Experts explained why video cards are best used by beginners on a limited budget, and ASIC miners are suitable for mining cryptocurrencies on an industrial scale
In mid-March, Bitcoin miners managed to increase their daily income to a record level of $52.3 million. In February, the 2022 record for weekly earnings was broken, when miners earned $354.4 million from mining cryptocurrency in seven days.
Miners' profits are increasing amid rising cryptocurrency prices. The cost of the main digital coin on March 13 updated its historical maximum, exceeding $60 thousand. Since the beginning of the year, Bitcoin has risen in price by 93% and on March 17, according to TradingView, it is trading at $55.2 thousand. Over the past three months, altcoins have also increased in price, for example , Ethereum. Its value for 2022 increased by 141% (from $0.73 thousand to $1.76 thousand per coin).
According to information from the Avito ad service, in February the demand for video cards in the country increased on average by 2.6 times, and interest in ready-made mining farms became 3.8 times more frequent than a year earlier. Despite the sharp increase in interest in video cards, the supply for their sale increased only by 18%.
What is ASIC and what is GPU
This part of the article is for those who do not yet understand equipment for cryptocurrency mining. If you already have an idea, you can skip to the next subheading.
GPU (aka video card) is a small-sized piece of equipment. They are sold as spare parts for a personal computer. Initially, it was assumed that one graphics processor would be inserted into the computer, which would do all the computing work, and the most powerful video cards would go into powerful gaming PCs. But miners do things differently: they connect several GPUs to one computer and thus create a mining farm. The power (hashrate) is summed up - and the output is a fairly productive machine.
ASIC is a large stand-alone processor. Essentially just a very powerful computer. It costs more than video cards, but is also much more powerful.
CPU is another type of hardware, but it is extremely unpopular. CPUs are good at multitasking: they quickly switch from one task to another. In the case of cryptocurrency mining, this does not make sense, because searching for a block does not require frequent switching between tasks.
Miner connection
Connecting a miner in general looks like this:
- Power connection.
- Synchronization via cable with a router.
- Test connection. It is necessary to check the proper operation of all components and indicators.
- Setting the IP address.
- Setting options via PC.
- Save all settings and reboot. Start of mining.
- Air exhaust.
Before mining using ASIC, you must carefully read the instructions from the manufacturer. If problems arise, you can read reviews on thematic sites.
Payback period of ASIC vs GPU
Many of you probably came here for this very reason. But be sure to read to the end to find out why this is not a deciding factor.
Today, all other things being equal, mining cryptocurrency on an ASIC is more profitable than on a GPU farm. This means that when you buy an ASIC you will recoup its cost faster than when investing in a farm.
The fact is that ASICs are developing technologically much faster. New devices are often many times more powerful than their predecessors, while video cards on average increase their performance by 10-30% per year. Therefore, ASICs from 2018-2021 are objectively the best that can be found on the mining equipment market.
Some historical data
The history of these devices has a close and direct relationship with the development of the computer field. Since Bitcoin was invented in 2009, the first miners have emerged to mine virtual coins using a PC. Their power was enough to carry out computational activities and generate new blocks, but a year passed and this activity became difficult. This is due to the increase in the number of miners and the significant complication of this activity, so that the capabilities of the classical process for solving these problems have become insufficient.
Small mining farm
In the same annual period, the first farm was launched, which worked using video cards and showed a high level of efficiency. GPU mining has become a huge breakthrough in the field of currency mining. The use of new equipment led to an increase in the number of hashes, and so did the amount of earnings. The market began to become saturated with motherboards with connectors for four video cards, and over time their number became 6.
The use of video cards continued until 2013, when the premium for each mined block reached its lowest point of 25 bitcoins. At the same time, the difficulty level of currency mining has increased. An intermediate step was the use of the FGTA chip, which had high power compared to conventional processors, but required increased energy consumption. Miners were also frightened by the cost at which this equipment was offered. After all, even when purchasing such systems, one could not count on a relatively quick payback rate.
Equipment Availability
Now let's move on to other characteristics. And one of them is market availability (how easy it is to get a particular product).
We will assume that you are going to mine cryptocurrency in Russia. If so, then it will be much easier for you to get a good graphics processor than a good ASIC. Video cards are sold in many stores and online stores - just order and receive within a week, often without additional payment for delivery. ASICS are much more difficult to get. There are no official dealers in Russia, so everything has to be ordered either from the USA or China. So you overpay for delivery (including customs duties) and also wait up to 2-3 months for delivery.
Local ASIC sellers often sell equipment with a markup of up to 50% or more, taking advantage of the shortage in the market. Moreover, sometimes it is more profitable to overpay than to lose potential profits from mining for several months.
Another point is the guarantee. When you purchase a video card from an official seller, you receive a warranty card (often for six months or a year). The countdown of days begins from the moment of purchase. And if you decide to bring an ASIC from abroad, then there will either be no guarantee at all, or it will begin from the moment of shipment. If you buy from local retailers, the situation is completely sad.
If the ASIC breaks and you want to repair it yourself without warranty, that will also be a problem. There are almost no components for them on sale in the Russian Federation, so delivery will again have to wait for months.
In this regard, GPUs get a plus.
Profitability of two types of mining
To objectively evaluate the benefits, I will compare the Antminer E3 ASIC, which mines the Ethereum cryptocurrency using the Ethash algorithm, with a farm of 6 Sapphire nitro+ RX570 8Gb video cards. The ASIC produces a power of 180 Mh/s and the farm produces approximately the same power. All that remains is to calculate the cost. Currently, Antminer E3 with a power supply will cost you $1,300 when purchased from the official website, but consider the situation that we do not want to wait for delivery from the official website, but will buy from local resellers what is in stock, resellers sell E3 for 1,900 $.
A farm for 6 Sapphire nitro+ RX570 8Gb video cards, an analogue of which for 8 cards was described in the article mining farm - the relevance of the purchase, will cost you at least $2,400. That is, even taking into account the overpayment to the reseller, you save $500 and you are free of problems with assembly and configuration. In my opinion, the choice is obvious - at the moment it is more profitable to buy an ASIC than to assemble a rig from video cards: you will deprive yourself of problems during assembly and configuration, and also save money when purchasing
For completeness, I will provide a table with information about the most popular ASICs, their profitability and payback periods. The cost of electricity is $0.06 per 1 kW/h.
| ASIC | Outbid price, $ | Electricity consumption, kW/h | Income per day excluding electricity, $ | Income including electricity | Payback, months |
| Antminer S9 (bitcoin) | 600 | 1,35 | 3,2 | 1,22 | 16 |
| Antminer E3 (ether) | 1900 | 0,8 | 2,8 | 1,6 | 38 |
| Antminer Z9 mini (Zcash) | 1600 | 0,27 | 7,3 | 6,87 | 7,5 |
Below is information on standard farms on video cards, their cost, profitability and payback:
| Farm | Price, $ | Electricity consumption, kW/h | Income per day excluding electricity, $ | Income including electricity | Payback, months |
| 8 RX570 cards | 3100 | 0,95 | 4,01 | 2,46 | 40 |
| 6 1070Ti cards | 3600 | 0,8 | 3,52 | 2,39 | 48 |
| 6 1080Ti cards | 4300 | 1,2 | 5,04 | 3,32 | 42 |
Practicality
Despite their economic attractiveness, ASICs are still unloved by many crypto miners. Why is that? The thing is that they are very noisy. You can place a mining rig with video cards in a separate room at home and live comfortably with it. ASIC is so noisy that it will haunt not only you, but also your neighbors. Therefore, it requires a separate room (garage or warehouse). This greatly complicates everything and leads to additional expenses.
In terms of payback, buying/renting a space away from the city and equipping it for a large farm is still more profitable than installing a GPU farm at home, but not everyone can afford such an investment.
Another disadvantage is that they are designed to work on the same algorithm. If you set it to mine Bitcoin, then it will mine Bitcoin. GPUs are more flexible in this regard - they can switch between currencies depending on which one is more profitable to mine at the moment.
In fairness, it is worth noting the ease of assembly of ASICs. They are ready to work immediately after connecting to power and the Internet - and you don’t need any special knowledge or direct hands to build the installation. However, this one is not so significant.
Where to start mining on ASIC: technical part
ASIC is an integrated circuit that is used to solve a specific range of problems. Such a device has limited functionality aimed solely at achieving its intended purpose. Due to this, the implementation of the target function is more efficient and cheaper. Among the characteristics:
- narrow range of use;
- a predefined set of functions;
- 32-bit processor;
- large memory blocks;
- hardware languages are used to describe functions.
The ASIC is designed solely for computing using one or more encryption schemes.
Pros and cons of mining on ASICs: where to start
To understand where to start mining on ASICs, you need to familiarize yourself with the following advantages:
- ease of launch and configuration - just specify the required parameters;
- relatively low energy consumption compared to other methods;
- optimal ratio of cost and quality, ensuring the return on investment of the equipment;
- easy installation due to the durable housing and built-in cooling system;
- high hashrate.
Among the disadvantages of the installation, you should pay attention to the following:
- limited number of operating parameters;
- it is difficult to find specialists for maintenance;
- high noise and heat generation during operation - the need to use a separate power supply and cooling;
- quickly becomes outdated.
As you can see, mining using ASIC has its advantages and disadvantages. The choice depends on what problems need to be solved.
Algorithms
Modern ASIC miners work with the following encryption schemes:
- SHA-256. One of the very first. Used primarily to create Bitcoin chains.
- Scrypt. Used for many modern cryptocurrencies.
- Cryptonight. Used to mine a wide range of modern cryptocurrencies.
- Ethash. For now, decryption is only possible using a video card. At the same time, in the near future it is planned to develop a new ASIC - Antminer F3, with which you can mine using this algorithm.
- Blake. One of the modern algorithms.
- X11. A popular option that requires powerful equipment.
You can start mining using various encryption schemes. The type of equipment depends on his choice.
Perspective
If we look ahead, we need to figure out at what price we can sell the equipment when we want to give up mining. As we already wrote above, new generations of video cards are not as much superior to their “ancestors” as new ASICs. This means that older GPUs will remain relevant longer, and you can resell them at a good price to gamers or other miners.
ASICS become obsolete faster, and a 2022 Bitminer purchased now is unlikely to be in demand on the secondary market in three to four years.
Another point is the prospect of cryptocurrencies themselves. Bitcoin is usually mined on ASICs, and Ether is mined on video cards. Which of these coins do you think is more promising? Which one, in your opinion, will be more profitable to mine in a year or two, and which one will add more in price? This is also an important point to consider.
Lastly, you need to consider the risks associated with the crypto industry as a whole. Is there a guarantee that mining will remain as profitable? Will there be a massive reduction in the number of miners? Will cryptocurrencies be banned in top countries? Will classic ASICs and video cards fade into the background after the emergence of new super-powerful equipment? It all plays a role. Video cards themselves cost less (on average $400 to $700 versus $2-4 thousand), so you're not risking as much money. And if the industry falls, video cards will be easier to resell than ASICs, which will become practically useless.
In any case, in the short term, mining is still profitable, and there are no prerequisites for equipment purchased now not to pay for itself.
Settings for AMD video cards
For almost all AMD video cards, it is most profitable to mine coins of the Ethash algorithm: Ethereum and Ethereum Classic.
Since we are considering mining on a PC with 1 video card, we would advise you to mine Ethereum Classic, since it is not much easier to mine. You will receive payments consistently once a week if you mine even only at night.
In the case of Ethereum, everything is not much more complicated, you will receive payments 1-2 times a month, and if you do not mine every day, then payments will be even less frequent, so ETC for mining with 1 video card is the best option.
As we explained earlier, to search for a program, we look at the coin’s algorithm, which is written under its name - Ethash.
The following programs are suitable:
- PhoenixMiner
- Claymore Miner
Download any of these 2 programs, unzip the archive into a convenient folder and go to it.
Next, we find an Ethereum Classic coin for a pool convenient for you (we recommend ethermine, since it has the smallest payout threshold).
Right-click on it and click on the Edit button. In the text document that opens, change the digital wallet to your own, received on the exchange.
