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Another evolution came after on with FPGA mining. FPGA is a piece of hardware that can be connected to a computer in order to run a set of calculations. They are just like GPUs however 3100 times faster. The downside is that theyre harder to configure, which explains why they werent as commonly utilized in mining as GPUs. .
Finally, around 2013, a new breed of miner was introduced: the ASIC miner. ASIC stands for application specific integrated circuit, and these are bits of hardware manufactured solely for the purpose of mining Bitcoin. Unlike GPUs, CPUs, and FPGAs, they couldnt be used to do anything else. Their function was hardcoded into this machine. .
Now, ASIC miners are the current mining standard. Some ancient ASIC miners even appeared in the form of a USB, but they became obsolete rather quickly. Even though they started out 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 this mad 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 possible miner on the market, youre still in a massive disadvantage compared to professional Bitcoin mining farms.
Thats why mining pools came into existence. The idea is simple: miners group together to make a pool (i.e., combine their mining capability to compete more effectively). Once the pool manages to win the competition, the payoff is distributed between the pool depending on how much mining power each of these contributed.
Now there are more than a dozen large pools which compete for the chance to mine Bitcoin and update the ledger.
When calculating Bitcoin mining profitability, there are a lot of things that you need to take into account such as:
Hash rate: A Hash is the mathematical problem the miners pc needs to solve. The hash speed refers to a miners performance (i.e., how many guesses your computer can make per view it now 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 cube: The number of Bitcoins generated when a miner finds out the solution. This number began at 50 bitcoins back in 2009, and its halved every 210,000 cubes (approximately four years). The current number of bitcoins given per block is 12.5. The last block-halving happened in July 2016, and the next one will be in 2020. .
Mining difficulty: A number that represents how hard it's to mine bitcoins in any given moment considering the amount of mining power currently active in the system.
Electricity price: How many dollars are you paying per kilowatt Youll need to find out your electricity rate in order to calculate profitability. This can typically 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 really hot). .
Power consumption: Each miner consumes a different amount of energy. Youll need to find out the specific power consumption of your miner before calculating adulthood. This can be found easily with a quick search online or via this list. Power consumption is measured in watts.
Bitcoins cost: Since no one knows what Bitcoins price will probably be in the future, its hard to predict if Bitcoin mining will be profitable. If you're planning to convert your mined bitcoins to any other currency in the future, this variable will have a significant influence on profitability.
Difficulty increase per year: This is most likely the most important and elusive variable of all of them. The idea is that since no one can actually predict the speed of miners joining the network, neither can anyone predict how hard it will be to mine in six weeks, six months, or six years from now.
The last two variables are content the reason no one will ever Have the Ability to Provide a complete answer to the question is Bitcoin mining rewarding
Once you have each these variables at hand you can insert them into a Bitcoin mining calculator (as can be seen below) and get an estimate of how many Bitcoins you will earn each month. In case you cant get a positive effect on the calculator, then it probably means you dont have the ideal conditions for mining to be profitable. .