How to estimate the profitability of cryptocurrency mining?

This is a question that often comes up: Is it still profitable to mine today? And, above all, how to estimate profitability? In this article I focus more on the financial aspect and gives you clear steps to calculate your profitability.

Likewise, here we will discuss cryptocurrency mining as a whole, and not just bitcoin mining for example. Indeed, to know the profitability, it is always the same calculations.

Now, let's get to the point, and logically, at the end of reading this article, I invite you to read the other steps. At the end of this article series on how to mine cryptocurrencies, you will be ready to mine profitably from home. Oh yeah!

How to know the profitability of mining?

Bitcoin mining can be grouped into 3 main stages. I am not going to remind you that you must first have a bitcoin wallet and that the latter must be protégé. I'll show you how to do it, assuming that you know how it works in theory.

Likewise, the first preliminary step will be to measure the profitability. Yes, before you start, you must very clearly measure the profitability of your mining activity. There are a lot of things to take into account like But, well, bitcoin being at $10,000 currently; It can be a good way to get some for free and leave them warm for a while.

That said, be aware that there are also other perhaps more profitable methods for generating bitcoins, such as with lending. For example, you have the Company Youhodler which pays you interest every month. It's up to you to decide method of making money which suits you best.

Finally, to measure the profitability of your bitcoin mining. The very first thing to do is to go to specialized sites which give you the estimated profitability of your mining. You will need to enter the price of electricity at home as well as the hash power of the machine you have chosen.

Understanding the Whattomine site:

Go to whattomine, which is the absolute reference for knowing the performance of your mining whether for bitcoin or another cryptocurrency.

When you arrive on the page, the site gives you the most profitable cryptocurrency of the moment. For example, today, Monday July 1, 2019, we have this:

Read the table columns like this:

• on the far left you have the name of the cryptocurrency algorithm
• Then you have the rewards column for each calculated block.
• The next column shows the difficulty rate of mining this cryptocurrency.
• Then, you are told the amount of the last reward.
• Next, you have the cryptocurrency exchange rate.
• Of course, afterwards, we give you the marketcap, that is to say the total circulating value of this cryptocurrency.
• Finally, the last column shows you the profitability/yield of this cryptocurrency. We tell you the current profitability, in 24 hours, in 3 days and in 7 days.

All columns are important, but of course, the last column is really crucial. That said, I also advise you to look at the marketcap. It is indeed revealing of the "power" and "validity granted" by the crypto-user community. It is fundamental.

Then, when you have found the right cryptocurrency (or its algorithm) to mine, then you can click on it. There you will be given the page with all the details to mine your cryptocurrency. We give you the best machine that can be used for mining as well as the expected yield. Likewise, we also give you the best mining pools for this cryptocurrency.

Here is an example to make it easier to understand:

Let's say I choose to mine Etash to get EGEM. So I click on the rank of this algorithm. So I arrive on the dedicated page, here:

You will see why this site is really great when you want to mine cryptocurrencies. Indeed, this site gives us all the information we need to know before getting started.

So, if you already have a specific machine, for example, that you purchased on Amazon or another dedicated site, then you can enter the information about your equipment yourself into the profitability calculator. Don't forget to indicate the cost of your electricity because this is generally the only real criterion which will determine whether your mining will be profitable or not.

If you don't have a mining machine and equipment yet, then maybe even better. You will see at the bottom of the page, on the left, a small snack where we see the equipment recommended by Whattomine for mining this cryptocurrency.

The site even indicates the sites where you can make your purchase. Do not hesitate to compare offers because sometimes from one site to another, prices vary and so does delivery time.

But, before you buy anything, calculate the yield first! Click on the "Calculate" button located under the image of the mining machine.

Still, in this example, I clicked on "calculate" and I also added above in the calculator a price of 0.14 cents of dollars which is approximately the cost of electricity in France. You will see that the price of electricity is fundamental in the mining of cryptocurrencies. Many cryptocurrencies are profitable in many countries and not at all profitable in Europe, because of the price of electricity. Currently, the countries the cheapest to mine bitcoin are Kuwait and Algeria.

(In this regard, I plan to write an article on this subject, because many African citizens could profitably mine cryptocurrencies because the price of electricity is very affordable. I am thinking of Tunisia, Egypt, Morocco, Benin, Togo etc. But, that will be the subject of a future article).

Anyway, let's go back to our example, and that gives me this.

How to calculate your profitability when mining?

We can therefore see, according to current indices, that I can, with this machine, earn 43 dollars per weekend and around 180 dollars per month. It's not so bad. We also see that I could earn $2,260 per year. Wow?! Awesome?!

But how to interpret these results? I'm going to tell you here and remember that it's very important to reread your figures carefully overall. Here are 3 elements that you must take into account:

• The price of cryptocurrency: Indeed, even if you can be happy with 200 dollars per month, know that it can be more or less depending on the price of the cryptocurrency in question. So try to bet on cryptocurrencies that increase in value over time.
• The price of your mining equipment: Eh yes! For example, the mining equipment that we offered on Whattomine costs a whopping $5500. This means that to make your machine profitable (if we accept that the Egem crypto remains stable), you will need to mine for 2 years.
• The price of electricity : Obviously, this differs from one country to another. You must then calculate the average cost of your machines over a given period. You will then have to subtract the electricity cost to then know the final profitability.

So in this example, you see that in terms of profitability, it is not great even if at first glance, it seems interesting. In any case, you should know that mining cryptocurrencies is not always a lucrative activity as there are so many factors that come into play.

You also have two options in front of you: Either you keep the mined cryptocurrencies or you exchange them for bitcoins for example. Or, you exchange them directly into euros and dollars.

Final word on mining profitability

And now? It's time to move on to step 2: Choosing your equipment to mine cryptocurrency.

That's it for the first part. I now invite you to take a good look at WhAttomine to best determine the best cryptocurrency to mine from home.

In the second part, I give you some tips for choosing the best mining machine for mining cryptocurrencies.

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Note: No financial advice is given in this or any other article on zonebitcoin. This is information of which you are the sole judge and master. Be responsible with your investments and only invest as much as you are willing to lose.

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