Is Mining Crypto Worth It?

in LeoFinance2 months ago

In this clip from the Weekly AMA, we talk about Ethereum 2.0 and mining.

There are rumors that ETH 2.0 is coming out soon and the "date" is now officially on the board. For ETH miners, this is not very good news.

I personally am an ETH miner and have been one for years. I think ETH2 can be great for the space but from a selfish, miner perspective, ETH2 is not exciting.

A lot of people are not into mining crypto because of the increasingly difficult procedures endured to keep up with mining.

Mining is different from proof of brain and liquidity mining in many ways. One problem with mining is the continual reinvestment in mining equipment in order to keep your profitability up. This brings the question, does the market price of your assets - the mining equipment - increase to cover your expenses?

Another problem with mining is the cost of energy. This is why we see a lot of mining farms moving to places where energy is cheaper, like Kazakhstan.

We talk about this and more in this clip from the Weekly AMA!

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Obviously, most of the equipment do not increase in prices to cover the cost. And the cost of electricity is high in most part of the world as you said.

But let me play the video and listen to the full gist. Maybe, I'll be convinced that mining crypto is worth it.

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The key to mining is to calculate and project costs/profits correctly.

These days, I prefer liquidity mining on Cub/Polycub and proof of brain mining on LeoFinance & Hive.

The days of hardware mining are coming to an end

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Sadly, I agree. I mined Z-Cash and Ethereum before the last bear market, and thought about it again during the most recent bull market.

But the cost of electricity, the noise, the heat and the ease of making money in DeFi demotivated me to build a miner again.

I built four, with 10 GPU motherboards, but only ran 8 GPU due to the cost of the GPU at the time.

In truth sometimes the exciting notions of building and running a miner are more pleasant then the actual emotions of running a miner. But the knowlege I gained is invaluable.

I guess it's a good time to buy GPU now, that miners are giving up due to lower price for crypto. So this would be the perfect time to start.

If only I lived in a state that would subsidize my electricity cost to promote cryptocurrency mining...

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I'm a small time miner, and the hike in elec prices has made it uneconomical now. However, I do also use my miner to heat the room where my wife works from home, and accordingly we dont have our heating system on during the day - so that offsets the elec price increase. But its becoming more difficult by the day, and I can see I will probably have to stop at some point soon.

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Ah yes that’s an interesting use case I’ve heard from a few people who use it for heat as well.

It’s crazy how energy costs have skyrocketed. That’s why I prefer proof of stake and proof of brain mining these days. Alternatives to the physical

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Yes - I agree, I'm unlikely to do much more mining - I definitely prefer the Hive type approach - content and curation

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Hive is truly one of a kind in this way. I think we’re leading the pack on the Web3 frontier - but you already know that since you’re here :)

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I personally feel that mining, using proof of work is really out dated. Yes it was great 10 years ago but technology evolves and better ways of achieving things get invented. When mining your are investing and risking your money on electricity, hoping that the value of what you are mining pumps. It’s way more risky than proof of stake. Imagine spending all that money for electricity mining and the value of what you are mining keeps dropping. How do you keep up?

I 100% agree!

This is what we're seeing with BTC Miners right now - they're being forced to sell a great deal of their stake in order to keep up with expenses.

Proof of Brain, Proof of Stake and LP Mining (i.e. Liquidity Pools on PolyCUB and CUB) are the future.

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And probably with Eth 2.0 the gas costs also will decrease.

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Quite understandable why Eth miners wouldn't love the ETH 2.0 has it will be affecting their rewards. Don't think it is worth it for new miner with this new development due to the effort compared to the rewards

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Exactly! Even me as a small miner. I’m not super excited about ETH2 for this reason.

That being said, I’m also excited for other reasons - I.e. usability and adoption of Ethereum. This effectively gives me a nice and hedged bet

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It depends which involves a personal decision to take by individuals that engage in mining and every step taken requires the idea of making profits

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Yes it does, there are great calculators out there to help you figure it out

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It is definitely awesome

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Though mining consumed so much of energy and this is on of factors to be consider. One of the biggest miner country Iran also denied the supply energy due to Large energy consume by the miners.

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Mining will always be a thing. The question is around how sustainable and economically viable it is!

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I was once a miner back in 2011 but quickly stopped once things started going to ASCI and my GPU was chugging out some serious heat at that point I only mined in the winter months. I moved to POS mining I'd say 2016 and having looked back. It just makes more sense and has the possibility for more people to get involved as long as the UI is easy enough. The big reason all these companies do so well with people loaning out their crypto in exchange for partial rewards is because people can't be bothered with setting up a node, how to use the complicated wallets etc. KISS (Keep It Stupid Simple) Is something crypto really lacks and is where companies are exploiting.

I feel the same way. I moved away from mining due to the heat, noise and doubling of my electric bill!
:)

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I mine HNT (Helium) and make about .08 HNT per day in my small city.

I've made about 36 HNT since last May when I started.

With the $600 upfront cost and waiting 6 months to receive the miner and antenna and cable, I haven't broken even with the current cost of HNT ~$10.15

What I will say is that setting up my antenna and my miner has been roughly set-and-forget since I set it up and configured my modem which was relatively painless.

So, if I can keep mining for years to come, without having to do much work or maintenance, I think it was a great investment honestly.

When HNT was $50 last year, I would have been so happy with that bonus income.

Wow that’s crazy. 6 months to receive your miner 🙀

It’s always cool to get some extra passive income. No matter how small it might be

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Thanks for reading and responding, Khal

The miner took so long because I ordered it in October 2020 when muh "supply chain crisis" was setting in nice and cozy, especially in the electronics markets.

It's a Nebra miner from Parley Labs - Parley is based in California and actually is pretty good I think as far as 3rd party retailers of this stuff goes. Waiting 6 months with constantly shifting times was really difficult but a humbling experience for sure.

This is my very lazy setup lol, note the chopsticks, actual sticks and zip ties. I made .18 HNT with it yesterday tho lol, not too bad. .18 of the ATH of $54.88 is like $9 something, that's pretty awesome! Uses less electricity than the router.

signal-2022-06-23-145302.jpeg

HAHA that is awesome lol

I love the DIY setup you’ve got there. I hope it reaches back to ATHs for you, that would be truly awesome.

The real gains in mining happen when you combine earning a steady income and the price of the asset going up over long time frames

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I have heard of this, and hthought it might be worthwhile. But that big delay in getting the miner is problematic. Perhaps there is a secondary market now?

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I have tried mining only through mobile apps and websites. Every time, it proved to be a scam.

Mining crypto is one of the best and easiest way to acquire crypto ,
Thanks for sharing with us ,your post are always education and informative @khaleelkazi

Some friends of mine are still running a very profitable mining operation in Paraguay, where electricity costs are incredibly low due the Itaipu Dam...but that's a rarity nowadays...

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I am thinking about using solar since I live in a sunny place.

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