Bitcoin mining is seen as one of the most advantageous practices in recent times due to its high reward. Even though it is complex and requires multiple variables to do successfully, it is still very beneficial to miners if done properly. Even with the mining difficulty being readjusted every 10 minutes, it seems that recently, there have been a lot of individuals/miners who have given up this practice due to insufficient results. Since the difficulty is adjusted depending on two variables namely the number of miners on the network and the time it takes to mine another block, it seems that some might find it too complex or competitive to actually make a profit.
Let’s go back to the process of mining first. Done through specialized computers, miners make sure that the network is secure enough and verify each transaction. To do this, they need to solve computational problems which can take a lot of time but are duly rewarded for successful efforts in the form of bitcoins. After a problem is solved and embedded into a block of the whole blockchain (Read Tyslin Technical for blockchain related content), the miners get issued new Bitcoins. Thus, the main task for miners is to secure the transactions by verifying it and preventing it from being attacked. We all know that bitcoin is profitable so why isn’t everyone doing it? That is because mining can only be done by lots of warehouses full of specialized computers requiring tons of electricity and more. In fact, I would not recommend this to beginners looking to make it big without prior experience. You would still require a mining pool, mining software, a crypto wallet and an exchange etc. even afterwards. So, the main question comes back to, how is it profitable?
We can easily google the price of a bitcoin. Calculate the costs it took to get that bitcoin and voila, you can easily find out if you can make a profit. With the way bitcoin prices can shoot up, you might even make a lot more than you originally thought. But if the prices go up, so will the competition and that will increase the difficulty of bitcoin mining. Hence coming back to the current difficulty level of mining. It seems that ever since the third halving of Bitcoin this march, the value dropped and many miners came out with losses instead of profits. As soon as the value started shooting up again, every miner wanted a piece of the improved value and caused the network to be more filled. As we mentioned before, more miners = more difficulty and that will indirectly lead to less blocks being mined. Those miners who are using newer versions of computers will still come out on top and since technology is being refined every day, I can surely say that those will older versions will not be as successful.
So, what do you think? Is mining really that difficult? Should the rewards be higher? Should people invest more and is it still going to be profitable in the future? If you have your own opinion on this topic, drop me a message at the chat box or any of the social links and we will be sure to feature you and your opinions.
