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The legend says it all started in October 2007, when Satoshi Nakamoto published the whitepaper of the Bitcoin on the internet. In 2008 Bitcoin software was released and the Genesis block, block 0, was ‘mined’. Finally, on 9 January 2009, the first version of the Bitcoin was released. It included a Bitcoin generation system that would create a total of 21 million Bitcoins through the year 2040. So what is this mining? More important, is mining Bitcoins worth it for you and me?

The Bitcoin is the first cryptocurrency or digital currency. There are just two ways to get Bitcoins. Either buying them for traditional valuta or mining them yourself. Mining Bitcoins serves only one purpose. Authorizing Bitcoin transactions made in a certain period. The miners prevent Bitcoin users from spending their coins multiple times or committing fraud in a different way. Afterwards, the miners will be rewarded in Bitcoins.

So how does this mining work?

Everyone with a PC or a laptop can mine Bitcoins. In the beginning, miners used the processor in their computers to mine Bitcoins. After a while, they noticed that video cards of gaming PC’s were much better suited for the mining process. The video card will use it’s power to solve difficult math problems ( Hash’s) that authorize the transaction made between Bitcoin users. To start mining, you’ll need three things.

Mining hardware (high-end video card)
Mining software (downloadable for free)
Mining account

After you meet these requirements you can start mining. Mining has become more difficult the last few years, for several reasons. First, you got ‘The Bitcoin halving’. Bitcoin’s code commands that every 210,000 blocks, the number of new bitcoins created is cut in half. (Coinjournal, 2016). When Bitcoin was launched in 2009, miners were rewarded with 50 bitcoins per block. The second era started in November 2012, reducing the number of bitcoins earned to 25. The third era started in July this year, reducing the number of bitcoins to 12.5 per block. The second reason is that the number of miners keeps increasing. How more miners, how smaller the chance you’ll solve the math problem and earn the Bitcoins.

So is mining Bitcoins worth it for you and me?

Mining has become a serious business in the last few years. The value of the bitcoin increased from $0.04 in 2012 to around $600 today. There are several huge mining rigs which are just built for mining Bitcoins. We’re talking about warehouses with thousands of video cards, million dollar investments and a lot of dedication. They use hundreds of thousands of dollars of electricity each month and only a few manage to mine efficiently. In the documentary ‘Het Bitcoin Evangelie’, there is an owner of such bitcoin mine who talks freely about his mine. (I’ll post the link below) Currently, it is barely profitable for individuals to earn money with Bitcoin mining with a single setup. A possibility is to join a mining pool, which is a group of individuals who mine together. Still, within this group, you will just earn a few dollars if you got a thousand dollar video card.

Conclusion: Mining Bitcoins as an individual with a gaming PC will only earn you a few dollars a day, even if you are within a mining pool. There are too many high-end players on the market with high-tech setups. You can compare it with the regular mining process. An individual can go mine for gold with his pickaxe but probably won’t succeed. If you group with 10 miners you will have more success, but there will always big mining organization who got the equipment to mine way more than you’ll be able to do as an individual. My advice: don’t start mining unless you are you really dedicated.

If you have any questions/comments, please share them!

More information about the Bitcoin and Bitcoin mining:

To fully understand the Bitcoin mining concept, I’ll share the next 2-minute explanation video. Credits to Bitcoinmining.com