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LESSONS

Should you mine at home?

At household power rates, home mining loses money against simply buying. It makes sense with cheap power, useful heat, a desire for non-KYC coins, or as education.

5 MIN READ
COURSE · Bitcoin miningSTAGE 4 · GO DEEPLESSON 7 OF 7
Two panels on when home mining makes sense.
LEVEL · Intermediate
IN THIS LESSON · 7 OF 7
BY THE END YOU WILL BE ABLE TO ANSWER
  • At household power rates, how does home mining usually compare with buying bitcoin?
  • What is the main risk with cloud mining?
  • When can home mining make sense, according to the lesson?
  • A miner earns $8 a day and uses 3.5 kW. At what electricity price per kWh does it break even? (3.5 kW x 24 h = 84 kWh a day.)

Then prove it: a 3-question quiz · a challenge. The lesson marks itself complete at 100%.

After this lesson you can: decide whether home mining makes sense for you.

The honest math

At typical household rates (10 to 20 cents per kWh) an ASIC loses money every day compared with buying the same bitcoin. Lesson 4's worked example shows why. Serious mining runs on power at a few cents, bought in bulk, in facilities built for heat and noise.

When it does make sense

Line chart of daily power cost versus revenue for a home miner across household power prices.
At household rates the cost line sits above the revenue line.

  • Cheap power. Hydro, a solar surplus, a special tariff.
  • Heat. A miner is a space heater that pays part of its bill. In a cold climate, heating your house or a greenhouse with hash rate changes the math.
  • Non-KYC coins. Mined bitcoin arrives with no exchange record. Some people value that enough to mine at a loss.
  • Education and support. Running a small miner on a pool, or a tiny "lottery" miner, teaches you the business and adds a little decentralisation. Think of it as a hobby with a chance of a prize.

Hosted and cloud mining

Table of the four cases where home mining can make sense.
When the math changes.

Hosted mining: you buy a machine and a company runs it in its facility for a fee. You own the hardware, they own the power contract. Reasonable with a reputable host; read the contract.

Cloud mining: you buy "hash power" from a website. The industry is full of fraud; the honest version offers returns below just buying bitcoin. Treat any cloud mining offer with guaranteed returns as a scam.

Miners or bitcoin?

Two columns comparing hosted mining with cloud mining.
Hosted: you own a machine. Cloud: you own a promise.

Buying bitcoin gives you the asset. Buying mining hardware gives you a depreciating machine, operational risk and exposure to hashprice. Most people wanting exposure to bitcoin should hold bitcoin; mining is a business, and businesses are for people who want to run them.

Course checklist: what you can now do

Tick each one you have actually done. The course is finished when they are all ticked, not when the quiz is.

MINI CHALLENGEBreak-even power

A miner earns $8 a day and uses 3.5 kW. At what electricity price per kWh does it break even? (3.5 kW x 24 h = 84 kWh a day.)

$/kWh
CHECK YOURSELF
1/3 At household power rates, how does home mining usually compare with buying bitcoin?
2/3 What is the main risk with cloud mining?
3/3 When can home mining make sense, according to the lesson?
pick an answer for each question

SOURCES

  1. Should you buy bitcoin miners or bitcoin? (River)
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