Mining Earnings per kWh - Why should Dogecoin and Kaspa Miners get paid in Bitcoin?
Should Dogecoin, Litecoin, and Kaspa Miners get paid in Bitcoin?
Some miners want to get paid in DOGE, LTC and KAS because they are speculating on the price of that given coin. Some miners simply want to take some risks or they are true believers in the project they are supporting.
Yet, many miners run their mining operations as businesses, and they are always striving to optimize their profits and operations in any way possible.
In this article, I want to show an alternative to getting paid in native currency - by getting paid in the king of money - sound money a.k.a. Bitcoin (BTC).
What does normal mining look like?
Since Slush introduced the first pool for Bitcoin mining in 2010, miners have been joining forces to increase their chances of confirming a block and thus receive more frequent payouts compared to solo mining.
By doing pool mining, a miner is also getting paid in the native currency - normally directly from the blockchain, or in FPPS reward system based pool, from the bag, or fund, of their coins that they use to guarantee payrates. In other words, FPPS pools act as a financial insurance company for the miners - ensuring steady payouts with their funds.
As said, mining on a pool means the miner gets paid in the native currency. For Scrypt miners this means that the miner will get paid in Dogecoin, Litecoin or any other coin that they are supporting with their hashrate. The same goes for Kaspa miners, who get paid in Kaspa currency.
Paradox of mining profits
When it comes to mining, the currencies with the highest mining profit margins are normally the most risky (Kaspa). On the contrary, currencies with lower profit margins tend to be more stable in the long term (Bitcoin). The cryptocurrencies with the lowest margins are considered more stable and safe from an investment perspective.
Additionally, holding an asset that is more volatile to price fluctuations is more risky in the long run.
Let's take a look at a real-world example:
| SHA256 (Bitcoin) | Scrypt (Dogecoin) | kHeavyHash (Kaspa) | |
|---|---|---|---|
| Earnings per kWh | ~$3 (e.g., Bitmain S21 Pro) | ~$5 (e.g., Antminer L9) | ~$3 or ~$9 (e.g., IceRiver KS7) |
| Pros ✅ | Low Price Volatility | Medium Price Volatility | High-Profit Margin |
| Cons ❌ | Low-Profit Margin Low Risk of Difficulty Spike |
Medium Profit Margin Medium Risk of Difficulty spike |
High Price Volatility High Risk of Difficulty spike |
| Risk/Reward Ratio | Low | Medium | High |
*data as of 7. April 2025
SHA256 (Bitcoin) Mining earnings per kWH
Bitcoin mining margins are quite low. Earnings per kWh are about 3 USD for the latest generation ASIC (S21 Pro).
Yet, Bitcoin's price is considered to be relatively stable compared to other cryptocurrencies. That is why Bitcoin miners, or site owners, normally invest in Bitcoin mining with longer-term preferences for return on investment.
Scrypt (Dogecoin/Litecoin) Mining earnings per kWh
Scrypt mining margins are higher than Bitcoin mining. Earnings per kWh are about 5 USD for the latest generation ASIC (L9).
Regarding profit per energy used, Scrypt mining is more profitable than Bitcoin mining.
Investors deciding to invest in Scrypt mining normally prefer slightly higher earnings but should also be aware of slightly higher risk from both price volatility and difficulty increases.
Kaspa Mining earnings per kWh
Kaspa mining margins are currently at the Bitcoin mining level. Earnings per kWh are about 3 USD for the latest generation ASIC (IceRiver KS7).
Kaspa has the highest risk/reward ratio. Not only that the price of the coin can change quickly, the difficulty can also be increased quickly due to the relatively small amount of energy used on the blockchain.
But keep in mind that Kaspa coin price has plummeted from $0.18 to $0.06 in the past few weeks. With the current difficulty and past higher price of Kaspa coin, the earnings per kWh would be 9 USD for the same machine.
This would make Kaspa mining the most profitable per energy used, but the risk is the highest. As proven in the last few months where Kaspa price has plummeted down to 6 cents USD.
How to hedge against high coin price fluctuations when mining Altcoins?
Mining altcoins like Dogecoin, Litecoin, or Kaspa often gives you better returns per unit of energy compared to Bitcoin. But holding onto those mined altcoins comes with risk - prices can drop fast and eat into your profits.
One way to reduce that risk is to convert everything to Bitcoin right after mining. But doing that manually takes extra time and effort, and it’s not always worth the hassle.
NiceHash solves this.
No matter what you're mining - SHA256, Scrypt, kHeavyHash, KawPow, RandomX, or anything else - you get paid in Bitcoin. Automatically. No extra steps, no juggling coins. Just plug in your ASIC, start mining, and stack sats.
How and why do all miners get paid in Bitcoin?
Marketplaces are platforms that allow buyers and sellers to meet and exchange goods or services. In the NiceHash example, hashrate is being traded. NiceHash is a hashrate marketplace. Hashrate could also be defined as a compute power or even a commodity, such as electricity.
On NiceHash, your hashrate is being bought by buyers of hashrate, who then use it on other pools or even for solo mining. But the buyers always have to pay you in the universal medium of exchange - Bitcoin.
As on every marketplace, a medium of exchange is needed. For the NiceHash hashrate marketplace, the medium of exchange is Bitcoin. Buyers of hashrate must, before bidding for hashrate, deposit Bitcoins to the platform. They then use these deposited Bitcoins to place bids and pay for the hashrate delivered by sellers (miners).
Summary
It is all about the performance of your mining operations and the potential upside. If you want to squeeze the most out of your mining operations, you should consider using NiceHash with direct Bitcoin payouts that will eliminate all the manually exchanging you had to do when mining Dogecoin, Kaspa or other coins directly.
If you prioritize profit efficiency and risk reduction, mining via NiceHash is the best fit for you. Bitcoin payouts eliminate the need for manual altcoin conversions. While direct mining may offer a higher potential upside, Bitcoin payouts provide stability - letting you focus on hashrate performance rather than market speculation.