Welcome, cryptocurrency student! In today’s guide, I am going to cover Bitcoin Cash mining. So, if you are looking to earn money by mining Bitcoin Cash, then you’ve come to the right place!
Here's a cool fact before we get started though; did you know that Bitcoin Cash miners can confirm 8 times as many transactions as Bitcoin? This was one of the main reasons that Bitcoin Cash was created, as it allows people to pay small transaction fees when sending funds.
Anyway, in this Bitcoin Cash mining guide, I am going to start by explaining why the network needs miners, followed by a discussion on whether or not it is profitable.
Once you understand the basics, I’ll then let you know what you need to do to get started, including the required hardware and software. Finally, I’ll also give you some information on the pros and cons of joining a Bitcoin Cash mining pool (if you don’t know what this means yet, don’t worry), as this option might suit you best!
So, what are you waiting for? Let’s start by finding out what Bitcoin Cash mining is!
What is Bitcoin Cash Mining?
Like most other cryptocurrency projects that operate on a blockchain, miners are required to verify and confirm transactions. Anyone in the world can be a Bitcoin Cash miner by purchasing the correct hardware and downloading the required software (which I'll discuss in more detail later).
Just like Bitcoin, a block of transactions is confirmed by the Bitcoin Cash mining community every 10 minutes. Before a block can be confirmed, all the miners on the Bitcoin Cash network must attempt to solve a cryptographic puzzle. This puzzle is so difficult that no human could solve it, instead, it requires a lot of computational power to do so.
Every miner on the Bitcoin Cash network is competing to be the first to solve the puzzle! This is because whoever solves it first, gets the mining reward. The current reward for successfully mining a block is 12.5 BCH, which will remain in place until April 2020. After that, the reward will be halved to 6.25 BCH.
On top of the block reward, the successful miner will also earn the transaction fees that each Bitcoin Cash user paid when they transferred the funds. It is also important to note that the person (or organization) with the most powerful mining hardware has the best chance of winning the mining reward.
In the world of Bitcoin Cash mining, an expensive and powerful mining device will always have more chance of winning the reward against a basic CPU. I’ll talk about this in more detail later.
So, now that you know the concept of Bitcoin Cash mining, I am now going to answer whether Bitcoin Cash mining is profitable.
Is Bitcoin Cash Mining Profitable?
As I mentioned above, anybody in the world can attempt to make money from Bitcoin Cash mining. However, there are some important financial commitments that you need to consider.
Firstly, you will need to invest in some Bitcoin Cash mining hardware.
How successful you are at mining will depend on your equipment. So, you should invest as much as possible to get the most powerful device you can. Otherwise, it will be near impossible to win the mining reward against other competitors.
Another thing that you need to consider is the amount of electricity required to start mining. Just like Bitcoin, Bitcoin Cash mining uses a significant amount of power. The reason for this is that the cryptographic puzzle that miners need to solve is complex. The only way that it can be solved is by using lots of computational power, which requires lots of electricity!
You must remember that every miner on the blockchain is attempting to solve the same puzzle. This means that even if you are not successful in winning the mining reward, you will still use lots of electricity in your attempt!
You also have to consider where in the world you live, as electricity costs depend on the country of which you're based. For example, China is one of the cheapest places in the world for electricity, which is why the majority of large mining operations are based there. On the other hand, mining Bitcoin Cash in South Korea is the least profitable, as electricity is so expensive!
One final thing that you need to consider is the actual market value of Bitcoin Cash. As you are paid out in BCH, the higher the price, the more profitable it is! If the price of BCH falls too low, then you might be making a loss. This all depends on your goals and whether you believe in Bitcoin Cash as a long-term investment too.
Essentially, if you are looking for a straight answer on whether Bitcoin Cash mining is profitable, it all depends on the factors above.
To help you figure all of this out for yourself, there is a cool website that allows you to calculate whether you will make any profit. However, before you do, it is probably best to read the rest of my guide, so that you have all the required information.
So, now that you know what to consider, I am now going to show you how to get started by discussing hardware.
Hardware to Mine Bitcoin Cash
Before you can even think about mining Bitcoin Cash, you will need to purchase some hardware. Back in the early days of cryptocurrency mining, it was possible to make good money just by using a CPU or GPU device. These devices are cheap and it gave everyone a fair chance of winning the mining reward.
However, mining technology has now become advanced, meaning that there are now specialized hardware devices that have been built specifically for mining. As I mentioned earlier, those with the most powerful devices have the best chance of being successful. Let me briefly explain why this is.
Every device can generate a certain amount of ‘Hashing Power’. Think of it like a car. Depending on the model, a car can only generate a certain amount of speed. In most cases, the more expensive the car is, the more powerful it is!
This is important because when miners attempt to solve the puzzle, they try billions of different combinations until they are correct. The more hashing power a hardware device has, the more combinations it can try each second!
At present, the only hardware devices that are going to give you a chance to mine Bitcoin Cash is something called an ASIC (Application-specific integrated circuit). There are lots of different variations, with some being better than others. There is no point in considering anything other than an ASIC, as you will have absolutely no chance of ever winning the mining reward!
Anyway, so now that you know the importance of hashing power, let’s take a look at some of the best devices available to mine Bitcoin Cash!
Halong Mining DragonMint 16T
The DragonMint device was released in March 2018 and it is the most powerful ASIC device in the world for Bitcoin Cash mining! The company behind it is called Halong Mining, and the team claims that they invested more than $30 million to get the product to where it is now.
As the name suggests, the DragonMint 16T device can reach a maximum hashing power of a 16 TH/second! This is 2 TH/Second faster than its nearest rival – the Antminer S9!
As great as the device is, it comes with a cost of $2,729! On top of this, the manufacturer also recommends that you purchase a custom power supply, which will cost you an additional $115.
This device requires a power supply of between 220-240V. Every country has its standards, so you will need to check this first. For example, in the U.S, the standard is 110V, meaning that you would either need to hire an electrician or buy a converter!
As a result, the DragonMint might not be suitable for the average miner who is looking to make a bit of money on the side. It is a device made for much more serious miners and organizations.
In second place for the world’s most powerful Bitcoin Cash mining device is the Antminer S9! The device is manufactured by a company called Bitmain, which is based in China.
Some people think that Bitmain has too much control in the cryptocurrency industry. This is because not only do they sell the most mining hardware devices, but they are also one of the largest mining pools in the Bitcoin and Bitcoin Cash industry.
The Antminer S9 can reach a maximum hashing rate of 14 TH/Second. The device is an upgrade from the S7, which was limited to a maximum hashing rate of just 4.73 TH/Second. The S9 is also much quieter than the S7, which sounded like a factory production machine!
However, much like the DragonMint ASIC, the Antminer S9 is expensive. On average, it will cost you about $3,000 to buy. You will also need to buy an additional power supply, which costs around $170!
At the time of writing, the Antminer S9 is slightly more expensive than the DragonMint, even though it is less powerful. It is hoped that soon both prices will eventually be reduced, as Bitmain now has competition – something it didn’t have before.
If you want to buy the Antminer S9 or would like more information, click here to go to the official web page!
Other than the above two devices, there would be no point in me suggesting anything else for ‘solo’ mining. The nearest device in terms of power is the Antminer R4, which has a maximum hashing power of 8.6 TS/second and costs around $1000.
However, if you are planning to join a Bitcoin Cash mining pool, then you can purchase a much less powerful device. This is because your share of the mining reward is based on the amount of hashing power that you contribute! So, if this sounds more suitable for you, check out my suggestion below!
The Antminer S7
The Antminer S7 was the best ASIC hardware device before the S9 was released! It is also manufactured by Bitmain and can produce a maximum hashing rate of 4.73 TH/Second.
Although this is much slower than the S9, it will allow you to earn Bitcoin Cash when you join a Bitcoin Cash mining pool. At the time of writing, you can pick up an S7 for just under $200. It is a highly reliable and proven piece of hardware that used to be the most popular in the industry.
Before buying the Antminer S7, there are two things you should consider. Firstly, if you intend on solo mining Bitcoin Cash with it – don’t! You will not be able to compete with more powerful models. Secondly, the S7 is noisy, so if you plan on running it during the evening, be prepared for complaints from your neighbors.
If you want to purchase the Antminer S7, click here to buy it from the official Amazon store.
So, now that you know all about the hardware requirements, the next part of my Bitcoin Cash mining guide is going to look at what software you need.
Software for Mining Bitcoin Cash
Just like your desktop computer or laptop device, the software is just as important as hardware. Once you have purchased your ASIC device, you will need to download some software to accompany it. However, in most cases, the required software will be included with the product.
It is not recommended to use software other than the one included with your product. There are various third-party mining programs available to download, but these are only suitable for GPU or CPU mining. If you have read my guide up to this point, you will know that neither of these devices is suitable for Bitcoin Cash mining, as you will need to use an ASIC.
When you install your software program, there are various things that you can configure. Firstly, you will need to enter your Bitcoin Cash wallet address. This is important as this is the address that your mining rewards will be sent to.
You will also need to tell the software how much power you want the hardware to generate. It is highly recommended that you read the manual included within your hardware device before amending any settings!
Finally, you will also need to tell the software the number of hours you want it to mine. If you are purchasing a quiet device like the Antminer S9, then it makes sense to run it 24 hours a day, as you will want to maximize your profits.
However, if you are using a noisy device like the Antminer S7, then (depending on where your hardware is situated) its best to only use it during the day.
So, now that you know about the requirements to download software, the final part of the guide is going to discuss Bitcoin Cash mining pools.
Bitcoin Cash Mining Pools
As Bitcoin Cash mining pool is a way for lots of people to ‘Pool’ their resources together to stand a better chance of winning the mining reward. It’s like being in a game of ‘Tug-of-War’.
If one side of the rope has 5 people, and the other side had 10,000, then no matter how powerful the people were, the side with 10,000 would always win! This is why Bitcoin Cash mining pools are so great because they give everyone a chance to win a piece of the pie!
However, it is important to remember that mining pools hold a lot of control. Although you are sharing your hashing power, the pool has full control over their terms and conditions. This means that they can change the membership fee or reduce the number of rewards that are shared.
There are a lot of mining pool scams out there which will never pay you any rewards, so always conduct enough research before joining one, or choose a well-known mining pool like the one I have listed below.
Antpool, just like the Antpool hardware device, is owned by Bitmain. When you connect your device to the Antpool mining pool, you can start mining straight away without having to pay any fees.
On the other hand, the company keeps all of the transaction fees that are won as part of the mining reward. The block reward of 12.5 BCH is shared between all miners, based on how much hashing power you contribute.
For example, if you contribute 10% of all the hashing power, then you would receive 10% of the reward!
I hope you have enjoyed my Bitcoin Cash mining guide. If you have read it from start to finish, then you should have a really good idea of whether Bitcoin Cash mining is right for you.
The days of being able to mine popular cryptocurrencies like Bitcoin and Bitcoin Cash using basic CPU or GPU devices are long gone (unfortunately). Back then, it was a fair system that allowed anybody to get involved. However, the only real chance you now have is to either spend a significant amount of money on the very best ASIC hardware or instead, join a mining pool.
Who knows, if the Bitcoin community ever agrees to make changes to the code, then one day they might be able to ban ASIC devices from connecting to the network. Until then, the ability to win the mining reward is now in the hands of a few mega mining farms.
So, what are your thoughts on Bitcoin Cash mining? Would you prefer to buy a DragonMint or Antpool machine, or are you going to settle for a cheaper option? Please let me know in the comments below.