A friend of mine (get it?) has been mining Bitcoin since 2013. To date, he has earned 1 complete Bitcoin, meaning he owns about $56,000 in Bitcoin at the time of this post. When I visited his home, I found a computer mining Bitcoin in almost every room of the house. In total, he had 8 or 9 computers mining Bitcoin, including an ASIC unit specifically designed for mining. He couldn’t install more because the power requirements needed to mine more Bitcoin. After the cost of electricity, he was making about $45 per day, or $16,425 per year. As it is defined on bitcoinmining.com, “Bitcoin mining is the process of adding transaction records to Bitcoin’s public ledger of past transactions or blockchain. This ledger of past transactions is called the block chain as it is a chain of blocks. The block chain serves to confirm transactions to the rest of the network as having taken place.”
Bitcoin Mining Requirements
When I found out how much he was making in passive income, I decided to start mining Bitcoin. You can use any modern computer, but it is not worth mining Bitcoin unless you have a computer with a very good graphics video card and processor. For that reason, powerful gaming computers are the best way to get started. If you decide you want to use your old Windows XP Desktop computer or Macbook lying around, you may actually spend more money in electricity than you earn in Bitcoin.
If you try to buy a gaming computer now, you will be hard pressed to find one under $2000. If you browse computers online on Bestbuy.com, Amazon.com, WalMart.com, and Newegg.com, you will find that most computers are out of stock, especially the gaming computers. It is also more expensive than ever to build your own gaming computer. The cost of graphics cards have skyrocketed. It is even hard to find the new Xbox. This is because many people have started mining Bitcoin as the prices of Bitcoin went up. The more Bitcoin is worth, the more money you earn mining Bitcoin. Luckily, I was able to find a gaming computer for $1400 with newegg.com. This computer had an AMD 6 core processor with an NVIDIA RTX 3060 graphics card. It wasn’t the best, but it was still good enough to earn me $7+ per day after the cost of electricity. I figured that my return on investment would be around 7 months depending on the cost of Bitcoin. Not bad. *Keep in mind that your computer will be very slow and will run hot when you are mining Bitcoin. Your Bitcoin miner should be your spare computer specifically meant for mining. You should store your mining computer in a cool location like a basement.
How to get started mining Bitcoin
Once you have a computer for mining Bitcoin, you will need to change your computer settings, install a miner and sign up with a mining service. First setup your computer settings so that it stays awake 24/7. If your computer sleeps, it won’t mine Bitcoin. Next, sign up with a mining service. There are many different mining systems available for Windows, Mac, and Linux. I recommend NiceHash.com for Windows as it is easy to use for beginners. Depending on the anti-virus software you have, it may think your mining software is a virus. You will need to create an exception rule so that your mining software is not flagged by your computer. When you sign up with NiceHash, you will create a new crypto wallet. All of the coin you mine will go into this wallet. NiceHash automatically mines the most profitable coins to maximize your earnings. They also have a profitability calculator where you can enter your cost of electricity in kW/h (look at your electricity bill) and your computer specs. The process of signing up with NiceHash is easy. The entire process took me about 15 minutes from start to mining my first Bitcoin.
Your Mining Wallet
You can convert Bitcoin to another cryptocurrency or transfer your funds from your mining wallet to your main crypto wallet. For example, I use Coinbase as my crypto brokerage. Sign up with my referral link to receive $10 in free Bitcoin when you purchase your first $100 of crypto. I can transfer Bitcoin from NiceHash to Coinbase and convert my Bitcoin to cash. I can even move Bitcoin from my NiceHash wallet to my BlockFi wallet, where I earn 6% interest on Bitcoin. Sign up with BlockFi here to earn up to $250 in free Bitcoin. BlockFi will soon offer a 1.5% Bitcoin-back rewards credit card.
Conclusion
Mining Bitcoin is an easy way to earn a passive income. After setting up your computer for 15 minutes, you are done. I personally periodically check to see if my computer is still mining. You can also setup alerts with NiceHash to email you if the mining process was interrupted by a power outage or some other reason. At the current cost of Bitcoin sitting around $56,000, I could easily make $20,000 per year if I had 8 gaming computers mining Bitcoin in my house. My wife wouldn’t let me buy that many computers, so I will stick with my single miner for now. If you would like to learn more about buying and trading with Bitcoin, read my step by step guide here. If you would like to learn more about Ethereum, the second most popular cryptocurrency, read my post here.
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