Over the past few years, the cryptocurrency market has experienced enormous growth in terms of bitcoin mining. Many newcomers have been embracing this new trend to the point where it’s exploding. This has in turn contributed to the difficulties bitcoin miners face today.
If you have been mining bitcoin for some time now, then you must have noticed the increasing challenges involved. You might be wondering, why is it more difficult to mine bitcoin now than in the past? Well, there are several factors which have contributed to the difficulties involved.
In this article, I will be taking you through the past, present, and future of bitcoin mining to help you understand better the challenges involved in mining bitcoins. So, if you are among many other miners bothered with this question? Read on to find out more.
Initial Bitcoin Mining
When bitcoin was first introduced, there were quite a few miners. Satoshi Nakamoto is known to be the first person to be involved in bitcoin mining. It is approximated that he managed to mine nearly 1,000,000 bitcoins within just a few weeks using only CPUs. The trend of using CPUs in mining continued for the next months as more miners flocked the bitcoin network
Transition to GPUs
However, things took a new turn when GPUs – Graphics processing units – were introduced into the mining system. The key advantage of GPUs is that they had the potential to deliver the same mining power produced by several CPUs. This resulted to the increased popularity of GPUs among miners. At first, the GPU could produce 1-2 blocks of bitcoins per hour, unlike CPU which produced at most 1 block containing 50 bitcoins per day.
Introduction of ASICs
After GPUs, more advanced mining hardware devices commonly known as ASICs where introduced. These new devices had the power equivalent to dozens of GPUs combined. The modern ASICs are designed with remarkable power almost 200 times that of the initial ASICs. They became popular to become the standard mining tools used by most bitcoin miners. The use of ASICs quickly became the norm to the extent that if you are not using them, then most likely you are not making any reasonable profits.
What Does The Evolution Of Mining Show?
If you are a keen follower of bitcoin technology, then you must have noticed that there is a clear indication of increased mining difficulties as time goes on. This implies that bitcoin is becoming harder to mine each and every day and there is nothing indicating that this trend will stop anytime soon.
Currently, mining bitcoins is a hard and expensive process. Apart from the costly ASIC hardware that you need to acquire to keep up with the mining race, you need to be prepared for even tougher means in the future. What’s even worse is the fact that bitcoin reward offered is also declining, which means that you will be using expensive tools only to get fewer bitcoins. Some miners might even end up spending what they have earned on the latest hardware in anticipation of better results.
The present bitcoin mining situation only favor market players who can afford energy efficient mining tools and their operating cost. If you are a small player, chances are you have limited capability, and even after struggling for some time, you might end up dropping out of the race.
Additionally, lots of factors count on the profit you will be getting out of the mining. For instance, data-center cost and speed, mining-power consumption, electricity rates alongside the prevailing bitcoin rates. These are the factors making it harder for small players to continue with the mining. The prices of the latest fast processors are also high while the cheaper once might not deliver the best performance which makes the process even more complicated.
From the trend of bitcoin mining, it is clear that the process is becoming harder each and every day. This is due to the growth of a number of miners which in turn demands the use of advanced equipment to achieve better rewards. Since the machines are costly, most small players will end up with little to no profit.
Even though the small miners are kicked out of the competition, it is not a guarantee that the big miners are going to enjoy good ROI in future. This is due to the constant changes in rates and the rewards of bitcoins. In simple terms, bitcoin mining is not going to be as profitable as it used to be in the past. Need to stay informed about bitcoin updates? Check out https://bitclubnetwork.com/ to find out more.