Although mining cryptocurrencies isn’t as profitable as it was in the earlier years, there is still the chance of making a profit, and with some less technical mining solutions, it can be a great way to earn a passive income, even for the beginner.
Many people say Bitcoin is the best to mine, and although it’s the best coin by far, it is getting ultra competitive and very expensive just to be able to compete, so mining altcoins can be a great option.
Whenever you think about starting mining altcoins, the first thing you want to be sure about is whether mining is profitable. And although this varies greatly, you can make serious money mining altcoins.
Estimate Your Profits Before Starting
Before starting mining altcoins, make sure you can work out whether it’s profitable. Do as much research as possible to find out whether everything you’re going to get into is the best for you in your region. But here are some factors to take into account before you start:
Firstly, you want to know the price of the altcoin. The higher it is, the more profit you will make. Be warned, altcoins had a pretty bad 2018 and 2019 pricewise, and although they have been bullish this year, they are still pretty low. This could be a good thing, as well as they have a long way to go just to reach their all time high prices.
The cost of electricity cost in your region is arguably the important factor, when calculating the profitability of mining any cryptocurrency. That said it is profitable in many parts of the world, but always take your electricity cost into consideration.
Related Reading: Is USB Mining The Way Forward for Mining Bitcoin?
Although if you can afford to mine at a loss, and keep hold of your altcoin, you can wait for it to gain value and sell when the price pumps. There’s no guarantees that altcoins will rise in value of course, but personally I have faith in the ones I list below.
Also, if you’re mining a low-cap coin (shitcoin), which exchange can you sell them on? Usually the shitcoins are only on the lower liquid exchanges and they tend to charge a higher transaction fee, so take that into account if you want to mine shitcoins.
Mining difficulty and hashrate is an important factor to take into account when getting into mining. Both GPU and CPU can be difficult and the parts needed can be expensive. However, it’s still possible to find a profitbale niche altcoin to mine.
You must have up to date efficient equipment to be able to compete against the other miners. Depending on your budget, will largely play into which coins you should try and mine, as the more your budget allows for more powerful mining rigs, the more popular altcoins you can go for.
Making sure your mining pool is legitimate is also an important factor. The ones I mention below are respectable but aren’t without the odd bit of controversy. Another problem with mining pools is that they kind of centralize the network. That being said, it’s important to join one as it gives you more chance of winning the block reward of your chosen altcoin.
5 Profitable Altcoins You Can Mine
There are many factors to take into account, and profitability changes a lot so always do research as some of this advice might be outdated by the time you read this.
*All profit calculations are taken from CryptoCompare Mining Calculator
Ethereum is the second most popular cryptocurrency, and is still a great choice to mine. The value of ETH has risen dramatically this year, and although it will eventually move to a proof-of-stake consensus algorithm, it is still a mineable coin and will be for the foreseeable future.
And at today’s current price and taking an average electricity cost into consideration, you can earn a fantastic 628% profit ratio a day.
Hashing Function: Ethash
Current Price: $221
Profit Ratio Per Day: 628%
Mining Pools: ETHfans, Dwarfpool, F2pool, ETHpool, MinerGate
ZCash (ZEC) was released in October 2016, and has since become ne of the more respected altcoins, due to its anonymity. Since it can be mined by anyone, it’s also one of the more popular coins to mine. Its algorithm allows GPU graphics cards.
And at today’s current price and taking an average electricity cost into consideration, you can earn 91% profit ratio a day.
Hashing Function: Equihash
Current Price: $50.32
Profit Ratio Per Day: 91%
Mining Pools: Poolin, F2Pool, Slushpool, Antpool, Flypool
Monero is the ultimate privacy coin. Many people liken it to ZEC, but XMR has higher tansaction fees, but that being said Monero is probably more popular due to its level of anonymity.
The thing about Monero is that it keeps altering its algorithm to prevent ASIC-mining capability. This means you can use cheaper GPU and CPU to mine XMR.
Hashing Function: CryptoNightR
Current Price: $66.56
Profit Ratio Per Day: 86%
Mining Pools: MineXMR, MinerGate, Nanopool, Dwarfpool, Poolin
Litecoin is one of the most popular and most respected altcoins. It is highly liquid and can be mined at a profit. With Litecoin being such a popular coin, it is quite competitive and CPU and GPU mining isn’t that profitable. That said, if your old Bitcoin ASIC mining rigs aren’t competitive mining Bitcoin anymore, Litecoin is a great coin to choose as it is ASIC compatible, and that will bring you the best returns.
Hashing Function: Scrypt
Current Price: $58.54
Profit Ratio Per Day: 308%
Mining Pools: Multipool, Prohashing, Litecoinpool, NiceHash, viaBTC
Dash is another good and respectable altcoin that you can mine. Because of the x11 Algorithm, which combines 11 different algorithms, DASH yields a great deal of efficiency and also reduces power consumption. You can mine DASH with CPU and GPU, but it’s better to have ASIC mining rigs to mine DASH and this will guarantee more profits.
Hashing Function: Scrypt
Current Price: $58.54
Profit Ratio Per Day: 7%
Mining Pool: Poolin, F2Pool, Antpool, Cybtc, Coinmine
Wrapping It All Up
Mining can be technical, but it’s also profitable if you’re in an area with cheaper electricity. Before getting into mining, it’s important to take in all factors. It’s not just financially rewarding but also the fact that you’re helping to secure the network also gives you a feeling of satisfaction.
Bitcoin will always be king, but mining altcoins means it’s easier to earn and can be profitable if the prices are high enough. The outlay for altcoin mining is much cheaper than Bitcoin mining, and if your Bitcoin mining rigs are outdated, you can use them to mine altcoins.
All in all, it’s best to start as a hobby, get used to all the technicalities, and as you become more knowledgeable, grow your own mining farm, and as altcoins grow in utility and hopefully price, the profits will only get bigger.
Author: Tommy Limpitlaw