The Real Dilemma of BTC Mining: How Can Individual Miners Break Through in the Hashrate Arms Race?

Many beginners hold romantic fantasies about Bitcoin mining—buying a mining rig and easily earning BTC. But reality is far more brutal than imagination. Today’s mining industry has completely transformed, and individual miners face unprecedented challenges.

Mining is No Longer a “Free Lunch”

In the early years, Bitcoin mining indeed had a “free” era. From 2009 to 2012, mining with ordinary computer CPUs was possible, with low difficulty and little competition. Satoshi Nakamoto even easily earned millions of BTC using just a personal computer.

But that era is gone forever.

The current truth of mining is: The total network hashrate has exceeded 580EH/s, and the hashrate of a single personal machine is negligible in comparison. If you are still mining solo with a computer, you can hardly mine BTC—it’s not “almost,” but “impossible.” Even if you join a mining pool for combined mining, the BTC distributed proportionally to hashrate is so small that it barely covers electricity costs and equipment depreciation.

Evolution of Third-Generation Mining Machines: From Consumer Computers to Professional Arsenal

The iteration speed of mining equipment is astonishing, with each generation’s obsolescence meaning a significant depreciation of previous investments:

CPU Era (2009-2012) — Ordinary computers could mine, with minimal costs

GPU Era (early 2013) — Graphics cards became popular, increasing hashrate but still acceptable power consumption

ASIC Era (2013-present) — Dedicated integrated circuit miners dominate the market, with explosive hashrate growth and multiplied power consumption

Current mainstream ASIC miners (like Ant S19 Pro, Shima M30S++, etc.) range in price from $1,000 to $3,000 per unit, and the cycle of iteration is short—new machines bought last year may already face performance depreciation this year. Buying old models is no different from investing in a pile of scrap metal; even if the hardware still runs, low hashrate means almost zero profit.

The True Cost of Mining

Many underestimate the hidden costs of mining. Building a profitable mining operation requires considering:

Hardware Investment — Professional miners often cost thousands of dollars

Electricity Expenses — Running 24/7, monthly electricity bills can reach hundreds or thousands of dollars (depending on local electricity prices and miner power consumption)

Cooling Systems — Efficient cooling requires air conditioning, fans, or liquid cooling solutions, adding extra costs

Operational Expenses — Maintenance, network fees, venue rental, and other miscellaneous costs

Transaction Fees and Pool Commission — Joining a mining pool usually involves paying 1-4% commission

According to data, as of May 2025, the total cost to mine one Bitcoin is approximately $108,256.62. In other words, if BTC price is below this cost line, miners are operating at a loss.

How Can Individual Miners Survive?

In an era of hashrate oligopoly, individual miners face three options:

Option 1: Purchase and operate mining rigs independently — Requires technical knowledge, substantial capital, and stable, low-cost electricity. Suitable for those with skills and funds.

Option 2: Outsource mining to third-party operators — Hand over maintenance to professional mining farms, but pay hosting fees, further reducing profits.

Option 3: Rent hashrate — Buy hashrate for a period (platforms like NiceHash, Genesis Mining offer this service), saving on equipment costs but losing long-term asset accumulation. However, this method has the lowest risk and is suitable for those with limited funds or short-term experimentation.

The Impact of Halving: Miners’ Collective “Surrender Wave”

In April 2024, Bitcoin completed its fourth halving—block rewards dropped sharply from 6.25 BTC to 3.125 BTC. This halving caused a huge shock to the mining industry:

Reward Halved Instantly — If BTC price does not double simultaneously, miners’ marginal profits evaporate by 50%. Many small miners with high electricity costs or old equipment are forced to shut down and exit.

Transaction Fees Become a Lifeline — As on-chain activities like Ordinals inscriptions and Layer 2 solutions explode, transaction fee income proportion increases. During the 2023 inscription boom, fees once accounted for over 50% of miners’ total revenue.

Hashrate Redistribution — Large mining farms, benefiting from scale advantages and low electricity agreements, survived; small and medium miners were heavily淘汰, leading to increased market concentration.

Strategies for Self-Help: Miners’ Survival Plans

Faced with profit pressure after halving, surviving miners adopt these strategies:

Optimize Energy Consumption — Eliminate power-hungry equipment, upgrade to more efficient miners like AvalonMiner 1246 and similar cost-effective models.

Relocate to Low Electricity Cost Areas — Move mining farms to regions with cheap electricity (Iceland, Iran, Central Asia) or utilize waste energy sources (geothermal, wind, solar).

Diversify Mining — Use automatic algorithm switching to mine Bitcoin and Dogecoin simultaneously, or chase hot new coins.

Hedging — Use futures contracts to lock in BTC prices, hedging against market downturns.

The Future of Mining: Big Capital Dominates

The future landscape of mining is already clear: Small individual miners will gradually be phased out, with hashrate concentrated in large-scale mining farms with low electricity costs, strong technical capabilities, and ample capital.

Emerging trends include mining with waste energy, AI computing power leasing, and hybrid mining farms, but these are far beyond the reach of ordinary individuals.

Conclusion: Mining or Trading?

If you are not a professional miner, lack access to cheap electricity, or do not have substantial startup capital, the best way to pursue BTC is not through mining.

Bitcoin trading (spot or derivatives) offers a more flexible alternative—zero equipment costs, two-way trading mechanisms, 24/7 liquidity. Compared to buying mining rigs and bearing operational costs, trading markets give small investors more agency.

The golden age of mining has already passed. Now, if you join, you are not investing in the future but engaging in a high-cost, low-yield consumption war.