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Another evolution came later on with FPGA mining. FPGA is a piece of hardware which can be connected to your computer in order to run a pair of calculations. They are just like GPUs however 3100 times faster. The downside is that theyre more difficult to configure, and this is 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 used to do anything else. Their function has been hardcoded into this machine. .

Now, ASIC miners are the current mining standard. Some early ASIC miners even emerged in the kind of a USB, but they became obsolete rather quickly. Even though they began in 2013, the technology rapidly evolved, and new, stronger 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 obstacle, and things began to cool down a little. Since 2016, the speed at which new miners are published has slowed considerably.

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Assuming youre simply entering the Bitcoin mining match, youre up against some heavy competition. Even if you buy the best possible miner out there, youre still at a massive disadvantage when compared with professional Bitcoin mining farms.

Thats why mining pools came into existence. The idea is simple: miners team 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 spread out between the pool depending on how much mining power each of them contributed.

Today there are more than a dozen large pools that compete for the chance to mine Bitcoin and update the ledger.

When calculating Bitcoin mining profitability, there are a Great Deal of things that you need to take into account for example:

Hash rate: A Hash is the mathematical difficulty the miners computer needs to solve. The hash speed refers to your miners performance (i.e., just how many guesses your pc can make per second). Hash rate can be measured in MH/s (mega hash each second), GH/s (giga hash each second), TH/s (terra hash per second), and even PH/s (peta hash per second). .

Bitcoin reward per block: The number of Bitcoins generated when a miner finds the solution. This number started at 50 bitcoins back in 2009, and its own halved every 210,000 cubes (about four years). The current number of bitcoins awarded per block is 12.5. The last block-halving occurred in July 2016, and the next one will be in 2020. .

Mining issue: A number that represents how difficult it's to mine bitcoins in any given moment considering the amount of mining power currently active in the system.

Electricity cost: Just how many dollars are you currently paying each kilowatt Youll need to find out your electricity rate in order to compute profitability. This can typically be found on your monthly electricity bill. The reason this is important is that miners consume power, whether for powering up the special info miner or for cooling down (these machines can get 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 profitability. This can be found easily with a fast search online or through this list. Power consumption is measured in watts.

Pool fees: When youre mining through a mining pool (you need to ), then the pool is going to take a certain percentage of your earnings to rendering their services. Generally, this would my company be somewhere around 2%.

Bitcoins price: Since no one knows what Bitcoins price will probably be in the long run, it's challenging to predict whether Bitcoin mining will be profitable. If you're planning to convert your mined bitcoins to any other currency in the long run, this factor will have a significant impact on profitability.

Difficulty increase annually: This is most likely the most important and elusive variable of them all. The idea 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 factors are the reason no one will ever be able to give a complete answer to the question is Bitcoin mining profitable

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 will earn each month. If you cant get a favorable effect on the calculator, then it likely means you dont have the right conditions for mining to be rewarding. .