Mining is the process of validating cryptocurrency transactions on the public ledger or blockchain. Cryptocurrency mining has been a profitable venture for early adopters of virtual assets like Bitcoin. The first crypto coin was launched in early 2009, followed by the release of many other altcoins including a Bitcoin hard fork called Bitcoin Cash.
Cryptocurrency mining can fetch you a small yet reasonable income of one or two dollars every day. Cryptocurrencies such as Litecoin, Monero, Zcash and Dash are easily accessible for regular miners and a person can recover the initial investments in just about 18 to 24 months. But if you are looking for a substantial profit of $50 per day or more, you will have to invest around $3000-$5000 in advanced mining hardware.
Profit generation is possible only if the electricity cost is kept within the reasonable limit of $0.11 per kilowatt-hour. GPU mining can cost you around $8.00 to $10.00 on a daily basis (this also depends on the cryptocurrency that you have opted for), which comes close to $250-$300 every month.
Mining is a 24/7 computational process of verifying transactions. Miners, in turn, get a small reward (a fraction of the cryptocurrency being mined) for their contribution to the blockchain network. You can mine using a CPU or graphics card installed in your computer. Creating a mining rig will help you fetch more rewards. If you do not wish to invest much time in mining, you can join a mining pool. Here, a group of miners come together to perform the mining operations in joint collaboration so as to increase income stability as well as profitability. They fetch dividends in proportion to their contribution.
In case you started mining BTC in the initial years, you may have earned huge profits by now. It is also possible that you had lost money since mining is not only a time-consuming process but also demands exponential power supply. Bitcoin is not a good option for beginners who work on a smaller scale. The initial investments and maintenance costs, as well as the computational difficulty makes it a less profitable deal for consumer-level hardware. Initially, a simple CPU (Central Processing Unit) or a GPU (essentially graphics card) installed in your computer would work well. However, as the popularity of Bitcoin increased, more and more miners started to join the league. The algorithmic equations became harder to solve, owing to the increased traffic. Nowadays, Bitcoin mining requires specialized ASIC devices and is mostly limited to large-scale operations.