Welcome to 99Bitcoins’ simple Bitcoin Mining Calculator
Instructions on how to use the Bitcoin Mining Calculator:
- Enter the hash rate of the Bitcoin miner you’re planning to use
- Click on “Calculate mining revenue”
- That’s it! (we said it was simple….)
Note: If some values in the Bitcoin mining calculator don’t seem right (exchange rate, block reward, etc.) you can adjust them manually. However normally they are all up to date.
Keep in mind that:
- Revenue is shown in USD based on the current exchange rate, the exchange rate can (and probably will) change from time to time.
- Revenue is based on current difficulty to mine Bitcoins. Difficulty can (and probably will) change. From past experience it usually goes up as time goes by.
- Revenue IS NOT profit. You still have to take into account the cost of your mining hardware and the electricity to run it (and cool it down if needed).
If you want to know more about Bitcoin mining profitability check out this page.
How to Calculate Bitcoin Mining Profitability
Bitcoin mining secures the Bitcoin network. Without miners, Bitcoin could easily be attacked and even shut down. Since Bitcoin miners provide such an important service to the network, they are paid for their services! Each block mined by miners contains a block reward, which is paid out to the miner that successfully mined the block.
While mining today is very competitive, it is possible to run a successful and profitable mining farm. This post will outline the many factors that will determine whether or not your mining operation will be profitable.
Mining Hardware Costs
The upfront costs to pay for mining hardware is usually the largest expense for any new mining farm. Just like good computers cost more money, good mining hardware is expensive. The Antminer S7 is one currently the most efficient miner and costs $629. It only mines about $200 worth of bitcoins per month, meaning just based on hardware costs alone it will take more than three months to get back your money. This does not include electricity costs or equipment costs (more on this below).
When purchasing mining hardware, you will want to look at these metrics: Th/s and W/GH. Th/s, or sometimes Gh/s, measures a miner’s terahashes (Th/s) or gigahashes (Gh/s) per second and is called hash rate. A higher hash rate means a more powerful miner. You can use this simple calculator from Bitcoin Wisdom to determine how much money an amount of hash power will earn per month.
Hash power is not the end all for determining good miners, though. Miners use massive amounts of electricity. You want a miner that has both a high hash rate and uses the electricity provided efficiently.
W/GH is the metric used to display a miner’s efficiency. The Antminer S7 is also the most efficient miner available on the market, with 0.25 W/GH. Consider that the previous version of the S7, the S5, had an efficiency of just 0.51 W/GH. That means the S5 uses twice as much electricity per hash as the S7.
Buying a miner that has a low W/GH and also has good hash power is the key for any profitable mining operation.
Miners generate heat, and also need to be supplied with electricity. Unless you already have the needed parts, you will likely need to purchase cooling fans and power supplies.
Electricity costs can make or break any mining operation. A monthly electric bill means monthly costs on top of the upfront cost of the hardware.
China’s cheap electricity is one reason that nearly 60% of the Bitcoin network’s hashing power is located there. In the USA, for example, most mining hardware is run in Washington State, where there is cheap hydroelectricity. Venezuela’s crisis and cheap electricity has also made Bitcoin mining extremely profitable there.
Don’t discount electricity as a cost. It can make or break your mining operation.
Extra Heat and Weather
Creative miners in cold areas can use the heat generated by miners to heat their houses in the winter. If the heat generated by miners will partly replace your normal heating costs, it is one way to save money and improve your chances of profitability.
Miners in cold areas also have an advantage because they may not need to use extra fans to cool the hardware.
Bitcoin Mining Difficulty and Network Hash Power
The Bitcoin mining difficulty makes sure that Bitcoin blocks are mined, on average, every 10 minutes. A higher difficulty is indicative of more hash power joining the network.
As you would expect, more hash power on the network means that existing miners then control a lower percentage of the Bitcoin network hash power.
The image above shows the network hash power over the last 2 years. From September 2015 to February 2016, the network hash rate tripled. That means any miner who added no additional hardware to his farm would earn about 33% less bitcoins.
Hash rate and network difficulty are external factors that should be accounted for. It’s impossible to know difficulty months in advance. However, pay attention to advances in mining technology and efficiency to get a better idea of how the hash rate and difficulty may look down the line.
Bitcoin Price and Block Reward
Bitcoin’s price is volatile and can’t be predicted. You may calculate your profitability with a Bitcoin price of $500, but it won’t be accurate if the price drops to $300 the next day. Be prepared for price movements and understand that the Bitcoin price is a factor that you cannot control.
The Bitcoin block reward is at least one factor that is predictable. Every 4 years, the amount of bitcoins rewarded in each block is cut in half. The reward started at 50 bitcoins per block, and is now 25 bitcoins per block. In July 2016, this reward will fall to just 12.5 bitcoins per block.
Each block reward halving cuts miners’ shares of bitcoins in half. Miners can, however, see similar incomes after a reward halving if the fiat price of Bitcoin doubles.
Bitcoin Mining Calculators
Use a Bitcoin mining calculator to input your hardware information and electricity costs. This will give you a much better idea on your overall potential to run a profitable mining farm. Remember, however, that some factors like the Bitcoin price and mining difficulty change everyday and can have dramatic effects on profitability.