Is Bitcoin Mining Profitable in 2017?

Last updated on November 10th, 2017 at 02:24 pm

Before we start, if you’re new to Bitcoin mining and don’t know what it is watch this short and simple explanation:

Is Bitcoin Mining Profitable in 2017?

The short answer would be “It depends on how much you’re willing to spend”. Each person asking himself this will get a slightly different answer since Bitcoin Mining profitability depends on many different factors. In order to find out Bitcoin mining profitability for different factors “mining profitability calculators” were invented.

These calculators take into account the different parameters such as electricity cost, the cost of your hardware and other variables and give you an estimate of your projected profit. Before I give you a short example of how this is calculated let’s make sure you are familiar with the different variables:

Bitcoin Mining terms you should get to know

Hash Rate – A Hash is the mathematical problem the miner’s computer needs to solve. The Hash Rate is the rate at which these problems are being solved. The more miners that join the Bitcoin network, the higher the network Hash Rate is.

The Hash Rate can also refer to your miner’s performance. Today Bitcoin miners (those super powerful computers talked about in the video) come with different Hash Rates. Miners’ performance is measured in MH/s (Mega hash per second), GH/s (Giga hash per second), TH/s (Terra hash per second) and even PH/s (Peta hash per second).

Bitcoins per Block – Each time a mathematical problem is solved, a constant amount of Bitcoins are created. The number of Bitcoins generated per block starts at 50 and is halved every 210,000 blocks (about four years). The current number of Bitcoins awarded per block is 12.5. The last block halving occurred on July 2016 and the next one will be in 2020.

Bitcoin Difficulty – Since the Bitcoin network is designed to produce a constant amount of Bitcoins every 10 minutes, the difficulty of solving the mathematical problems has to increase in order to adjust to the network’s Hash Rate increase. Basically this means that the more miners that join, the harder it gets to actually mine Bitcoins.

Electricity Rate – Operating a Bitcoin miner consumes a lot of electricity. You’ll need to find out your electricity rate in order to calculate profitability. This can usually be found on your monthly electricity bill.

Power consumption – Each miner consumes a different amount of energy. Make sure to find out the exact power consumption of your miner before calculating profitability. This can be found easily with a quick search on the Internet or through this list. Power consumption is measured in Watts.

Pool fees – In order to mine you’ll need to join a mining pool. A mining pool is a group of miners that join together in order to mine more effectively. The platform that brings them together is called a mining pool and it deducts some sort of a fee in order to maintain its operations. Once the pool manages to mine Bitcoins the profits are divided between the pool members depending on how much work each miner has done (i.e. their miner’s hash rate).

Time Frame – When calculating if Bitcoin mining is profitable you’ll have to define a time frame to relate to. Since the more time you mine, the more Bitcoins you’ll earn.

Profitability decline per year – This is probably the most important and elusive variable of them all. The idea is that since no one can actually predict the rate of miners joining the network no one can also predict how difficult it will be to mine in 6 weeks, 6 months or 6 years from now. This is one of the two reasons no one will ever be able to answer you once and for all “is Bitcoin mining profitable ?”. The second reason is the conversion rate. In the case below, you can insert an annual profitability decline factor that will help you estimate the growing difficulty.

Conversion rate – Since no one knows what the BTC/USD exchange rate will be in the future it’s hard to predict if Bitcoin mining will be profitable. If you’re into mining in order to accumulate Bitcoins only then this doesn’t need to bother you. But if you are planning to convert these Bitcoins in the future to any other currency this factor will have a major impact of course.

Get a mining calculator

In order to calculate all of these parameters and get an answer to our question we will use a mining profitability calculator.  here’s a simple mining calculator from 99Bitcoins:

However, now let’s take a look at a more complex example where we include more factors:

Today one of the most advanced miners out there is the Antminer S9. It’s what is known as an ASIC mining rig.  It has a mining rate of 14 TH/s. If we use the simple Bitcoin mining calculator (shown above) you will see that at today’s difficulty you will earn around 0.11 Bitcoins a month.

But of course this doesn’t take into account the hardware cost, electricity cost, pool fees, etc. Let’s try to calculate all of these together.

Bitcoin mining profits

This data was taken from an advanced Bitcoin mining calculator using the following stats: 2% mining pool fees, 12.5 Bitcoins as a block reward, 14 TH/s hash rate, 1375W power consumption and $0.12 per KW. Date of calculation – August 2017

So after 12 months we should be making around $4,032. However we haven’t deducted the hardware cost yet, so it’s more like $ 2,032. However this is true for Bitcoin’s current exchange rate (around $4,000). If you calculate this with the exchange rate of 1 month ago you’ll only be breaking even.

This result can change depending on your own electricity cost, the change in mining difficulty and most importantly the change in the price of Bitcoin.

So you’re probably not going to get rich by mining Bitcoins at home unless you buy some heavy duty equipment and have very low electricity costs. Here’s a list of the most efficient Bitcoin mining hardware out there today. There’s not a lot of variety to pick from since home mining is a dying art.

  • Select miner

  • Released
  • How much electricity does your miner consume?Power consumption
  • Power efficiency
  • How "fast" can your miner mine BitcoinsHash rate
  • Dimensions
  • Weight
  • This does not include hardware cost, electricity cost, or changes in BTC rate and mining difficultyRevenue in vacum*
  • Price
  • Our rating of the miner taking into account all specifications aboveOverall rating
  • Antminer R4

  • Antminer R4
  • August 2016
  • 845W±9%
  • 0.1 J/GH +9%
  • 8.6TH/s±5%
  • 20 x 3.9 x 8.7 inches
  • unknown
  • Based on BTC rate and mining difficulty on August 28th 20160.29 BTC/month
  • Estiamted $1000
  • 88%
  • Read review
  • AntMiner S9

  • antminer s9
  • June 2016
  • 1375W ±7%
  • 0.098 J/GH
  • 12.93 TH/s
  • 13.7 x 5.3 x 6.2 inches
  • 10 lbs
  • Based on BTC rate and mining difficulty on July 1st 20160.5 BTC/month
  • ~$2000
  • 95%
  • Read review
  • Avalon 7

  • Avalon 7
  • November 2016
  • 850W-1000W
  • 0.29 J/GH
  • 6 TH/s
  • 13.4 x 5.3x 5.9
  • 9.5 lbs
  • 0.14 BTC/month
  • $880
  • 81%
  • Read review
  • AntMiner S7

  • Antminer s7
  • August 2015
  • 1293W
  • 0.25 J/GH
  • 4.73 TH/s
  • 11.8 x 6.1 x 4.8 inches
  • 7.5 lbs
  • Based on BTC rate and mining difficulty on July 1st 20160.15 BTC/month
  • $599
  • 83%
  • Read review
  • AntMiner S5

  • antminer s5
  • December 2014
  • 590W
  • 0.51 J/GH
  • 1.155 TH/s
  • 11.7 x 5.3 x 6.1 inches
  • 6.6 lbs
  • Based on BTC rate and mining difficulty on July 1st 20160.05 BTC/month
  • $199
  • 79%
  • Read review
  • Avalon 6

  • Avalon 6
  • August 2015
  • 1100W
  • 0.29 J/GH
  • 3.5 TH/s
  • 13.9 x 5.1 x 5.9 inches
  • 9.5 lbs
  • Based on BTC rate and mining difficulty on July 1st 20160.12 BTC/month
  • $700
  • 76%
  • Read review
  • Antrouter R1

  • Avalon 6
  • September 2015
  • This miner barely takes up any powerNegligible
  • Negligible
  • 5.5 GH/s
  • 3.3 x 2.2 x 1.1 inches
  • 0.2 lbs
  • This miner is a solo miner. It has a small chance of mining a block but does not generate monthly revenue.Probably nothing
  • $39
  • 70%
  • Read review

So even though home mining is an expensive business there are still other option that may be relevant for you to get into the mining game at a lower cost.

How to mine Bitcoins with cloud mining

There a new concept called “cloud mining“. This means that you do not buy a physical mining rig but rather rent computing power from a different company and get paid according to how much power you own. At first this sounds like a really good idea, since you don’t have all of the hassle of buying expensive equipment, storing it, cooling it, etc.

However, when you do the math it seems that none of these cloud mining sites are profitable in the long run. Those that do seems profitable are usually scams that don’t even own any mining equipment, they are just elaborate Ponzi schemes.

If you do want to take a look at cloud mining I suggest using Genesis Mining – the only cloud mining company that has been around long enough to prove it’s not a scam. But make sure to do the math before putting your money into any of these plans.

Mining Altcoins as an alternative to Bitcoin

One more option you can consider is mining Altcoins instead of Bitcions. Today there are hundreds of Altcoins available on the market and some of them are still real easy to mine. The problem is that because there are so many Altcoins it’s hard to tell which ones are worth investing your time in. Some good examples for Altcoins are Litecoin, Dogecoin and Peercoin.

In order to understand which Altcoins are profitable you can find website indexes such as CoinChoose that give you a complete Altcoin breakdown. On CoinChoose you can see the difficulty for each Altocoin, where can you exchange them and what are the chances to profit Bitcoins by mining each specific Altcoin. 

So is Bitcoin Mining Profitable ?

My guess is that in the long run you could make a profit from Bitcoin mining but only if you invest a considerable amount of money in a good mining rig (e.g. Antminer s9). If you don’t have the time or the money – stay away from mining and just invest in buying Bitcoins for the long run.

Ofir Beigel

Owner at 99 Coins ltd.
Blogger and owner of 99Bitcoins. I've been dealing with Bitcoin since the beginning of 2013 and it taught me a lesson in finance that I couldn't get anywhere else on the planet. I'm not a techie, I don't understand "Hashes" and "Protocols", I designed this website with people like myself in mind. My expertise is online marketing and I've dedicated a large portion of 99Bitcoins to Bitcoin marketing.

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172 Comments on "Is Bitcoin Mining Profitable in 2017?"

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Rafi
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Rafi

Do you think that it is profitable to mine with genesis ? For example 20TH and the contract stat Feb 28.

Zsofia Elek
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Zsofia Elek

Hi Rafi, we have a detailed review about Genesis mining, you can check it out here: https://99bitcoins.com/genesis-cloud-mining-review-scam-legit-investment/

irfan
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irfan

well tell me if we want to earn 10 bitcoin daily by mining then how much investment we need to do and if we use s9 antminer 100 machines then much they can generate bitcoin in a day? or a new sp50 rig

Jeff
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Jeff

100 S9s would mine about .25 BTC/day… if you wanted to mine 10 BTC per day you would need about 4000 machines… at a cost of about $6.4million… if you have this kind of money look into bitfury.

Soham
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Soham

Great article. But as you mentioned in your article that profits from mining is directly proportional to the amount of investment. With time, miners will keep getting lesser and lesser reward with same or even more amount of investment…and this is the same case for all mine-able currencies out there. So going forward in future, looks like mining will be controlled by centralized bodies. Then where is the vision for decentralized ledger/nodes/network?…the vision with which Satoshi Nakamoto started with? Penny for thoughts?

Steven Hay
Member
Member
Steven Hay

Hi Soham,

Satoshi’s design for distribution is for mining rewards to fall over time, and this same design is used by most cryptocurrencies. In theory, as time passes, the cryptocurrency rises in value as it receives further adoption. Eventually, the value of mining fees become sufficient to offset the declining block rewards. We see evidence that is likely to occur with Bitcoin at least. I think it was this week – or very recently anyway – when a block was mined with a higher fee than mining reward. I don’t believe that falling block rewards pose a direct danger to decentralization.

Lazar
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Lazar

I am new in this so I would appreciate an answer? You have mentioned 1375 W power consumption. Is that per hour? Thanks

Steven Hay
Member
Member
Steven Hay

Hey Lazar,

One Watt is defined as one joule of energy per second. So 1375 is that many joules per second. As you can see, that’s going to add up to a lot of electricity if you’re mining continuously! It would be similar to running a small kettle all day – and miners also generate considerable heat.

Paul
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Paul

I run 5 x S9 in the UK although 1 has a damaged card so only running at 8.5 TH/s, using ViaBTC so auto swaps between BTC and BCC depending on profitability.

My figures average per machine last 7 days per day:

0.0024 BTC per day (approx £10 – £12)
Electric cost: £5 per day (0.1255 per unit 24/7)
Daily profit £6 per day
Machine + power supply cost price: £2000
Return Time : 333 days, so about a year before you start profiting

Obviously just a snapshot and changes can be erratic depending on difficulty, electricity cost and BTC price but gives a rough idea.

Seofinder
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Seofinder

Hey Paul are you on Skype? Maybe we can do something together

mhammad
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mhammad

in this article the say S9 makes 0.5 btc per month! how come you have 5 x S9 and it makes only 0.0024 btc per day which is 0.072 btc per month !!

Flint
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Flint

Bitcoin value is determined by supply and demand only. Very limited supply at current rate, while demand is surging. Particularly from investors. In the future there will be many crypto coins..etherum, litcoin, etc… the supply for crypto currency will be unlimited … then the value will crash… (as supply exceeds investor demand!) Unless crypto currency is legalised as the world acceptable transaction exchange in which all currencies (US$, ¥,€, £) will have no value anymore. Do you think the US and major countries will do nothing about it ?

John
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John

You are all fools. This is all a huge Ponzi scheme. One day it will all come crashing down and your money will be gone and you will have no recourse. Don’t say I didn’t warn you.

Jud
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Jud

Show me the proof it’s a Ponzi scheme and I will believe you.

Lord Zero
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Lord Zero

the only fool is the one that did not do it and made no money…which would be YOU

Omk
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Omk

Im sure in 5 years there’ll be massive queues outside YOUR door: “ow great John, we wish we listened to you”….

Dave
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Dave

For bitcoin’s value to continue to rise, is it solely based on its amount of users ? (I.e. Transactions) if traders bought bitcoin, but didn’t actually trade(stayed in wallet) would this effect its growth? Less trading, = less mining? Am on the right path here?

Steven Hay
Member
Member
Steven Hay
Hi Dave, There’s no direct correlation between trading and mining. However, as mining creates an ever expanding supply of bitcoins, there has to be enough demand (buyers) to meet the supply (sales by miners) in order to keep the price steady. When there is more demand for bitcoins from buyers, the price rises despite the inflation (currently 4% per year). I think the biggest single factor determining Bitcoin price rise is the number of people holding. The volatility over the years has been such that many of the weak hands have gotten shaken out. Those who remain tend to be… Read more »
Jacko
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Jacko

I read the “Is Bitcoin Mining Profitable in 2017” and I have a few questions:
1. Does the Miner only work for Bitcoin? For instance, can the Antminer s9, work for Litecoin?
2. What if I setup a small mining facility. Let’s say using 5-10 Antiminer s9. Wouldn’t that make me break-even faster?
3. How is a mining facility set up? Are there any dedicated contractors who do such thing or anyone can personally set it up?

Steven Hay
Member
Member
Steven Hay
Hi Jacko, Thanks for the follow-up questions. Here are my responses: 1) A Bitcoin ASIC miner will only work for coins which use the same algorithm as Bitcoin; the SHA-256 algorithm. You may have heard about miners switching their hashpower back and forth between Bitcoin and Bcash? This is possible because both coins use the same algorithm. It’s even possible to mine multiple coins of the same algo simultaneously, this is known as merged mining. 2) Not really… unless you’re able to negotiate a better rate on power (and/or other costs), you’re just multiplying your income and expenditure by the… Read more »
Haider
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Haider

There is a website in UK with a liecence no..
bitcoingo.cc
They say deposit 25usd and get 1.25 daily. Is it ok to invest there.

Zsofia Elek
Admin
Member
Zsofia Elek

Hi Haider, this seems to be an extremely high return which is definitely a red flag that it is too good to be true. I suggest reading our article about the different types of Bitcoin investments here: https://99bitcoins.com/should-i-invest-in-bitcoin-heres-what-you-need-to-know/

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