5 Reasons Why You Should Not Mine Cryptocurrency

The crypto-sphere is increasing on a day-to-day basis, with new developments and technologies being brought into the market. As interpreted from crypto latest news, many major investors and entrepreneurs have begun shifting more towards cryptocurrency adoption and digitizing their payment systems.

That being said, at present, mining cryptocurrency has become a highly accepted task for individuals. However, crypto mining is not as rewarding as it seems and given the dive several major cryptocurrencies have experienced in the market in the past few months, crypto users are better off trading digital currencies than buying them.

Here, we have outlined 5 reasons why you should not consider mining cryptocurrency. Give it a good read and you might understand why it is not the right time for mining.

Unstable Value

Cryptocurrencies are known for their high volatility rate, meaning that their price is repeatedly fluctuating and can drop at any time. Unlike fiat currency, digital currencies are highly sensitive so, if there is a technical issue in any exchange or a country expresses distrust towards a cryptocurrency, the coin is bound to experience a dip.

For instance, according to Btc news, due to the increase in number of security breaches in exchanges and cryptocurrency regulations, many of the top cryptocurrencies, including bitcoin have experienced a decline in their value.

High start-up cost

The initial startup cost will always be extremely high because you are going to be making major purchases such as the mining hardware, warehouse and cooling equipment along with utility bills. If your aim is to mine efficiently, then you must be able to get your hands on all the above-mentioned items. So, if you are on a tight budget then mining is not going to be your forte.

Fraudulent organizers

One method that newbie and enthusiastic miners opt for is joining mining groups where they share the hardware and electricity cost and then split the rewards amongst all members in the group. Though this method is a cost-efficient option for beginner miners but it is also an extremely risky one because the crypto-verse is filled with fraudulent organizers looking to steal earnings of other miners. Once you enter a group of deceitful members, you place your earnings at a high risk and might never get them back. Hence, unless you are completely sure your group is safe, do not start mining.

Less possibility of profit

Mining is not a cheap task; you have got electricity bills to cover and mining equipment to look after. So, when you do manage to make a decent amount from mining, majority of it would be used to pay off the large electricity charges, rent or maintenance bills accumulated during your mining venture.

Mining competition

There was a point when cryptocurrencies could be easily mined using your personal computers but then as difficulty to solve the next block increased, miners soon shifted to Graphical Processing Units (GPUs) that were able to provide more hashing power as compared to regular PCs. As the demand for cryptocurrency has increased substantially, the difficulty to mine a coin has increased as well which means, more miners are competing against one another to solve a block and earn the rewards.

Currently, efficient cryptocurrency mining can only be done using ASIC mining chips since they are specifically designed to perform the task while consuming less electricity. While you can still mine using PCs, you are just not likely to gain any profit.

Considering all the above points, if you are feeling even a little bit skeptical towards the task at hand then this is not the right field for you. There are expenses to take care of and risks to dodge which require a lot of money, time and strategy. Even when you are doing everything right, the chances of you making any profit is very less. Therefore, we recommend that you stick with trading till the crypto market has settled down.