Cryptocurrencies like Bitcoin are all the rage nowadays, and despite the huge fluctuations in their prices from recent months, Bitcoin mining can prove to be quite lucrative, provided you know what you’re doing and you have the proper gear. Speaking of Bitcoin and mining, many people seem to believe that using your personal computer can make you rich, or something along these lines. The truth is, cryptocurrency (like Bitcoin) mining is a fairly complicated topic, but the basics can be summed up pretty simple, so keep reading.
What is Bitcoin Mining
Maybe you are wondering where do cryptocurrencies come from, and that’s a good question. With regard to our “regular” fiat-currencies (like the modern US dollar), they’re issued out of thin air basically, at the whim of central banks/regular banks working in “collusion” with governments. Bitcoin is another matter altogether, because it’s a completely decentralized currency, as in the government has nothing to do with it. New Bitcoin “comes to life” when internet-miners use their home-PCs or specially designed “rigs” which run dedicated software to solve highly difficult math-problems. In exchange for this task, the miners are rewarded with a predetermined number of Bitcoin (depending upon the task solved), and that’s the simple explanation of Bitcoin mining in layman’s terms (That’s what 99Bitcons has to say about that).
Can you Mine Bitcoin with your PC?
The short answer is yes, and that’s one of the reasons which drove the price of computer hardware (like GPUs ) through the roof in recent years. So, if you’re into gaming and you already have a powerful GPU installed, you may consider making some extra cash by mining Bitcoin via putting your graphic card to work while you’re sleeping or AFK. Obviously, the end result (read profits) will depend upon a number of variables, such as how powerful your hardware is and what’s the price of Bitcoin vs how much energy you consume during the mining process, and so forth and so on (the price of electricity also plays a big role in this equation obviously). The problem with Bitcoin mining is that it would put huge stress on your GPU, which translates into your computer using more electricity than usual, i.e. you’ll see an increase in your electricity bill at the end of the month. The faster the GPU, the more profitable Bitcoin mining may be, yet after all is said and done, by using an upper-mid-range GPU for mining Bitcoin all day long non stop, your estimated earnings would be $1.5-$2 tops per day (best case scenario using 99Bitcoins calculator), without counting in electricity costs. Bottom line, you’ll probably make something like $1 a day clean-profit from Bitcoin mining using a solid gaming-PC, but then again, this is the best case scenario. Even if you’re not an entrepreneur just yet, you probably realize that’s not “making money” in the true sense of the word, especially considering the fact that your PC would run 24 hours a day for generating a mere $1 profit (considering the current price of Bitcoin).
So, why is your PC Not Suitable for Bitcoin Mining?
In the past, using a regular PC for Bitcoin mining (the GPU does all the work actually, as it’s able to hash data up to 100 times faster than your CPU, while consuming significantly less power in the process) was doable and even profitable, more or less. However, things changed dramatically starting with 2014 if memory serves. What you need to understand is that the Bitcoin mining system/network/whatchamacallit was created in such a way that it would produce a predetermined (as in fixed) amount of Bitcoin every ten minutes. What does that mean? Well, as soon as the “gold rush” for mining Bitcoin begun on a massive scale, i.e. hundreds of thousands/millions of additional miners started to dig for digital-gold, the difficulty of solving math-problems has increased exponentially. The phenomenon is pretty simple to understand: the more people mining Bitcoin, the harder/more complicated it gets. The free market’s reaction to the problem was simple and predictable: create specially designed hardware for mining Bitcoin. So, if one’s home-PC only uses one graphics card for gaming/mining or whatever, computer geeks looking to get rich created Bitcoin mining rigs, which were designed (initially) to use two or three GPUs working together. In the next phase, specially designed Bitcoin mining rigs hit the market, also known as ASIC miners. ASIC stands for application specific integrated circuit, and their only purpose is to efficiently solve (in our case) Bitcoin blocks, while being pretty useless for anything else. Besides their excellent computing power Bitcoin-wise, ASICs are far more efficient in terms of electricity use, compared to your PC/GPU. To put it simply, your single GPU card in your home PC/laptop has absolutely zero chances to seriously compete on a market which is currently dominated by specially designed hardware, that is way faster and more efficient in terms of energy consumed, not to mention the fact that Bitcoin’s math-problems are becoming increasingly difficult.
The sad truth is that Bitcoin mining has changed dramatically in the past 5 years, becoming a serious (and lucrative) business for some people and/or companies (especially those located in China, where electricity is dirt cheap), that compared to the “golden days”, when a handful of Bitcoin enthusiasts were using their PCs for digging “digital gold”. The early-days cottage industry has now become a highly specialized (almost industrial level) venture, and making easy money via mining Bitcoin from your basement is no longer possible realistically speaking. The only way to make a tangible profit via Bitcoin mining nowadays is by using specially designed gear (read ASICs). Strictly speaking, anyone can still use their PC for mining Bitcoin, this is certainly possible, but you’ll most probably end up spending more on your electricity bill than you make from mining, and that’s a raw deal by any metrics. Unless you don’t have to pay for electricity, small scale Bitcoin mining will not turn up to be profitable, and even with free electricity, using only your PC for mining Bitcoin would not make you “rich”.