Wednesday, January 17th 2018

Confessions of a Crypto Miner: The Setup

As I have mentioned on the forums here at TechPowerUp a few times, I was an active crypto-miner during one of the most tumultuous times in crypto history: The period between 2013 and 2015. Rather than tell you a long and sad story, I will say just this: I ended up with a net loss by the end of this era, and it wasn't a good time to be an investor if you didn't like roller coaster rides. The reasons I lost money are many, but I think I can attribute them to primarily a lack of experience, a lack of written records, and really, a complete lack of a plan.

My New Plan
Yes, I'm planning on mining again. I've always been drawn to the tech, and I am in a much better position to do so now. Ironically, this time around, I'm not really in it for the money. I've already been there, done that, and it's too stressful for me. Having no end goal of riches doesn't set me up for failure. I think it is a more realistic mindset for taking on this project. It also gives me a chance to document my endeavor to the world, and to you, dear reader. I hope we all learn something here.
First off, a piece of advice: Personally, I would never really consider getting back into crypto mining for money's sake. But if you have the money available and want to do this as a side operation for some fun and the possibility of making some money while you are at it, it might be for you. The aim of this column is to show you what the life of a crypto-miner is like, by becoming one, and to keep you updated with the things that concern miners these days. It will show you the work that goes into producing that "magic Internet money" that a lot of people claim "grows on trees" and show you that it is indeed an occupation in its own right… or so I hope. If I get rich off this, I really won't mind per se, but my assumption is I'll probably end up making below minimum wage at the end of the day, as has happened in the past.

Also, this article is meant to educate you, the reader. It is meant to be a piece for those considering getting into crypto-currency mining, to help them know what they are diving into. The reason I have no problem with doing this series is, the outcome doesn't matter. If I break even, I'm happy. I still get to tell a story, even if I basically worked as a miner for free for a year. The math now indicates I'll be more than breaking even in that timeframe, so I'm comfortable with this, even if the math ends up being somewhat horribly off.

The Math
Yes, the math. Unlike my prior endeavors into crypto, I did some homework first. I found that due to the GPU shortage, I could only easily get my hands on NVIDIA GTX 1080 cards. So, I bought two of those and the cheapest modern motherboard and CPU money could buy. The complete build, for the curious, may be viewed in Newegg receipt form here (Note I supplied the HDD, though a prospective miner could easily boot from USB as well):
So, I decided from the beginning that to minimize risk, I would mine a somewhat mainstream coin rather than go for some higher risk options. That basically means ZCash or Ethereum (I eliminated Monero as an option because some exchanges are beginning to flag this relatively anonymous coin as "high risk" transactions, and I want my liquidity to be high). Of the two, GTX 1080s do significantly better in ZCash than Ethereum, making about $300 per month over my electricity cost (I pay roughly 0.10 cents per kilowatt-hour, for reference).

The whole setup will draw less than 650W. It must, because that's the max rating of the PSU it's being supplied with. I went with a Titanium Seasonic Prime PSU both for their excellent quality/efficiency and for the fact that it may be usable after the mining is done.

The whole setup cost around $1,640. At $300 per month, it will be paid off in a little under six months, so it's not too difficult to get to a profitable point if you can spend the money upfront. From there, the setup can be sold or you can mine further, so you have more than surpassed your "Return on Investment." But you need to account for hours of your time spent, if you want to ask if it's really worth it. I'll be reporting hours throughout this build.

The Build
The Build is of the open-air type and minimalist in all regards, except for cooling. I designed this setup (which may be a generous term) some time ago back in the Litecoin GPU-mining era with Radeon 7970s, back when things were much hotter, much nosier, and much harder to keep cool. Basically, the concept is simple. Use the motherboard box as a makeshift breadboard case and splay the innards of the PC around it on a shelf. Mount a big house fan on top of the GPUs to hold them in place (It will also provide cooling on hotter days, of course.) The result is pictured below, ready to mine. All in all, the assembly probably took two hours, but the install and setup of the OS (I went with Windows, but Linux options are available), various updates, and ZCash mining and wallet software probably took me another four hours. It really was a whole day of work, truth be told. I am listing seven hours of work for the moment on my chart. All for this:
The rig is mining right now (has been since the 8th of January, actually) and producing as expected from the looks of it. Expect a report in approximately two weeks and a biweekly column from this adventure. It should be an interesting ride.

You can track the stats of how TPU's new mining project is doing at anytime here.
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161 Comments on Confessions of a Crypto Miner: The Setup

#1
yotano211
Captain_Tom said:
I have no problem with the premise of your post, but I do become concerned about the messaging that some people might take from this. When I first started mining, it was definitely looked at as a hobby (mining Litecoin). But then I read the whitepaper for Darkcoin and immediately switched all of my hashing power even though it was "Half as profitable." It was a good choice made by someone who made an informed decision.

Right now there are a lot of people acting like it's all luck, or that no one is really making any real money off of this. If all you do is mine the top coin with 2 graphics cards for fun - yeah, you are likely to just make $1000 worth of fun money per year (Not that there is anything wrong with that!). But if you put forth extra time and effort into building a few serious rigs, and you also do the research to mine some emerging coins part of every week: You can seriously make a lot of money. But not everyone will be good at it.



What is your hashing power mining ethereum with your 7 1080's? Don't lie, you have noted they are only using 760w.
about 158mh/s
I dont need to lie to prove myself
Posted on Reply
#2
Captain_Tom
yotano211 said:
about 158mh/s
I dont need to lie to prove myself
7 1080's.... Those are $500 cards! I get about the same with a rig that has 4x380's ($120 each) and 2 x 570's. ($250 each)....


USER BEWARE: Nvida cards really aren't good at mining compared to AMD.
Posted on Reply
#3
yotano211
Captain_Tom said:
7 1080's.... Those are $500 cards! I get about the same with a rig that has 4x380's ($120 each) and 2 x 570's. ($250 each)....


USER BEWARE: Nvida cards really aren't good at mining compared to AMD.
So what is your point about Nvidia cards. I can mine zcash with any 1080 or Nvidia card and make more but I like ETH. And I have ways to pay less then $500 for the cards but with cards running low in stock it doesnt work anymore but it did 2 months ago.
Posted on Reply
#4
Chloe Price
It's insane that my 980 is worth of 250eur or something. Going for SLI would be insane.
Posted on Reply
#5
Captain_Tom
yotano211 said:
So what is your point about Nvidia cards. I can mine zcash with any 1080 or Nvidia card and make more but I like ETH. And I have ways to pay less then $500 for the cards but with cards running low in stock it doesnt work anymore but it did 2 months ago.
I am not necessarily attacking you. After all it is true that people can only buy what's available.

However I am trying to make sure people remember that AMD cards are by FAR more efficient and cheaper for mining than Nvidia (Yes even with Zcash). I have seen fanboy wars creep into mining in the past year, which is ridiculous lol.
Posted on Reply
#6
yotano211
Captain_Tom said:
I am not necessarily attacking you. After all it is true that people can only buy what's available.

However I am trying to make sure people remember that AMD cards are by FAR more efficient and cheaper for mining than Nvidia (Yes even with Zcash). I have seen fanboy wars creep into mining in the past year, which is ridiculous lol.
Nvidia likes zcash or the Equihash algorithm more then AMD. With the rx470, the current profit per day is $1.80 with zcash, with the 1070 its $3.12, its $4.04 with the 1080.
I checked on whattomine.com
Posted on Reply
#7
R-T-B
Captain_Tom said:
USER BEWARE: Nvida cards really aren't good at mining compared to AMD.
At ethereum, yes. At ZCash not so much.
Look into out shapeshift.io @yotano211. As long as your miner pool withdraws to the shapeshift address at something above their minimum deposit, you can use a reusable address to mine zcash and consistently get paid in ethereum...
Posted on Reply
#8
yotano211
R-T-B said:
At ethereum, yes. At ZCash not so much.
Look into out shapeshift.io @yotano211. As long as your miner pool withdraws to the shapeshift address at something above their minimum deposit, you can use a reusable address to mine zcash and consistently get paid in ethereum...
Wow thanks, didnt now something like this exsisted. I knew about exchangers but most are only are 1 time deal.
I'll convert BTG, bitcoin gold, into ETH. BTG seems to always make about 20-40% more than ETH with the Nvidia cards.
Posted on Reply
#9
R-T-B
yotano211 said:
Wow thanks, didnt now something like this exsisted. I knew about exchangers but most are only are 1 time deal.
I'll convert BTG, bitcoin gold, into ETH. BTG seems to always make about 20-40% more than ETH with the Nvidia cards.
Think my exchange practices will be a future article themselves, shapeshift.io is a godsend.
Posted on Reply
#10
trog100
my 1070 cards do a fraction over 30 mhs each.. 10 do just over 300 mhs.. i am currently mining eth.. in dollar terms the payout seems to be directly linked to the current price of eth..

during this last week the dollar payout has moved between 30 dollars per day and 50 dollars per day.. in other words its impossible to say whats the most profitable to mine and what isnt..

all crypto has took another unexpected dive during the night currently my mining eth payout is near the 30 dollars per day scale..

currently the price of available 1070 cards in the UK has just shot up £549... which puts 10 of them (the amount i have mining) at £5490..

the current cost to build a mining rig similar to the one i have would be.. 8 x 1070 cards = £4392 plus maybe another £500 for the other bits.. i would say close to £5000..

how many folks in this thread would would pay that kind of money...

i recon we need to stop talking about the past and talk about the present.. we all know what crypto did last year and what hardware cost last year.. what we need to be talking about is what gonna happen this coming year..

trog

ps... these UK prices have just happened.. they might "happen" again next week and to go up to £599.. :)

https://www.scan.co.uk/shop/computer-hardware/gpu-nvidia/nvidia-geforce-gtx-1070

just to add.. 1070tI cards are at £599 and 1080 cards are at £649.. i expect them to go higher or become unavailable..
Posted on Reply
#11
xldeane
Don't come to UK then mate... electricity prices are sky high, so is petrol (Gas) $8.00 a gallon for petrol, $17.00 for a packet of 20 cigarettes..


xl...out
Posted on Reply
#12
R-T-B
xldeane said:
Don't come to UK then mate... electricity prices are sky high, so is petrol (Gas) $8.00 a gallon for petrol, $17.00 for a packet of 20 cigarettes..


xl...out
We have UK miners too...
Posted on Reply
#13
trog100
R-T-B said:
We have UK miners too...
me for example.. :)

trog
Posted on Reply
#14
Bytales
I jus bought 2 Vegas Frintier Editions Liquid Cooled for mining. Setup has taken me probably two to three days to Setup everything in order. It will take some more days to make it final since im switching from two Xeons 2690v3 to one Epyc 32 core CPU. All in all im looking at about 5500 h/s in Cryptonote mining.
I believe it is worth it to have watercooled Setups, especially for mining, and esspecially if you dont want to risk busting up your expensive GPUs. One was 1300 euro, so thats a thing to consider. Didnt mind paying for it, since i got me a premium Vega, the 8gb watercooled Version is getting ridiculously Close to 1200 euros, (crazy miners bought everything), so it wasnt all that bad.
Especially since the yellow VEGAs were always on stock since they lunched (Mindfactory had for half a year the same 5 pieces in stock) and nobody bought them anyway. So i cant be blamed for People not having VIDEO Cards for gaming,

But mining is a fun experience, especially when the mined coin makes 10x, like im hoping it will.

EatingDirt said:
There is one, very large issue I have with mining that I never see mentioned...

That is how much of a massive waste of energy it is to accomplish almost nothing. Now, if the majority of cryptocurrencies created value in furthering science, I may be okay with that, but the simple fact is they don't. Miners, for the most part, are just burning oil/coal/gas to create these 'coins' that have no backing, and can fluctuate in price by more than 20% in a day, which means the 'coins' are not a viable currency and quite obviously are easily manipulated which makes them all but useless for everyday societal needs.

I don't expect miners care or want to think about this issue, because in reality, mining is easy money.
Dont worry, the future is of the coins, that are
INSTANT (regardless how many user are trasnacting per second)
MINELESS
FEELESS

Currently only two coins are like this, or, at least they will be, when they are ready,
IOTA(Still in beta, thats why it is very slow now)
RAIBLOCK - this one actually works now as advertised
EOS, when ready, it is still in ICO, probably the bigggest ICO in the history of ICOs (Initial Coin offering) - it started last year in summer, and going to end this year in summer. Ist market cap is only given by the People who pumped Money in it, and it is not even the real Thing.
This one right here has the potential to dethrone all other coins before it. So get your while you still can.

EOS platform will Support milions of trasnactions per second, compared to bit coin7, and ether under 20.
Posted on Reply
#15
alganonim
yotano211 said:
Monero and zcash are for the criminal elite.
It's not worth for it, hard cash is better for it !
Posted on Reply
#16
Nate1492
The solution to the Graphics card issue is to tie the graphics card into some steam purchase.

I'd gladly pay 500+300 for a gfx card and steam wallet. That'd stop crytpo miners from purchasing the cards as you can't move the cash in steam wallet very easily.
Posted on Reply
#17
Captain_Tom
Nate1492 said:
The solution to the Graphics card issue is to tie the graphics card into some steam purchase.

I'd gladly pay 500+300 for a gfx card and steam wallet. That'd stop crytpo miners from purchasing the cards as you can't move the cash in steam wallet very easily.
It might help a tiny bit, but not really. Most people don't realize these things:

1) Mining is massively, massively profitable. I was happy to buy those RX Vega cards even with their included Games. I just sold the games on ebay to minimize the mark-up.

2) Most of the scarcity is due to factories in China DIRECTLY selling cards to mega mining groups. Haven't you seen that article that showed miners were renting full cargo jets to get entire airplanes worth of cards to their offices ASAP? Newegg's prices are high because they can't even get ahold of cards to sell!
Posted on Reply
#18
trog100
tell me what you mean by "massively profitable" captain.. in money terms if you would... ??

trog
Posted on Reply
#19
Captain_Tom
trog100 said:
tell me what you mean by "massively profitable" captain.. in money terms if you would... ??

trog
Even buying cards at double their MSRP, they can easily pay for themselves over a few months. Some people are willing to pay $1000 for Vega cards because they will pay themselves off in under a year, and if prices go up at all they will do it much quicker than that.
Posted on Reply
#20
yotano211
alganonim said:
It's not worth for it, hard cash is better for it !
Kinda hard to move around millions or billions so why not go the monero route
Posted on Reply
#21
OneMoar
There is Always Moar
if you feel the need to clear your conscious send me those 1080's ill provide them a loving forever home where they can slave away ..err I mean play all day... running startcitzen and the hunt
Posted on Reply
#22
trog100
Captain_Tom said:
Even buying cards at double their MSRP, they can easily pay for themselves over a few months. Some people are willing to pay $1000 for Vega cards because they will pay themselves off in under a year, and if prices go up at all they will do it much quicker than that.
thanks tom.. i dont really see the ability to pay for its self in under a year as "massive profits" for small miners but some may..

trog
Posted on Reply
#23
R-T-B
OneMoar said:
if you feel the need to clear your conscious send me those 1080's ill provide them a loving forever home where they can slave away ..err I mean play all day... running startcitzen and the hunt
They will be sold at half msrp or less like all my items I sell when they are done with the experiment. I will likely post to my notification feed when the time is coming close if they are still "hot" items, as I want everyone to have a fair shot.

I don't feel guilty in the least as I'm doing this for science and honestly, running a 500w miner like I am is not going to burn down the forest anymore than an expensive server hobby. Plus, we all get to learn some.
Posted on Reply
#24
Mescalamba
During 2013 to 2015 managed to not make money in crypto. Okaaay...

Reminds me that recent story of dude that went from 3 BTC to 200 BTC to 0.
Posted on Reply
#25
Jism
I mined with 5 cards as a experiment. It is fun yes. Profitable? No. Not on such small scale anyway.

If your good with numbers put your money into trading, not mining.

What i did. :)
Posted on Reply
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