Mining Bitcoin (BTC) at home is an easy task using a home computer. But, things have changed a lot in this arena. The declining prices of the cryptocurrency and higher electricity charges are making at home miners to bleed. Even the cheap electricity is not helping the miners at home. In order to become profitable, the individual miners need to produce more bitcoins. But, it is not possible at home with existing hardware.
Institutional Firms takes the lead in bitcoin mining
Most of the firms across the world are establishing bitcoin mining operations where cheaper electricity exists. They are also installing advanced hardware to increase hash-rate of the bitcoins and become profitable. Therefore, institutional firms are at advantage in bitcoin mining generation and generate profits when compared to at home miners.
Hard times ahead for Institutional Firms in Mining
Cheap electricity is vital for institutional firms to become profitable in bitcoin mining. However, many regions are maintaining a separate slab for the companies engaged in mining of bitcoin. Therefore, higher electricity charges as a result of higher slabs are denting the profits of large companies. The best way to make profits in bitcoin mining is to produce more bitcoins with efficient hardware that increase hash-rate by utilizing less electricity. The bitcoin prices should recover faster to make bitcoin miners profitable.
President and co-founder of Blockchain Intelligence Group, Shone Anstey said those involved in bitcoin mining are likely to shut down their computers till the prices stage a comeback. According to the Chief Executive Officer of CryptoCompare, Charlle Hayter, the earnings of bitcoin miners have almost reduced to half in December due to increased interest in bitcoin mining. Other factors denting the profit of bitcoin miners including overhead costs including maintaining cooling, higher electricity charges, and increased hardware costs.
Caution for Bitcoin Investors
Investing in bitcoin have gathered momentum worldwide since late 2016. Everyone is interested to make quick money by cashing in on the surging prices of cryptocurrency. The prices of bitcoin have surged to $20,000 for each unit. However, the prices are following a downward trend since reaching that peak. The market value of cryptocurrencies has declined by $6 billion on Friday.