The rapidly growing popularity and rise in the cost of cryptocurrencies has led to the emergence of a large number of people who want to make money on digital gold mining.
- Mining and mining farm - what is it in simple words
- How a mining farm works. What the mining farm considers
- Methods of mining through the farm
- Which is better: buy a ready-made mining farm or build it yourself
- Necessary components for a mining farm
- How to build a mining farm - step by step instructions
- How much can you earn on mining through the farm
- How much energy does a mining farm consume
- How much does a mining farm pay off
The most common method has become mining through a farm on video cards.
Mining and mining farm – what is it in simple words
Mining is a method of generating income based on the creation of new blocks in a distributed platform. The remuneration is paid in the form of a cryptocurrency – a virtual unit of account. The amount of income is set by the developer of the program code.
Mining is carried out using a farm, which is a collection of devices connected to the blockchain network. Technically, a mining farm is a cascade of video cards connected to a computer with several powerful power supplies. When assembling this device, the main attention is paid to the performance of video cards. The unit of information processing power of such a farm is called hashrate. 25-28 Mh/s (megahash per second) per video card is considered good performance.
How a mining farm works. What the mining farm considers
The essence of the mining farm is to track and process new blocks of transactions in a specialized blockchain network. The discovered block will generate income in the form of bitcoin or other cryptocurrency. Finding each block can take from several minutes to several days.
It depends on 2 factors:
- Hardware performance. The more powerful the farm, the faster the production of cryptocurrency.
- Network complexity. Increasing the number of miners (which is rapidly happening at the moment) in the network will reduce the cost of the discovered block and increase the time to find it.
Currently used mining farms can be divided into 3 types:
- Devices where video cards are the main computing element. In the early years after the creation of Bitcoin, AMD GPUs showed good performance in cryptocurrency mining. Now this method for mining Bitcoin is used less and less. The reason for this was the emergence of large industrial-scale farmers who use huge capacities and the latest expensive equipment to mine digital gold. This greatly increased the complexity of the network and made Bitcoin mining on video cards unprofitable. Today, the method is used on alternative cryptocurrencies.
- FPGA-based devices. This equipment is not inferior in performance to mining on video cards, but does not require an expensive cooling system. This makes such devices more cost-effective and compact.
- ASIC based systems. These devices were made specifically for Bitcoin mining. Now such systems are recognized as the best in terms of performance and price. The downside is that these devices are not suitable for mining other cryptocurrencies other than Bitcoin.
Methods of mining through the farm
There are 2 ways to mine digital coins:
- Solo. In this case, the development of the block is carried out alone and all the profits remain with the owner of the farm. The disadvantage of this method is the need for powerful equipment and a lot of time to make a profit.
- With the help of pools – special services, which are a network to which digital gold miners connect their mining farms. In this case, the profit is divided among all pool participants in proportion to the capacity.
In order to decide on the mining method, it is recommended to mine for some time both in the pool and solo. So you can choose the most profitable way for your farm.
Which is better: buy a ready-made mining farm or build it yourself
To answer this question, first of all, you need to understand whether there is real knowledge and experience in assembling computer equipment. If you have such experience, then a self-assembled mining farm of 6 video cards will cost an average of about $1500. Buying a ready-made farm of similar performance will require $2500-3000. The benefits of self-assembly are more than significant.
Necessary components for a mining farm
The following equipment is required for self-assembly of a mining farm:
- Processor. Not necessarily high performance.
- Motherboard with multiple PCI-E slots.
- Hard drive. At least 40, and preferably 80 GB.
- Minimum 4 GB of RAM – any will do, as long as it fits the slot to the motherboard.
- Video cards. The main part of the system. The minimum requirement is 4 GB. A good budget option is the ZOTAC GeForce GTX1060, which costs about $250. for one card. For self-assembly, mining farms often use video cards: AMD Radeon RX 470, AMD Radeon RX 480, Nvidia Geforce GTX 1060, Nvidia Geforce GTX 1070 and AMD Fury X.
- Power supply. Assuming that the farm will be built from 6 video cards, then the power supply should be 1500 V. To save money, you can use 2 units of 750 V each.
- Razer adapters, for connecting video cards.
- Start button and 4 coolers
- Frame for easy cooling of the block.
How to build a mining farm – step by step instructions
- You can buy a frame for a farm inexpensively on the Internet or make it yourself from metal corners. When making it yourself, the main thing is to accurately fit all sizes to GPUs and other devices of the mining farm.
- The motherboard must be placed in the center of the bottom shelf of the frame. This is necessary to create an air cushion, which is necessary for better cooling.
- We install a processor with a cooler on the motherboard.
- It is better to screw the power supply to the aluminum corner with screws. Next, we connect the power button and the hard drive.
- Fans for cooling video cards are mounted on the side panels of the rack. For 6 cards, 4 fans are enough (2 on each side).
- Video cards are suspended from the top rails of the rack using cable ties and connected to the motherboard using risers.
- The farm is assembled by hand and is almost ready for mining. It remains to install the software.
How much can you earn on mining through the farm
The level of profitability of a farm for mining is easiest to calculate using calculator services. To do this, you need to enter data on video cards and the cost of electricity there. The service will calculate the mining profit for each cryptocurrency.
For clarity, we can consider the profitability of a mining farm for the extraction of the Ethereum cryptocurrency, assembled from 5 video cards GPU Radeon RX 480 8 GB (operating at 8 GHz). With standard settings, the RX 480 delivers about 25 MH / s. Multiply by 5, we get a hashrate of 125 MH / s, which brings about $ 5 per day. It’s $150 per month.
How much energy does a mining farm consume
Now you need to calculate the cost of electricity. One video card consumes approximately 150W. In a month it turns out 1250W * 24 hours * 30 days = 900000W = 900kW.
We multiply 900 kW by the cost of electricity (5 rubles per 1 kW). We get 4500 rubles. or $78.
In total, the net profit for the month is: 150-78=$72.
The location of a mining farm greatly affects the profitability of a mining farm. the cost of electricity in different countries can vary significantly.
How much does a mining farm pay off
The payback of the farm is very easy to calculate. An illustrative example can be seen on the same farm of 5 video cards GPU Radeon RX 480 8 GB:
Multiply the cost of one video card (about $300) by their number in the system (5) and add the cost of the rest of the equipment (motherboard, hard drive, fans, etc.). We get: 300*5+250=$1750. Further, the cost of the farm is divided by its profitability and we get: 1750:78=22.4. In total, the payback period for this Ethereum mining farm is 22.4 months.
Miners periodically hang, they need to be configured for maximum performance. This requires regular maintenance for the homemade farm owner. It consists in setting up the software, maintaining continuous operation, and controlling ventilation.
It is much easier for owners of purchased farms – all system maintenance work is performed by the manufacturer’s service department within the framework of warranty obligations.
As you can see from the example above, the profitability of a mining farm today is very low. As network complexity increases, profitability will decrease. Whether the increase in the price of the cryptocurrency will compensate for the decrease in profitability caused by the complexity of the network is very difficult to predict. It is unprofitable to mine bitcoins on home farms now. It is a fact. Whether such a fate awaits Ethereum and other cryptocurrencies, time will tell.
Now, those who do not want to invest in risky topics, but want to test themselves in a new business, can do cloud mining. This technology uses the power of network storage and does not require investment in equipment. The main thing in cloud mining is to find a proven and reliable platform.
