- Dogecoin’s Scrypt algorithm uses less energy, supporting lower-cost hardware and broader participation compared to Bitcoin’s SHA-256.
- Dogecoin’s frequent block rewards and lower operational costs make it a viable, more accessible option for individual miners.
Dogecoin (DOGE) mining has recently outpaced Bitcoin (BTC) in terms of profitability. Some mining rigs for Dogecoin have earned as much as $14 in the last 24 hours, while Bitcoin mining rigs have seen lower returns, with earnings of up to $7 during the same period.
The differences in profitability can be attributed to several factors such as initial investment, energy costs, the algorithms used by each network, and the time it takes to process new blocks.
Data from Whattomine shows that the most profitable Dogecoin mining rigs generated net earnings between $3 and $14 in the past day. In contrast, Bitcoin miners showed lower returns, with net incomes peaking at $7 and some losses starting at -$0.12, reaching as much as -$6 for less efficient rigs.
Dogecoin Mining Equipment Has a Longer Lifespan
Another notable difference between the two cryptocurrencies lies in the lifespan of their mining equipment. Half of the analyzed Dogecoin mining rigs were launched in 2021, while Bitcoin’s devices mostly debuted between 2023 and 2024. There are also two Bitcoin miners set for release later, one in October 2024 and another in November 2024.
Dogecoin miners tend to remain operational for longer, which translates to fewer replacements and lower operational costs. The initial investment for Dogecoin miners is also lower.
For example, the Bitmain Antminer L9, one of the most efficient Dogecoin miners, costs around $6,600. In comparison, the Bitmain Antminer S21 XP Hydro, a top-tier Bitcoin miner, costs $10,700, and the upcoming November model is priced at $20,000.
Energy Efficiency and Mining Algorithms
In terms of energy consumption, Dogecoin mining equipment requires less power compared to Bitcoin’s. Dogecoin miners typically use no more than 4,000 watts, while Bitcoin mining rigs range from 3,000 to 11,000 watts. This lower energy requirement is another factor contributing to Dogecoin’s higher profitability.
Dogecoin uses the Scrypt algorithm, which is less energy-intensive and allows for mining with more affordable hardware. This algorithm enables a wider pool of participants, making Dogecoin mining more accessible.
On the other hand, Bitcoin uses the SHA-256 algorithm, which is optimized for speed but requires more powerful, specialized equipment. As a result, Bitcoin mining has become more concentrated in the hands of large mining pools, reducing opportunities for individual miners to secure rewards.
The current conditions make Dogecoin mining an attractive option for those looking for lower costs and more frequent rewards.
