Don’t Start Crypto Mining Now: 500+ Days Just to Break Even

High costs make it difficult to turn a profit from mining.

by 9SIX
don-t-start-crypto-mining-now- -days-just-to-break-even

These days it seems like cryptocurrency is constantly in the news with some investors and miners taking home huge profits. If you’re not already involved, it may seem like getting into cryptocurrency mining — the process of minting a new coin by having your computer solve complex equations — could earn you some money. However, if you look carefully at the cost of building and maintaining your own mining rig, as we have below, you’ll find that it currently takes between 500 and 900 days just to break even. And that’s assuming your equipment doesn’t break and that current prices don’t sink much lower.
The latest downward trend in crypto prices, along with the uncertainty surrounding the key currencies, is bad news for new miners. However, given that miners have been snatching up GPUs and driving up GPU prices, it could be good news for gamers who want to buy the best graphics cards at anywhere close to MSRP.

One of the biggest factors in mining profitability is the amount of energy consumed. Looking just at Ethereum, since that’s by far the largest cryptocurrency that’s mined via GPUs, current estimates peg the Ethereum network’s power use at 111 TWh per year and 261 kWh per transaction. That means if someone wants to buy lunch at a place that accepts Ethereum and sends $15, around the globe there will be about $26 worth of electricity (at a rate of $0.10 per kWh) burned up “securing the blockchain” for that (and other) transactions.

Ethereum 2.0 looks to address this major concern by switching to a proof of stake model, which would eliminate most of the power drain. That’s slated to occur some time in the first half of 2022, though do note that it has already been pushed back two years and could end up being delayed once again. Now factor in the still-inflated GPU prices and you have a trifecta of great reasons to not think about starting mining or expanding an existing mining farm.

But let’s say someone wants to throw caution to the wind. Just how bad an investment would it be to purchase PC hardware for cryptocurrency mining right now? Let’s run some numbers, but start with a look at the current profitability of the last two generations of GPUs. We’ll sort these according to the time required to break even, using current eBay GPU prices. We’ve factored in the cost of the rest of the PC as well as electricity costs, which gives the following:

GPU (Six for Miner Rig) Miner Cost (Jan 2022 eBay GPU Price) Total Hashrate Power Use Daily Profit Days to Break Even
Radeon RX 5700 XT $5,618 323 889 $10.78 521
Radeon RX 5600 XT $4,016 238 822 $7.55 532
Radeon RX 5700 $5,522 314 942 $10.30 536
GeForce RTX 2060 Super $4,598 262 916 $8.32 553
GeForce RTX 2070 $4,616 263 922 $8.32 555
Radeon RX 5500 XT 8GB $2,948 158 596 $4.99 591
GeForce RTX 2070 Super $4,982 263 909 $8.38 595
GeForce GTX 1660 Ti $3,512 178 542 $5.89 596
GeForce RTX 2080 $5,264 263 849 $8.50 619
Radeon RX 6800 $7,878 387 1162 $12.68 622
GeForce RTX 2060 $3,866 198 756 $6.17 626
Radeon RX 6700 XT $5,840 283 856 $9.28 629
GeForce GTX 1660 Super $3,746 181 556 $5.95 630
GeForce GTX 1660 $3,164 152 522 $4.87 649
GeForce RTX 2080 Super $5,702 263 882 $8.44 676
GeForce RTX 2080 Ti $7,740 361 1256 $11.41 679
Radeon RX 6600 XT $4,418 194 556 $6.43 687
Radeon RX 6600 $3,854 171 556 $5.59 689
Radeon RX 6800 XT $8,592 388 1296 $12.36 695
GeForce RTX 3060 Ti $5,822 254 816 $8.27 704
GeForce RTX 3090 $16,632 690 1956 $22.74 731
GeForce RTX 3060 $4,700 204 789 $6.35 740
GeForce RTX 3070 $6,728 257 856 $8.26 814
Radeon RX 6900 XT $10,146 388 1276 $12.43 817
GeForce RTX 3080 Ti $12,222 462 1522 $14.80 826
GeForce RTX 3080 $10,188 395 1489 $12.23 833
GeForce RTX 3070 Ti $8,052 306 1089 $9.62 837
GeForce RTX 3050 $3,992 138 556 $4.27 935

One thing to note is that we’re using LHR hash rates for the RTX 30-series GPUs, as Nvidia isn’t allowing the production and sale of new non-LHR cards. Only the RTX 3090 remains fully unlocked for GPU mining. Also of note, more recent drivers and firmware seem to have rolled back some of the gains made by NBminer in overriding the LHR limiter, so that RTX 3080 Ti as an example only ends up running at 63 MH/s. We’re giving miners the benefit of the doubt by not using the half-speed figures on the LHR cards, but Nvidia hasn’t given up on limiting Ethereum mining performance.

The best-case scenario for breaking even right now is around 520–550 days. That could be accomplished with the Radeon RX 5700 XT or 5700Radeon RX 5600 XTGeForce RTX 2060 Super, or the RTX 2070, using current prices. This of course assumes static profitability and the continued mining of Ethereum, neither of which are likely. For nearly all GPUs, Ethereum remains the most profitable option, with the next best choice typically averaging 33% less income. What that means is that in the coming months, if Ethereum goes through with the proof of stake change, miners could be looking at closer to 780–825 days just to break even, assuming all of the hardware remains fully functional.

That’s at the “good” end of the spectrum as well. If you wanted to blow nearly 17 grand on an RTX 3090 setup, the current rate of around $4 per day per GPU means it would take 731 days to break even mining Ethereum. Without Ethereum, you’re basically looking at three years of continuous mining to recover the cost of the hardware purchases.

And that’s just for the cost of the mining rig, which of course doesn’t exist in a vacuum. You also need space, infrastructure, internet, and cooling to keep everything running, especially in the warmer summer months. You also need someone to put everything together, maintain the hardware, and troubleshoot any problems. Those costs could easily double the expense, meaning double the amount of time to break even.

Just for clarity, here’s the sample mining rig we’re using for the above calculations, which uses six GPUs per PC. We have a motherboard that supports six PCIe slots (two x16 and four x1 slots), six riser cables, storage, memory, a modest CPU, and a good power supply.

Component Description Price
Motherboard ASUS Prime Z390-P $197
CPU Intel Core i3-9100 $125
RAM 2x8GB DDR4-3200 $58
Storage WD Blue 500GB SSD $50
PSU EVGA Supernova 1200 P2 Platinum $220
PCIe Extenders 6x PCIe Risers $50
Shelf Unit Amazon Basics 4-Shelf Adjustable $58
Total Price $758

That’s $758 as a baseline, not including the graphics cards and whatever extras might be needed to put it all together. Realistically, the cheapest approach is probably a bunch of zip ties to secure everything in place. We’ll leave that as an exercise for the potential miner, because the whole point is that this really isn’t going to be a great money making proposition.

With the above setup, after tuning for optimal efficiency, you could run six budget to mainstream GPUs (<150W power each), or if you want to chase higher hash rates, adding a second PSU would allow for up to six extreme GPUs like the RTX 3090 or RX 6900 XT and increase the cost by $220.

Mining on a Laptop?

As bad as that all sounds, there are even worse ways to try to mine cryptocurrencies. At the height of the crypto bubble last year, we reported on some places setting up mining farms using laptops. It was a stupid and short-sighted idea then, and it’s an even worse idea now. The RTX 3080 mobile as an example is basically equivalent to a desktop RTX 3070, meaning best-case (i.e., without an LHR limiter) it could do perhaps 60 MH/s on Ethereum. With the limiter, it would be closer to 40 MH/s or less.

The problems with mining on a laptop are numerous. You have to pay for the entire system, and you only get a single GPU miner in the process. The cheapest RTX 3080 laptops typically cost more than $2,000 — twice as much as you’d pay for a similar performing desktop card. Even worse, cooling on a laptop most certainly isn’t designed to run 24/7 at maxed-out loads. Even if we take the higher hash rate, you’d be looking at roughly 1,000 days to break even at current rates. Use the lower 40 MH/s value and that climbs to about 1,500 days. Then take away Ethereum mining and we’d be looking at perhaps 2,200 days to break even.

Raise your hand if you actually think a gaming laptop will run at 100% GPU load 24/7 for six years straight. Anyone with your hand up, I’ve got a sure-fire business proposition that will only require a modest investment…

Just Say No to Mining

The bottom line is that, as good as things might have looked in early 2021 for cryptocurrency mining, we knew it wouldn’t last, and it didn’t. There are of course pundits predicting the next big wave of cryptocurrency fever, and maybe they’ll even be right. That’s the problem with unregulated and pseudo-anonymous commodities like crypto coins. Maybe in a few years we’ll see Bitcoin break $100,000 and Ethereum at $10,000 or more! Equally possible — more so in the minds of many people — is that this whole funny money scheme will prove unsustainable and many people will lose whatever savings they put into it.

Source: tomshardware

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