Cryptocurrencies have recently become quite popular among the broad masses. If a couple of years ago the digital coins were known, for the most part, geeks and a limited handful of investors, nowadays it is difficult to meet a person who has never heard about the existence of Bitcoin. Some analysts argue that the technology of blocking and crypto currency in general is waiting for a great future. Many compare bitcoin with gold. Indeed, BTC as well as the precious metal has limited reserves, and to get new coins, it is necessary to engage in its mining (mining). In this article, we will take a closer look at what the beating is doing and how profitable it is.
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- What is a Bitcoin farm? The biggest farm in the world
- What is an online farm and cloud mining?
- How much does a ready farm cost and where can I buy it? Is it profitable?
- Experts’ forecasts on the subject of mining Bitcoin and other cryptocurrencies
Mining of the world’s leading cryptocurrency is a tiresome process that requires a lot of processing power. The emission of Bitcoin is limited to 21 million coins, that’s why its algorithm provides for a gradual increase in the complexity of mining and reducing the reward for the work done. For example, the miners received a reward of 50 BTC for each block for the first 210 thousand blocks, after that it decreased by 50% to 25 coins. Now it is 12.5 BTC. According to preliminary calculations, due to this gradually more complicated process, the last coin will be mined approximately in the May of 2140.
Mining farm is a certain amount of graphic equipment that provides the system with their computing power. The owner of the equipment receives a certain number of coins as a reward. As a rule, a cryptocurrency farm is an unlimited number of video cards that run under one or more computers.
More advanced miners use specialized equipment, which was originally developed purely for mining purposes – ASIC. “ASICs” are tuned to the algorithm of a certain coin and are a narrow-profile equipment. For example, a video card is a more versatile tool, it can always be resold and not necessarily to a miner, but an ASIC serves only one purpose.
The largest amount of equipment for mining is installed in China. It is very profitable to engage in cryptocurrency mining in the Celestial Empire for several reasons:
- China has the lion’s share of the factories of all leading video card manufacturers. For this reason, Chinese citizens have an undeniable advantage, as they have the opportunity to buy equipment at favorable prices and not overpay for logistics.
- Prices for electricity. The cost of one kilowatt of electricity in China varies from 3 to 9 cents. Another factor of the rapidly developing industrial mining is state support.
- Some provinces have a very favorable climate for mining, which allows the owners of farms to save on ventilation and equipment repair.
- Cheap labor. The well-known fact is that the PRC has a very large population, so many people apply for one job, which gives employers the opportunity to set a low salary.
All these factors allowed to create the largest Bitcoin farm in the world exactly in China. It is located in Liaoning Province. Pretty much nothing is known about the owners. According to preliminary data, it is owned by 4 people. This is a three-story structure, which is completely crammed with ASIC-miners. According to data for 2017, their number was about 3000 pcs. The owners of this farm have to pay about $80 thousand for electricity every month. If we talk about profitability, then such a number of miners can extract about 600-700 Bitcoins per month. Considering even the huge drawdown of the Bitcoin exchange rate (as of the time of writing the article, the price of 1 BTC is $ 6174), the profit is approximately $3.8 – $4.4 million.
Physical mining is crystal clear, you buy equipment, install and maintain it, it works in a 24/7 mode and mines you coins. But what is cloud mining? Here you do not need to bother with buying and servicing your own equipment. You will have the miners, but they will be located in a specialized Data Center, and their maintenance will not be your headache. You will only have to monitor your personal account and take profits.
In order to start earning money on an online farm you need to pay a specialized company for renting their processing capacity. After that, its employees will set up and monitor all the processes. This kind of mining is not particularly different from physical one, but it relieves you of inconveniences. You can read more about cloud mining in this article:
The price of a Bitcoin farm can range from $1000 and up to tens of millions of dollars. Accordingly, the more equipment you buy, the cheaper the price of one item is going to be. It means that the payback will come much faster. On average, one specialized ASIC-miner costs about $2000-$4000, payback varies from 3 to 12 months and depends on many factors.
Farms for mining Bitcoin and other coins can be bought both in our country at inflated prices and ordered directly from the Celestial Empire. You should understand that the delivery from China takes at least 7-14 days if it is delivered by plane, in general you should expect 21-28 days.
Saving is certainly good, but there is one huge flaw in this scheme. The fact is that when the equipment finally arrives to you, it can become irrelevant and will not pay off. For example, in the July of 2017, certain ASICs fully paid off after 9 days of use, but it did not remain so for a long time. Those who mined immediately after the launch managed to withdraw their money, and those who waited for delivery received a less profitable piece of hardware. In such situations, you have a reason to overpay, but get the equipment first.
In general, such a concept as the payback of a Bitcoin farm depends on many factors:
- the number of miners in the system and overall;
- prices for electricity in a particular country;
- rate of the coin;
According to many experts and analysts, we are only at the dawn of the cryptocurrency industry development. For this reason, we still have to witness the big growth of coins. This leads to a conclusion that mining is a rather promising occupation, but only if we consider it for the long term (approximately one and a half to two years or more).
These days the cryptocurrency market stagnation is replaced by a price drop and vice versa all the time. Despite this, many analysts predict a great future for Bitcoin and other cryptocurrencies. For example, Tom Lee said that Bitcoin would cost about $91 thousand by the March of 2020, many predict different prices, but John McAffee went the farthest by saying that the Bitcoin rate would be at least $1 million by the December of 2020. Anyway, we shall see how the history unravels.
Many experts compare Bitcoin with gold for a reason. These two financial assets do have some common characteristics. For example, stocks of BTC are also limited, and it must be extracted, almost like gold. You can do this through a special farm. Bitcoin farms are a certain number of video cards or ASIC-processors that operate under one or more computers. They provide the system with their computing power, for this they receive a reward in the form of new coins.
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