How to Calculate Mining Profits

This article shows how to calculate mining profitability using the special formula, how much money you are going to spend for hardware depending on its type, approximate electricity costs by country and additional pool fees. Moreover, it provides the list of online calculators which will help you to estimate your expenditures.

Before committing your resources to mining, you will have to make sure it is profitable for you. There are a lot of factors that may come into play when calculating your mining profitability, such as mining algorithms, hardware, and electricity bills.

Formula

Expressed in the simplest form, your mining profitability equation looks like this:

I - B = P,

where I stands for income you make, the value of the number of coins you mine each month, B — electricity bills, money you spend on electricity, P — profit, money you are left with at the end of the month. You can figure out approximate earnings beforehand by going to online mining calculators, where you can choose your GPU model, enter your electricity rate, and the cryptocurrency you mine.

Hardware expenses

You will have to make sure your equipment pays for itself in a reasonable amount of time — usually three months. As a miner, you would usually use either GPUs or ASICs. Graphics cards are common for mining ASIC-resistant cryptocurrencies, such as Ethereum and Monero.

A GPU-powered mining rig implies that you will have to spend extra money on additional hardware, such as PSUs, Power Supply Units. PSUs differ in the watts they supply and draw. If a PSU claims to supply 800W and is 80% efficient, it would actually draw 1000W from your wall. Don’t cheap out on PSUs and buy those with higher efficiency. GPUs also generate a lot of heat, so unless you want to risk your house setting on fire, you will have to have a good cooling system, which is another item on your expenses list.

ASICs are usually easier to manage as they come in their own cases with their own fans for cooling. You may want to buy a UPS (Uninterrupted Power Supply) so that you can go on mining your precious coins without downtime, even if power shuts down. Although this is true for both GPU and ASIC rigs. Among the most popular ASICs are:

  • Antminer S9, 14 TH/s, $3k;
  • Dragonmint 16T, 16 TH/s, $2.7k;
  • Antminer R4, 8.6 TH/s, $1k.

Electricity bills

After you’ve returned back the money you had spent on your rig, you start making the actual profit off of it. Electricity costs can vary dramatically depending on where you live. In EU, due to their ecological policies, prices for electricity are much higher than, for example, in China, where coal is cheap. Due to this, mining is big in China, and Chinese miners provide the largest portion of total hashrate in many cryptocurrencies. Here is an incomplete list of how much electricity costs in some countries:

  • China, 4 US cents/KWh;
  • Germany, 35 US cents/KWh;
  • Japan, 22 US cents/KWh;
  • Russia, 2.4-14 US cents/KWh;
  • South Africa, 15 US cents/KWh;
  • UK, 22 US cents/KWh;
  • United States, 8-17 US cents/KWh.

To calculate the precise amount of money you spend on mining, compare your bills from before you started mining and after, and find the difference.

Additional costs

If you are pool-mining, which is most likely, you should also take into account the pool fees. Some pools do not have fees at all, other can charge you up to 4% of your earnings. Read their instructions carefully and learn about their reward structures, before joining a pool. Here is the list of the biggest mining pools:

  • Antpool, 0-2.5% fees depending on the type of membership;
  • Slush Pool, 2% fee;
  • F2Pool, 4% fee;
  • BTCC Pool, 2% fee;
  • BW Pool, 1% fee.

Mining equipment is mostly manufactured in the US, so this means that you will have to spend some money on shipping, which is not very cheap, considering that ASICs can be heavy big machines. Some of your money will go to various accessories, such as cables, adapters, and so on.

There are plenty of useful websites that will do all the math for you.

  • Crypto Compare. An easy calculator. Choose the cryptocurrency, enter your hashrate, wattage, and power cost, and it will give you your daily average profit.
  • What To Mine is one of the most useful calculators online. You choose your GPU model, and the site will calculate the power draw, hashrate, profit, and even recommend the most profitable cryptocurrency for your hardware.
  • NiceHash Calculator is an easy straightforward calculator that lets you choose your GPU model and country, and gives you the average daily, weekly, and monthly profits.
  • MyCryptoBuddy is another good calculator, which accounts for the average difficulty increase each month;
  • Coin Warz is an Ethereum mining profits calculator that allows you to put your hardware cost in calculations.
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