The next side hustle I want to try.
Is crypto mining dead?
The latest bull run has everyone very excited and optimistic about cryptocurrencies (myself included). However, I never gave much thought to mining crypto until the other day. To me, crypto mining was reserved to Enigma — a massive facility in Iceland dedicated to mining bitcoin.
I changed my mind about crypto mining after watching one of Biaheza’s videos entitled “I Tried Mining Bitcoin For a Week”. In the video, Biaheza interviews his friend Richard who mines cryptocurrency. Richard explains that the biggest barrier to mining is the cost of the rig ($15,000). However, with the rig in hand, you can start making approx. $135/day in profit. This means after 111 days, you would pay off the cost of the rig. And after 111 days you would be making $135 passive income per day.
Sounds like the dream?
The biggest risk with crypto mining is the fluctuation in the price of the cryptocurrency you are mining. This is one of the most common reasons why people are skeptical about cryptocurrency mining — if the price of bitcoin falls below the cost of running the rig then mining is no longer cost-effective. However, if you’re bullish about the price of bitcoin long-term then the short to medium fluctuations should not deter you from mining.
In the rest of the video, Biaheza sets up his own crypto rig at a hefty price of $15,774. Thereafter, he started mining approx. 0.002 BTC valued between $80–119.
Introduction to Crypto Mining
There are four main ways to mine cryptos:
- Cloud mining — In this process, you pay someone (most often it’s a big corporation) a specific amount of money and “rent out” their mining machine called a “rig”, and the process of mining itself. This rent lasts for an agreed-upon period, through which all of the earnings that the rig makes (minus the electricity and maintenance costs) are transferred to your cryptocurrency wallet.
- CPU mining — This utilizes processors to mine cryptocurrencies. It used to be a viable option back in the day, but currently, fewer and fewer people choose this method of how to mine cryptocurrency daily. There are a couple of reasons why that is. First of all, CPU mining is very slow. You could go on for months without noticing the smallest amount of revenue. It’s also usually not worth it — you make very little amounts of money, but you probably spend ten times that amount on electricity and cooling. The problem mitigates itself by a bit if you can find a place that has nice cooling and cheap electricity bills, but that’s rarely the case.
- GPU mining — This is probably the most popular and well-known method of mining cryptocurrencies. If you google “cryptocurrency mining”, GPU rigs are going to be some of the first things that you’ll see. GPU mining is very popular because it’s both efficient and relatively cheap. Don’t get me wrong, the construction of the rig itself tends to be costly — but when it comes to its hash speed and the general workforce, the GPU mining rig is great.
The last thing to consider when getting started mining crypto, is which cryptocurrency you want to mine. Some of the obvious favorites would be BTC, ETH, or Dash. Keep in mind, though, that Bitcoin mining is probably the trickiest of them all — since the coin is so popular, there are many miners around the world tuning into the few pools that there are and trying to snatch at least a small bit of Bitcoin. This might result in you waiting for countless hours until the first drops of Bitcoin start coming in.
Keeping that in mind, your best bet would probably be to stick with Eth or some other less-popular cryptocurrency. Depending on your method of choice, check out the prices, calculate when your return on investment would happen, do some math and you’ll figure it out in no time!