Mining – what kind of myths and stories have not been put forward on this topic. A soap bubble, fun for schoolchildren, spending money – all this came from the Internet and television about earning cryptocurrency. In 2018, the bitcoin exchange rate stabilized at an average level, which allowed the opponents of virtual money to forget about their existence, and the miners to calmly go about their business. But before buying video cards and setting up the system, you should draw up a business plan for a mining farm, otherwise you can easily go bankrupt. Mining is a business just like opening a store or a service company. Serious investments require competent calculation, equipment setup and basic knowledge in the field of cryptocurrency.
What is a mining farm and how does it work?
Mining is the extraction of cryptocurrency. Farm – a network of several devices connected into one for accelerated work and receiving rewards. The main component that is involved in the process is a video card, so when assembling your own farm, up to 8-16 cards are connected to one motherboard.
The principle of operation is as follows:
- installation of special software;
- registration in a special system (the so-called mining pool);
- equipment setup;
- start mining.
Even such a simple explanation is not clear to everyone how to mine and where the money comes from. After setting up the system and starting the process, the computer directs all its power to the servers to solve complex mathematical calculations. Every second, a huge amount of information is processed by several users at once. As soon as the task is solved, the miners are rewarded in the form of cryptocurrency to the internal account.
Computing speed and receipt of funds depend on the power of the computer and the number of users in the network. It is worth noting that every year the complexity of the calculation increases due to the growing number of users. In addition, technology does not stand still, so if a couple of years ago some video cards were considered the most top-end, today no one uses them due to obsolescence.
The mining process is fully automatic – it is enough to set up the system once and periodically check its performance. Ideally, the computer works in 24/7 mode, so mandatory monitoring is required. An elementary reboot of the software will require the system to start. If the person is not there, then time and money will be lost.
The final stage is the withdrawal of funds. As soon as the necessary amount for withdrawal accumulates on the internal account, it can be received on your cryptocurrency wallet and withdrawn to the card.
Reference: Bitcoin is not mined on video cards, because special equipment is required – ASIC. In Russia, it can only be purchased on the Internet (not entirely legal), otherwise you need to order in China. Video cards are suitable for mining Ethereum, Zcash and other virtual coins.
The relevance of investments in cryptocurrency mining
The peak of mining occurred at the end of 2017, when in just a few months bitcoin, and then the rest of the cryptocurrency, went up in price dozens of times. For example, if BTC cost $1,000 per coin in 2016, then since 2017, the rate has been increasing almost every day, and by the end of the year it reached its highest level of $19,000. It was at this time that everyone started talking about mining and ways to earn money.
Today, the most important cryptocurrency is worth about $7,000 per coin and is confidently holding its position. Even such indicators are enough to talk about the profitable side of starting a business based on a mining farm. At today’s rates, the payback is approximately 3% per month from the invested funds.
If the media and bloggers stopped talking about cryptocurrency, this does not mean that mining is dead. Users who have been in this business for a long time only expand the premises and change equipment. Beginners also have every chance to start earning if they approach the organization of the process competently and with a clear business plan for future investments and events.
How to earn on mining?
If you need a short answer, then it will sound like this – you need to buy equipment, set it up and mine cryptocurrency. Naturally, figurative expressions do not provide any useful information without clear instructions.
Search for premises and requirements for it
An important stage of organizational measures, since the activity does not imply the registration of an individual entrepreneur and the deduction of taxes, therefore it is not entirely appropriate to talk about renting a room. This is fraught with the fact that the property owner or strangers can report the miner to the police for illegal business.
Reference: a separate room for a mining farm is still required, because the design of 6-8 video cards is noisy and emits a huge amount of heat. Stay in a room with an area of 18-20 square meters. m. for a long time, where a computer for cryptocurrency mining is installed, it is problematic.
Basic requirements for the premises:
- electricity – without it it is impossible to turn on the computer, which is understandable, but you should pay attention to the condition of the wiring. It must be free of defects and bare areas, and also withstand the power of the entire system;
- the Internet is also a prerequisite, because without a connection it is impossible to connect to the server. Mining does not require high speeds, so if there is no fiber optic, then even a 3G modem will do the job;
- ventilation – given that the farm generates a huge amount of heat, the room should be well and regularly ventilated. This is especially true for the summer period.
The type of premises depends on the scale of the future business. If you plan one farm for 6-8 cards, then home conditions are quite suitable:
- An empty room in an apartment.
- Glazed balcony.
- Shed or utility room.
- Empty private house.
If none of the options are suitable, then it is best to rent a room in an industrial area, or rent a garage.
Purchase of equipment
For mining farm you will need:
- video cards – the model is chosen at the discretion of the user, but the price difference immediately directs to the only true direction. Most miners are advised to purchase a GeForce GTX 1080 Ti. There is no deceit or slyness in this, but if these video cards cost 30-35 rubles a couple of months ago, today the price has risen to 56-60 thousand. If it is possible to purchase inexpensively, then this should be done, otherwise there is an alternative – the Radeon RX 570-580. The cost of one card is 23-24 thousand rubles in free sale. In terms of functional qualities, the information processing speed of the card is somewhat inferior to 1080 Ti, but at the same time they pay off much faster;
- motherboard – the reference point is the presence of PCI connectors, with the help of which several video cards are connected to the motherboard at the same time. Since demand creates supply, manufacturers have begun to produce special boards for miners. For example, the ASRock line is marked “BTC”, which means that it has all the necessary ports and is compatible with the latest video cards;
- processor – no matter how strange it may sound, but the “heart” of any computer in the mining farm plays an insignificant role. The processor is required only to run the system and provide the minimum requirements for the operation of the computer. For these purposes, an inexpensive “stone” based on Intel Celeron is suitable;
- hard drive for data storage – the simplest size of 80-160 GB is suitable;
- RAM – one bar for 2-4 GB;
- power supply – given the high power of video cards, appropriate power supply will be required. Conventional blocks for gaming computers will not withstand such a load, so you should purchase devices with a power of 750-1000 watts.
In addition, you need to take care of a cooling system for video cards and a processor (standard coolers will do), as well as racks for mounting a farm. The design is not installed in a conventional case of the system unit.
Monitor and software for setting up and starting the system – here you can use a pirated version of Windows and an old (used) screen.
Building a farm for mining
Assembling a farm is not difficult if a person has ever done this operation with a regular computer. Alternatively, you can use a video instruction from the public domain or invite a specially trained person.
The main difficulty in assembling the system is the connection of video cards in one motherboard. As a rule, special risers (adapters) are used for this.
Installing software is no different from downloading and activating computer programs. Sequencing:
- Visiting a specialized portal for mining.
- Select the desired pool.
- Downloading and installing software.
- Specifying a wallet for cryptocurrency, the name of the farm and e-mail for notifications.
Next, you need to close the program and start the farm. Everything, the mining process has begun, nothing is required from the user.
Like any automatic process, a mining farm needs periodic maintenance. The procedure can be divided into 2 stages.
Creation of conditions for work:
- ventilation in the room – an open window is enough in the apartment. If the farm is located in an industrial building without windows, then the hood is required;
- temperature regime – in summer it is recommended to install additional cooling (fan, air conditioner);
- control of electrical wiring – before starting the farm, you need to check the condition of the electrical network for compliance with safety requirements and the expected load.
Maintenance of equipment involves no less serious measures:
- daily inspection of components – the wires must be securely fastened in the sockets, excluding short circuits and fire;
- conducting periodic tests for the performance of programs;
- tracking the receipt of funds.
If errors or unforeseen situations occur, you must turn off the system, eliminate an external source of threat, or simply let the computer rest, and then boot the system again.
Financial part of the business plan
The amount of investments directly depends on the scale of the mining farm and the cost of components. Below are the calculations based on 6 video cards located in an apartment.
Investment in a business project
Investments at the start (in rubles): (1 rubles = 0.013 USD)
- video cards – Radeon RX 580 6 pcs. 24,000 each (144,000);
- motherboard – 5,000;
- processor – 1,700;
- RAM – 1,500;
- hard drive – 500;
- power supply – 2 pcs. 750 W each (7,000);
- cooling system – 1,700;
- processor – 1,500;
- monitor – 1,000;
- risers – 2,000;
- racks for mounting the farm – 500.
Result: 166,400 rubles or 2156.39 USD (Feb, 2022)
After the mining farm is launched, the costs end, except for the payment of electricity. The calculation is based on the energy consumption of all equipment. And if the video cards indicate how much light each consumes at maximum load, then the costs of the remaining components will not work.
Considering that 2 power supplies of 750 W were purchased, it makes sense to calculate the maximum value of energy costs, which is 1.5 kWh:
(1 rubles = 0.013 USD)
- the cost of electricity – 3.5 rubles. for 1 kW/h;
- 36 kW is consumed per day (1.5 times 24);
- conversion of daily consumption into money – 126 rubles (36 times 3.5);
- monthly electricity costs – 3,780 rubles.
It should be understood that the calculation was made according to the maximum values, so it may be lower.
Profit from mining depends on many parameters, ranging from the type of video cards, their number and power, to the mined coin. Considering that each cryptocurrency has its own course in relation to bitcoin, the frequency of receiving payments in each individual case is different. Simply put, the cheaper the coin, the more often and more the miner will receive, but in terms of rubles, this does not mean high earnings.
If an expensive cryptocurrency is mined, then the miner receives hundredths and thousandths of a coin. It also does not affect earnings in terms of rubles.
Now there are many services on the Internet that allow you to calculate future mining income based on the exact parameters of the system. At the peak of the course, the daily income from one farm on 6 cards was approximately 800 rubles per day. However, now the rate has fallen by almost 10 times and the income from such a farm is around 80 rubles a day.
If the total earnings are 24,000 rubles per month, then calculating net income is easy. Electricity costs are deducted from this amount.
24,000 – 3,780 = 20,220 rubles per month. (1 rubles = 0.013 USD)
Given that the amount of invested funds is 166,400, the farm will pay for itself in 6-8 months of continuous operation.
Reference: 24/7 video cards become unusable after 12-18 months, so the net profit will not last long, after which you will have to invest in the business again.
How to cash out virtual currency?
Initially, earnings are credited to a cryptocurrency account, which can be paid on the Internet, and even then not in all stores. To receive cash income, you need to make an exchange.
There are a huge number of cryptocurrency exchangers in the network. For a certain percentage of the transaction, virtual money can be transferred even to an electronic wallet, even to a Sberbank card.
There are many offers from individuals who often use fraudulent schemes. A common option is for a person to offer to transfer cryptocurrency to his wallet, and he will pay in cash. However, after the transfer, the user is left with nothing.
Experienced miners recommend that it is better to pay a percentage to a proven service, but it is guaranteed to receive the earned funds.
Despite the fact that the majority of the population has a negative or distrustful attitude towards mining, the activity can be called a full-fledged business. Here are investments, and equipment, premises, and the launch of the process, and making a profit. In any case, there are risks, so the last money spent on equipment is not worth risking. And if possible, it is worth organizing a mining farm. Following the clear instructions of the drawn up business plan, after six months you can completely switch to passive income.
Source | StrategiNext