The cryptocurrency industry is fast becoming a notable force to reckon with. A lot of people are catching on to what it is, how profitable it can be, and how useful it can be. While cryptocurrencies like Bitcoin (BTC) and Etherum (ETH) are already very popular, a lot of people are still left with the struggle on how to lay their hands on some of these cryptocurrencies.

There are basically two ways in which you can get Bitcoin (or any other cryptocurrency for that matter). You can either trade it or you mine it. Most people in the crypto world go with the former as they are either not sure, fully educated, or do not have the resources to go through with the latter.

In this article though, we'll be talking about what bitcoin mining is, and providing you with every necessary information you need to know about mining this cryptocurrency. So without further ado, let's get down to it.
Mining Bitcoin, Profitable Or Not?

WHAT IS BITCOIN MINING?

Simply put, mining is the process of adding your computer or hardware's processing power to the bitcoin network in order to help with the transaction process and the longevity of the bitcoin network. Back in 2009 when Bitcoin was very new, mining the cryptocurrency was incredibly easy. You could use your desktop computer to mine BTC and you'll get a fair amount of it. But these days, since bitcoin has grown more popular and is being accepted by a lot of people, mining the cryptocurrency has become a hassle and lots of people have come up with the idea that mining bitcoin isn’t worth it. But is that true?

Well, the answer to the question above is "it solely depends on how much you have to invest". While bitcoin mining was simpler back in the days, the mining process has become a bit harder now and also requires some special equipment, and we all know that special simply means expensive.

Now, in order to know about the profitability and difficulty of bitcoin mining, there are some factors you need to consider so as to fully understand why mining would be easier or difficult (depends on your point of view) for you.

 Read Also: What You Need To Know About Bitcoin

FACTORS FOR MINING BITCOIN

·   Hash Rate- The mathematical problem a miner's computer has to solve is known as a hash. Now, the hash rate is the rate and pace at which the problems are being solved. As more miners join the network, the hash rate becomes higher. The hash rate can also be referred to as your hardware's (miner's) performance. The bitcoin miners you'll see today come with different hash rate. The performance of a miner can be measured in Mega hash per second (MH/s), Giga hash per second (GH/s), Terra hash per second (TH/s), and Pera hash per second (PH/s).

·  Bitcoin Difficulty- Getting bitcoin is difficult for miners now. This is due to the fact that the BTC network was designed to produce a specific amount of BTC every ten minutes. So in order have a successful hash rate increase as more miners join the network, the difficulty of getting through the mathematical problems also needs to increase. Simply put, the more miners that join the BTC network, the harder mining becomes.

·  Bitcoins per Block- As said earlier, for every mathematical problem solved, a specific amount of bitcoins are generated. The number of BTC created per block started at fifty and for every 210,000 blocks created, the bitcoin generated is reduced by half. Currently, the amount of BTC generated per block is 12.5. The halving of the last block was done in July 2016 and the next one has been stated to happen in 2020.

·  Power Consumption- There are different types of miners and each of them consumes different amount of energy. When purchasing a miner, you need to ensure that you know the exact amount of power consumption your miner has so as to be able to calculate your profitability. Power consumption is usually measured in Watts.

·  Electricity Rate- This is another term you need to keep in mind as it will also help you determine your profitability.

·  Pool Fees- Mining requires joining a mining pool. Mining pools provide miners with a better chance of getting more rewards. A mining pool is a collection or group of miners who have come together to ensure that they are able to mine effectively. They all register on a platform, which is the pool. The platform charges a fee for the maintenance of its operation. Once this pool is able to mine BTC, the profits made from this mining is shared between those in the pool, depending on each miner's hash rate, that is, the amount of work each miner has done.

·  Profitability Decline Per Year - This factor is a very important one as you need to place a lot of consideration on it in order to know how profitable you'll be during the course of your bitcoin mining. Since no one is certain about how difficult it will be to mine in future or how much people will join in the future, it's very hard to provide a direct answer to the question, "Is the mining of BTC profitable?”

CONCLUSION

All of these factors are what will help you determine if you are going to be profitable with bitcoin mining or not. Once you weigh all of these factors and you are on the positive side of them all, then it's sure that the mining business might favor you. To be precise though, it will take a while for you to earn a considerable amount of profit from BTC mining even if you invest a considerable amount of money. If you know you are not equipped with the time or the money, it is best you leave mining for those who have the time and money, and instead, look toward trading BTC.