Deep analysis of the current state of Bitcoin mining: Why is it difficult for individuals to profit?

Have you ever wondered how early miners managed to mine大量比特幣? If you still want to join the mining ranks today, what are your chances of success? Today, we will reveal the true face of Bitcoin mining and the fundamental changes that have occurred in this industry in recent years.

What is Mining? Analyzing the Principles of Cryptocurrency Mining

When it comes to mining, many people’s first reaction is to think of using a pickaxe to dig minerals underground. But in the blockchain world, Bitcoin mining refers to miners using computers to perform verification tasks for the Bitcoin network, earning newly issued Bitcoins and transaction fees as rewards.

Specifically, those who own mining machines (professional mining equipment) are called “miners.” What do they do? Simply put, they are engaged in automated bookkeeping. Every transaction on the Bitcoin network needs to be recorded into a “block,” and miners perform this task by running complex cryptographic calculations.

Miners are the main source of supply for cryptocurrencies; their behavior directly determines the healthy operation of the Bitcoin network. Without miners, no one would record transactions, and the Bitcoin network would grind to a halt.

Principles of Cryptocurrency Mining: Proof of Work (PoW) Mechanism

Bitcoin adopts a consensus mechanism called “Proof of Work” (PoW). The operation logic of this system is:

Miners continuously perform cryptographic calculations, trying to find a “Hash” that meets certain conditions. This process is similar to solving an extremely complex math problem that requires many attempts. The first to find the correct answer has the right to record the transaction information of that block.

When a miner successfully finds a qualifying Hash, the new block is broadcast to the entire network, and other nodes verify its validity. After most nodes agree, the block is permanently added to the blockchain. Miners who complete this process are rewarded.

It is important to note that this difficulty is not fixed. Mining difficulty is directly proportional to the total network hashrate—as more miners join, total hashrate increases, and mining difficulty automatically adjusts upward. Currently, the total network hashrate of Bitcoin has surpassed 580 EH/s, making it completely unrealistic to mine with a personal computer.

What Are the Benefits of Mining?

Miners’ income mainly comes from two parts:

1. Block Rewards
The system reduces the reward every 4 years, starting from 50 BTC, then 25, 12.5, 6.25, 3.125… Currently (after the 2024 halving), the reward per block is 3.125 BTC.

2. Transaction Fees
All transactions on the network require fees paid to miners, which fluctuate based on network congestion. During the memecoin boom, fee income once accounted for over 50% of miners’ total revenue.

Industry Evolution: From Individual Gaming to Institutional Monopoly

The Bitcoin mining industry has gone through three distinct stages:

Equipment Evolution

• 2009-2012: Ordinary CPUs could mine
• Early 2013: GPU mining became mainstream
• After 2013: Professional ASIC miners (like Antminer, Avalon) completely dominated the market

Organizational Structure Evolution

• Early: Solo mining by individuals
• Later: As total network hashrate surged, individual mining probability plummeted, miners began forming “mining pools” for collective mining
• Currently: Cloud mining pools are mainstream, and scaled operations are inevitable

Reward Distribution Evolution

• Solo mining era: 100% of block rewards go to individuals
• Pool era: Rewards are distributed proportionally based on contributed hashrate

What do these changes indicate? Mining is rapidly evolving from a democratized participatory activity into a professional industry dominated by large capital.

Will Individuals Still Mine Bitcoin in 2025? Cost Realities

This is a question many people care about. The short answer is: In theory, yes, but in practice, it’s very hard to make money.

Cost Realities

As of May 2025, the total cost to mine one Bitcoin has reached $108,256. This figure includes:

• Hardware costs: Professional mining machines priced between $1,000-$2,000 or higher
• Electricity costs: The largest expense, usually accounting for 60-70%
• Cooling systems: Purchase and maintenance of efficient cooling equipment
• Daily maintenance: Network, upkeep, labor costs
• Mining pool fees: Usually 1-2% of earnings

Why is it difficult for individual miners to survive?

Suppose you buy a new ASIC miner with a hashrate of about 170 TH/s, and electricity costs $0.10 per kWh. The daily electricity cost is about $42. Under current difficulty, this miner produces approximately 0.0002 BTC per day (about $10). You need to mine for over 4 days just to offset one day’s electricity cost, let alone recover the hardware investment.

Moreover, hardware models are updated very quickly; buying outdated models directly impacts profitability. At the same time, solo mining has almost zero chance of success; joining a mining pool is necessary for stable income.

2024 Halving and Industry Reshuffle

Bitcoin completed its fourth halving in April 2024, reducing the block reward from 6.25 BTC to 3.125 BTC—a heavy blow to the mining industry.

Impact of the Halving

• Miners’ income is cut in half (if the price doesn’t rise)
• Many inefficient miners shut down, causing a short-term decrease in total network hashrate
• The importance of transaction fees increases

Miners’ Response Strategies

Surviving miners are mainly adopting these approaches:

1. Eliminate old equipment and upgrade to more energy-efficient new miners
2. Relocate to low-cost electricity regions, such as Xinjiang, Sichuan, or seek renewable energy sources
3. Mine multiple cryptocurrencies, switching between Bitcoin and others based on market trends
4. Hedge risks through futures markets to lock in Bitcoin prices

Industry Outlook

Post-halving, the mining industry is accelerating towards centralization. Large-scale mining farms benefit from economies of scale and low electricity costs, while small miners face the risk of being pushed out. Future developments may include “waste energy mining,” AI-powered combined computing, and other innovative models, but these require significant capital and technical investment.

Alternative Options for Personal Miners

If you’re interested in Bitcoin but don’t want to invest heavily in hardware, there are other options:

1. Renting Hashrate
Through platforms like NiceHash, Genesis Mining, you can rent hashrate directly without buying hardware, though returns are lower.

2. Contract Trading
Trade Bitcoin contracts on exchanges like Gate.io—no need to buy hardware, higher capital efficiency, and support for both long and short positions—allowing profit whether the market rises or falls.

3. Spot Investment
Buy and hold Bitcoin directly, avoiding the complexities of daily mining operations.

Summary

Bitcoin mining has evolved from a democratized participatory activity into a high-threshold professional industry. The era of mining大量比特幣 with free electricity using personal computers is gone forever.

Currently, for individuals to profit from mining, they must face: initial costs exceeding $108,000, rising difficulty, rapid equipment iteration, and increasing market centralization.

For most investors, studying the Bitcoin market and participating through legitimate trading platforms—via spot or contract trading—is a more efficient and flexible approach. It allows exposure to Bitcoin without hardware investments, electricity costs, or maintenance hassles, and avoids regional and policy restrictions.

The value of Bitcoin is not only in its supply side through mining but also in the trading markets full of opportunities. The key is to choose the right way to participate.