Mining plays a very crucial role in cryptocurrency world. In case you don’t know what is mining – it is the process of issuing cryptocurrencies. For the purposes of this article, we can summarize mining as the process by which new blocks are added to the blockchain. In mining, we have a consensus protocol called proof-of-work. This simply means a miner has to use their mining hardware to complete a complex mathematical problem as a way of securing and verifying a transaction on the blockchain.
Once this is done, the successful miner is rewarded with crypto coins; for example, for Bitcoin, you get 12.5 BTC down from 25BTC when the process began.
In the early days, it was easy to do mining with your computer’s CPU. However, that changed with time as the process became more difficult and computationally intensive.
For now, Graphic Processing Units (GPU) rigs or application- specific integrated circuit (ASIC) rigs are used with most cryptocurrencies. In this article we ask:
ASIC vs. GPU mining rig: which one is better?
There is need to understand how each method works bearing in mind things like initial costs, power consumption, profitability and so on.
Let’s, therefore, look at each concept highlighting the pros and cons. Both GPU and ASIC rigs work in the proof-of-work consensus, but the choice of either really depends on the hashing algorithm used on a particular cryptocurrency. From here we will tell you which one is better according to our analysis.
ASIC mining rig
ASICs as we saw earlier, are application-specific integrated circuits designed to execute a particular hashing algorithm, hence can only be used to mine a given cryptocurrency for which it is designed. Since ASIC mining rigs are custom-built, there are many types of ASIC miners meant for different hashing algorithms. The most popular ones are Bitmain and Canaan.
Pros and cons of ASIC mining rigs
So as to get an understanding of whether the use of ASICs is better or not, let’s look at the advantages and disadvantages of ASIC mining rigs.
Advantages of ASIC mining rigs
- Compact design
ASICs are designed specifically for crypto mining and hence the design focuses on how to maximize hashing power. They are mostly small inbuilt but give more hash power. You can get one that gives you 14 tera hashes (TH) out of the box.
- Easy to set up
ASIC mining rigs are shipped ready for use. The device won’t require any modifications or additional components apart from the mandatory power supply unit (PSU).
- Higher Hashrate
ASICs are powerful rigs that have outputs hundreds of times bigger than GPUs. On a network where an ASIC and GPU are allowed, ASICs will always come on top. The higher hashrate translates to better performance and hence good profitability.
- ASIC rigs are highly profitable
Because ASICs are coin-specific, they tend to focus on the major coins. In addition, a high-end ASIC has more hashing power, meaning greater chances of success during mining. The higher the hashrate, the higher the ROI is.
Disadvantages of ASIC Rig
- High electricity costs
ASIC rigs give off great hash power, but the downside is that they consume a lot more electricity. Therefore, you will face huge electricity bills. ASICs are thus great in countries that have cheap electricity.
- Poor resell value
ASIC rigs are built for mining only. They can also be used for a single coin only. The result is that they cannot be re-used for anything else once they become obsolete. Mining arms races mean that many become obsolete quickly as more hashing power is needed, hence new ASICs designed or upgraded.
- Noisy
ASIC mining rigs produce a lot of heat during mining. They, therefore, require a lot of cooling leading to the installation of several fans that end up producing a lot of noise. Thus ASIC rigs aren’t great for home use.
Other disadvantages include limited availability and rate at which they become obsolete.
GPU Mining Rig
GPU mining rigs utilize several graphic cards assembled into a rig to perform computational processes. GPU mining was the most powerful way of mining crypto coins before ASIC rigs. However, there are cryptocurrencies that encourage the use GPU mining rigs only; for example, Ethereum, Bitcoin Gold, and Monero.
Benefits of GPU mining rigs
- Multiple coins to mine
GPU mining rigs aren’t designed for a specific coin. You can, therefore, use it to mine a variety of coins. For instance, you can mine ethereum and any other altcoin that uses the Ethash algorithm. You can also do concurrent mining or switch from one to the other depending on profitability.
- GPU rigs have a better resale value
You can use a GPU rig for gaming purposes or for video editing, thus if mining isn’t possible anymore, you can resell the rig at a profit.
- Lower electricity use
Compared to ASICs, GPU rigs utilize much less electricity due to lower hashing power and fewer cooling fans. You can reduce electricity needs further by having the GPU rig in an open area.
- Environmentally friendly
GPU rigs do not produce as much heat as ASICs. This reduces the need for fanning and the accompanying noise. As a result, they are much quieter and can be used within the home.
- GPU components have warranties
Manufacturers like Nvidia and AMD have a warranty for their products which are mostly used for gaming units. If you buy from either, you get a 3-5 year warranty. There are also repair services available within your locality.
Disadvantages of GPU mining rigs
- High initial setup costs
To set up a GPU mining rig would require up to 12 graphic cards, a good CPU, RAM, a motherboard, and PSU. All these cost money. If you aren’t an expert yourself, add the cost of hiring a technician.
- Lower ROI/profitability compared to ASICs
Compared to ASIC rigs, a GPU rig has a lower return because it has low hashrates and takes much more time to get a profit. It may also be due to the fact that GPU mining is common with coins that are still to command high price values.
- Graphic card shortages
There is a shortage of high-end GPU cards due to limitations instituted to protect gamers, for whom the graphic cards are originally meant. The cards are in short supply, and prices are sky-rocketing.
Summary
The use of ASIC mining rigs has its own pros and cons, and so does the use of GPU rigs. Different coins have different algorithms that to an extent determine which method is preferable. As for the FAQ of which one is better, it is our belief that based on profitability alone, ASIC mining is better than GPU mining. However, when you factor in other considerations, it becomes a bit more difficult to call. Which one do you think is the best? Give us your opinion about the two mining equipment.
Check out our website for more comprehensive content. Thank you for reading. Happy mining!