The bottom line is to plug your computer or specialized mining rigs into the Internet and making profit out of thin air is extremely impressive. However, it is definitely not as simple as it appears, and the mining sector is one that has become very competitive and refined.
Despite this, single businessmen who are interested in mining can still join in, and by narrowing their margins, there is the potential to make a big money. It all comes down to cheap resources though, and in the case of mining, that resource is electricity. The discrepancy between electricity prices around the world means that mining one Bitcoin in a particular country can be many times more profitable than doing the same things abroad.
How it is calculated
The picture below shows a list of countries and the average cost in USD to mine a single Bitcoin. This research, made by Elite Fixtures, was put together using consumption required to mine a Bitcoin averaged from 3 different mining rigs — the AntMiner S7, the AntMiner S9 and the Avalon 6.
The research sourced its electricity price data supplied by each country’s government and local utility companies, as well as the International Energy Agency, IBTimes reports.
Where to cash in
Thus, with this data available, unexpected mining across the globe becomes expedient. The best place to make gain mining a single Bitcoin is Venezuela. The process costs only around $530.
After last Bitcoin price hovering about $10,000, this has the potential for a massive rate of profit for South American miners. Apart from this, given the country’s economic and political climate, it is not surprising to see that many Venezuelans have taken advantage of mining. Not only is it relevant to mine in Venezuela in times of peace, the South Americans have utilized this cheap electricity in times of crisis with their own currency distending to useless sizes.
Where not to even bother
A number of countries in Western Europe (such as Germany and Denmark) are classified as some of the most expensive places to try and pull Bitcoin out of the ether. In substance, in the current climate, mining a Bitcoin in either of the aforementioned countries would end up costing you $4,000.
The mining diffusion across the globe also clearly follows the lines of cheap electricity as a research made by Cambridge University last year displayed that countries in the Far East, particularly China, held the title of mining capitals of the world.
Mining super powers
A power that China, and even Russia, hold as mining super powers comes almost directly from the price of their electricity. China, in accordance with the research, sits at a modest $3,172 per coin which is still, currently, a 70% return.
China has also been gaining from the government being open to letting the miners use surplus power in the country, but this has recently come under study. The Chinese government is now trying to break down on all verges of cryptocurrency, which has them looking at mining.
Russian Federation, another super power that is benefiting from relatively cheap electricity (which sits at $4,675 per Bitcoin), as well as subsidies from the government, could soon be under strict control.
The future of mining
Since electricity is one of the first costs that will need to be considered when setting up mining, it is expediently for large mining setups to consider the above low-cost countries to be an impressive outlook. However, as Bitcoin continues to grow, regulators are looking to take aim at different sectors, including mining.
There also may be some other countries where the electricity is more expensive, but regulations around mining and cryptocurrencies are a lot lighter, for instance, Japan. There are also definite mining pools and even ICOs that are looking at setting up their operations near green sources of renewable power to try to reduce the costs and the burden not only on their wallet, but on the environment as well.