How Much Does It Cost to Mine 1 Bitcoin?

Bitcoin has come a long way since 2009. What started in obscurity on the internet has exploded into a $3 trillion cryptocurrency market in just over a decade.

Of course, those who have experienced the biggest rewards are those who got their hands on bitcoin early on. Back then, anyone could mine bitcoin using their spare computer.

Today, bitcoin mining is still a highly profitable business. However, the competition is at an all-time high, and the use of the highest-quality computers is necessary to actually earn any money.

So how much does it cost to mine 1 bitcoin? If you can mine 1 bitcoin, you can make anywhere from $30,000 to $60,000, depending on the state of the crypto market.

Keep reading our bitcoin mining guide below to learn all about the mining process, what it takes to get started, and what the ongoing and upfront costs are when it comes to crypto mining. 

What Is Bitcoin Mining?

Bitcoin has a limited supply. There will only ever be 21 million bitcoin in circulation.

In 2022, there are only about 19 million bitcoin in circulation. The rest is “hidden.” Rather than created, this new supply of bitcoin is “mined” on a daily basis.

Just like gold or silver is physically mined from the earth, from a limited supply, so too is bitcoin “mined” from the blockchain and added to public circulation. 

But unlike physical mining, you don’t have to break a sweat or swing a pick to find bitcoin. You just need a computer (a powerful one), some electricity, and the right software program. 

Once you’re set-up, you run the bitcoin mining software. Your computer then competes with all the other bitcoin miners to try to complete a mathematical equation.

The first person (or group) that completes that equation is able to create the next block in the blockchain. These blocks are essentially digital folders that house bitcoin-based transactions. 

Each block can hold a certain amount of transactions. A new block is created every 10 minutes. And each time a block is created, the creator (or miner) receives a block reward, paid in the new bitcoin supply. 

So once you’ve set up your bitcoin mining rig, as it’s often called, you let it run on its own. Mining becomes a passive activity. 

Equipment Needed to Mine Bitcoin

If you want to start passively earning bitcoin, you’ll need to spend money upfront. While there are ongoing costs, your biggest expense happens upfront.

And it’s these upfront expenses that keep most aspiring miners away.

To start mining, you’ll need a mining computer. In the past, you were able to use any old computer you had at the time. But today, you need a dedicated rig.

Most people use ASICs (application-specific integrated circuits). These are essentially high-powered computer hard drives dedicated to one task only bitcoin mining. 

You can spend as little as $500 for a cheap ASIC miner, or upwards of $20K for a more efficient, profitable ASIC. 

What you buy depends on the current availability (they’re often sold out), as well as how much you’d like to earn in bitcoin on a daily/monthly basis. 

Once you’ll have that, you can download the latest version of the bitcoin mining software which is free. 

Ongoing Expenses for Mining Bitcoin

Once you’ve spent money upfront to set up your mining operation, you’ll have some ongoing costs. Electricity is the biggest.

ASIC miners need to run 24/7 in order to earn you money. And they use a ton of power. Especially if you have multiple units. 

The specific ASIC that you buy will use a certain amount of power (kWh). To determine your cost, compare the power usage with how much money you pay for electricity. 

In California, the average price is $0.18 per kWh, meaning no one can make money mining bitcoin in the Golden State. In Wyoming and a handful of other states, the average rate is around $0.08 per kWh. 

Lastly, you’ll need to pay for access to a mining pool. These are collaborative groups that join forces to mine bitcoin together. They have become a necessary part of the mining process and can cost between 1% and 3% of your total earnings. 

More details on mining pools are below. 

Mine at Home or Outsource

Early miners all ran their mining rigs on their own, at home. While many enthusiasts still manage their own mining rigs at home, most actually outsource this to a professional facility.

Why? Because mining rigs are very loud, get very hot, and consume a lot of power.

Electricity costs are one of the biggest factors that determine your profitability. If you live somewhere with high utility costs, then mining bitcoin at home is pointless.

Instead, you can send your mining rigs to a facility in a place like Texas, Canada, or the American Midwest to leverage cheap power prices.

Then, you don’t have to deal with the noise and temperature of your mining rigs at home. 

To run them at home, you’ll need a dedicated place to run them, such as a basement or closet, along with cooling fans that run 24/7. 

While you can “save money” by running them at home, rather than paying someone else, you’ll end up paying for it somehow. 

How Much Does It Cost to Mine 1 Bitcoin?

So here’s where it gets tricky. You’re never going to mine “1 bitcoin.”

To successfully complete a block in the blockchain, you’ll earn the current block reward, which in 2022, is 6.25 bitcoin. But to complete a block in the blockchain, you need all the hash power you can get.

Essentially, you need as many mining rigs contributing hash power to your operation as possible. The more hash power you have, the more chances you have at solving the puzzle and completing the block before someone else does.

So what I’m trying to say is that you have to join forces with others, contributing hash power to a concerted effort, in order to actually win the block.

It’s next to impossible for an individual miner to actually complete a block. Currently, most blocks in the blockchain are completed by a handful of operations where individual miners contribute their hash power.

When the operation wins a block, the rewards are distributed among the miners, depending on the amount of hash power they contributed.

So someone with 10 mining rigs, contributing hash power, will earn more than someone with just one mining rig. 

These groups are called mining pools. To participate, you just join the mining pool, pay a monthly fee, and sync your mining rigs with their software. 

These pools are often made up of thousands of miners, individuals, and companies, from across the globe. 

Understanding Mining Rewards

Within the current mining landscape, you need to join a mining pool to earn any money. You’ll never earn an entire block reward on your own, nor will you earn an entire bitcoin.

What you will earn, however, is daily income based on the amount of hash power you contribute. So bitcoin mining has the potential to become a passive daily income source.

If you only invest a little bit of money into your mining rigs, you might earn between $5 or $10 a day. If you invest a lot, you might earn $20, or even $100 a day.

The amount you earn depends on how efficient your mining rigs are, how cheap (or expensive) your electricity is, and the current price of bitcoin.

If bitcoin is at $30,000, your earnings will be low, or even negative. If bitcoin moves back up to $50K or $60K, you’ll be earning nice profits, since your expenses don’t change based on the market. 

Bitcoin Mining Costs and Profit Examples

It’s impossible to say exactly how much it costs to mine one bitcoin. It’s not a straightforward process.

But here are some examples to help you see how much money you can make depending on how much you invest.

Let’s say you bought the Antminer S19j Pro ASIC miner. It has a hash rate of 100 Th/s. It consumes 3050 W. 

If you live in an area where electricity costs $0.12 per kWh, then you’ll earn around $13.53 per day in bitcoin rewards, but spend about $8.78 on electricity.

That yields a daily profit of $4.74, which you would then subtract any other fees from (such as a mining pool fee). 

If your power only costs $0.09 per kWh, that same mining rig would yield $6.94 in profit per day or about $2,500 per year.

This particular mining right can cost around $10K upfront, meaning you would pay back your investment in about 4 years (at current bitcoin prices). If the price of bitcoin jumps, so too would your profitability, leading to a faster ROI. 

You can buy much more efficient mining rigs, that generate more hash power while consuming less electricity. The result is faster profits, but a much higher cost upfront. 

Bitcoin Mining Tips

So what does it take to find success in bitcoin mining? The most important factor is your electricity cost. If you live somewhere with power costs of more than $0.10, then it makes much more sense to outsource ASIC management to a facility operating with a $0.08 power cost. 

Outsourcing management also means you won’t have to deal with noise, you won’t have to deal with cooling your miners, and you won’t have to deal with malfunctions, errors, repairs, or power outages. 

What to Do With Your Bitcoin?

One of the most important things you can do is decide what you’re going to do with all your bitcoin. After all, you don’t get paid in USD, you get paid in bitcoin. It will go straight to your crypto wallet address.

Here are some options, depending on your investing strategy.

Cash It Out

Everyone wants passive income. But passive income only helps when you can use it to pay for your monthly expenses or to treat yourself to new toys, a vacation, or something else you really want.

You can cash out your bitcoin daily, but it makes more sense to do it on a monthly basis when you have a decent amount stockpiled in your wallet.

If you want physical cash, you can just head to a bitcoin ATM. Use your mobile crypto wallet to sell your bitcoin and receive cash on the spot, and spend it however you wish.

Bitcoin ATMs are available all over the US and in many parts of the world. Visit to find one near you. 

Or, you can transfer bitcoin to an online crypto exchange, sell it for USD (or your native fiat currency), and withdraw it to your bank account. 

Hold Bitcoin Until the Price Jumps

Depending on the state of the crypto market, it might be better to hold onto your bitcoin until the price increases.

Bitcoin peaked at an all-time high of $68,000 in November 2021. If you sold around that time, you’d be sitting on some nice profits. 

Since that time, bitcoin has struggled to move past $40K. If you don’t need the money right away, waiting until the next bitcoin bull run, when the price jumps back up, maybe to a new all-time high, you can earn much more from your mining efforts. 

If you sell all your bitcoin while it’s between $30K and $40K, you might not be making any profits on your mining operation. 

Invest in Other Assets

Smart bitcoin miners will take some (or all) of their bitcoin mining profits and invest in other assets, both crypto and non-crypto related. 

For some, this means diversifying their crypto portfolio by acquiring other reputable alt-coins. Ethereum is the best option behind bitcoin, but many others are available as well with a bright future. 

Some miners will invest their profits into NFTs, which can provide outsized returns if you develop a solid investing strategy. NFTs have blown up in recent months and many investors are adding plenty to their portfolios.

Otherwise, you can diversify into completely different markets by diverting some of your bitcoin profits into stocks, bonds, or even real estate to fend off the effects of frequent crypto bear markets. 

Bitcoin Mining Is a Long-Term Play

So how much does it cost to mine 1 bitcoin? It costs a lot, both in upfront mining equipment costs and electricity. 

You can spend $10,000 on a miner and $2,000 per year on electricity to generate a profit of around $2,500. 

If you have the patience, and the funds to invest in quality mining hardware, bitcoin mining can be a profitable endeavor in the long term.

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I've got so many tattoos and you know what? I'm still scared of getting them. Oh, and I love writing about the weirder stuff in life. You'll see.

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