How To Successfully Mine Cryptocurrencies Profitably, 6 Tips To Consider

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Cryptocurrency mining is an activity that many people are doing to generate extra money. In some cases enthusiastically, which occupies a few hours a day and in other cases, others have dedicated their careers to this new and growing industry, like HydroMiner for example.

In this section, we will comment some hints that should be taken into consideration when you begin to enthusiastically start the cryptocurrency mining in order to be as profitable as possible.

The first thing that should be consulted before starting to do this is the legal aspect of it, it is important that you make a legal consultation about the cryptocurrency mining activity in your country to make sure you won’t get into trouble. For example, in Venezuela people have been arrested for mining cryptocurrency, and in other countries such as Spain mining and trading bitcoins is regulated as an income generating activity when is sold into fiat currency.

After having a clear idea of how this is regulated in your country, then you can focus on the following 6 tips to make sure this activity is as profitable as possible:

1- Electricity costs: this is the most important variable when you mine cryptocurrencies. In some places, the electric cost can be so high that it exceeds the income generated by mining. The mining hardware used for this task performs a job that fully covers the computing capacity which requires large amounts of energy. Ideally, you should be in a location with a low rate of electric costs to carry out this activity, such as Iceland, with low-cost geothermal energy. The Cryptocompare website can help you get these calculations for the most relevant cryptocurrencies such as Bitcoin, Ethereum and Litecoin.

The following graphic shows an example of an estimate of the monthly income generated today of an Antminer S9 of Bitmain, which works in the algorithm SHA-256 (same as Bitcoin) with a hash power of 13.5 TH/s and electrical consumption of 1.323 watts:

(Income in dollars without taking into account electric cost)

(Income in dollars taking into account the electric cost of $0.12 KW/h.)

As shown, the difference in income is $114.31 per month, which represents a cost of 26.93% of monthly production.

2- Electrical installation: Enthusiasts who have later turned to part-time or full-time miners know that it is important to save on wiring. One way to save money is to locate the machines in places where the electric access is close to the miner’s installation. For example, if you want to install miners in an industrial building, the higher the installation is, the more wiring you will need.

(colored wires in order to differentiate the electric flows)

3- Mining structure: When RIG miners are installed, it is much more economical to assemble the structures of the RIGS by yourself. Today there are RIG structures assembled that are sold around $150 but if you search on the internet instead, you can find designs that can be done by buying cheap and efficient materials such as PVC pipes.

(Mining RIG for 6 GPU structure)

4- Cooling: The cooling is essential for the proper functioning of the miners and to maximize the product life. The best way is to have large spaces for the miners because if they are in small spaces and without ventilation, heat will accumulate and it will be necessary to have an air conditioner installed; and air conditioning represents an investment and additional cost. In closed spaces, around 18,000 VTU are needed for every 20 graphics cards adapted to mining. By having a large and open space, you can use forced air cooling which is much cheaper than air conditioner cooling. You can also use a combination of both types of cooling. The only drawback of forced air cooling is that it generates more dust which is not good for computer components but can be solved by placing filters in the extractors and performing a routine maintenance.

(Forced air extractor)

5- Computing Power (or Hash Rate): the equipment used can also be relevant at some rate of profitability. Each computer equipment represents different variables when it comes to electrical consumption and performance. There are several pages that where you can investigate the hardware performance, hashrate and power consumption. For example, in Wikibooks, you can find a comparison of the different graphics cards for Zcash (ZEC) mining. With this database, you can compare which one would be the best hardware (or GPU) to mine ZEC.

(Zcash GPU brands hashrate/solutions mining comparison, source: Wikibooks)

6- Cryptocurrency Algorithm Profitability: There are times when the mining of a specific cryptocurrency is more profitable than other. To determine which is the most profitable currency for mining, you can go to Whattomine where you can see the most profitable algorithms on the market depending on the type of hardware that you have.

(GPU mining cryptocurrency profitability, source: Whattomine)

 

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