This is the final part of a three part series about Cryptomining for a month. The first part covered how to get setup, second part covered how to use the coins that were generated, this part will cover my conclusions from the experiment.
Overview
There are several moving pieces when it comes to Cryptomining. You need the hardware to be able to mine, you then need some kind of mining software to actually do the mining and pay you for it. You then need to be able to turn the coins into actual money if you want to use it.
Setup
The simplest part of all of these is getting NiceHash up and running on your rig. The QuickMiner setup is easy, and once you read through some of the settings for the overclocking section then their OCTune settings work nicely too. It could be possible to add an extra handful of percent by using some other miner or by endlessly tweaking the OC on your cards, but I suspect for the majority of people it will be fine as it is.
So yes, mining is actually quite easy, if you have the hardware. But is it profitable, well that’s another, longer, story?
Profitable?
If you already have hardware, either current gen or from the previous couple of gens of GPU’s then you can mine and actually make some money. If it’s worth it to you to do that is another matter. I ran my RTX 3060 Ti pretty much flat-out for a whole month and generated about £30 a week of coins. I also ran a slightly older RTX 2060 for a few weeks too, and it actually performed better than I expected and generally ran just over half the speed of the 3060 Ti and generated about £15 a week. The GTX 1650 Super was making about £1 a day before calculating what the energy was, so it was a non-starter really.
That doesn’t sound too bad, but that was running 24/7, no gaming or using the PC for anything intensive that would slow it down. If I were to be editing video and gaming for a few hours a day then I would be making a lot less. There is also the question of energy consumption. NiceHash shows you the power consumption of your card, but that isn’t the consumption for the whole rig. So whilst NiceHash says I am using 116W, when I plug a power meter into the socket for the PC I find I am actually using 270W. The rate for electricity where I live is £0.19/kwH so I am using about £1.20 a day of electricity.
That makes the equation for how profitable it is a bit clearer, £30 a week mining minus the £8.4 of electricity means I am making ~£20 a week. If I run both cards in 2 rigs then I am back to around £30 a week as profit, running them 24/7.
However, that also doesn’t take into account how volatile BTC can be. Whilst waiting to get verified for an account to transfer out of NiceHash BTC lost about 15%. You then also have the fees to transfer the coin, then the fees to sell the coins.
The conclusion I can come to is, if you already have hardware and you don’t mind running it 24/7 then potentially you could make some money that could maybe buy you some more games, or upgrades to your rig etc. It certainly isn’t a get rich quick scheme, and I definitely would not recommend paying the current GPU prices with the idea of mining with them for profit. At the current BTC rate and how fast I can run my RTX 3060Ti, I would have to run it 24/7 for close to 6 months to get my money back on the purchase, at which point I have a card that has been mining 24/7 for 6 months, not ideal. That is also based on the purchase price I paid back in December when I managed to pick it up for £50 over MSRP from Scan.
Currently the same card is going for over £800 on eBay, to cover that cost would be over 1 year of mining.
Getting your money
This is where I really have had a terrible experience. There have been issues with all of the companies I have had to deal with when it has come to moving my BTC around and turning it into cash I could actually use.
NiceHash integrates with both Coinbase and Payeer, both of whom I tried to get accounts with. I created accounts and then needed to get verified to be able to use them. To be verified you need to send documentation like a driving license or passport, a utility bill showing your address and then also a photo, so much like any bank account.
As I am writing this up my Coinbase account has been stuck on hold for over a month while they verify me. I contacted support and was told there was a delay due to the number of people signing up (this was a couple of weeks after they had floated on the US Stock Exchange), however, it still isn’t sorted, three weeks later. I also tried to get verified with Payeer, once I had submitted the paperwork I was contacted to be told somebody from Eastern Europe would call me on Skype to verify my identity, I didn’t feel too happy about that so didn’t follow through.
Some of the security I am sure is just pure theatre to give the impression that your funds are safe. When first setting everything up it is very frustrating and I was left feeling like the whole process was deliberatly complex to stop me accessing my coins, I know it isn’t but that’s how it feels. The companies need to realise that at some point you would actually like to use what you have earned!
I think the problem is that BTC has only been around for a few years, and companies are popping up all over the place to try and fill the space with the solutions people need to be able to work with it. They are trying to show they are professional institutions so you will feel safe, but at the same time they are scrambling to get their systems and procedures setup in the background and you can see through it sometimes which doesn’t make me feel all that safe.
I guess what I am trying to say is, BTC and the companies based around the industry have a bit of an image problem with some of the scandals there have been in the past and that a lot of people don’t really understand the whole BTC ‘thing’. Each time I have an issue dealing with a company related to BTC then it reminds me that it has an image problem.
I finally managed to get a verified account from Liquid, who I found after trying a “coinbase alternative” search on Google. They are actually a pretty large company, and I had heard of them before. The verification process was easy with the same paperwork as previously mentioned, and was basically the same as for my Monzo and Revolut accounts I have setup in the past. I was verified within 24 hours.
I have my account, I was ready to move the coins, which I did, but this isn’t instantaneous. You have to wait inline, as your transaction has to be verified programmatically to become part of the blockchain. Well, that’s what I understand it to be, it wasn’t exactly clear what was going on, all I knew was it was going to take ‘some’ amount of time for the transaction to go through. Not only that, but when I was researching what was going on and why it takes time I found some people had been waiting days for transactions to go through because a mine in China had flooded!
You also have to deal with the ridiculous fees, Liquid charged me $45 on $300. I think they are fixed fees, so I would have been better mining some more, but that wasn’t what I wanted to do, and with the issues I had trying to get accounts with other wallets I didn’t exactly have much choice on where I could go. I could only use the places that would work with me.
My money never made it out of Liquid, despite supplying the same credentials I have used to transfer money around the world before the transfer failed. And, you guessed it, my fees were non-refundable and to try again will cost another $45!
What’s the point?
What is the point of all of this? To be honest, I have no idea. I truly cannot see a point to BTC, I understand it is a Cryptocurrency, and I have read all the arguments about how much safer it is to have than cash etc. At this point though there are so many things I don’t understand.
How can you have a currency that is going to transform business that gets slowed down by a flood in China? What is that all about? How can I pay for things when the transaction will take ‘some’ amount of time to be processed. I certainly couldn’t buy something in a shop and walk out with it while the transaction waits to be processed.
The end result is, a month after I stopped mining and tried to cash my coins in I still don’t have my money and every single company I have tried to use to move the coins around and then turn into cash has given me problems. I know this isn’t the case for everyone, it can’t possibly be. However, I am pretty tech savvy, and having worked at major financial institutions in the Cayman Islands in the past I understand how international finance works and how transfers should work. Despite all this I am sitting here out of pocket as it has cost me £36 in electricity to mine for a month and I have no profits because my initial transfer failed, and it will cost me another $45 to try again, how many times will I have to try?
Would I recommend doing it? No, not at all. I know my experience will not be the same as most peoples, the system has to work or nobody would ever do it. But it is overly complex to move the coins about. You are forced to work with companies that are not regulated in the same way as a regular bank or financial institution, so if anything goes wrong they aren’t obligated to help you, even if it is them that has caused the problem.
Not to mention the environmental impact of doing the mining, the amount of electricity and therefore fuels that are required to mine the coins makes no sense. If you happen to have your own wind or solar farm, then maybe you could justify it, but I still don’t see a purpose to it. Whilst one of the draws of crypto is the decentralisation, what happens when something goes wrong, if there is no regulation who do you turn to?
Ultimately it has left a bit of a bad taste in the mouth, not from the mining, that was simple, but the whole process and the nature of the companies you have to deal with means I have uninstalled the miners from all my machines and don’t plan on putting them back.