Why Cloud Bitcoin Mining?

HOME VS. CLOUD BITCOIN MINING

I mine Bitcoins at home, in a data center, and in the cloud.  I’ll get into the benefits of home mining, and why I got into cloud mining in the first place.  I’m a huge fan of home Bitcoin mining, because I enjoy playing around with electronics, as well as upgrading and optimizing hardware.  I love researching Bitcoin hardware manufacturers, searching out the latest, most efficient mining hardware, and setting it up.  I started out by building GPU mining rigs back in early 2013, and I have learned so much since then, and I’m not planning on stopping anytime soon.  Plus, having access to low cost electricity can make home mining incredibly profitable.  If you have access to free or sub-$0.10/kwh electricity, then home mining is likely going to be more profitable than cloud mining.  So if you have the technical know-how, the time, and access to cheap electricity, then you should definitely look into home BTC mining.  On the other hand, for those without access to inexpensive power, you are likely better off starting out with a reputable cloud mining company.

The main limitation is power.  Given that an average home may have 6KW of electricity available to dedicate toward Bitcoin mining, and given the efficiency of current generation ASICs, a single home mining operation could produce up to 12TH/S of mining capacity with an initial investment of around $6,000.  At the current difficulty, this equates to approx. $1800 worth of Bitcoin in the first month, assuming a constant Bitcoin network difficulty.  If electricity costs are $0.15/kwh, that means monthly electricity bills could cost 6KW X 24hrs X 30 days X $0.15 = $648/month, bringing your net profit down to $1150.  And consider that 6KW of hardware is going to make your home into an absolute sauna without running your air conditioning 24/7 or installing industrial fans.  There is a distinct possibility that your investment could potentially never provide a positive return on investment with increasing Bitcoin network difficulty.  You’re taking on all of the risk and expense yourself.  This is why I turned to Cloud bitcoin mining, to augment my home operation, and (hopefully) multiply my profits.

WHY CLOUD BITCOIN MINING?

Cloud technologies are revolutionizing Bitcoin mining in the same way they have revolutionized modern computing.  Cloud Bitcoin mining services remove the technical complexity of mining, as well as the heat and noise that are inherent byproducts of mining at home.  Some cloud mining is a little more expensive in terms of hardware cost, but once you factor in other factors such as shipping and customs, as well as your own time, the cost of Bitcoin cloud mining becomes a little more reasonable.  Plus, since companies are able to locate in areas with extremely low power costs, they can pass those savings on to customers.  For example, the average combined cost for hosting, electricity, management, and internet from a cloud mining company is $0.10/KW to $0.20/KW which is competitive with many residential electricity markets.  Ease of use is another key factor, as cloud mining firms simplify tasks such as choosing and ordering hardware, configuring mining pools, troubleshooting hardware, and upgrading it every few months.  Companies are willing to invest in modern fire suppression systems, massive efficient cooling systems, and data center grade power systems, while the operations are monitored by trained professionals 24/7.  So even though you’re paying a premium for this service, the benefits can outweigh the cost.

I use cloud mining as a leverage tool, so I can operate more mining hardware – and generate more Bitcoin – than I would otherwise be able to at home.  For the most part I’ve been happy with the mining results I’ve received, but as with any industry, some companies are better than others.  I lost hundreds of dollars by investing in PBMining, and almost got burned by CEX.IO when they suspended their service.  The key is finding mining companies that you can trust, and that’s what this website is all about.  I will continue reviewing more cloud mining services, and report back to you on my experiences.  Thanks again for visiting the site!

<— Back to “The History and Evolution of Bitcoin Mining”