Is Bitcoin Mining Profitable in 2017?

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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:

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 zper 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 25. However soon enough the block halving will occur and the reward will be downgraded to only 12.5 Bitcoins.

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 is 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 illusive 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 inset 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 parameter 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 were 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 difficultly you will earn around 1 Bitcoin 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.

mining with s9

This data was taken from an advanced Bitcoin mining calculator using the following stats: 2% mining pool fees, 25 Bitcoins as a block reward, 14 TH/s hash rate, 1375W power consumption. 

So after 12 months we should be making around $6,000. However we haven’t deducted the hardware cost yet, so it’s more like $ 3,400. Also, pretty soon the block reward goes down to 12.5 so we’ll actually only be breaking even.

Of course 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 non 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 month 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). I’d currently stay away from Altcoins but that’s my own personal opinion. If you don’t have the time or the money – stay away from mining and just invest in buying Bitcoins for the long run.

94 Comments

  1. Hi, thank you for the very educative blog.

    If i buy an Antminer S9, what other software or hardware would I need to start mining.

    Thank you

  2. The crypto era has officially begun and you definitely don’t want to stand by not knowing what all the commotion is and missing out on the wealth being created.

  3. I also have a source for pretty cheap asics, check em out, mo bs they are selling their old stock , selling s7s and i believe 9s also soon, i know $ for s7s is around 100usd.

    • Zsofia - 99Bitcoins support on

      Hi Ade, if you’re asking about POS coin mining then it’s beyond the scope of this blog. At 99 Bitcoins we focus mainly on Bitcoin and the POW (proof of work) protocol. So I don’t have a good answer to give you on this subject.

  4. It truly depends on the cost. I mean the electricity cost. My country has high electricity cost, thus, chose to try the cloud mining 4 months ago. So far, it pays the BTC everyday in stable manner and as BTC price went up, getting the investment 100% back will take 2 more month if the price stays at this level. My cloud mining service is Hashflare and it is known as one of the biggest companies. Happy mining and hope my information is useful for you

  5. Thanks Ofir for this great article!

    How much time per day or peer week needs to be invested into mining?

  6. Great article. I’ve been toying with the idea for a long while however being based in the UK, electricity isn’t cheap and with the difficulty set to increase and number of bit coins produced decrease then it doesn’t look like a goer.

    What are your thoughts on buying Bitcoins as an investment?

    • No, you can’t. The cost of the panels and the amount of watts needed can not provide ANY profit whatsoever no matter what machines you are trying to run. We looked into this some time ago. However…If you could find a way to build a small windmill, that could run 60-100 machine easily even on a semi-dreary day. The windmill will cost you less in the long run and you can even sell the excess power you generate back to the electric company! It’s not cheap but it’s far less than solar is!

        • hi, im also looking into solar, i live in Southern California which i think is idea for plenty of sunshine. WOuld you mind PM what you use?

    • Zsofia - 99Bitcoins support on

      Hey, thanks for sharing your analysis. Almost 1,5 years is quite long term time frame to invest in, especially if that just mean the breakeven point.

  7. Mining bitcoins has always been a cat and mouse game. The difficulty goes up too fast that you’ll be spending all (if any) profits on newer/more hardware.

    Your best bet at making money is to mine the most profitable alt coin at that moment using gpu rigs and convert it to bitcoin/fiat daily. Of course you’ll need to make it a habit of checking daily on http://www.whattomine.com or just sell your hash rate on nicehash if you’re lazy.

    You’ll be profitable within 4 to 6 months unless all gpu coins go to the gutter. But you’ll still be able to sell your hardware.

    • Zsofia - 99Bitcoins support on

      Hey Chris, thanks for sharing this approach of how to make mining profitable on the short run.

  8. Antony Groves on

    well there is now: anonymous, safe, fast, quality mining pools for cryptocurrency like DASH, BITCOIN, LITECOIN, ZCASH, Z-CLASSICS making your mining experience flawless

    • I have looked at every thing about Bit Coin : Truth the only people making money out of this are the makers of hardware and software , one big scam just like Insurance Co. and Us Government with Money Scam : Every thing on web is a SCAM !

      • Zsofia - 99Bitcoins support on

        Hey Timothy, please read a bit more on our site, Bitcoin itself is not a scam. Maybe sign up to the Bitcoin Crash Course on the Home page, it could have some new information for you. There are however many companies that try to scam people out of their money using Bitcoin’s reputation but that’s a whole other story.

      • You are correct. The only ones making money are the Chinese that get free power from the Gov since the Gov are partners with them. The makers of the machines are the real winners. Here’s why, and this is 100% true, people like Bitmain tell you that the machines are on backorder, or they are being built, they want you to pay for them LONG before you get them. While almost everyone does as soon as they say the newest machines are coming, they are actually NOT on backorder or delayed at all! The parts are being purchased with YOUR money. The machines are being built, then the MACHINES ARE BEING RUN UP TO 2 TO 5 WEEKS STRAIGHT MINING COINS FOR THEM WHILE YOU ARE SITTING THERE WAITING FOR YOUR MACHINES! The makers get all the coins they can mine for free from your money AND THEY ALSO MAKE THE PROFIT ON THE MACHINE ONCE THEY SHIP IT TO YOU AS WELL! TOTAL SCAM! Makes me ill thinking about it actually.

  9. Ive been using Genesis Mining now for a little over a year. If you watch the market and allocate hashpower correctly, you can make some real money. Sha256 contracts just became less expensive and higher payouts! and X11 is offering 2 year contracts rather than the original 1 year!

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  10. Anglefroghammer on

    No, it is not profitable. If you bought the S9 which has the best power rating and assuming a difficulty increase of 4.69% which is average and being generous and saying 1kwh costs 0.01USD by the year 2020 you still won’t have broken even you’ll be $13.67 in debt and then you start losing money. You’d be better off putting your $2k in the bank. Use a proper calculator to test these things https://bitcoinwisdom.com/bitcoin/calculator

  11. No it’s not profitable anymore at least if you have power costs. With an s9 taking into account difficulty increases, assuming the 14TH/s, assming there are no power costs and assuming it cost you $2000 it would take about 528 days to break even. The making about $1 a day until the difficulty increases. This calculator http://jblevins.org/btcmpc/ takes into account increased difficulty so use this if you actually want to calculate the profit.

    TLDR
    Doesn’t mater how much money you’ve got the top machines aren’t profitable if you have even the slightest power cost.

    • The Best Way I can think of to improve the economics of this is to use the S9 or better miner in a cold environment where the heat is needed. The bitcoin would subsidize the electric consumption.
      Maybe a liquid cooling system could be configured from the miner to a water heater for year round use, This would also eliminate most of the noise. The economic and energy efficiencies can be improved by using the waste instead of viewing it as a problem.

      • So then what’s the point in mining if it doesn’t pay out? If you have to buy all this equipment and spend money on energy and then on top of that you have to run the equipment 24hours just to make one bit coin a month, when do you see profits or did we miss the bitcoin rush. Also how long do you think this equipment “s9 antminer ” will last before it burns out? What the life time of the device. I want to be a miner but it doesn’t seem to be profitable unless the value of bitcoin goes up and we just store it like nuts… Right?

        • You’re absolutely right. Mining today isn’t for everyone. The people who are profiting from mining are basically large corporations that have big mining farms with low electricity costs. Regarding the lifetime of the miner – I’ll write a post about this soon, however it seems that the next generation miner has around 12-18 months before it comes along.

  12. I live in Nigeria and electricity is subsidised in my country, almost free, and the value of dollar to the naira is averagely $1 = 450 naira….so will cloud mining be profitable for me?

    • Cloud mining isn’t relevant to electricity cost – it won’t be profitable no matter what (probably). Electricity cost is only relevant if you decide to mine at home, and even then at today’s mining rate you will probably break even only after 12 months.

    • No, it can be profitable in countries where there is low electricity cost, and even then that’s not certain. You should use the Bitcoin mining calculator to figure out if it’s worth the risk

  13. Glorious Emmanuel Omolola on

    Thanks for your article…Loves!
    Please,
    I want to inbvest in this business by God’s grace.
    Now, from your article sir, it shows that its better to go for hardware than cloud…
    So, for the hardware I prepare the s9 because its the best presently.
    Now, the confusion with me here is…I see different time of s9 with different prices from different countries at eBay online store…so I became confused on which s9 from which country to go for…as I want to go for the best only no matter the cost…and nothing but the best only…no matter the cost…please faithfully help me out…
    Thanks,
    Loves!

    • Hey Emmanuel, I guess it’s all about doing a good enough market research. I can’t tell you exactly where would be the best eBay site to buy the miner from as there are too many variables (shipping cost, merchant reputation, does the merchant ship to your country, etc)

      • I can tell where to buy a 50th/s miner SHA256 for only 3000$, if you buy 10 of them you have a mining power of 500th/s you can connect them via lan 100mbit/s and mine together.

        Just go to any mining calculator and check your profit for 500 th/s of mining ;) Dont know why people still buy miners with only 20th/s for 3000$????

        Open your.eyes guys

        • Where to buy the SHA256 you talked about?
          To connect them via lan 100mbit/s does that mean using one computer? I’d love to get an answer! Thank you very much!!

        • You say you can organize 50ths for 3000$? Let us know where, I cant find anything remotly close to this price.

  14. Pepe Weasel on

    Hi, great article. So you recommend to do Cloud mining? In my case I want to invest in 2 s9 miners but I’m not sure, so this can help me to decide . Thanks in advance

  15. Not sure how to calculate profit in cloud mining. If I invest $117.00 dollars to purchase .25 TH/s in a cloud mining co. How many bitcoins can I expect to mine over a year?

    • Ofir Beigel on

      You can’t know exactly. You’ll need to use a mining calculator and estimate the increase in difficulty. However I’d probably avoid all cloudmining sites out there – they are not worth your money.

  16. When you state “invest some serious money” what kind of dollar amount are you talking about. I have a great full time job as an engineer and I’m looking to make some side money as a long term investment. Thoughts on mining for me? I am tech savy but I cant say with confidence I understand mining.

    • This is just a rough estimate but I think it will be somewhere around $3k to see some sort of positive ROI. If you want a more precise answer it’s best that you compare different models of miners using a mining calculator – this way you will be able to see how and when you’ll be profitable.

  17. Hey really good article thank you! but in my country it is still considered very profitable minning even with little hardware because the dollar is worth 4 times the country ‘s currency and minning trough faucets it´s good leverage along with a few antminer U3 for example and with time the bitcoin It’s been accepted in common stores and markets what caused an increase in the valuation of the bitcoin , so if you join these factors with some cloud minning contracts is valid minning. And do not forget that in small clusters you can use soler energy that today is not so expensive and there are even books on how to make your own system.

  18. Mohammad arif on

    Thank u so much for clear information brother I search many blog but I satisfied after reading ur blog think u so much

  19. are ASIC units even available in large qualities at this time? After a month of research, I still can’t find any reputable supplier that has any decent stock. I have two friends and myself with a crap load of fck you dollars to spend but buying one or two rigs makes no sense… purchasing 20 -40 units on a quarterly basis does and we have the funds and facilities, just no source. Willing to travel to the US, China & Korea if anyone can recommend a source.

  20. Dave Hernandez on

    I have free electricity, so is profitable mining isnt it? Which machine is better (remember the electricity is not a problem)?

    • Hey Dave, in this case you may want to check out some of Spoondolies’ miners. I don’t mine myself so I can’t personally recommend any of them but they seem to be getting great reviews.

    • The one costing $100.000 or more, since you’ll be mining solo and will need all the power in the world to mine even 1 coin. Don’t trust me, use calculators. I just tried with hardware cost being $0 and the result is – I need 1938 years and 200 days to mine 1 coin :D

      Good luck with your mining!

  21. Traceable meaning you know what wallet address has/had it, not the user. Which in my definition is untraceable.

  22. Modern pirate on

    I think bitcoin now have no more profit for new users nor privacy, since you need put all your date, documents, address and hand scan to buy bitcoin … you and bitcoin are 100% trackeable for any person or governments. So, is better continues using cash, that damn fiat currency.

    • Who said to you that bitcoin is traceable? Where did you find that information? You probably don’t know that bitcoin is the basic currency used in the deep web…. If your affirmation is back up by some article or a good source, please let me know.

      • Bitcoin is 100% traceable since all transactions are recorded in the Blockchain. The only thing is that you don’t know which address belongs to whom. So if you can’t pin a person to an address he will remain anonymous. That’s what makes Bitcoin pseudonymous as explained here.

  23. I would like to get your e mail address and talk to you about a particular Idea in connection with mining BC.
    Thanks, Bill

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