So What’s Next for Miners?
This article is part of our “Mining the Digital Gold” epoch.
For this week’s article, I am gonna talk about what you should do with your GPUs now that Ethereum is no longer proof-of-work (mineable). With Ethereum moving to proof-of-stake (PoS), Ethereum mining is officially over. And with that, you are probably reading this because it’s not profitable to mine anymore and you don’t know what to do next.
Today, I’m going to ask you three questions, and based on your answers, I’ll tell you what you can do to move on. But before we start, I just wanted to point out that if you’re a miner and you still want to mine cryptos, then you’re absolutely awesome, lately it’s become clear that the people behind Ethereum don’t really care about us miners at all, despite the fact we miner provided them with security for sooo many years. Well, enough chit chat and let’s dive right in!
Question 1
Are you willing to mine at a loss right now? (Even with the most efficient RTX 3070s you still lose money)
I know it sounds like a stupid question, but in some people’s case mining might not be about the profitability, these miners simply just wanted to increase their coins size, and they might be willing to do it even at a loss.
So what does mining at a loss actually mean for them? In a nutshell, it means paying a little more for your cryptocurrency than if you just buy it on an exchange. The way it works is that you pay a bit more for electricity to mine that coin instead of buying it on an exchange. You would pay less for the coin if you shut down your mining rig and take the money you could have spent on electricity to buy the coins on an exchange. Another reason that miners might be willing to mine at a lost is that, they just want to support a project by providing Security on their blockchain, even if it costs money. If you are willing to mine at a loss, you can do that.
Question 2
Do you want to spec mine?
Let’s talk about spec mining first, this means mining a coin and holding it long term based on your own speculation that the coin will increase in value over time, for example if you feel strongly that MeowCoin might go up significantly in price over the next few years, you might be okay mining that coin even though technically you would make an additional profit a day in terms of profitability mining a different coin. Spec miners don’t look at the current coin price when deciding what coin to mine, rather they look at the potential of the coin price in the future.
However, there’s also a risk and reward range when it comes to spec mining, for example you could go for one of the more established mineable coins that have already existed for a couple of years, or you could with absolutely brand new coins that aren’t even available to buy on exchanges yet. If spec mining is what you are looking for, I suggest you really understand the token project before choosing what to do, so read their whitepaper, connect with them on social media, research their roadmap, investigate the people behind the project and so on. DYOR is key!
Question 3
Do you want to chase profitability?
Now for those of you that don’t want to spec mine and wanna chase profitability regardless of what coin you’re mining. You want to make the most amount of money right here right now, and it basically involves mining whatever coin with the highest profit margin above your electricity cost in order to maximize profitability. Of course it is possible to combine this with spec mining, where you mine whatever coin is the most profitable and then swap that coin for whatever coin you want to hold long term.
A quick way to check mining profitability is to head over to WhatToMine, you can sign up and make an account on the website to customize your GPUs settings by entering your own details on how much hash rate and voltage you can get out of a specific GPU.
It is recommended to select Current Revenue and Current Values for the best results. Doing so, it will give me a value for whether my rig will be profitable mining any coin or not. So for example as you can see from above, with my power cost on my 8*6700XTs rig I am currently not profitable, and the least unprofitable coin for me to mine right now would be Conceal where I would only be losing 0.69 cents(wink wink) per day. However, please keep in mind that this is just literally for today and these numbers literally change every single hour. So basically what you can do now is come in here and check on what would be profitable to mine on your rigs on a daily basis.
Concluding thoughts
Let’s say you’ve done all of that and you’re still in the same boat as me where even your most efficient rig is still unprofitable on everything, so what do you do then?
Well, here are three options for you to consider:
1. Keep your GPUs and either mine on them at a loss or spec mine some absurd coin as we spoke about earlier. You could also turn them off but keep them because you expect mining profitability to come back up in the near future.
2. Keep your GPU rigs but ship them off to a hosting facility like a mining farm where you can get a much lower power cost than your current electric cost because depending on your current power costs it might be a lot cheaper and it will you back in the green again.
3. Sell your GPU rigs, and take the L for the team by pocketing the money. Another option is that you can take that money and reinvest it in new mining gear that currently is profitable, for example on some of the GPU mineable coins like Ethereum Classic (ETC) there are ASICs that are still profitable, this is due to the fact that they are so much more power efficient, so if you wanna learn more about ASICs, feel free to check the last article I wrote.
Happy mining y’all!
Disclaimer: this article is written from my personal opinions as a miner, I’m not affiliated with Ethereum in any way. This article is written with the sole purpose of providing an insight of what to do now that it’s no longer possible to mine Ethereum.
