After being ter the crypto space for the last 6 months (it feels like years!), wij determined that wij desired to round out our portfolio by adding a mining equipment. While wij presently have an Antminer D3 on order (that is basically worthless), wij desired to supplement that mining with a 6 card GPU mining equipment. Wij are relatively fresh to mining, but wij will be providing you with everything you need to know ter order to build your very first equipment.
You’ll also want to get yourself a hardware wallet to store the cryptocurrency you will be mining. Different coins only be used on certain hardware wallets, but Bitcoin can be stored on all of them. You can read about the Best Bitcoin Wallets presently available here and here.
Is GPU Mining Still Profitable?
Brief response, yes. You won’t get rich overnight by building one mining equipment, but you can certainly make money if you do it right. There are a few different ways to treatment GPU mining, and I choose to define them te terms of exchange rate risk.
Mine and HODL Altcoins
Sell Hash Power for Bitcoin and HODL
Strategy #1 – Mine and HODL Altcoins
This is the very first strategy and arguably the riskiest of the three. If you choose to mine something like VertCoin (VRT) or ZenCash (ZEN)and determine to hold it, you’re accepting the risk that that coin may go to zero. I call this high exchange rate risk. The newer the altcoin, the lower the probability of its success. That’s not to say a fresh altcoin won’t become the next Bitcoin or Ethereum, but it is very unlikely to toebijten ter the near term.
The opposite could also toebijten. Suppose you began mining ZenCash a few months ago and you held it, you would be up an extra 200% come back due to the price increase of ZenCash. Mining at a loss for an “appreciation play” is a risky script that could wind up being hugely profitable. There are many altcoins that have bot pumped 5x or 10x seemingly out of nowhere. If you mine the right coin, you could find yourself sitting on a pot of gold.
Strategy #Two – Sell Hash Power for Bitcoin and HODL
Your 2nd option has less exchange rate risk than mining altcoins because Bitcoin is considered the base currency for the cryptocurrency market. Wij are making the assumption that Bitcoin, or BTC, would be LESS volatile than an altcoin like ZenCash or Monero. While the 30% and 50% price reductions that seem to toebijten fairly often for Bitcoin, it still is looked to spil the safe toevluchthaven cryptocurrency.
Once you get your GPU mining equipment up and running, you can sell your hashing power to Nice Hash, the largest crypto-mining marketplace. Nice Hash will pay you ter Bitcoin for selling the has power your GPU mining equipment is presently generating. Simply choose your hashing algorithm, and Nice Hash will deposit the omschrijving amount of “mined” BTC to your wallet address. Wij would recommend using a hardware wallet for this.
Strategy #Trio – Convert Crypto into USD
If you want to begin a mining business, this would be the most logical way to operate. Locking ter earnings by converting Bitcoin or another altcoin directly to USD will be the best way to protect yourself from fluctuations ter the crypto market. For tax purposes, you may also want to convert your earnings into USD te order to pay for expenses, like the brand fresh gpu mining equipment you just built!
While this is the safest option from a business management standpoint, it is also the most limiting te terms of profit potential. By converting your earnings into USD, you will not be able to realize the appreciation of your mined token. Depending upon your risk tolerance, you may want to keep a certain amount of earnings ter the mined token, and convert the surplus into fiat currency to lock te those earnings.
How Profitable is a GPU Mining Equipment?
The nice part about GPU mining is that you have a few difference choices ter terms of what you want to mine. With that being said, you will also need to determine what algorithm you want to commence mining. I like to embark by checking out www.whattomine.com (WTM) and witnessing what the most profitable coins to mine are. Please note that thesis are just estimates ter terms of profitability. Using WTM is very elementary.
Photo Credit: WhatToMine.Com
Selecting a GPU is fairly straight forward. The most profitable card (spil determined by WhatToMine) is usually the latest card on the list, going from left to right, and top to bottom. Your budget will ultimately determine how many cards you can purchase, but for our example, wij will go with 6 cards spil that is what wij are interested ter building. You can find you’re $/kwh on your electrical play bill. If you can’t obtain that information, you can always Google your local area rates.
WhatToMine will then provide you with a running list of various cryptocurrencies and their respective profitability. The Revenue and Profit katern will provide you with daily profitability estimates. The BOLD number is the profitability, which nets out your estimated expenses from total revenue. This is the figure you should use if you want to estimate you expected taxes assuming you convert to USD or another fiat currency.
The line underneath the coin name is the name of the token’s respective algorithm. This is the algorithm that your GPU processes te order to “mine” and earn cryptocurrency. You’ll notice that there are a few different algorithms, but not an enormously large amount. That is one of the nice things about GPU mining, they are much more versatile than ASICs because ASICs can only mine one algorithm.
Photo Credit: WhatToMine.Com
GPU mining became utterly popular because the algorithm that Ethereum uses is minable on a GPU. Spil Ethereum’s price enhanced, miners were making almost $100 vanaf day vanaf GPU before the difficulty and hash power enlargened. Mining ETH is still profitable, but would require a significant investment te a GPU mining equipment. At this point, it would be more profitable to simply sell your hash power for BTC and then use that BTC to buy ETH.
GPU mining is also popular because they can process algorithms that are ASIC resistant, such spil the Equihash algorithm that Zcash and ZenCash use. GPU mining is considered less centralized than ASIC mining since there are only a few different ASIC mining companies that sell (but mostly keep for themselves) high powered cryptocurrency miners. This means that the average person can purchase, for a reasonable price, GPUs and build their own mining equipment to support a network of their choice.
How Many GPUs do I need?
This question can only be answered by your own individual budget. Trio mining equipments have become enormously popular on the BitcoinTalk forums because of their stability and entry level price point. Spil of November 2018, Trio mining equipments typically consist of two (2x) 1080 Ti GPUs and one (1x) 1070 mini. I would assume spil newer cards come to the market, that the 1080 Tis and 1070s will be substituted with their predecessor.
You should also determine how long you expect to be mining for. If you are programma on making this hobby more of a business, it might be worth spending a little bit more up gevelbreedte for more cards and a better assembly. While not everyone can afford spending $3k or more for a GPU mining equipment, once you pay off the hardware outside of the GPUs themselves, you typically won’t need to substitute it (framework, risers, power supply, etc.)
What Mining Equipment Fram Should I Use?
Depending upon what zuigeling of setup you are going for, you may want to purchase or build your own framework for your mining equipment. I would very recommend going with a Trio mining equipment (spil shown above te the VoskCoin movie) or going with a 6-card mining equipment setup. VoskCoin demonstrated us a excellent all-in-one framework and hardware solution from Parallel Miner that wij indeed like. While it may be expensive relative to a DIY framework, it is enormously effortless to use for beginners just getting into mining.
Recall, you can think about the framework and the included hardware spil a submerged cost. Once you pay it off, you shouldn’t need to substitute many of those items on a consistent voet. Coupling thesis drowned costs with 6 GPUs will also permit you to decrease the time it will take to pay off your equipment. Spreading the upfront costs across 6 cards is much more profitable than attempting to pay off your drowned costs with Three cards or less.
This movie from VoskCoin shows you how effortless to use the Parallel Miner framework is. The nice thing about purchasing this framework is that once you pay off the drowned costs and the GPUs, you can always sell the GPUs and upgrade to fresh ones down the road. Wij believe that GPUs will be upgradeable on a quarterly voet. The timing of the GPUs depreciation and resale value should help determine when you choose to upgrade.
Parts List for GPU Mining Equipment
Equipment with Risers and Power Supply
PCIe Adaptor Power Cable
Power Extension Cable
Alternative Movie Cards (Less expensive)
ZOTAC 1080 mini (6x)
ZOTAC 1070 mini (6x)
ZOTAC 1060 mini (6x)
GPU Mining Equipment – Will it always be Profitable?
This is the million-dollar question. Wij believe GPU mining will be profitable for the foreseeable future for a few reasons.
Why GPU Mining is Here to Stay
Fresh coins will use ASIC resistant algorithms
There will always be fresh coin and ICOs
Long term outlook of cryptocurrency market is positive
Every fresh coin (besides Bitcoin Contant, assuming you consider it a Fresh coin) utilizes an alogithm that is ASIC resistant and GPU minable. There are a number of different algorithms that are GPU minable.
GPU Mining Equipment – Will it always be Profitable?
Ethereum, Ethereum Classic
Power Extension Cable
Equihash has remained the most profitable algorithm to mine / process for the past few months, everzwijn since mining difficulty and total Ethereum hash power has enhanced. Equihash is the algorithm of choice for security coins such spil Zcash and ZenCash. The Lyra2REv2 algorithm is utilized by VertCoin, which has seen significant growth ter the past few months. The rise of altcoins such spil Zcash and Monero ter 2018 has driven the rebirth of GPU mining.
CryptoNight algorithm is utilized by Monero, another privacy coin. Monero and its underlying XMR token have absolutely explosed ter 2018. Their GUI desktop wallet is fairly straightforward, and they are expected to release a hardware wallet within the next few months. It is worth mentioning that Monero mining is more profitable utilizing AMD GPUs. Wij will note that the optimization of AMD cards can be a difficult task to overcome, but there are slew of tutorials on setting up a Monero mining equipment on the bitcointalk forums.
There Will Always Be Fresh Coins
Cryptocurrencies are here to stay, period. 2018 has proved to be the year of the ICO, but ICO activity will most likely increase ter 2018 and 2019 spil the Ethereum network resumes to scale. Additionally, more and more use cases for cryptocurrency are coming to the surface which leads to more ICOs. While wij are not certain that each fresh use case is worth its own token, this will most likely be the trend until the market says otherwise.
Thesis fresh tokens will almost certainly use an algorithm that is GPU minable. It is significant to keep your ear to the ground for fresh coins or tokens that are gaining traction ter the cryptocurrency space. Monero and other privacy coins such spil Zcash and its ZenCash fork are presently some of the most profitable GPU minable coins. ZenCash just made its debut, and is presently making a lotsbestemming of miners a welvoeglijk income.
Hard forks are also another reason why wij believe GPU mining is here to stay and will proceed to be profitable. Bitcoin Gold wasgoed created to help decentralize Bitcoin, the already decentralized king of crypto. The reason BTG chose to fork wasgoed to enable the average investor to mine and participate ter the network without having to spend a loterijlot of money on ASIC mining equipments. This is an attempt to decentralize the current mining pools who predominate the hash power of the network.
Long Term Outlook on Crypto is Positive
Cryptocurrencies are here to stay, period. 2018 has proved to be the year of the ICO, but ICO activity will most likely increase te 2018 and 2019 spil the Ethereum network resumes to scale. Additionally, more and more use cases for cryptocurrency are coming to the surface which leads to more ICOs. While wij are not certain that each fresh use case is worth its own token, this will most likely be the trend until the market says otherwise.
Thesis fresh tokens will almost certainly use an algorithm that is GPU minable. It is significant to keep your ear to the ground for fresh coins or tokens that are gaining traction te the cryptocurrency space. Monero and other privacy coins such spil Zcash and its ZenCash fork are presently some of the most profitable GPU minable coins. ZenCash just made its debut, and is presently making a lotsbestemming of miners a welvoeglijk income.
Hard forks are also another reason why wij believe GPU mining will proceed to be profitable. Bitcoin Gold wasgoed created to help decentralize Bitcoin, the already decentralized king of crypto. The reason BTG chose to fork wasgoed to enable the average investor to mine and participate te the network without having to spend a lotsbestemming of money on ASIC mining equipments. This is an attempt to decentralize the current mining pools who predominate the hash power of the network.
At the time of this writing, Bitcoin futures trading is set to start within the next few weeks spil noted by CME Group. This may be related to Novogratz’s comment that “the heard is coming” and fresh money will be coming into the cryptocurrency space. Novogratz also reminded everyone that the NASDAQ bubble didn’t burst until the market cap reached almost $6 trillion dollars. This wasgoed during a time when the internet wasgoed just making its way into homes and business, and wielding a good domain name meant you could IPO with essentially no business monster. Wij are not even close to those times.
Spil of November Nineteen th , 2018, mining the X11Gost algorithm on Nice Hash is Enormously profitable. This is the very first time I have seen overheen $100 a day profitability for a 6-card equipment (6x 1080 Ti). I will leave this picture up on this postbode for proof that GPU mining is here to stay, and that it behooves you to keep checking which coins are most profitable. This profitability wasgoed only available for a few hours on the Nineteen th . After refreshing the pagina, the X11Gost profitability had dropped back down to normal levels.