Make money On Bitcoin
Something like 3600 bitcoins are mined per day. At the current price that's $1.3 million per day. So, naturally, there are some efficient miners out there who make a profit on that.
But I've also heard that miners spend upwards of $1 million per day on electricity alone. Even of some miners who run at a loss because they, "can't stop."
There's gold in them hills!
The most profitable miners have access to cheap electricity, like hydroelectric in China or geo-thermal in Iceland. They have access to equipment that's advanced enough to hash at the current difficulty. They source that equipment at a cost where it's reasonable to project, based on the price and difficulty, that they will make a return on their investment.
In bitcoin mining, miners come and go because the difficulty can increase rapidly with the introduction of new hashing technology. But that's why the biggest players in bitcoin mining are making their own hardware.
In bitcoin mining, when the price of bitcoin rises, you need to sell less bitcoin in order to pay your electric bill. So, your bitcoin denominated profit margin increases. But if the difficulty starts to outpace your equipment, you start generating less bitcoin, so your bitcoin profit margin decreases.
You have a fluctuating bitcoin reward and a fluctuating bitcoin price.
So, you're looking for a situation where the difficulty is stable/dropping, electricity is stable/cheap, and the bitcoin price is stable/rising.
Or, if you are a company who is pushing the limits on mining technology, and you are the reason the difficulty is increasing, that's good too. Because you're pushing out competition. A lot of people (who aren't miners) see this as a negative.
The people who aren't making money mining are hobbyists. People who bought an out-dated or soon-to-be-out-dated miner for more money than it will ever produce.
It's an attractive idea, mining. It's like, "I can print money!" But it's not the case now with difficulty so high.
It's a specialist game or a fool's errand at this point.
I say this from experience. I've bought a miner for $600 when bitcoins cost $60 and when the miner finally came I generated around 1 bitcoin, but the price was $600 then. So, I broke even and shut it off.
Since then, I have invested a small sum in a fund (this is not investment advice) and I receive daily bitcoin dividends from their mining operation in Iceland. And that dividend is growing as price goes up because they have to sell less bitcoin to pay electricity. It's neat, but buying BTC outright is easier.