Cryptocurrency Mining and Profitability
Throughout 2020, I researched and ordered parts to build an Ethereum mining rig. I got it up and running in late September.
2021 looks A LOT different than 2020.
Q4 2020 saw the start of a crypto market bull run.
We are about halfway through the market cycle if things track similar to 2013 and 2017.
I’m glad I started mining Ethereum prior to the current bull run. It was great timing. ETH hit all-time highs in the first week of February 2021.
Reaching profitability mining cryptocurrency is largely dependent on what the market looks like.
Ethereum was slow to catch up with Bitcoin, but ETH seems to finally be breaking previous price level resistance.
When determining how “profitable” Ethereum mining is, you first need to consider all of your startup and ongoing costs.
Startup costs include your basic parts for the mining rig.
Ongoing costs are things like electricity.
If you look at my original post, you’ll see my startup costs were $978.
I started with just two graphics cards.
I added two more cards soon after to roughly double the amount of Ethereum that the rig can mine.
Currently, given the market price of Ethereum and considering my all-in costs to this point, I’m in the green. The rig has made its money back.
It Took 4 Months to Be Profitable
Almost four months to the day, my Ethereum mining rig became profitable. I’ll caveat this by saying that I’m still holding everything that the rig has mined in Ethereum.
I have not converted any ETH yet.
That’s not to say I won’t convert some ETH to BTC or cash out a portion at some point. I just that haven’t touched the mined ETH as of now.
When I started mining Ethereum, I didn’t expect to reach break-even for several more months.
The crypto bull market accelerated the rig’s profitability.
When I wrote an update on the rig two months back, it was making about $7 per day. Now, the rig makes closer to $13 per day more often than not.
NOTE — the market can turn at any moment.
I like to say that as bitcoin moves, so does the market. Bitcoin remains the world’s largest cryptocurrency by market cap.
Bitcoin’s performance and ability to attract institutional investment has provided a massive tailwind for Ethereum and other cryptocurrencies.
My mining rig will likely remain in the green from this point forward with the exception of a very drastic downturn in the market.
So yes, Ethereum mining is profitable in 2021.
But, how profitable is it?
How much money can you really make mining Ethereum?
Here’s a screenshot of the Ethereum mining rig when it’s making roughly $10 per day. Because $13+ per day is such a new trend with the market’s recent upswing, this is better example of how much it earns.
I’m part of an Ethereum mining pool within Nanopool.
The above interface approximates the rig’s earnings based on performance over the previous six hours. These are just estimates.
- $10.50 per day
- $73.50 per week
- $315.01 per month
I also have the rig deposit earnings directly to an Ethereum wallet address I use specifically for mining. This occurs roughly every 8-10 days.
The Nanopool setup also allows you to customize your payouts to trigger each time you hit a certain threshold.
I’ve been utilizing the minimum payout amount so that when the rig has earned 0.05 ETH, it withdraws that amount from my “Nanopool account” and deposits it into my ETH wallet.
There is a small fee taken.
I prefer to withdraw at the current minimum level in order to ensure quick access to the funds in the event there’s an issue with Nanopool. But, I haven’t run into any issues using Nanopool yet.
You’ll see earnings are in intervals of about 0.0489 ETH.
The above numbers are estimates of what my particular Ethereum mining rig makes. These earnings and your profitability can vary, wildly.
It’s not just the crypto market itself that determines the earning potential of a mining rig. The rig itself is critical.
My Cards Are All NVIDIA GTX 1660s
I use NVIDIA GTX 1660 GPUs for my mining rig.
These are older but arguably more affordable cards that have sustained decent earning potential over time.
During COVID, there was a rush on graphics cards for both cryptocurrency miners and gamers alike. Then, the crypto market turned bullish and the rush was accelerated even more.
These same cards that I purchased new directly from NVIDIA are twice that price secondhand or from other vendors if they’re available at all. Most places are on backorder.
GPU drought aside though, your graphics cards matter.
I chose the NVIDIA GTX 1660 because they allowed me to keep my startup costs low. Some GPUs can cost thousands of dollars.
2021 looks promising for Ethereum and other crypto mining.
That said, mining Ethereum will eventually be phased out as part of the overall ETH 2.0 roadmap.
Staking is replacing mining but consensus is that miners have a 2–3 year runway before that happens.
In the short term, the cryptocurrency market also remains a huge factor in determining profitability.
If Bitcoin and Ethereum continue to perform well, mining will likely also remain worthwhile.
All of this is dependent on your particular costs.
If you’re starting from scratch, whether or not you’re able to find affordable GPUs in the current environment will be a considerable factor.