Mining Profitability:
Is Crypto Mining Worth It in 2026?
The complete profitability equation: revenue formulas, cost breakdowns, break-even analysis, ROI examples, and a clear framework for deciding whether to mine or buy.
Mining profitability boils down to one equation: Profit = Revenue − Costs
- Revenue = (your hashrate / network hashrate) × blocks per day × block reward × coin price
- Electricity is the #1 cost — typically 70–90% of operating expenses
- Break-even = hardware cost / (daily revenue − daily electricity)
- Below $0.10/kWh: most GPU mining is profitable with modern cards
- Above $0.20/kWh: almost no GPU mining is profitable — buy coins instead
The Fundamental Profitability Equation
Every mining operation comes down to a single question: does the value of the coins you mine exceed the total cost of mining them? Everything else is a detail within this core equation:
Daily Profit = Daily Revenue - Daily Costs
// Where:
Daily Revenue = coins_mined_per_day × coin_price_in_fiat
Daily Costs = electricity + pool_fees + depreciation + overhead
// If Daily Profit > 0: mining is profitable
// If Daily Profit < 0: you are losing money
// If Daily Profit = 0: break-even (electricity = revenue)Let's break each component down with real formulas and numbers.
Revenue Calculation
The number of coins you mine per day depends on your fraction of the total network hashrate:
coins_per_day = (your_hashrate / network_hashrate) × blocks_per_day × block_reward
// blocks_per_day = 86,400 seconds / block_time_in_seconds
// Example: Mining Ravencoin (RVN) with an RTX 4070
Your hashrate: 30 MH/s
Network hashrate: 5,000 GH/s = 5,000,000 MH/s
Block time: 60 seconds
Block reward: 2,500 RVN
Blocks per day: 86,400 / 60 = 1,440
coins_per_day = (30 / 5,000,000) × 1,440 × 2,500
= 0.000006 × 3,600,000
= 21.6 RVN per dayTo convert to fiat (USD, EUR, etc.):
daily_revenue_usd = coins_per_day × coin_price_usd
// If RVN = $0.025:
daily_revenue = 21.6 × $0.025 = $0.54 per dayBoth the coin price and the network hashrate (which determines difficulty) change continuously. A calculation done today may be 20% off by next week. Treat revenue estimates as rough guides, not guarantees. Pool mining luck adds another layer of short-term variance on top of these estimates. Always recalculate regularly.
Cost Calculation
Costs have four main components. Electricity dominates, but ignoring the others leads to an overly optimistic view.
1. Electricity (The Big One)
This is the single most important number in mining economics. The formula is straightforward:
daily_electricity_cost = (watts / 1000) × 24 × electricity_rate
// Example: RTX 4070 drawing 200W at $0.12/kWh
daily_cost = (200 / 1000) × 24 × $0.12
= 0.2 kW × 24 hours × $0.12
= $0.576 per day
// Monthly: $0.576 × 30 = $17.28
// Yearly: $0.576 × 365 = $210.24Here is how electricity rates around the world affect mining profitability for a single RTX 4070 drawing 200W:
| Region | Typical Rate | Daily Cost (200W) | Monthly Cost | Viability |
|---|---|---|---|---|
| US (cheap states: TX, WA) | $0.06–0.08/kWh | $0.29–0.38 | $8.60–11.50 | Excellent |
| US (average) | $0.12–0.15/kWh | $0.58–0.72 | $17.30–21.60 | Good |
| Canada | $0.08–0.13/kWh | $0.38–0.62 | $11.50–18.70 | Good |
| Eastern Europe | $0.08–0.12/kWh | $0.38–0.58 | $11.50–17.30 | Good |
| US (expensive states: CA, NY) | $0.20–0.30/kWh | $0.96–1.44 | $28.80–43.20 | Marginal |
| Western Europe (DE, UK) | $0.25–0.40/kWh | $1.20–1.92 | $36.00–57.60 | Unprofitable |
| Australia | $0.22–0.35/kWh | $1.06–1.68 | $31.70–50.40 | Unprofitable |
2. Hardware Depreciation
Your GPU loses value over time. To account for this, spread the purchase cost over the expected useful life:
daily_depreciation = hardware_cost / (useful_life_in_years × 365)
// Example: RTX 4070 purchased for $550, expected 3-year useful life
daily_depreciation = $550 / (3 × 365) = $0.50 per day
// Note: GPUs retain some resale value
// If you sell after 2 years for $200:
effective_depreciation = ($550 - $200) / (2 × 365) = $0.48 per day3. Pool Fees
Most pools charge 0.5–2% of your mining revenue. This is deducted automatically:
pool_fee_cost = daily_revenue × pool_fee_percentage
// Example: $0.54/day revenue with 1% pool fee
pool_fee = $0.54 × 0.01 = $0.0054 per day // Minimal impact4. Overhead (Often Forgotten)
- Internet: ~$1–2/month incremental (mining uses minimal bandwidth)
- Cooling: Air conditioning costs in summer can add 20–40% to electricity cost
- Maintenance: Thermal paste replacement, fan replacement, cables ($50–100/year)
- Space: If you are renting dedicated space, include that cost
Think of mining like running a vending machine business. The coins the machine collects are revenue. Electricity to power the machine, rent for the location, restocking costs, and the original purchase price of the machine are all costs. The machine is "profitable" only if the coins collected exceed everything you spend to keep it running.
Break-Even Analysis
The break-even point is when your total mining revenue equals your total costs, including the hardware purchase. After that point, every dollar of revenue is profit.
break_even_days = hardware_cost / (daily_revenue - daily_operating_costs)
// Where daily_operating_costs = electricity + pool_fees + overhead
// (NOT including depreciation — that's what we're calculating)
// Example: RTX 4070 mining Ravencoin
Hardware cost: $550
Daily revenue: $0.54
Daily electricity: $0.58 (at $0.12/kWh)
Daily pool fee: $0.005
Daily net profit: $0.54 - $0.58 - $0.005 = -$0.045
// NEGATIVE! This setup loses money at current prices.
// Break-even is impossible unless coin price rises or electricity falls.If daily_revenue < daily_electricity, you will never break even. You are paying more for electricity than the coins are worth. In this case, you would get more crypto by simply using your electricity money to buy coins on an exchange. This is the fundamental profitability test.
ROI Calculation Examples
Let's walk through three realistic scenarios with different hardware and coins. These use representative market conditions — your actual results will vary with price changes and difficulty adjustments.
Example 1: RTX 4070 Mining Ravencoin (KawPow)
| Parameter | Value |
|---|---|
| GPU | RTX 4070 |
| Hashrate | 30 MH/s (KawPow) |
| Power draw | 200W |
| GPU cost | $550 |
| Electricity rate | $0.08/kWh (cheap state) |
| Pool fee | 1% |
| RVN price | $0.025 |
Daily revenue: 21.6 RVN × $0.025 = $0.54
Daily electricity: (200/1000) × 24 × $0.08 = $0.384
Daily pool fee: $0.54 × 0.01 = $0.005
Daily net profit: $0.54 - $0.384 - $0.005 = $0.151
Break-even: $550 / $0.151 = ~3,642 days (10 years)
Monthly profit: $0.151 × 30 = $4.53
Annual profit: $0.151 × 365 = $55.12
Annual ROI: $55.12 / $550 = 10.0%At current RVN prices and cheap electricity, this setup is technically profitable but the ROI is poor. The real strategy here is the HODL bet: if RVN price increases 5x, those 21.6 RVN/day become much more valuable retroactively.
Example 2: AMD Ryzen 9 7950X Mining Monero (RandomX)
| Parameter | Value |
|---|---|
| CPU | Ryzen 9 7950X |
| Hashrate | 20,000 H/s (RandomX) |
| Power draw | 125W (CPU only) |
| CPU cost | $450 (assuming you already have the system) |
| Electricity rate | $0.10/kWh |
| Pool fee | 1% |
| XMR price | $180 |
// Monero mining revenue depends on network hashrate (~2.5 GH/s)
Your share: 20,000 / 2,500,000,000 = 0.000008 = 0.0008%
Blocks/day: 86,400 / 120 = 720
Block reward: 0.6 XMR
Daily XMR: 0.000008 × 720 × 0.6 = 0.003456 XMR
Daily revenue: 0.003456 × $180 = $0.622
Daily electricity: (125/1000) × 24 × $0.10 = $0.30
Daily pool fee: $0.622 × 0.01 = $0.006
Daily net profit: $0.622 - $0.30 - $0.006 = $0.316
Break-even: $450 / $0.316 = ~1,424 days (3.9 years)
Monthly profit: $0.316 × 30 = $9.48
Annual ROI: ($0.316 × 365) / $450 = 25.6%CPU mining Monero has a better electricity-to-revenue ratio because modern CPUs are very power-efficient. If you already own the CPU for other purposes (workstation, gaming), the effective hardware cost is zero, making this highly attractive as supplemental income.
Example 3: 6x RTX 4070 Rig Mining Flux (ZelHash)
| Parameter | Value |
|---|---|
| Hardware | 6x RTX 4070 + frame, PSU, motherboard |
| Total hashrate | ~360 Sol/s (ZelHash) |
| Total power draw | 1,400W (GPUs + system) |
| Total hardware cost | $4,200 (GPUs $3,300 + $900 frame/PSU/MB) |
| Electricity rate | $0.07/kWh (industrial rate) |
| Pool fee | 1% |
| FLUX price | $0.50 |
Daily revenue: ~8.5 FLUX × $0.50 = $4.25
Daily electricity: (1400/1000) × 24 × $0.07 = $2.352
Daily pool fee: $4.25 × 0.01 = $0.043
Daily net profit: $4.25 - $2.352 - $0.043 = $1.855
Break-even: $4,200 / $1.855 = ~2,264 days (6.2 years)
Monthly profit: $1.855 × 30 = $55.65
Annual ROI: ($1.855 × 365) / $4,200 = 16.1%The multi-GPU rig generates more absolute profit ($55/month) but the ROI percentage is lower because the total investment is large. The break-even period of 6+ years assumes static prices and difficulty, which is unrealistic — coin prices could rise significantly or crash entirely.
Factors That Change Profitability
The calculations above are snapshots. In reality, several variables shift constantly:
Difficulty Increases
As more miners join the network, difficulty rises, meaning you mine fewer coins per day with the same hardware. On actively mined coins, difficulty can increase 5–20% per month during bull markets.
→ Mining becomes more profitable
→ More miners join the network
→ Difficulty increases
→ Each miner earns fewer coins (equilibrium)
Coin Price Changes
The most impactful variable. A 2x price increase doubles your revenue instantly. A 50% price crash halves it. This is why the HODL strategy matters: coins mined during low prices that are held through a bull run can be worth 5–20x their mining-day value.
Network Hashrate Trends
When miners leave a network (for example, after a price crash), difficulty drops and remaining miners earn more coins. This is the self-correcting mechanism that keeps mining profitable for the most efficient operators.
| Scenario | Impact on Revenue | Impact on Costs | Net Effect |
|---|---|---|---|
| Coin price doubles | +100% revenue | No change | Much more profitable |
| Difficulty doubles | -50% coins mined | No change | May become unprofitable |
| Electricity rate rises 50% | No change | +50% electricity cost | Profit squeezed or wiped |
| 50% of miners leave | +100% coins (after difficulty adjusts) | No change | Much more profitable |
| Summer (cooling needed) | No change | +20-40% electricity (AC) | Profit reduced seasonally |
The HODL Strategy vs Selling Immediately
This is the strategic question every miner faces: sell the coins as you mine them, or hold and hope for higher prices later?
- Guarantees a known profit (or covers electricity costs)
- Eliminates price risk — you get today's value today
- Best for miners who depend on mining income for bills
- Simple accounting for taxes
- Downside: you miss potential future price appreciation
- Bets on future price increases — could multiply your returns
- Mining at a small loss can still be profitable if the coin appreciates 5–10x
- Best for miners with separate income to cover electricity
- Risk: the coin could go to zero and you lose both coins and electricity money
- Tax implications: must track cost basis and capital gains
Many experienced miners use a hybrid strategy: sell enough coins each month to cover electricity and operating costs, then HODL the remainder. This ensures you never mine at an out-of-pocket loss while still benefiting from potential price appreciation. For example, if you mine $100/month in coins and electricity is $60/month, sell $60 worth immediately and hold the remaining $40 worth.
When Mining is NOT Profitable
There are situations where mining is clearly the wrong choice:
- Electricity exceeds $0.20/kWh: For most GPU-minable coins at current prices, this puts you in the red. You would get more crypto by spending the electricity money on an exchange.
- Your hardware is old: GPUs from the GTX 1060 / RX 570 era are too inefficient (low hashrate per watt). The electricity cost per coin is higher than modern cards.
- You cannot handle the heat: In hot climates without air conditioning, GPUs throttle and draw extra power for cooling fans. If you need AC, add 30–50% to your electricity estimate.
- You need guaranteed income: Mining revenue fluctuates with luck and coin prices. If missing a payment has serious consequences, the volatility is too risky.
- You are mining the wrong coin: Not all coins are equally profitable for your hardware. An RTX 4070 mining SHA-256 coins earns essentially nothing because ASICs dominate that algorithm.
The quick test: calculate your daily electricity cost at your actual rate. If it exceeds the daily revenue for any coin you want to mine, buy the coin on an exchange instead. You get more coin per dollar spent.
Mining Profitability Tools
You do not need to do all this math by hand. Use mining calculators to get instant estimates:
Our Groestlcoin mining calculator lets you enter your hashrate and see estimated daily, weekly, and monthly earnings. It uses live network difficulty and current block rewards for accurate projections. Similar calculators are available on each of our pool dashboards.
Other popular multi-coin calculators include WhatToMine and MinerStat. These let you compare profitability across dozens of coins simultaneously.
What Calculators Cannot Tell You
- Future coin prices (the biggest variable)
- Future difficulty changes (unpredictable)
- Whether a coin will still exist in a year
- Your actual power draw (measure it with a Kill-A-Watt meter, do not trust specs)
Tax Considerations (Brief Overview)
Mining income is taxable in most jurisdictions. While this is not tax advice, here are the general principles:
- Income event: In many countries (including the US), mined coins are taxed as income at the time of mining, valued at the market price when received.
- Capital gains: If you later sell or trade the mined coins, any price change since mining is a capital gain or loss.
- Deductions: Electricity costs, hardware depreciation, and other mining expenses may be deductible as business expenses in some jurisdictions.
- Record keeping: Track every coin mined, the date, the value at time of mining, and the value when sold. This is essential for accurate reporting.
Tax treatment of cryptocurrency mining varies significantly by country and is still evolving. Consult a tax professional familiar with cryptocurrency in your jurisdiction. The cost of good tax advice is far less than the cost of an audit.
Bottom Line
Electricity is everything. It is the single variable that determines whether mining can possibly be profitable. Below $0.10/kWh with modern hardware, most coins offer positive margins. Above $0.20/kWh, you are almost certainly better off buying coins directly.
Hardware ROI is slow. At current prices and difficulty levels, break-even on dedicated mining hardware often takes years. GPU mining makes most sense when the GPU has dual purpose (gaming/work + mining), reducing the effective hardware cost to zero.
The HODL bet is the real play. Many profitable miners today are mining coins at a small margin and holding them, betting that future price appreciation will turn a modest $1/day profit into a significant sum retroactively. This is speculative and carries risk.
Run the numbers with YOUR costs. Do not rely on generic "mining profitability" claims. Use a calculator with your actual electricity rate, your actual hardware, and your actual hashrate. The difference between $0.07/kWh and $0.15/kWh is the difference between solid profit and total loss.
Start small. Before building a 6-GPU rig, read our getting started guide and test with one GPU for a month. Verify your actual power draw, actual hashrate, and actual earnings against the calculator estimates. Scale up only after confirming the numbers work at your cost basis.