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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 pair of calculations. They are just like GPUs but 3100 times quicker. The downside is that theyre harder to configure, which is the reason why they werent as commonly used 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 utilized to do anything else. Their function was hardcoded into this machine. .

Today, ASIC miners would be the current mining standard. Some ancient ASIC miners even emerged in the form of a USB, but they became obsolete fairly quickly. Even though they began in 2013, the technology quickly evolved, and new, more powerful miners were coming out every six months.

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After about three decades of this crazy technological race, we finally reached a technological barrier, and things started to cool down a little. Since 2016, the pace at which new miners are released has slowed considerably.

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Assuming youre just entering the Bitcoin mining match, youre up against some heavy competition. Even if you purchase the finest potential miner on the market, youre still at 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 swimming pool manages to win the competition, the payoff is distributed between the pool members depending on how much mining energy each of these contributed.

Now there are over 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 you need to take into account such as:

Hash rate: A Hash is the mathematical difficulty the miners computer needs to fix. The hash speed refers to your miners performance (i.e., how many guesses your computer 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 cube: The number of Bitcoins generated when a miner finds out the solution. This number started at 50 bitcoins back in 2009, and its halved every 210,000 cubes (about four years). The current number of bitcoins given per cube is 12.5. The final block-halving happened in July 2016, and the next one will be in 2020. .

Mining issue: A number that represents how hard it is to mine bitcoins in any given moment considering the check over here amount of mining electricity currently active in the system.

Electricity cost: Just how many dollars are you paying each kilowatt Youll need to find out your electricity rate in order to calculate profitability. This can typically be found on your monthly electricity bill. The reason that is important is that miners consume power, while for powering up the miner or for cooling down (these machines can become really hot). .

Power consumption: Every miner consumes a different amount of energy. Youll need to find out the exact energy consumption of your miner before calculating adulthood. This can be found easily with a quick search online or through this list. Power consumption is measured in watts.

Pool fees: If youre mining through a mining pool (you need to ), then the pool will take a certain percentage of your earnings for rendering their service. Generally, this would be somewhere around 2%.

Bitcoins price: Since no one knows what Bitcoins price will be in the future, its hard to predict whether Bitcoin mining will be profitable. If you are planning to convert your mined bitcoins to any other currency in the long run, this factor 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 concept is that since no one can really predict the speed of miners joining the network, neither can anyone predict just how hard it's going to be to mine in fourteen days, six months, or even six years from now.

The last two variables are the reason no one will ever be able to give a complete answer to this question is Bitcoin mining rewarding

Once you have all 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 may earn every month. In case you cant get a positive result on the calculator, it likely means you dont have the ideal conditions for mining to be profitable. .