How Does Bitcoin Mining Work? A Plain-English Guide (2026)

Bitcoin mining is a global guessing contest paid in new coins. At today's numbers the winners are efficient Bitcoin miners running on cheap power.

By Michal Beno, CEO, OneMiners8 October 2026

Bitcoin is a shared record of who owns what, called a blockchain. Thousands of independent computers, called nodes, each hold a full copy. New transactions are bundled into a block, a page of a few thousand payments. Each block carries a fingerprint of the one before it, chaining the pages back to the first block, created on 3 January 2009.

Someone has to pick the next block without anyone being trusted. Mining is that method. Miners compete using purpose-built computers called ASICs (application-specific integrated circuits) that do one job: run Bitcoin's puzzle with as little power as possible. Each round's winner earns new bitcoin, which is how every bitcoin in circulation came into existence. One round looks like this:

The puzzle is built on a hash function called SHA-256. A hash function takes any input, such as a word, a file or a block of transactions, and turns it into a fixed-length string of 64 characters that looks completely random. Change a single letter and the output changes beyond recognition. Crucially, there is no shortcut: the only way to find an input that produces a particular kind of output is to try inputs one by one.

Now the game. A miner takes the block it wants to publish, adds the nonce, and hashes the lot. The network sets a target, and the hash only counts if it is a number lower than that target, which in practice means it starts with a long run of zeros. Below is a toy version you can check yourself. The input is the text "OneMiners block, nonce N", and the toy target is any hash that starts with three zeros.

The real target is far harder. At today's difficulty of about 132.7 T, one valid block takes about 570,000 billion billion guesses on average, roughly 19 to 20 leading zeros. That is why the whole network makes about 970 quintillion guesses every second, written as 970 EH/s (exahashes per second). A single Antminer S21 Pro makes 245 TH/s, 245 trillion. Finding the answer is hard; checking it takes one calculation. That imbalance is the whole trick.

If more equipment switches on, the network finds answers faster. Without a correction, blocks would arrive every few minutes and new coins would be issued too quickly. Bitcoin fixes this with the difficulty adjustment. Every 2,016 blocks, about two weeks, every node looks at how long those blocks took. Too fast, and the target drops so the puzzle gets harder; too slow, and it gets easier. A single adjustment can move difficulty by at most a factor of four either way. No company or committee makes this decision; it is written into the software every node runs.

The current difficulty is about 132.7 T, and the next adjustment is estimated at roughly +2.4%. For anyone running equipment, this is the key to earnings: your miner's speed never changes, but your share of the network does. When global hashrate rises, each TH/s earns slightly less bitcoin.

The winner of each block receives two things. First, the block subsidy: brand-new bitcoin, currently 3.125 BTC per block since the April 2024 halving. The subsidy halves every 210,000 blocks, roughly every four years, and the next halving is expected around block 1,050,000 in spring 2028. Second, transaction fees that users attach to get included. Today fees are a small extra.

With about 144 blocks a day, the network releases roughly 450 new BTC daily. About 20.09 million of the 21 million bitcoin that will ever exist have already been mined, and the last fraction of a coin is expected around the year 2140. After that, miners will be paid by fees alone.

To compare equipment, the industry uses hashprice: expected revenue per unit of hashrate per day. At a BTC price of about $85,739 and a network hashrate of about 970 EH/s, hashprice is about $0.040 per TH/s per day, or $40 per PH/s per day, before fees. That gives two simple formulas.

With 970 EH/s competing, a single S21 Pro mining alone would find a block on average about once every 75 years. That is a lottery ticket, not a business. A mining pool combines thousands of members, finds blocks regularly and splits each reward by work contributed, minus a small fee. Members prove their work with shares: easier near-miss answers, much like the three-zero toy example above.

Strip away the jargon and mining comes down to revenue minus running costs. Three numbers drive both sides.

A useful shortcut is the break-even power price: the rate at which revenue just covers the power bill. The S21 Pro earns about $9.75 a day and uses 88.2 kWh, so at today's hashprice it covers its power at any rate below roughly $0.11 per kWh. Then there is the upfront cost: an S21 Pro sells for $2,299, so at about $5.52 a day that is roughly 417 days to recover the hardware at today's numbers, before fees. Difficulty usually rises, so real payback tends to be longer.

Antminer S21 Pro 245T$2,299Hashrate245 TH/sEfficiency15.00 J/THPower draw3,675 WBreak-even power$0.111/kWhNet/day at 4.80c$5.52View on OneMiners

Antminer S21 XP Hyd 473T$6,199Hashrate473 TH/sEfficiency12.00 J/THPower draw5,676 WBreak-even power$0.138/kWhNet/day at 4.80c$12.29View on OneMiners

Antminer S23 Hyd 580T$12,299Hashrate580 TH/sEfficiency9.50 J/THPower draw5,510 WBreak-even power$0.175/kWhNet/day at 4.80c$16.74View on OneMiners

Three efficiency tiers on the OneMiners catalogue, live prices 6 October 2026. Card figures use hashprice including recent fees, so they can differ by a cent from the subsidy-only examples above.

You can plug a Bitcoin miner in at home, but at a typical U.S. home rate of about $0.17 per kWh an S21 Pro costs more to run than it earns, and full-size units are loud and hot. A hobby Bitaxe Gamma (1.2 TH/s, 17 W, $63) is a quiet way to learn, essentially a tiny solo lottery ticket.

With hosting, you own the equipment and a professional facility runs it for a per-kWh fee. OneMiners hosts in Nigeria, Ethiopia, Norway, Paraguay, Canada, Dubai, Texas, Georgia USA and more, from $0.048 per kWh at the cheapest site in Nigeria and from $0.0364 per kWh on a 7-year prepaid contract. Hosted miners come with a 7-year warranty that covers defects, not normal wear. See every site on the hosting centers page.

Frequently asked questions

Michal Beno

CEO of OneMiners, the global Bitcoin mining hosting and hardware platform with 15 published hosting locations, 7-year fixed electricity contracts and a 7-year hardware warranty. He writes about the economics of industrial Bitcoin mining.

Informational only, not financial advice. Figures are a snapshot from public market data and news reports as of 5 October 2026 and can change quickly. Crypto prices can fall as well as rise. No return is offered or implied. Do your own research.