In January 2009, a world-changing event occurred: Satoshi Nakamoto mined the first Bitcoin block — the genesis block. This marked the beginning of a new era in resource mining, linked to digital assets.
While in the 19th century, gold and other physical materials were the foundation of the economy, the 21st century introduced new tools — cryptocurrencies and blockchain. Cryptocurrency mining has become not only a way to create new digital coins but also a technological process that ensures the security and reliability of decentralized networks.
Here’s an explanation of what cryptocurrency mining is and how much you can earn from it in 2025.
What is cryptocurrency mining in simple terms?
Cryptocurrency mining is the process of extracting new cryptocurrency by creating new blocks in the blockchain, which is done using the computational power of computers. This process serves two main purposes:
- Creating new coins: Miners are rewarded for their work with newly created tokens (cryptocurrency).
- Ensuring network security: Solving mathematical problems validates transactions and prevents attacks on the network.
The cryptocurrency mining process involves solving complex cryptographic tasks that are practically impossible to solve manually. Computers analyze millions of options until they find the correct solution. This makes the blockchain resistant to tampering: in order to make changes to the network, an attacker would need enormous computational resources.
Main Consensus Mechanisms
Cryptocurrency mining varies depending on the consensus mechanism used in the blockchain. A consensus mechanism defines how the network reaches an agreement about adding new data to the blockchain.
Proof-of-Work (PoW)
Proof-of-Work is one of the earliest and most well-known consensus mechanisms. It uses computational power to solve complex problems. Cryptocurrency miners compete for the right to add a block to the chain.
How it works:
- The network sets a cryptographic task that needs to be solved.
- Miners use their devices to search for a solution.
- The first one to find the correct solution adds the block to the blockchain and is rewarded.
Disadvantages:
- High energy consumption.
- Expensive hardware required.
Examples of cryptocurrencies: Bitcoin (BTC), Litecoin (LTC), Monero (XMR).
Proof-of-Stake (PoS)
Proof-of-Stake was developed as a more environmentally friendly alternative to PoW. In this mechanism, validators do not use computational power but lock up their coins in the network for passive earnings (a process called staking).
How it works:
- The more coins a user has, the higher the chance of being chosen to create a block.
- This reduces the need for powerful computers, as the computational work is minimal.
Disadvantages:
- Possibility of concentration of power among large coin holders.
Examples of cryptocurrencies: Ethereum 2.0 (ETH), Cardano (ADA), Polkadot (DOT).
Proof-of-Capacity (PoC) / Proof-of-Spacetime (PoSt)
These mechanisms use disk space to create and validate blocks.
Features:
- Use of hard drives (HDD) or solid-state drives (SSD).
- Energy efficiency compared to PoW.
Examples of cryptocurrencies: Filecoin (FIL), Chia (XCH).
Proof-of-Authority (PoA)
This mechanism is used in enterprise blockchains, where trust in validators is based on their reputation.
Features:
- Suitable for private networks.
- Provides high transaction speed.
Examples of cryptocurrencies: VeChain (VET), WhiteBIT Coin (WBT).
Types of Cryptocurrency Mining Equipment
ASIC Miners
Specialized devices designed exclusively for cryptocurrency mining. They provide maximum efficiency but are limited to supporting specific algorithms.
Pros: High performance.
Cons: High cost, lack of versatility.
GPU Mining
Graphics cards (GPU) are widely used for mining various cryptocurrencies.
Pros: Versatility, ability to mine multiple algorithms.
Cons: High power consumption.
CPU Mining
Using a central processing unit (CPU) for cryptocurrency mining.
Pros: Accessibility.
Cons: Low performance.
Cloud Mining
Renting computing power from third-party providers.
Pros: No need to purchase equipment.
Cons: Risk of fraud.,
HDD and SSD Mining
Suitable for cryptocurrencies based on PoC, such as Chia.
Pros: Energy efficiency.
Cons: Equipment wear.
How Proof-of-Work Works in Bitcoin
- Transaction Gathering: Miners collect transactions and group them into a structure known as a Merkle Tree.
- Hashing the Block: A unique hash is created with a specific number of zeros at the beginning.
- Solving the Problem: Miners compete to find the correct nonce (a special number) that meets the required conditions.
- Block Validation: The first miner to find the solution adds the block to the blockchain and receives a reward.
- Block Distribution: The new block is sent to all participants in the network.
Why Cryptocurrency Mining is Important
Cryptocurrency mining plays a key role in maintaining the operation and security of blockchain networks. It serves several critically important functions, each contributing to the stability and efficiency of the cryptocurrency ecosystem.
- Transaction Verification: Mining ensures the verification of transactions. Miners group user operations into blocks, which are then added to the blockchain. In networks based on the Proof of Work (PoW) mechanism, this requires solving complex mathematical problems. In the case of Proof of Stake (PoS), miners provide proof of ownership of a certain amount of cryptocurrency. This process guarantees the legitimacy of transactions.
- Achieving Consensus: Mining contributes to achieving consensus among network participants. Consensus mechanisms such as Proof of Work and Proof of Stake help nodes agree on the current state of the blockchain. This ensures uniformity and data synchronization across the entire distributed ledger.
- Economic Incentives: Economic motivation is also a key element in the cryptocurrency mining system. Participants are rewarded for their efforts with new coins and transaction processing fees. This incentivizes competition and attracts miners who are interested in the network’s success. Additionally, mining serves as the main method for issuing new coins, creating a decentralized distribution mechanism, unlike centralized systems controlled by a single organization.
- Decentralization: Cryptocurrency mining also promotes decentralization. The distributed structure of the network prevents the concentration of power in the hands of a single person or group, making the system more resilient to external influences. As a result, blockchains remain democratic and secure. Data Immutability: Mining supports data immutability. Once a block is added to the chain, altering it becomes extremely difficult, which increases the overall security of the system.
How to Start Mining Cryptocurrency
To start cryptocurrency mining, preparation is key. First and foremost, it’s important to research and understand which cryptocurrencies and consensus mechanisms are the best fit for you. For example, Bitcoin mining requires significant resources and specialized equipment, whereas other cryptocurrencies may be less “demanding.”
The next step is choosing the right equipment. Various cryptocurrencies require different types of mining hardware, such as ASIC devices, GPUs, or CPUs. Your choice will depend on hash rate, energy efficiency, and the economic profitability of the equipment. For Bitcoin, ASIC miners, are highly effective, while Ethereum mining often uses powerful graphics processors.
Once you’ve chosen your equipment, you need to create a cryptocurrency wallet. This is where your mined coins will be stored. The choice between hardware, software, and online wallets depends on your needs and preferences, but security should always be a priority.
It’s also important to calculate the potential profitability. Consider costs such as electricity, equipment maintenance, and any fees for participating in a mining pool (if you plan to use one). Analyzing these factors will help you assess whether your cryptocurrency mining venture will be profitable in the long term.
Pay special attention to energy consumption. Many miners opt for energy-efficient methods, including using renewable energy sources or implementing optimal cooling systems. These steps can help reduce costs and minimize the environmental impact of your mining activities.
For beginners, joining a mining pool can be helpful. A mining pool is a group of miners who work together to solve problems, increasing the chances of finding a block. The reward is distributed among participants according to their contribution. However, keep in mind that joining a pool may reduce your share of profits due to the fees charged by the pool.
After setting up your equipment and connecting to a pool, install specialized mining software that is compatible with the selected cryptocurrency and hardware. Once installed, run tests to ensure the system is functioning properly.
It’s also important to comply with local regulations. Familiarize yourself with the laws surrounding cryptocurrencies, including the taxation of mining income and electricity consumption rules.
Also read: What is a mining farm?
What are mining pools and how do they work?
Mining pools are groups of miners who combine their computational power to increase the chances of finding new blocks. Working in a pool simplifies the process for individual miners, as the rewards are distributed among all participants proportionally to their contribution. This allows for a more stable income compared to solo mining of cryptocurrencies.
However, there are drawbacks. For example, large pools may concentrate a significant portion of computational power, which contradicts the principle of decentralization. Additionally, participation in a pool involves paying a commission, which reduces your profit. Therefore, it’s important to choose a pool with a reliable reputation and transparent terms.
How much does a BTC miner earn today?
The earnings of Bitcoin miners depend on the current state of the network and the market price of the cryptocurrency. Block rewards are halved every four years through a process known as halving. In 2009, miners received 50 BTC per block, but today this amount is 3.125 BTC. However, earnings are heavily influenced by electricity costs and the level of competition.
Pros and cons of cryptocurrency mining
Cryptocurrency mining has its advantages and disadvantages. The pros include:
- Decentralization: The distributed nature of cryptocurrency mining supports the democratic structure of the system.
- Security: Cryptographic algorithms provide a high level of data protection.
- Financial benefit: Successful miners can earn significant profits.
- Independence: Cryptocurrency mining does not require participation from traditional financial institutions.
However, the cons are also apparent. Cryptocurrency mining requires significant energy and financial investments. Competition is constantly growing, making it harder for individual miners to compete with large pools. Additionally, changes in blockchain protocols may render equipment outdated or reduce profits.
What is a miner?
A miner is a device or software designed to perform complex mathematical calculations necessary for creating new blocks in a cryptocurrency blockchain. Miners play a key role in the functioning of most cryptocurrency networks, ensuring their security and confirming transactions.
Types of miners:
- ASIC miners (Application-Specific Integrated Circuit):
These are specialized devices designed exclusively for one purpose — cryptocurrency mining. Unlike general-purpose computers or graphics cards, ASIC miners operate with maximum efficiency due to their narrow specialization. - GPU miners:
Mining with graphics processing units (GPUs) remains popular for cryptocurrencies that are not optimized for ASICs. GPUs are more versatile because they can be used not only for mining but also for other tasks, such as rendering or gaming. - CPU miners:
Processors (CPUs) are mainly used for mining cryptocurrencies with low network difficulty. This method has gradually lost popularity due to low profitability. - FPGA miners (Field-Programmable Gate Array):
A compromise between ASIC and GPU. They are more energy-efficient than GPUs and can be configured for different algorithms. However, their cost and the complexity of setup limit their mass adoption. 
How do ASIC miners work?
ASIC miners operate based on hashing algorithms that are used to solve complex mathematical problems. These problems are necessary to validate transactions and add new blocks to the blockchain.
What is hashing?
Hashing is the process of transforming input data into a unique fixed-length code. For example, the Bitcoin network uses the SHA-256 algorithm, which transforms any information into a 64-character hash.
The role of hashing in mining:
- Protecting transactions from fraud.
- Ensuring network security.
- Generating new coins.
Main hashing algorithms for ASIC miners
Each algorithm is designed for specific cryptocurrencies:
- SHA-256: Bitcoin (BTC), Bitcoin Cash (BCH).
- Scrypt: Litecoin (LTC), Dogecoin (DOGE).
- X11: Dash.
- KHeavyHash: Kaspa (KAS).
These algorithms determine which cryptocurrencies a specific ASIC miner supports.
Popular cryptocurrencies for mining with ASICs
ASIC miners are focused on the most in-demand coins that support their algorithms. Some of these cryptocurrencies include:
- Bitcoin (BTC): The market leader with a current price of around $99,000 (as of January 2025).
- Litecoin (LTC): A more accessible alternative to Bitcoin with the Scrypt algorithm.
- Dash (DASH): A network focused on transaction anonymity.
- Kaspa (KAS): A rising star in mining due to its innovative KHeavyHash algorithm.
How to choose an ASIC miner?
Choosing the right equipment is crucial for successful mining. Here are the main criteria to consider:
- Hashrate
This indicates the speed of computations (measured in TH/s — terahashes per second). The higher this number, the more likely your miner will find a block faster than competitors. For example, the Bitmain Antminer S19 Pro with a hashrate of 110 TH/s is one of the most popular ASIC devices. - Energy consumption
Energy consumption is measured in watts (W). The higher the consumption, the higher your monthly electricity bills. Energy-efficient models, such as the Bitmain Antminer L7, help reduce costs. - Device cost
ASIC miners range in price from $500 to several thousand dollars. Profitability directly depends on the cost of the device and its earnings. - Supported algorithms
Some ASICs only work with one algorithm, while others support multiple algorithms. If you want to mine different coins, choose a device with broader functionality.
Example of profitability calculation
Let’s consider the Antminer S19 Pro:
- Hashrate: 110 TH/s
- Energy consumption: 3250 W
- Device cost: $3,500
- Daily earnings: $10
Payback formula:
Payback period = Device cost / (Earnings – Expenses)
With electricity costs of $2 per day, the payback period would be:
$3,500 / ($10 – $2) = 437 days.
Mining in 2025 — Prospects and Challenges
The ASIC miner market is showing steady growth, and it is projected that by 2030, its volume will reach $16.8 billion. Halvings in cryptocurrencies continue to stimulate investor interest due to frequent bull rallies following these events. However, miners are facing several challenges, such as:
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Increasing network difficulty, which reduces profitability.
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Volatility in cryptocurrency prices, affecting income stability.
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Rising electricity prices, especially in regions with limited access to affordable resources.
Miner Earnings in 2025
The average income from cryptocurrency mining in 2025 depends on the equipment and conditions. For example, the latest ASIC, the Bitmain Antminer S21 XP Hyd, with a power of 473 TH/s, generates around $15-20 per day at current Bitcoin prices and average electricity costs. However, this value can vary depending on electricity costs, network difficulty, and Bitcoin’s price.
Mining cryptocurrencies with less efficient devices (e.g., Antminer S19 Pro Hyd) generates lower income, averaging $5-10 per day, which makes older devices less profitable, especially in regions with expensive electricity. If you have a mining farm, cryptocurrency mining can be profitable, but if you only have a single device, it will be difficult to pay it off.
These trends confirm the growing preference for powerful and energy-efficient ASIC miners, which help maximize profits even as network difficulty increases.
Mining Pools: A Way to Stabilize Income
Mining cryptocurrency solo has become increasingly challenging due to intense competition. Mining pools bring together the computing power of multiple participants, allowing for more frequent block discoveries. Earnings are divided among all participants in proportion to their contributions.
Mining with ASIC devices remains one of the most profitable ways to earn in the crypto industry. However, for successful mining, it’s important to consider factors like the cost of equipment, energy consumption, cryptocurrency market prices, and network difficulty.
Cryptocurrency mining requires investments and careful planning, but with the right approach, it can become a reliable source of income in the growing crypto market.
Read another interesting article: Mining on Your Phone: Top 6 Bots for Mining Directly in Telegram.
Frequently Asked Questions
Can you still make money from cryptocurrency mining?
To mine, you’ll typically need powerful graphics cards (GPUs), specialized ASIC devices, and software to validate and process transactions. Additionally, you’ll need to factor in the costs of electricity and cooling.
Mining as a business is feasible, but it requires thorough market analysis. You’ll need to consider technical aspects, equipment costs, local regulations, and the outlook for the cryptocurrency market.
Cloud mining offers an alternative to purchasing your own equipment, allowing you to rent processing power in a data center and earn income based on your investment.
Is it better to mine at home or in dedicated centers?
A mining farm can be located either at home or in specially equipped centers. Home-based farms often take up a lot of space and require cooling, which adds complexity.
How do you get paid through mining?
