Ethereum mining is profitable, but not for long

Is it worth it?

This is a constant question, especially now that the price of Ethereum is rising. This year, Ethereum has seen an almost 20x jump in price. This increase has led people, who hadn’t considered cryptocurrency, to sit down and become suddenly extremely interested. When this happens, I believe that most of the biggest profits have already been made.

Photo credit: Etherscan.

People have been mining the coin for months or years, and they have probably seen some tremendous gains, especially if they have a decent-sized operation.

OK, let’s get back to the question: “Is it worth it to start mining?”

If you are just hearing about Ethereum and interested in maybe jumping onboard, this can be a very difficult question and the answer depends on a lot of factors. Well, hopefully, this article will help you get an idea of whether it is good to mine Ethereum.

What is Ethereum?

In elementary terms, Ethereum is an open software platform based on the blockchain technology that enables developers to build and deploy decentralized applications.

I remember a friend once came up to me and asked, “Is bitcoin and Ethereum similar?” Well, sort of, but not really.

Like bitcoin, Ethereum is a distributed public blockchain network. There are, of course, some significant technical differences, but the most important is that they differ substantially in purpose and capability. Bitcoin offers one application —a peer-to-peer electronic cash system that enables bitcoin payments. The Ethereum blockchain can support many different types of decentralized applications.

Wait, if it is a network, how is a price assigned to Ethereum?

If someone says that he or she has invested in Ethereum, they have actually bought Ether (ETH). Ethereum is a network, whereas, Ether is the fuel that powers it. Ethereum, of course, cannot be traded, but Ether is traded and it appreciates and depreciates in price. The price of Ether is what fluctuates based on demand.

Ethereum has a lot of real-life uses like supply chain, healthcare, and banking. More applications require more Ether, and this causes the price to increase.

So, how do I get Ether?

There are a few different ways to earn Ether, but the two most common ones are:

1. Cryptocurrency exchanges

Mining sounds easy. Should I start now?

Let’s take an example