What Is Bitcoin Mining? How It Works and When It Pays Off

The information provided in this article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry a high degree of risk. Always conduct your own research.Miners secure the Bitcoin network and earn 3.125 BTC per block. How proof of work functions, what an ASIC costs in electricity in Germany and at what power price mining breaks even.Bitcoin mining is the process that adds new blocks to the Bitcoin blockchain and issues new bitcoin. Specialised machines known as ASIC miners try trillions of random numbers per second until a block produces a hash below the target set by the network. Whoever succeeds first collects a block reward of 3.125 BTC, the amount in force since the halving of April 20, 2024, plus the transaction fees in that block. Whether mining pays off in Germany comes down almost entirely to the price of electricity: a current Antminer S21 XP only covers its power bill below roughly 10.4 cents per kilowatt hour (as of October 22, 2026). The sections below explain proof of work without formulas, run the numbers for two current machines on German household and business electricity rates, and put halving, pools, locations, ...