Last year Bitcoin Mining generated revenues totaling nearly five billion US dollars. This is the conclusion of a recent report by The Block.
Ear-splitting pneumatic hammers, dirt in the lungs, lack of oxygen, a small explosion here and there, and only distant memories of sunlight: there are better pleasures than working underground until death reaches out its hand. How nice that we live in the digital age and that today’s form of mining is much more pleasant and at the same time more profitable. A recent report by The Block has examined the 2019 revenue generated by mining. The miners in the shaft didn’t even dare to dream about the profits.
Bitcoin Mining remains lucrative
Connect the device, lean back and get rich. The business model of Mining can be roughly reduced to this formula. Costs and benefits seem to be unequally distributed in favour of profit, which is why the mining business continues to attract gold miners. The latest report “2020 Research Outlook” by The Block proves them right.
Bitcoin Mining generated an estimated five billion US dollars last year. Most of the sum – around 4.89 billion US dollars – is attributable to Block Rewards. Block Rewards are rewards for miners who generate new blocks. Each time a new transaction block is created, one lucky miner receives 12.5 Bitcoin, including accumulated transaction costs.
So-called mining pools, in which many miners join together to form a group, increase the chances of winning unevenly. The profit is distributed among all participants. Compared to the turnover generated by block rewards, the profit generated by transaction fees appears to be very small – around 146 million US dollars.
Although Bitcoin Mining had a dizzying turnover last year, the number is slightly lower than last year. It is estimated that Mining will still be making 5.26 billion US dollars in 2018. But overall, the Bitcoin cosmos is still in a gold-rush mood. Since 2017, when the estimated revenue was 3.19 billion US dollars, mining has become a billion-dollar business.
The report’s calculations coin on the assumption that Miner will sell its Bitcoin immediately. However, many Miners keep their digital coins in safekeeping and do not withdraw the coins directly. Therefore, the calculation should only be read as a hypothetical guide.