, there are a lot of things that you need to take into account such as:
Hash speed: A Hash is the mathematical difficulty the miners computer needs to fix. The hash rate refers to a miners performance (i.e., how many guesses your pc can make per second). Hash rate can be quantified in MH/s (mega hash per second), GH/s (giga hash each second), TH/s (terra hash per second), and even PH/s (peta hash per second). .
Bitcoin reward per block: The number of Bitcoins generated when a miner finds out the solution. This number started at 50 bitcoins back in 2009, and its own halved every 210,000 blocks (approximately four years). The current number of bitcoins awarded per cube is 12.5. The last block-halving occurred in July 2016, and the next one will probably be in 2020. .
Mining difficulty: A number that represents how difficult it is to mine bitcoins in any given moment considering the amount of mining power currently active in the system.
Electricity cost: Just how many dollars are you currently paying per kilowatt Youll need to find out your electricity rate in order to compute profitability. This can usually be found on your monthly power bill. The reason that is important is that miners consume electricity, while for powering up the miner or for cooling it down (these machines can become very hot). .
Power consumption: Each miner consumes a different amount of energy. Youll need to find out the exact energy consumption of your miner before calculating profitability. This can be found easily with a quick search online or via this list. Power consumption is measured in watts.
Pool fees: When youre mining by means of a mining pool (you need to ), then the pool is going to take a certain percentage of your earnings to rendering their service. Generally, this could be somewhere around 2 percent.
Bitcoins price: Since no one knows what Bitcoins price will probably be in the future, its hard to predict whether Bitcoin mining will likely be profitable. If you're planning to convert your mined bitcoins to any other currency in the long run, this variable will have a significant influence on profitability.
Difficulty increase per year: This is most likely the most important and elusive factor of them all. The idea is that since no one published here can really predict the rate of miners joining the network, neither can anyone predict just how hard it will be to mine in fourteen days, six months, or six years from now.
The last two variables are the reason no one will ever be able to Provide a complete answer to this question is Bitcoin mining profitable
Once you've got all these factors at hand you can insert them into a Bitcoin mining view it calculator (as can be seen below) and get an estimate of how many Bitcoins you will earn every month. If you cant get a favorable result on the calculator, it likely means you dont have the right conditions for mining to become profitable. .