A new cryptocurrency called Pearl (ticker PRL), which secures its blockchain by running the matrix multiplication behind AI workloads instead of conventional hashing, has set off a short-lived GPU mining rush, with profitability tracker hashrate.no recently listing an RTX 5090 at roughly $33.80 a day in mining revenue. The coin launched its mainnet in late April 2026 and recently drew attention when AI cloud provider Together AI announced an exclusive partnership, but PRL's price and per-card returns are already dropping precipitously as more miners pile onto the network.

Pearl, built by Pearl Research Labs, uses a consensus mechanism it calls Proof-of-Useful-Work, in which the computation that secures the network is large-scale matrix multiplication, also used in AI training and inference.

Together AI, which announced the tie-up in a May 15th blog post, launched a discounted inference endpoint for an instruction-tuned model called Gemma-4-31B-it-pearl, priced more than 25% below its usual rate and offset by the future value of PRL emissions. "Pearl changes the unit economics of AI," said Omri Weinstein, co-founder and CEO of Pearl Research Labs, in the announcement. Mining is limited to Nvidia hardware.

The protocol can extract a mining proof from genuine inference, as Together's endpoint does, but the rigs driving the rush run inference nobody requested or pays for, so the output goes nowhere. By Pearl's own research, computation is useful only if someone pays for the result, which makes most of the current mining AI-shaped proof-of-work.

Most of the mining activity has run on rented cloud capacity, with miners spinning up RTX 4090 and RTX 5090 instances on services such as RunPod and Vast.ai and pointing them at community mining pools. As that capacity flooded in, Pearl's network difficulty climbed steeply and cut the per-card payout, and hashrate.no now estimates the RTX 5090's daily revenue at $17.19, a 49% reduction compared to the previous $33.80 figure.

Pearl is a brand-new chain, and its block reward will only decline. It can also only be exchanged on minor exchanges where liquidity is thin, such as SafeTrade and MEXC. Officially, the Pearl pool is optimized for H100 and H200 cards, but as we’ve seen, community miners have produced builds that run on consumer-grade cards.

That split makes a repeat of previous crypto-rush GPU shortages unlikely, since the protocol is optimized for datacenter silicon and most of the rush has concerned rented cloud cards. With the reward set only to fall and the network's hashrate still climbing, returns are thinning in the same way past mining booms have unwound before.

An inventor has showcased a “filament dryer that pays you bitcoin.” When this news popped up in our feed we weren’t surprised to see that PizzAndy from Proof Of Print was the brains behind it. It’s the same guy who created the 3D printer that mines Bitcoin. Moreover, it very likely uses the same principle of taking waste heat / watts from crypto mining ASICs for use within the 3D printing process.

A filament dryer?

A filament dryer is a desirable piece of equipment for 3D printing pros and hobbyists. It maintains the filament at a predefined controlled temperature. This stops the filament from absorbing moisture from the air. It is a more proactive step than simply keeping your filament in a decent storage box.

‘Wet filament’ problems are manifested as popping, stringing, and bubbling in the print process. Post-output, the same underlying issue may cause weak interlayer bonding and result in a poor surface finish on your objects. So, keep your filament dry, folks.

Using a dedicated filament dryer also means you don’t have to worry about “hiding from your wife that you're drying filament in the kitchen oven,” notes PizzAndy.

Is it using the same underlying tech as the 3D printer that mines Bitcoin?

Though PizzAndy doesn’t explicitly say it, we are pretty sure this filament dryer uses the same underlying tech as in his 3D printer / Bitcoin miner. In that previously revealed product the 3D printer bed was kept steadily warm because it acted as a heatsink for a number of carefully throttled BTC mining ASICs.

The prototype 3D printer / Bitcoin miner could manage 500 GH/s when the bed was at 75°C. When we reported on that hybrid printing –mining device there was already talk about scaling things up.

Looking at PizzAndy’s latest stats, the new 3D printer filament dryer that mines Bitcoins may have already implemented some of the scaling and tuning that was talked about. Remember, this dryer prototype is capable of “6 TH/s @ 140W.”

Hopefully this new 3D printing filament dryer that mines BTC and the prior 3D printer with integrated Bitcoin miner don't just remain trade show prototypes for years.

Back in the COVID days, there was much hand-wringing about the energy use of Bitcoin (BTC) mining, reaching an estimated 204 TWh at its peak around 2022. Mining is only as profitable as the energy feeding it is cheap, and recent developments have pushed the global BTC network hashrate (computational power) down by 4% in the first quarter of 2026 alone, the first drop since 2020, and many data centers have shifted from hosting miners to hosting AI applications. The drop is not common; Bitcoin has seen double-digit hashrate growth in the first quarter since 2020.

Coindesk attributes most of the drop to the interesting times the Middle East is living in, namely the Iran-U.S. conflict and the subsequent closure of the Strait of Hormuz, a key passageway for oil tankers worldwide. This caused the price of oil to spike, a figure currently sitting above $100 for a single barrel of crude oil, up 49% month over month. In turn, the price per kWh of electrons is creeping up across most of the world.

Even though half the power of BTC mining is estimated to come from renewable sources, the rise in power prices still affects miners, who became stuck between a rock and a hard place thanks to 1 BTC only commanding about $66,700 as of this writing. Both factors result in math that isn't quite mathing for miners, as the price of producing one Bitcoin is about $88,000, resulting in a $19,000 loss for those looking to stay in the game.

The BTC network automatically scales mining difficulty up according to the hashrate. As miners leave the ecosystem, mining gets easier, hopefully inviting miners back in again. However, when the market is under the sign of the bear, mining operators also sell the BTC they're holding, further driving the price down and causing a spiral effect until the next upswing lifts all the boats again.

This time, it might be a bit different, as Coindesk believes that mining operators are switching to hosting AI instead. In that universe, the speedy ASICs dedicated to mining BTC are paperweights that can't do training or inference, so the mining gear is kicked out of datacenters to make room for racks full of Nvidia and AMD GPUs.

That's very likely a wise move in the current zeitgeist, as a key blocker for AI data center growth is the logistics around a facility, rather than the hardware within. Among other necessities, a data center requires absurd amounts of power delivered over stable grid connections that can take years to approve, and uses up copious amounts of water that beget environmental impact studies and permits. Considering the size of the investments in the AI space, having a readymade facility ready to roll and host GPUs is therefore a win-win for both landlord and tenant.

The creator of a 3D printer that mines Bitcoin took part in an interview on the Home Mining Podcast over the weekend. Host Two Sats quizzed creator PizzAndy about his adapted 3D printing prototype. In summary, the hybrid device is based on an open-source 3D printer design with a custom bed that is heat-controlled by throttling the Bitcoin mining ASICs attached to it. Yes, the printer bed is basically a heatsink. The compact prototype is capable of a humble 500 GH/s, says PizzAndy, but there are already plans for scaling and a tile-based model using Intel ASICs targeting at least 10 TH/s.

How did PizzAndy come up with this interesting blend of 3D printing and Bitcoin mining technology? In the interview, the creator says the thought initially popped into his head five years ago, when he was heating his basement workspace (in the cold months) to help his 3D printers work better.

Then, in 2024, PizzAndy attended a presentation about heat reuse — and something clicked. The 3D printer/BTC enthusiast thought it would be “a cool thing” to mix these two technologies, but wasn’t sure about its commercial value. Since that time, he has become convinced that a commercial product is worthwhile.

Podcast host Two Sats advises his guest that this kind of hybrid product has to be top quality, a respectable performer in its field, with Bitcoin as a bonus. Then the pair discusses the recent emergence of easy-to-market home heating products, which are dual-purpose Bitcoin mining hardware.

Round the clock business

PizzAndy notes that “this product is mostly intended to exist in a print farm, where printers are printing around the clock, all the time… that’s when the economics of a print farm are not unlike a Bitcoin mine. And if your machines aren’t printing, you’re not making money.”

Learning about the prototype

Andy says that the prototype achieves 500 GH/s when the bed is at 75 °C. The bed temperature is important to the process, so the BTC mining chips are run to target this particular thermal environment. This contrasts with typical BTC Miner optimization.

At this time, PizzAndy notes that the miner chip waste heat isn’t used to heat the extruder – only the 3D printer bed at this time.

Inside the prototype are four ‘BM 1362 AK chips’ according to the podcast transcript. A custom heatsink attached to these chips directly warms the bed. “That’s the heart of this printer, and its mining,” explains PizzAndy.

An open source printer design (Voron) forms the bones of this project, but Andy “designed everything on the Z-axis” with some supplementary electronics on the back. The ‘Bitcoin orange’ filament flourishes are the chef’s kiss of the design.

Roadmap and scaling

PizzAndy talks about a modular bed tile, which means you can scale up your printer bed and mining operation “as big as you want, theoretically.” Work on this is about to start, and the creator reckons there will be 16 mining chips per tile.

The mining hash rate of the new tiles at 75 °C is still to be determined, but estimates fall roughly between 10 and 30 TH/s with Intel BZM2 ASIC chips. “At least 10 TH/s or we riot,” quips Andy. And he teases there will be a prototype “soon.”

Interestingly, there is a configuration/efficiency perk of using cryptomining ASIC arrays to warm your 3D printer bed. Andy points out that you can selectively heat up certain zones of the printer bed, as each chip/tile is individually addressable. Also, different parts of the bed can be set to different temps to suit a range/mix of materials.

It will be interesting to see if this project takes off, or at least whether the bed tech gets bought/adopted by some of the bigger names in 3D printing. In essence, the underlying concept is like some of the Bitcoin water and space heater consumer products we’ve seen before.

Superheat was at CES 2026 to showcase what it describes as “a water heater that pays for itself.” The new Superheat H1 is a $2,000 water heater that warms up your H2O using waste-heat from its built-in Bitcoin mining ASIC hardware, rather than an immersed resistive heating element.

It is claimed that owners of a Superheat H1 can “offset up to 80% of electricity and water costs” with earnings from cryptomining. Superheat extrapolates these numbers to suggest that a 700-apartment community could raise “up to $980,000 yearly earnings.”

The infographic above shows that a Superheat H1 can earn $1,000 in passive income per year. Therefore, your initial hardware investment should be entirely paid-off in two years, while it reduces your water heater energy spend by 80%. The H1 has a predicted service life of 10 years, very similar to a regular domestic boiler.

Waste not, want not

Cooling data centers that run demanding workloads like cryptocurrency mining is a notoriously expensive business. It is estimated that cooling is the second most costly activity after actually powering the systems to chew through the tasks central to their existence.

But what if the ‘waste’ heat became a benefit? Indeed, some businesses, and most households, spend a lot of their energy budget heating water, for washing and heating systems, and so on, and get nothing else back except a hefty utility bill.

Enter the Superheat H1 with its “dual-value operation.” It requires roughly the same amount of energy as a regular electric water heater, according to the maker. Moreover, it is claimed to be scalable beyond homes, for apartment blocks, hotels, and so on.

“Heat is one of the world’s most overlooked resources,” said Andrew Geng, Co-Founder and CTO of Superheat. “The H1 proves that home appliances can create real economic and environmental value. As we expand into distributed AI and cloud computing, Superheat will redefine how buildings produce, reuse, and monetize heat.”

Bitcoin pricing is rather volatile. In Q3 last year, it nudged over $125,000, but 1BTC is currently valued at around $91,000. Superheat H1 owners should benefit from a higher Bitcoin valuation, but no one really knows which direction, nor how high or low BTC could go in 2026. CNBC recently measured investor and analyst predictions and estimated that Bitcoin valuations of between $75,000 and $225,000 would be seen this year.

Owning a Superheat H1 might be yet another reason for not being able to tune out from watching information feeds and stressing about trends, charts, and valuations. Can I heat water with a heatsink on my forehead?

Cryptocurrency mining has always been in somewhat of a legal gray zone. However, as Russia's war costs are increasing and incomes decreasing, the country wants to tax cryptocurrency mining. To make this happen, Russia is preparing to move cryptocurrency mining from a regulatory gray zone into the core of its criminal law, with penalties ranging from fines to prison terms of up to five years. The draft legislation is expected in 2026, reports CNews.

The Ministry of Justice has proposed amendments to the Russian Criminal Code that introduces Article 171.6, which would establish liability for "unlawful mining of digital currency" and "illegal operation of mining IT infrastructure." The key trigger for criminal responsibility is not mining itself, but the presence of large-scale damage to citizens, organizations, or the state, or the extraction of income on a large scale. Mining conducted by individuals or entities not included in the Federal Tax Service register would fall under this provision if certain limits are met.

Under the proposed legislation, basic offenses could be punished by a fine of up to 1.5 million rubles ($18,870), compulsory labor for up to 480 hours, or forced labor for up to two years. However, mining conducted by an organized group, mining activity that results in especially large damage, or income obtained on an especially large scale would carry significantly harsher penalties. These includes fines ranging from 500,000 to 2.5 million rubles ($6,289 - $31,445), forced labor for up to five years, or imprisonment for up to five years with an additional fine of up to 400,000 rubles ($5,031). In addition, Russia wants to charge for illegal intermediary activity in the cryptocurrency market.

The Ministry of Justice has already published the draft amendments on the official legal acts portal and completion of the legal framework is expected by July 1, 2026. It is unclear when this bill becomes a law, but according to CNews, the illegal intermediary activity — which is set to be viewed as a form of illegal banking — will be prosecuted starting July 1, 2027.

The proposal builds on rules already in force since 2024, under which cryptocurrency mining in Russia is permitted for legal entities and individual entrepreneurs registered in a dedicated Federal Tax Service registry. Private individuals are allowed to mine without registration, but only within an electricity consumption cap of 6,000 kWh per month and with mandatory reporting of mined assets, which creates a clear boundary between tolerated personal activity and industrial-scale operations. As a result, the proposed criminalization is the next step in regulating the cryptocurrency economy and taxing it, something which will bring more money into the Russian budget that has been hit by sanctions for years now.

In addition, Russia is considering controlled access to cryptocurrencies even for non-qualified investors, albeit with strict limits on transaction volumes and investment size. On the one hand, this might help some people hedge their money amid inflation. On the other, it exposes such investors to volatility, fraud, and losses that will not be covered by the government (unlike in cases of a bank collapse).

15 years ago, the first Bitcoin mining pool was introduced by coder Slush. This was the birth of Bitcoin CZ, which would become Slush Pool, and is still operating today under the moniker of Braiins Pool. The group claims to have mined 1,311,339 bitcoins over the last 15 years, which would be worth $115 billion at today's valuation, or $162 billion at Bitcoin's peak valuation earlier this year.

The first and original mining pool started with 60,000 KH/s of power. In 2025, this pool goes brrr-kerching at 13.56 EH/s. Thus, it wields about 225 billion times more computing power than its original incarnation.

By 2010, Bitcoin cryptomining rewards were simply becoming too variable for most solo participants to feel comfortable in their high-wattage pursuit. The difficulty of finding a block had reached the point where the mass of home enthusiasts could still mine BTC, but the painful gaps between striking crypto gold gave birth to the idea of pooling resources for a more steady, reliable, flow of income.

Mining collaborations don’t always have the desired outcome. ‘Gold’ can make men mad with desire, as seen in John Huston’s 1948 classic neo-Western, the Treasure of the Sierra Madre. However, history shows Slush and the community have put together a collaboration that would last.

The Bitcoin CZ originator noted that the mining pool server was based on an equitable sharing of rewards principle, and it worked with major CPU/GPU miners of the time. In contrast with mining solo, Bitcoin CZ would save blocks of crypto to the server wallet, and individual miners could get BTC sent to their own wallets based upon a personal customizable threshold.

Braiins Pool is now 225 billion times more powerful

From its humble forum-discussion beginnings to today, the world’s longest running cryptomining pool has grown at an astonishing rate. In the intro, we highlighted that the pool had grown from a combined 60,000 KH/s to 13.56 EH/s of hashing power. This represents a 225 billion times increase in computing power.

Bitcoin is worth around 400,000 times more than it was in December 2010

At the time the first Bitcoin pool was set up, on December 16, 2010, the value of 1 BTC was 22 cents. Along its spiky history, we saw the first astonishingly rapid BTC inflation in June 2011, with its value passing $26. The next great spike was in Nov/Dec 2013, with BTC breaking the $1,000 milestone. In 2017, it almost hit $20,000. Another milestone spike was when BTC rose above $67,000 in late 2021.

It has garnered many headlines along the way, marking numerous peaks and troughs in its valuation trajectory. Today, a single BTC is valued at approximately $86,000, but it rose above $125,000 for a period just a few weeks ago.

Braiins Pool claims it has been responsible for mining 1,311,339 BTC since it was set up, 15 years ago. Perhaps by the time you check the link, that figure will have risen somewhat.

If you are interested, Braiins Pool is still looking for new members to join up. It currently has nearly 13,000 active users, with a whole ecosystem boasting custom hardware, ASIC firmware, the mining pool, management software, and more. We’d encourage those with only a passing interest to still bookmark the site, and revisit in 15 years' time.

A solo miner running just 6 terahashes per second of computing power has overcome odds of about 1 in 180 million to mine a full Bitcoin block via the CKpool pool. According to CoinDesk, the miner secured 3.146 BTC plus transaction fees — a payout worth around US$270,000 at current rates, despite commanding only about 0.0000007% of the network’s estimated 855.7 exahashes/sec of hash‑rate.

The figure was confirmed by CKpool creator Con Kolivas, who said that the miner only had “a one in 180 million chance” of solving a block on any given day. The miner employed an older‑generation ASIC capable of roughly 6 TH/s, submitted shares to CKpool’s solo‑mining infrastructure, and retained the full block reward minus CKpool’s 2% pool fee.

Headline‑grabbing payout aside, the miner’s win shows how rare solo mining has become for small operators. With network difficulty and aggregate hash‑power climbing steadily, the chance of a tiny miner solving a block without significant scale is vanishingly small. In practical terms, operating at 6 TH/s in a sea of hundreds of exahashes is akin to buying one lottery ticket in a contest where billions of tickets are already in play.

CKpool’s model allows hobbyists to attempt solo mining while routing their work through the pool's infrastructure. It provides a lightweight setup that connects miners to the Bitcoin network without requiring them to run a full node or manage their own backend. That means they preserve solo‑reward ownership rather than sharing a reward across many contributors as happens in standard pooled mining.

For this miner, the choice paid off. That said, the economics of solo mining remain challenging. Running ASIC hardware and paying for electricity and cooling make solo success a highly speculative endeavour or, ultimately, a gamble.

This latest win marks the 308th block mined through CKpool since the software’s launch in 2014, and the first in several months. Moments like this will become all the more rare as the Bitcoin network’s total hash rate continues to climb. They will always be mathematically possible, however, and for some, that'll doubtless be reason enough to continue hashing away.

Crypto mining rigs from Chinese manufacturer Bitmain are being investigated by the U.S. Department of Homeland Security (DHS) due to potential risks to U.S. national security. According to Bloomberg, the federal government launched an investigation, “Operation Red Sunset,” to determine whether Beijing can access these mining machines remotely and use them for cyberespionage or to sabotage the power grid. As part of this probe, the government intercepted some of Bitmain’s imports, dismantled the machines, and tested their chips and code.

The findings of this teardown haven’t been published yet, as the investigation is still ongoing. Aside from assessing Bitmain’s technical capabilities, the authorities are also potentially investigating tariff and import tax violations by the company. However, this isn’t the first time the company’s name has appeared on the DHS's radar. In 2024, then-President Joe Biden shut down a massive Bitcoin mining operation owned by a Chinese entity that used thousands of Bitmain’s Antminer rigs. The government gave the order because it was within a mile of Warren Air Force Base, which hosts some of the U.S.’s Minuteman III intercontinental ballistic missiles. It also appeared earlier this year in a U.S. Senate Intelligence Committee report, which said that Bitmain miners can be remotely manipulated, posing a threat to the U.S.

In its defense, Bitmain released a statement denying these accusations and saying that it “strictly complies with U.S. and applicable laws and regulations and has never engaged in activities that pose risks to U.S. national security” and that it “has no awareness of or any information at all regarding any alleged federal investigation purported to be called ‘Operation Red Sunset.’” It also acknowledged that some of its products were impounded because of issues raised by the Federal Communications Commission (FCC), but that “nothing out of the ordinary” was discovered during that test.

Bitmain is the largest manufacturer of mining rigs, controlling at least 80% of the market. However, the geopolitical rivalry between Washington and Beijing is complicating its operations, with the U.S. becoming wary of large Chinese tech companies. This tension has especially heightened after China enacted its National Intelligence Law in 2017, which compelled companies and individuals to cooperate with Chinese intelligence agencies. We expect things only to get more complicated, especially as many of these manufacturers are transferring production to the U.S. as a strategic move to pivot toward more ‘politically acceptable’ sources.

Major Bitcoin mining firm Bitfarm has announced that it will pivot its business from cryptocurrency to AI data center services by 2027. Although it’s not the largest crypto mining firm in the U.S., it still has a sizeable operation with 12 data centers dedicated to Bitcoin mining. According to Decrypt, the company’s current energy capacity sits at 341 megawatts (MW), which it could take advantage of to deploy several thousand Nvidia GB300 NVL72 server racks.

“We continue executing on our HPC/AI infrastructure development strategy with a fully funded supply chain and plan to convert our Washington site to support Nvidia GB300s with state-of-the-art liquid cooling,” said Bitfarms CEO Ben Gagnon in a statement to Decrypt. “Despite being less than 1% of our total developable portfolio, we believe that the conversion of just our Washington site to GPU-as-a-service could potentially produce more net operating income than we have ever generated with Bitcoin mining.”

Bitfarm posted a $46 million net loss during its third-quarter earnings call, which is almost a 91% year-on-year increase in net losses from 3Q2024. Although Bitcoin reached an all-time high in early October, its volatility meant that the company could not consistently rely on it for its operating costs. Aside from this, its new T21 mining rigs did not perform as expected, leading to a 14% reduction in its hashrate guidance for 1H25.

Alongside its plan to convert its Washington data center, the company also converted a Macquarie debt facility worth $300 million into financing for its Panther Creek, Pennsylvania, data center, with a potential capacity of at least 350 MW. This site, which adds to the company’s 1.3-GW energy pipeline, could potentially make it one of the larger players in the AI data center industry.

At the moment, Bitfarm has 341 MW of energized capacity, meaning it does not have to negotiate with power providers and local governments to acquire more power for its data centers. This would help them avoid the power bottleneck that other hyperscalers like Microsoft are experiencing, with its CEO, Satya Nadella, saying that the company has AI GPUs sitting idle in inventory because it does not have enough warm shells to plug into.

This pivot would help Bitfarm capitalize on the massive demand for AI processing. However, it’s also taking more risks, especially as many experts are saying that the AI industry is already in a bubble. With the investment to completely move from crypto mining to AI data centers expected to cost hundreds of millions, if not billions, of dollars, a crash of the AI industry could potentially bring down the company and take the lending institution with it, alongside several other companies, and lead to trillions in losses.

The British Metropolitan Police seized more than 61,000 Bitcoins earlier this month from convicted Chinese national Zhimin Qian, also known as Yadi Zhang and dubbed the "Bitcoin Queen." Now, China and the U.K. government are working together to trace the movement of the stolen funds and identify additional fugitives, with the hope of returning the funds to the victims. According to the South China Morning Post, police in Tianjin, a city in the northern part of the country, are "doing everything possible" to track the more than 128,000 investors who were duped by fake investment schemes from 2014 through 2017.

The syndicate converted the proceeds from the crime into Bitcoin and property to hide their tracks, but Qian's guilty plea has finally allowed the authorities to begin recovery efforts. However, the cross-border nature of the crime, the large number of victims, and the skyrocketing value of Bitcoin have complicated matters. Tianjin authorities have already contacted claimants via an online platform, but they've warned them that the process can take time. A few experts even doubted whether the victims would be compensated at all.

Aside from determining each person's eligibility to claim the returns, the British government also has to determine whether the cash used to buy the crypto originated from the scam or was mixed with proceeds from other criminal activities. Furthermore, when the British police seized the digital wallets in 2018, one Bitcoin was valued at less than $10,000, trading for less than $ 3,300 near the end of the year.

However, it sits at around $110,000 today, even breaking its all-time high of over $125,000 earlier in October. This is a more than 30x increase in value, but it's unclear whether this growth will be disbursed equally among the victims or if they will only receive the original value they lost.

So, even though the seizure had an initial value of more than US$200 million, it's now estimated to be worth over US$6.7 billion. It's suggested that the U.K. will set up a compensation scheme for the victims, but it seems that they'll only get the verified amount that they were scammed out of, not the more than 3,000% increase in Bitcoin value.

Some members of the British government want to keep most of the seized Bitcoin, suggesting they will only return the original sum. However, others have cautioned against this, as it will likely cause diplomatic tension and would not be a good look internationally for the U.K. Furthermore, there's bound to be a protracted legal battle before the funds can even be released — whether to the victims or the British government.

If you like a gamble, there's a fascinating little device called the Lucky Miner SOLO-LV02 now available via AliExpress for a modest $24 outlay. This thumb-sized USB-C connected device needs just 1W of power, access to your Wi-Fi, and a Bitcoin wallet. You set-and-forget it, then wait for the Bitcoins to roll in. However, the leisurely hashrate of the Lucky Miner means that you will indeed be lucky to squeeze any BTC out of it. CNX Software likened the diminutive device to "a lottery ticket for Bitcoin," offering odds of 210.7 trillion-to-one of mining a single BTC block in a year.

Despite the outlandish odds of mining a Bitcoin block with the Lucky Miner SOLO-LV02, there's still a chance, right? Yes, but the $24 device's odds of striking lucky are akin to winning the traditional lottery several times in a row. A better bet might be something like the palm-sized Bitaxe, which famously earned a miner 6.25BTC — worth $206,000 — last year, for a hardware cost of ~$180. That 500 GH/s machine faced odds of around 2,667 to one to mine 1 BTC in a year of mining, so its owner was still very lucky. Commercial ASIC mining machines nowadays will offer hash rates in the hundreds of TH/s region, but also chew through 3kW or more and typically cost $3,000-$5,000 to purchase.

At the time of writing, 1 BTC = $104,000, and thus, successfully mining a Bitcoin block (3.125 BTC) would net you approximately $325,000.

Though you would have to be an extreme optimist to buy the Lucky Miner SOLO-LV02 in order to chase the dream of becoming crypto-rich, the device isn't without some geeky charm. Powered by an unnamed SoC (suspected ESP32 chip), the mining gadget can't be described as optimal for its primary purpose, with a weedy hashrate of 72 KH/s. But gadget lovers and tinkerers may be drawn in by its 1.9-inch color TFT display, USB-C port, Wi-Fi connectivity, two-button control, thrifty 1W power consumption, and 85 x 55 x 35mm dimensions. ESP32 devices can, of course, play Doom (for example), so it may be harsh to call the Lucky Miner SOLO-LV02 e-waste.

Some detective work by CNX Software suggests that, as well as being powered by an ESP32, this USB device is very similar to a DIY project dubbed the NerdSoloMiner v2. The quoted hashrate of 78 kH/s (the same as the Lucky Miner SOLO-LV02) provides another smoking gun.

The Lucky Miner SOLO-LV02 is also available on Amazon.com for $34.

Luxor Technology, a Bitcoin mining software and services company building machines in Thailand, is in a quandary: It needs to ship 5,600 units before the tariffs hit.

Lauren Lin, Head of Technology at Luxor, told Bloomberg that they’re considering chartering a flight to get the machines into the U.S., especially as it has less than 48 hours before the 10% levies apply to all imports arriving in the States. Aside from that, Thailand also expects to get higher duties starting April 9, with exporters from that country expecting to get charged 36%.

Many Bitcoin mining hardware companies have been based in China. Still, they’ve spread out to other countries like Indonesia, Malaysia, and Thailand since the U.S. applied tariffs, bans, and sanctions on the East Asian giant in 2018. However, the White House’s expansion of trade taxes to all countries with a trade imbalance with the United States means that these companies must set up shop within its borders to avoid these fees.

A few companies have already started moving to transfer some manufacturing within the U.S. Bitmain Technologies Ltd., the biggest Bitcoin mining hardware maker, said on X that it will launch a local production line “to provide faster response times and more efficient services to the North American customers.”

Bitcoin Machine Manufacturers Race Against The Clock To Ship Out Orders

Another Chinese competitor, MicroBT, was said to have previously struck a deal to use U.S.-based Riot Blockchain’s manufacturing capabilities. Luxor is also reported to have made a $131-million deal with the company for WhatsMiner machines, which will be assembled on U.S. soil.

However, even if these companies move their assembly and manufacturing lines within the 50 states, these tariffs will still affect them. That’s because these taxes will also apply to raw materials like aluminum. This means that electronic component manufacturers, including PC case and GPU makers, are affected, too, and will likely have to increase their prices to cope.

Some companies, like Puget Systems, say they might be able to absorb these additional costs for the moment, but they will inevitably have to raise their prices—either to pay the government fees or to offset the costs of moving production into the U.S.

A popular Airbnb host has been forced to implement a bizarre new rule when renting her house to guests: no crypto-mining. The change came after guests amassed a $1,500 electric bill during their stay. The guests were seen hauling out at least ten computers and also set up an improvised electric vehicle charging station.

After the experience, the property owner, Ashley, took to her TikTok channel to explain “the weirdest Airbnb rule I had to implement as a host.” She said the guests left home perfectly clean and a “five-star” review after their three-week stay. The problem came later when she received the electric bill for the property.

The guests’ electric bill amounted to $1,500 during their stay. Ashley checked the external security cameras for the property and watched the visitors haul out at least ten computers when they departed. They’d also set up a charging station for their electric vehicle.

Ashley filed on Airbnb to make the tenants pay the electricity bill, which was a bit of a struggle. She provided documentation to Airbnb, and the guests admitted what they’d done during their stay. In a follow-up comment to her TikTok video, Ashley said the miners told her they had made more than $100,000 mining cryptocurrency, so don’t feel bad for them being forced to pay the $1,500 bill. 

We can't verify the $100K profit number -- people have made more with less electricity in the past -- but we've reached out to Ashley to see if she can put us in touch with the miners to ask them about it (we'll update this article if we hear back).  But even if they made a smaller profit, the issue of miners using Airbnb to get low-cost electricity remains a challenge for hosts.

Ashley remarked, “It was cheaper for them to rent a house to pay for that electricity.” She’s since added “no crypto-mining” and “no electric vehicle charging” to her list of house rules for the property. Others who commented on the video reported similar happenings. One person in the comments said someone else told him about mining crypto in Airbnb properties and that he was “astonished he gets away with it.”

Mining cryptocurrency is an energy-intensive undertaking, with recent reports divulging that just 137 crypto miners use 2.3% of the total electricity produced in the U.S. Aspiring miners will often take whatever steps they can to minimize the expense. That sometimes means renting a property on Airbnb and mining from that vacation home or apartment.

A Bitcoin miner using an open-source Bitaxe mining rig won the Bitcoin lottery by mining a complete block worth 6.25BTC. With one Bitcoin worth approximately $64,000, the user earned $206,000 from their diminutive (human hand-sized) device which was a mere $179 hardware investment.

Altair Technology, one of the few sellers of the open-source ASIC Bitcoin officially endorsed by Bitaxe, shared the news on Twitter/X, congratulating the miner “who likely mined the first solo BTC block with a Bitaxe on @ckpooldev with ~500 Gh hashrate!”

Bitcoin mining is a power-intensive operation, with the complete Bitcoin network having a hash power of 552.49 exahashes per second (Eh/s) or 552,490,000,000 Gh/s. If we divide this by the Bitaxe’s 500 Gh/s performance, we show a dividend of 1.1 billion, meaning the tiny miner only has a 1 in 1.1 billion chance of mining a block every ten minutes. By comparison, you have about a one in 300 million chance of winning the Powerball or Mega Millions lottery, but the drawing doesn’t happen every ten minutes.

Bitcoin mining's thirst for power is also driven up as miners must use the most powerful devices they can get their hands on to have better chances of winning the mining race. In fact, it was reported that just 137 crypto miners use 2.3% of total U.S. power. Furthermore, a mining rig with a ton of computing power doesn’t guarantee that a user will win the mining race against less powerful devices every time, just as the Bitaxe has proven.

Since miners must pay for their electricity consumption whether or not they get BTCs from their operations, BTC mining is often compared to a lottery. You can increase your chances of winning by joining a mining pool, where the computing power of several devices are pooled together and any rewards the pool wins will then be shared among all the participants based on their computing contributions.

However, sub petahash devices like the Bitaxe are often at a disadvantage as it’s below the minimum payout that most Bitcoin mining pools require. So, Altair Technology recommends that Bitaxe mining is better suited for lottery mining — i.e. relying on the 1 in 1.1 billion chances of winning an entire block for yourself.

But before you go and buy a Bitaxe for yourself, you should know that this really is a game of chance and not a typical investment. Assuming that you get a 1 in 1.1 billion chance of winning one block every ten minutes, then it would likely take over 20,000 years for you to get a win. Even if the ROI is 115,000% (assuming that BTC prices will remain stable over that time period), that would equate to just over 5.75% per annum — you’ll be better off investing in an S&P 500 index fund with compounding interest, which currently has a long-term average of 6.87%. 

The U.S Energy Information Administration (EIA) is now requiring large-scale commercial cryptocurrency mining operations to report their power consumption. This initiative is part of a larger effort to regulate and penalize cryptocurrency mining due to the exorbitant amount of energy the industry consumes yearly. For now, the EIA is only collecting data, but this new data should give birth to new regulations that will penalize miners in the future. This comes as the company has released a study (first reported on by Inside Climate News) suggesting that cryptocurrency mining represents up to 2.3% of U.S. power demand.

“We intend to continue to analyze and write about the energy implications of cryptocurrency mining activities in the United States...,” EIA administratior Joe DeCarolis said in a release in January. “We will specifically focus on how the energy demand for cryptocurrency mining is evolving, identify geographic areas of high growth, and quantify the sources of electricity used to meet cryptocurrency mining demand.”

DeCarolis' words summarize that the United States will pay close attention to the environmental challenges cryptocurrency mining might be causing. We can surmise that the United States government specifically wants to crack down on mining operations that impact the reliability and sustainability of power in highly populated areas. Potentially leading to higher residential power costs and power shortage issues during peak hours. As of January 2024, the EIA has identified 137 cryptomining facilities. 

The EIA found that crypto-mining operations in the United States has grown substantially over the past few years, to the point where all U.S-based crypto-mining operations consume 0.6% to 2.3% of the nation's entire electricity consumption alone. For comparison, the total U.S. Bitcoin mining industry consumes the annual power budget of Utah or West Virginia. The estimated power draw of Bitcoin mining worldwide is projected to be anywhere between 0.2% to 0.9% of global demand, equating to the same power draw as Greece or Australia by themselves.

Bitcoin mining is very power-hungry in the United States specifically due to the exorbitant amount of mining that actually takes place within U.S borders. The EIA found that the global share of Bitcoin mining that takes place in the U.S. grew from 3.4% in 2020 to a whopping 37.8% in 2022.

The incredible power demands of the Bitcoin industry are a result of the Bitcoin mining algorithm becoming more and more difficult every single year. Bitcoin today isn't what it was eight to ten years ago, where you could mine it on a single computer and net a decent profit. Nowadays, Bitcoin needs to be mined on hundreds of specialized mining devices (ASICs) to be gathered at all. The continuous difficulty of the Bitcoin algorithm, in turn, creates higher and higher power costs as the cryptocurrency gets harder to mine.

We can expect this power phenomenon to become greater as Bitcoin grows in popularity. 2024 is expected to be one of the most eventful years in Bitcoin history, with the cryptocurrency expected to blow past its record $69,000 high sometime after its halving event in April (when the reward for Bitcoin mining is cut in half) thanks to reduced mining profit and large-scale institutional adoption.

Cryptocurrency mining operations hidden in plain sight have become surprisingly common everywhere, from Polish court buildings to school crawl spaces. Now, we have yet another clandestine mining operation to add to the list: The New York Times reported that a crypto mining farm based in Texas valued at over $6 million is actually owned by a New York University college student named Jerry Yu. 

Jerry Yu's company, known as BitRush Inc. or BytesRush, used cryptocurrency to buy a Texas computing center, thus masking the source of the investment, which originated in China, to avoid regulatory scrutiny. Yu was responsible for compensating contractors for their labor on this multi-million dollar project. 

According to lawsuits from various contractors and the Texas-based Crypton Mining Solutions company, BitRush refused to pay for electrical and plumbing work until a full work stoppage forced them to pay. These lawsuits have also brought much more scrutiny to Jerry Yu and BitRush. 

Based on documents shared with NYT by a Crypton Mining Solutions lawyer, the Channing, Texas site was purchased for $6.3 million in the Tether cryptocurrency. Tether is supposedly backed 1:1 with the US dollar or equivalent assets (a very dubious claim), which is meant to avoid the instability normally associated with cryptocurrency. 

As a side note, it's worth noting that Tether has a controversial reputation, even among cryptocurrencies. A new bill introduced in the US to outlaw government use of Chinese crypto networks also took aim at Tether, and WSJ even covered Tether's black market use in late October, which Tether addressed in a blog post.

According to Gavin Clarkson, Jerry Yu, and BitRush's lawyer, claims of not paying Crypton Mining Solutions are "baseless and without merit." Clarkson also claims that the company "complies with all federal, state and local laws and regulations", despite the seeming heavy use if cryptocurrency to evade attention from the authorities in this matter.

If the claims against Jerry Yu and BitRush are true, contractor payments may soon be the least of that N.Y.U. student's worries.

Bitcoin has shown some strength with a ~12% rise over the past week, and it broke the $42,000 barrier at one point today. The last time this iconic cryptocurrency held this kind of dollar valuation was in April 2022. According to reports, the surge in BTC today has two major propellants: growing confidence that a Bitcoin exchange-traded fund (ETF) will be approved, and expectations of interest rate cuts in the U.S.

Thankfully, gaming GPUs should be safe from the price hikes we've seen in the past, as GPU mining remains relatively unprofitable — you can in theory make over $1 per day with an RTX 4090 right now (after power costs), but that would still require years of continuous mining at current rates just to break even. On the other hand, a new wave of GPU price hikes has hit the GPU market due to US sanctions for AI processors, leading to GPU smugglers soaking up the supply to smuggle graphics cards into China. We also have what appears to be a shift with GPU makers prioritizing AI-centric GPUs. 

You can see the rate of Bitcoin’s climb today and over the last year in the above charts and screenshots (via Coindesk). Today’s 5% rise looks pretty strong, though it looks like the $42,000 mark is finding some resistance after the surge from the high $39,000's. Pondering over the yearly chart, the recent valuation spurt looks even more impressive.

It wasn't long ago that we wrote about Bitcoin becoming stronger: In late October, we highlighted the cryptocurrency’s 20% rise over a week. It hasn’t dropped back since then, and probably the main reason for continued strength is continued expectations regarding ETFs. Yes, we mentioned ETFs as one of the big reasons behind BTC’s rise in late October, and the likelihood that the US Securities and Exchange Commission (SEC) may finally give the go-ahead for this type of investment is stronger than ever.

Some key observations behind ETF optimism include reports that SEC officials met with representatives from Grayscale, BlackRock, and the Nasdaq last week. Moreover, an SEC memo said it was considering converting the Grayscale Bitcoin Trust into an ETF, a move blocked as recently as August.

Forecasts that recessionary forces are weakening are another impetus behind the rise in BTC. Subsequently, banks are expected to cut interest rates, making traditional savings less attractive and more speculative investments like shares and crypto more attractive.

Retrospective: GPU prices the last time BTC was $42,000

The last time BTC cruised at over $42,000 was in April 2022. This was in the months just before the Ethereum merge, so consumer GPUs were still in demand for cryptocurrency mining. We couldn’t resist taking a peek at the Tom's Hardware April 2022 GPU price index to thrill at the horrors of RTX 30-series and RX 6000-series pricing.

At that time, a card like the GeForce RTX 3090 cost $1,770, the RTX 3070 was $777, and even the RTX 3050 was $356. Skipping forward to the latest eBay pricing figures, those three cards can be grabbed for $704, $279, and $169, respectively. Oh, what a difference the demise of GPU mining makes! Bitcoin (and crypto in general) is now largely mined on ASICs and other specialized silicon, and while GPUs are still used for mining some cryptocoins, they currently aren't very profitable — certainly not enough that companies would invest in buying tens of thousands of GPUs.

Current-gen GPU pricing isn’t exactly a bed of roses, though. Low to mid-range GPU pricing has made PC gaming much more accessible again. However, we have noticed an unwelcome trend in high-end GPU prices, like the upward creep of the GeForce RTX 4090 in retail. There are some indications that RTX 4090 prices are being affected by people/organizations grabbing these consumer cards for AI acceleration.

A number of powerful computing devices were found secreted within the Supreme Administrative Court in Warsaw, Poland. They weren’t installed to collect court data, or any similar espionage, reports Poland’s TVN24. Instead, investigators believe they were simply hidden within the fabric of the building to mine cryptocurrency while enjoying ‘free’ electricity.

According to the source report, the discovery of the high-power equipment happened around August, September 2023. A letter sent to TVN24 by one of the court judges confirmed the purpose of the unofficial computing equipment as cryptocurrency mining.

This parasitic computing equipment, hidden under the building floors and in air ventilators, is claimed to have chewed through electricity worth up to several thousand zlotys per month (for guidance 1,000 zloty is roughly US$250). However, the installers of these devices took care to set up a separate network using their own modems, which probably helped them avoid detection.

From reading the machine translation of the report, it isn’t easy to unravel the precise chain of events. It seems to be that the IT services company responsible for looking after computers and networks in the court building fired a pair of employees. These individuals were reportedly responsible for servicing the parts of the large building where cryptomining equipment was revealed to be in operation. Sometime after the IT company cleaned up its act the president of the court terminated the contract with said company.

Official investigations are still ongoing in the above case. Ultimately, if anyone can be found guilty, it will be of a law that covers the theft of electricity. To get a grasp on the scale of the crime that has been committed, prosecutors are talking to experts from the fields of IT and the electrical power industry. By collecting data and having the experts work together, the courts should be able to accurately determine the scale and value of the power theft by the secret cryptomining criminals.

Last month we reported that Bitcoin mining was becoming more popular again due to strengthening BTC valuations. The iconic cryptocurrency remains in good health, with one BTC valued at around $36,500 at the time of writing. However, readers still shouldn’t worry about the specter of cryptomining on PC GPUs, as even the best graphics cards are totally unsuitable for BTC mining.

Bitcoin holders and traders will be feeling some cheer as the (in)famous cryptocurrency hit an 18-month high today. Whatever is happening in the background, it looks like more than a blip on the radar, as BTC valuations confidently pierced the $35,000 barrier. In fact, the price of Bitcoin reached an 18-month high today. This newfound vigor in BTC shouldn't cause PC GPU buyers any worries, though.

Above, you can see that Bitcoin valuations have surged in the last week, yet today looks quite turbulent (more on today’s ups and downs later). According to Sky News, Bitcoin enjoyed gains of about 10% on Monday, feeling the swell from the broader crypto market. The latest boost to its valuation though, is said to come from a US financial regulator decision.

Speculation is said to have been mounting that the US Securities and Exchange Commission (SEC) may finally give the go-ahead for exchange-traded funds (ETFs) based on the BTC market price. Grayscale Investments has been mentioned as one particular financial pioneer of these ETFs, driving valuations in recent weeks, but such rumors have been simmering since August.

Important benefits of ETFs based on BTC, if approved, would be the potential large audience and increased liquidity. In effect, these instruments allow investors to gain exposure to the BTC market without owning crypto. ETFs containing some BTC could benefit from the potential crypto-revival upside, with limited downside, and would be expected to stoke new interest. Such a financial instrument may even attract large institutional investors.

Looking closer at the chart for the last 24 hours, we can see that there was a precipitous drop at around 3 p.m. UTC. This seems to be explained by one of the major Bitcoin ETF pioneers perhaps not going forward with such plans. CoinDesk reports that BTC's $35,000 valuation achievement was severely dented by the ticker for BlackRock's (BLK) spot Bitcoin ETF being removed from the Depository Trust & Clearing Corporation's (DTCC) website in the US.

We note that the spike down seems to have been brief, but since when does reality affect the investments of BTC speculators?

GPU BTC Mining Remains Dead

PC enthusiasts shouldn't worry about anything other than the most astronomical rises in BTC valuations affecting the GPU market. For example, we have calculated that, at today's price, it still isn't viable to use the best graphics cards like the GeForce RTX 4080 or GeForce RTX 4090 for profitable cryptomining. Putting some rough numbers to our statement, either of these top gaming GPUs could be run to make $0.20 a day, according to NiceHash data. Breakeven would thus take 5,000 days for a GeForce RTX 4080, or 8,000 days for a GeForce RTX 4090.

Bitcoin mining is thriving in Russia, despite the international sanctions imposed on the country following its 2022 invasion of Ukraine. This upswing is due to an influx of mining machines from manufacturers like Bitmain and MicroBT, whose expansion is driven by a saturated U.S. market, reports CoinDesk.

Russia has held a dominant position in the global Bitcoin hash rate because of its cheap energy and cold climate, which makes it somewhat easier to cool down mining data centers. In addition, China's 2021 ban on crypto mining boosted Russia's hashrate even further, making it one of the world's largest mining industries. Now that the U.S. market is saturated with mining machines from Bitmain and MicroBT, more machines are shipping into Russia than to any other market, according to Ethan Vera, COO of Luxor Technologies.

Russia's booming mining industry stands out against its struggling economy, which has suffered under severe sanctions imposed by the West. These sanctions do not entirely prohibit involvement in the mining sector, although they present 'significant risks,' according to David Carlisle, vice president of policy and regulation at blockchain analytics firm Elliptic. Foreign mining companies cannot conduct business with sanctioned entities or make payments to state banks and companies, which makes it harder to set up data centers in the country. In addition, these companies also face potential reputational risks given the current geopolitical climate.

The rising price of Bitcoin, coupled with increased activity on the Bitcoin blockchain driven by projects like Ordinals, have created a favorable environment for mining. Some factors make Russia particularly more competitive when it comes to mining. Firstly, increased regulatory scrutiny and taxation in the U.S. and other countries made them less appealing for mining. Secondly, changes in Kazakhstan’s regulatory environment, limiting the amount of electricity available for Bitcoin mining, made some miners move away from Kazakhstan, possibly to Russia. Thirdly, energy costs in Russia are significantly lower than elsewhere. Current prices for installing machines at a colocation datacenter are between $0.05-$0.055 per kWh in Russia, significantly lower than U.S. prices around $0.08 per kWh.

Cryptocurrency Mining Group (CMG) suggests Russia will be the only country able to significantly accelerate hash rate growth due to these conditions.

Mining rig manufacturers like Bitmain and MicroBT are capitalizing on the opportunity presented by Russia's thriving sector. Both companies are purportedly expanding their presence in the Russian market, providing after-sales services such as maintenance and repairs to local miners, albeit without officially confirming it.

Despite geopolitical tensions and sanctions, Russian miners and their international clients remain undeterred. These sanctions may have even inadvertently boosted the Russian mining industry, offering an alternative revenue stream for power producers hit by the economic downturn and facilitating the conversion of Russian rubles to Bitcoin, which can be traded globally. Despite potential hesitation from European and U.S. miners, Chinese miners are keen to fill any voids, taking advantage of the thriving Russian market and China's close relations with Russia.

But the skies are not completely blue for the Russian mining sector as companies working in Russia or with Russian entities may be sanctioned by the U.S. government. 

Following the invasion of Ukraine, the U.S. government imposed sanctions on BitRiver, Russia's largest hosting provider and a key player in the mining industry, which was the first instance of a mining entity being targeted by U.S. sanctions. The aftermath of this decision has left companies, such as the retail-oriented Compass Mining, uncertain about how to manage their equipment. Obviously, doing business with a sanctioned entity like BitRiver presents considerable risks for companies.

Samsung officially started high-volume production of chips on its SF3E (3nm-class, gate-all-around early) process technology about a year ago, but no fabless chip designer has ever confirmed that it uses this node for its products. But TechInsights recently discovered that MicroBT's Whatsminer M56S++ cryptominer has an application specific integrated circuit (ASIC) that is indeed made with Samsung's SF3E process.

ASICs used to mine cryptocurrency tend to be small devices with a relatively low transistor count featuring similar repeating logic structures and a minimal number of SRAM bit cells. This generally makes such chips, and the Whatsminer M56S++ in particular, very well suited for serving as pipe cleaners for the most advanced manufacturing technologies due to their production simplicity. For Samsung Foundry, it makes perfect sense to use its SF3E for chips like cryptocurrency mining ASICs.

Unfortunately, we do not know much about the Whatsminer M56S++ ASIC except that the MictoBT's mining machine based on this chip has a 240-256 Th/s hashrate and a 22J/T energy efficiency. For those interested in discovering more about the chip, we recommend buying an appropriate report from TechInsights.

Unfortunately, it is presently unknown whether Samsung's SF3E is currently used for applications beyond cryptocurrency mining chips. But officially, Samsung says that it makes products using its latest process node.

"We are mass producing the 1st gen 3-nano process with stable yields, and, based on this experience, we are developing the 2nd gen process to secure even greater mass production capabilities," a financial statement issued by Samsung reads. 

When compared to Samsung's 2nd generation 5nm-class technology (SF5, 5LPP), SF3E (aka 3GAE) promises to decrease a chip's power consumption by up to 45% while maintaining the same complexity and frequency or it can enhance performance by 23% with similar transistor count and clocks. In addition, it can also reduce the area occupied by an integrated circuit (IC) by 16%. The company recently detailed its second-generation 3nm-class process called SF3.

Crypto mining infrastructure companies like Hive Blockchain and Hut 8 Mining are looking at profitable new opportunities for leveraging their considerable GPU-based computing power. Bloomberg reports that as opportunities and profits from crypto have ebbed away, these businesses have been lucky enough to be in line to catch another computational tidal wave — artificial intelligence (AI) computing.

It is estimated that the crypto mining industry invested $15B on GPUs with which to unearth blockchain-based tokens. Last September, the financial viability of a swathe of cryptomining businesses evaporated overnight.

Of course, we are talking about the event known as the Ethereum Merge, where this popular GPU-minable crypto currency switched from Proof-of-Work to Proof-of-Stake. At the time we celebrated, noting that millions of GPUs would become unshackled and perhaps find their way into the tender arms of a PC enthusiast or gamer. However, some miners have held on, having been less affected due to their Bitcoin mining activity, while looking for other crypto opportunities and hoping for a bounce or resurgence in the crypto economy. According to Bloomberg's report, the likes of Hive Blockchain and Hut 8 Mining are already raking in tens of millions of dollars thanks to their HPC service offerings and the burgeoning AI business.

In its talks with Hive Blockchain, Bloomberg heard that the company is hoping to hit $10M in revenue from HPC business by 2024, and foresees this income stream doubling the year after. Hive Blockchain is a sizable business that purchased $66M worth of GPUs from Nvidia in early 2021.

Hut 8 Mining seems to have been even more successful in partially transitioning from crypto to HPC services. Bloomberg's report suggests the firm has made nearly $17M from these operations in 2022, representing about 11% of overall revenue.

In some ways the example businesses above are lucky to have been able to continue, and therefore be around to catch the AI wave. The source report notes that Core Scientific, which was the largest public Bitcoin miner by computing power, didn't even make it to 2023 before going bankrupt.

Going forward, the crypto mining stalwarts will have to survive some serious competition from the likes of Microsoft Azure or Amazon Web Services (AWS) to successfully sell AI acceleration services. However, it is noted that the ex-mining outfits have some of the best GPU maintenance experience and strong histories of optimizing for energy management.

There've been rivers of ink written on all aspects of cryptocurrency ever since that fateful day of the Bitcoin whitepaper publishing. Still, one question that's repeatedly brought to the limelight (and understandably so) surrounds energetic and environmental sustainability. Now, the White House itself is adding fuel to the fire through its DAME Tax proposal, whose aim is, and we quote: "making cryptominers pay for costs they impose on others." 

How, you ask? By phasing in an additional 30% tax penalty for cryptocurrency mining firms on any energy they consume in that process. According to the White House, this is "an example of the President's commitment to addressing both long-standing national challenges as well as emerging risks – in this case, the economic and environmental costs of current practices for mining crypto assets." The idea is simple: Bitcoin mining consumes a lot of power; this consumption drives electricity prices up; which is bad for everyone unfortunate enough to share a grid with a cryptocurrency mining firm.

It seems that the White House's hand has been forced by their very own report, which estimates total Bitcoin mining energy consumption in 2022 at an eye-watering 50 billion kilowatt-hours (in fact, the estimate places consumption anywhere between the low of 30 billion kWh and a high of 60 billion kWh). That's greater power consumption than all operating computers in the United States put together - and within the margin of error of the countrywide electrical consumption for as basic a necessity as lighting. 

It's also more energy than Americans consume through their TV sets, and it's right here, in a nice graph:

Let's get this straight right off the bat: public and private lighting is definitely (and inarguably) more important than Bitcoin mining.

However, some arguments favoring the proposal seem to be mired in inconsistencies. Back when Intel announced its "Bonanza Mine" cryptocurrency mining chips, we took a relatively detailed look at Bitcoin's global power consumption and the utility that can already be extracted from it: anyone who has taken profits can attest to its utility; anyone who sold anything to someone and got paid in Bitcoin can attest to its utility; so can anyone who crossed an embattled border while invisibly carrying their wealth, or the citizens of El Salvador, where Bitcoin is legal tender. I'd be interested to know which process the White House used to quantitatively analyze cryptocurrency applications' social benefits before concluding that they "are yet to materialize."

There's also the question of what amount of Bitcoin's energy consumption actually hails from carbon-intensive sources; according to the Bitcoin Mining Council (BMC), a global forum of mining companies that represents 48.4% of the worldwide Bitcoin mining network,  it's estimated that in Q4 2022, renewable energy sources accounted for 58.9% of the electricity used to mine bitcoin - against an estimated 36.8% as of Q1 2021.

It'll be interesting to see what results from this legislative push. For one, a 30% tax for cryptocurrency mining firms would drive most of them out of business, resulting in a concentration of hashing power in the hands of the few firms with strong enough financials to stand above the waterline. That would be terrible for Bitcoin, whose network security assumes that processing power is distributed, not concentrated. We wouldn't go so far as saying that Bitcoin Core devs would be open to changing Bitcoin's security model from Proof of Work (the cause for the monumental energy consumption) to Proof of Stake (Ethereum did this transition through its Merge, basically cutting its energy consumption on transaction validation by over 99%). But Ethereum isn't Bitcoin, and Bitcoin isn't the only Proof of Work cryptocurrency out there.

Cryptocurrencies boomed during the pandemic, as many people worked from home and looked for things to do with their extra time (and make some money on the side). As a result, Bitcoin and Ethereum reached all-time highs in late 2021 before dropping significantly in 2022.

Now, the Biden administration is looking to curb any financial benefits companies gain by imposing a new tax on electricity used for cryptomining. According to the administration, cryptomining operations have an outsized impact on energy consumption in the United States. 

So as part of its FY 2024 budget, the White House is proposing a 30 percent tax on the electricity used by cryptomining operations. The Digital Asset Mining Energy (DAME) tax would go into effect on December 32, 2023, and phase in, starting at 10 percent in the first year. The tax would increase to 20 percent during the second year and hit 30 percent in the third and subsequent years. It's estimated that the DAME tax could generate $3.5 billion in revenue within the first decade of enactment.

The White House claims that "the increase in energy consumption attributable to the growth of digital asset mining has negative environmental effects and can have environmental justice implications as well as increase energy prices for those that share an electricity grid with digital asset miners." 

In other words, everyday citizens face the consequences of the increased energy demands from cryptominers in the form of higher rates to offset the costs of energy producers. However, the administration also notes that the volatility of cryptomining can have other consequences. "Because cryptomining is geographically mobile and the stability of the business model remains unclear, local utilities also face financial risks if they invest in upgrading capacity that may not be needed if mining activity ceases or moves away," the White House said in a press release. 

The White House wants these energy hogs to foot the bill through higher taxes to combat this perceived threat. The hope is that the up to 30 percent tax will be enough to deter cryptominers in a market that has already seen profitability drop. 

For example, figures from the U.S. Energy Information Administration show that refrigeration accounts for the majority of electricity usage at 85 billion kilowatt hours (kWh) in 2022. Lighting was second at around 65 million kWh, while televisions came in third at just over 50 kWh. The surprising entry on the list is cryptomining, which consumed 50 million kWh in 2022 and landed in the fourth-place spot.

To put those numbers in perspective, the 34 largest cryptomining operations in the U.S. consume enough electricity in one year to power three million homes. In addition, "Cryptominers' high energy consumption has negative spillovers on the environment, quality of life, and electricity grids where these firms locate across the country."

The economic benefits of cryptomining are dubious at best, with the White House arguing that it doesn't offer nearly the type of return on investment for communities as businesses that consume similar energy levels. Interestingly, firms would have to self-report the amount and value of the energy they consume specifically for mining. Those figures would serve as the tax base for the cryptomining operations.

Cryptomining was previously embraced by companies like Nvidia, which experienced widespread and lengthy graphics card shortages due to immense demand. Nvidia even developed GPUs specifically to target the cryptomining market. However, in recent months, even Nvidia has soured on the industry. 

"All this crypto stuff, it needed parallel processing, and [Nvidia] is the best, so people just programmed it to use for this purpose," said Michael Kagan, chief technology officer for Nvidia, in a March 2023 interview with The Guardian. "They bought a lot of stuff, and then eventually it collapsed, because it doesn't bring anything useful for society. I never believed that [crypto] is something that will do something good for humanity."

Having earned a boatload of money selling graphics processors to miners of crypto currencies like Bitcoin and Ethereum, Nvidia now says that cryptocurrencies are useless for society. Instead of wasting GPU compute power for mining, it can be used to run various artificial intelligence applications like smart chatbots.  

"All this crypto stuff, it needed parallel processing, and [Nvidia] is the best, so people just programmed it to use for this purpose," said Michael Kagan, chief technology officer of Nvidia, in an interview with The Guardian (via VideoCardz). "They bought a lot of stuff, and then eventually it collapsed, because it doesn’t bring anything useful for society. AI does,” Kagan told the Guardian." 

Microsoft's ChatGPT was trained on a supercomputer based on 10,000 Nvidia A100 compute GPUs (although some implementations may use different hardware). The Generative Pre-trained Transformer also uses Nvidia's DGX servers to run. 

But while Microsoft only used 10,000 of compute GPUs to make a product that can be used by almost everyone on the planet, it's likely that hundreds of thousands of GPUs were used to mine Bitcoins and Ethereum currencies that were useful for people courageous enough to earn on them and desperate enough to hedge their money in crypto. 

Analysts from Bitpro Consulting estimated that Ethereum miners purchased $15 billion worth of GPUs over the period between early 2021 and mid-2022. Miners bought some of the best gaming graphics cards around, and demand from these customers increased prices of gaming hardware to levels that were too high for your average buyer. 

Officially, Nvidia only sold its CMP (crypto mining processor) GPUs to professional miners, but in reality, many of the company's gaming graphics cards were sold at retail at prices higher than MSRP to cryptominers, too. In fact, Nvidia even had to pay the United States Securities and Exchange Commission (SEC) a fine of $5.5 million for failure to disclose "that cryptomining was a significant factor in year-over-year growth in the company's gaming revenue" during consecutive quarters in its 2018 fiscal year." 

"I never believed that [crypto] is something that will do something good for humanity," said Kagan. "You know, people do crazy things, but they buy your stuff, you sell them stuff. But you don’t redirect the company to support whatever it is."

Update 3/8/2023 9:50 am PT: TP-Link representatives responded to our queries, stating that this is not a TP-Link product. As such, it appears that the "TP-Link ASIC" router is a scam. We're investigating further. 

A company named "TP-Link ASIC" has announced an NX31 ASIC mining router that sports Wi-Fi 7 connectivity. According to the specs, this $1,440 router has a built-in ASIC that mines crypto faster than the RTX 4090 and pulls 1,200 Watts during full load. However, the well-known router maker TP-Link tells us that this is not their product and that they are working to get the press release removed. At best, "TP-Link ASIC" is an unaffiliated company, but it's more likely that this device is a scam — much like other crypto hardware scams we've seen in the past. We're working to dig up more information.

The NX31 (NX31-B2MR) listing claims the device doubles as a Wi-Fi 7 router and ASIC miner. However, the product page lacks some technical details, and the image of the NX31 device corresponds to TP-Link's Archer BE900 Wi-Fi 7 router — even the filename confirms it. That doesn't make sense, though. Unless it was significantly larger, the company wouldn't be able to cram this much horsepower into a pirated design that mimics the router.

According to the company's claims, the NX31 delivers a hash rate of up to 31.2 TH/s, much faster than a GeForce RTX 4090. Except that appears to be for an ASIC-friendly mining algorithm (Kadena / Blake2S), and no one in their right mind — who has to pay for electricity — would be running those on a GPU these days. But there's still the question of efficiency.

The manufacturer labeled the NX31 for Kadena (KDA), so support for other cryptocurrencies is unknown and unlikely. It claims to outperform cheaper ASIC miners, such as the Canaan Avalon A9 miner (20 TH/s), but it lags behind Intel's Bonanza Mine ASICs (34.5 - 47.7 TH/s). The problem is we're looking at apples (SHA256 mining) and oranges (Kadena mining). The selling point for the NX31 is the device's dual functionality as both a router and ASIC-based crypto miner.

TP-Link ASIC didn't share the dimensions of the NX31, but says it weighs 3.9kg (8.58 lbs). The vanilla Archer BE900 has an LED screen, which you can personalize with the weather, time, or other graphics. On the NX31, the vendor claims to have added the functionality to display the hash rate and temperature. In addition, the machine features a metallic body and two fans to improve cooling and draws 1,200W. You can't just blindly plug the NX31 into your home's outlet, though, as the ASIC miner requires a 240V outlet.

On the router side, the NX31's other attributes concur with the Archer BE900. For example, it claims to support quad-band technology and 12 internal antennas to improve coverage over large areas. In addition, the NX31 claims a generous amount of Ethernet ports of different standards. The list includes one 10 Gbps WAN/LAN port, one 10 Gbps SFP+/RJ45 port, four 2.5 Gbps LAN ports, and a 1 Gbps LAN port. For USB connectivity, the NX31 provides one USB 3.0 and one USB 2.0 port.

The NX31 isn't the only ASIC miner in TP-Link ASIC's ranks. The company also sells the D11 (D11-B1FB) Doge and Litecoin miner for $570. The machine reportedly pumps out 610 Mh/s while pulling 400W. This model is more versatile as it can come in both 100V and 240V variants. TP-Link ASIC will ship the first batch on March 24.

TP-Link ASIC says it has already sold the first batch of NX31; therefore, the ASIC mining router is on backorder for an April release. It appears that the vendor has adjusted the pricing to $1,370, 5% lower than the launch price. Purchase orders are limited to three devices per customer, but you absolutely should not plunk down your money for this likely scam. TP-Link ASIC claims that the standard ROI (return on investment) time for the NX31 is between five to seven months, which seems highly ambitious.

Based on the claimed mining performance of 31.2 TH/s for Kadena, it would appear that if the NX31 were even real it could only mine about $4 per day worth of cryptocurrency at present rates. With a power draw of 1200W and assuming $0.10 per kWh, that would bring the actual net profits down to about $1.40 per day, which means you're looking at more like 1,000 days to break even — and that's assuming nothing bad happens to the Kadena cryptocoin or the NX31 in the intervening time.

Cryptocurrency mining may no longer be profitable, but it was booming during the pandemic. But it might still be worth it, even now, if you didn't have to foot the bill for electricity — like the former employee of a small town in Massachusetts, who has been accused of setting up a secret crypto mining operation in the crawl space at a public school.

Nadeam Nahas, a former employee in the facilities department of Cohasset, Ma., is facing charges of fraudulent use of electricity and vandalizing a school. The secret mining operation was discovered inside a crawlspace in Cohasset Middle/High School in December 2021 by the town's facilities director, who was performing a routine inspection. 

The facilities director found "electrical wires, temporary duct work, and numerous computers that seemed out of place," according to an AP News report. With help from the town's IT director, the collection of equipment was identified as a crypto mining operation hooked up to the school's electrical system (illegally, of course). It was removed and examined with help from the Coast Guard Investigative Service and the Department of Homeland Security. 

The town's police department launched a three-month investigation, culminating in Nahas being identified as a suspect. During the investigation, the police determined that the mining operation ran for eight months and used $17,492 in electricity, according to WCVB. As a result, Nahas resigned from his position as Assistant Facilities Director in March 2022. 

A default warrant was issued Thursday after Nahas failed to show up for his arraignment but has since been canceled after Nahas appeared in court Friday, according to the Boston Globe.

Previous illegal crypto mining operations were found in Ukraine and Kyrgyzstan tapped directly into power grids (although at least one Chinese mining operation also used a school's resources).

Cryptocurrency mining company Hive Blockchain said this week it had begun to deploy 5800 Intel Blockscale accelerator-based BuzzMiner mining systems that it designed itself. To date, this is the first large-scale deployment of Intel-powered mining machines. Also, the company disclosed that it earned $3.15 million in December by lowering its power use and, therefore, the number of Bitcoins it mined, reports CoinDesk. 

Hive constantly optimizes its hardware to improve efficiency and lower power consumption. Late last year, the company ordered the production of 5800 Hive BuzzMiners — cryptocurrency mining machines that it designed itself based on Intel's Blockscale custom ASICs. So far, the company has received and installed 1423 of these machines and shipped 987 systems to Sweden, where they will be installed by January 15. The remaining systems will be tested and shipped by the end of the month. In addition, Hive plans to replace older ASIC and GPU-powered mining hardware with its own BuzzMiner machines. Meanwhile, Hive appears to be the largest buyer of Intel's Blockscale chips.

Also, the company recently procured 3570 Bitmain S19j Pro miners, 2050 of which have been installed already. 

Hive mined 213.8 Bitcoin in December using ASIC and GPU hardware, which equaled 113.2 Bitcoin Per Exahash. Meanwhile, the cryptocurrency mining company earned $3.15 million in income from its energy price hedging and grid balancing strategy. It essentially means that it did not mine when the demand for energy was high. Instead, it sold electricity back to the grid.  

An interesting fact is that Hive's production was down by about 20% month-over-month in December. Meanwhile, the company’s grid balancing strategy and selling electricity back to the grid more than offset declines in cryptocurrency mining.  

Cryptocurrency mining got significantly less profitable in recent quarters due to lower demand for Bitcoins and because it got harder to mine cryptocurrency, which is why Hive and its rivals must improve their efficiency to stay in business. 

"Our technical team has updated our software stack which monitors the vital statistics of our global fleet of ASIC miners," said Aydin Kilic, president & COO of Hive. "This allows us to have great insight and granularity into the performance of each machine, using bespoke API calls, as we carefully study the overall fleet efficiency (in Joules per Terahash), to ensure we are mining for maximum profitability during a Bitcoin bear market. We continue to strive for excellence, ensuring that as we scale our hashrate we also optimize our uptime, to ensure ideal Bitcoin output figures and leading the sector in performance."

Gone are the days when you must wait in a six-month queue or pay thousands of dollars for an ASIC miner. Nowadays, if you want an ASIC miner, you can grab one directly from Walmart (via Bitcoin Magazine). Admittedly, they aren't dirt cheap, but some have decreased in price.

Bitcoin has seen a downward trend over the last few months. The cryptocurrency started the year strong at around $47,000 in January but has since dropped to around the $20,000 mark in November. Despite Bitcoin's price reduction, optimistic miners continue diligently working the mines, but these are million-dollar companies with tons of mining equipment. Unfortunately, it's too late for the average Joe to jump on the mining bandwagon, given the difficulty of mining a bitcoin.

China's ban on cryptocurrency mining has forced many sellers to take refuge at Walmart to offload their ASIC miners. Walmart's marketplace has devices from all the big names, including Bitmain, Goldshell, and Canaan. Of course, it's not only ASIC miners, either. The third-party sellers also commercialize control boards, individual ASIC chips, cables, connectors, and other tidbits you may need to set up your mining operation.

The Walmart marketplace offers ASIC miners options at different price points. We see devices going from $2,500 up to $14,600. For example, Bitmain sells the AntMiner S19J Pro for $9,984 on its online store. The same AISC miner is available at Walmart for $6,000, 40% cheaper than buying it from the manufacturer. A seller also listed the AntMiner T19 for $199, but it's out of stock.

Bitcoin mining as an individual simply isn't profitable when you factor in the equipment and electricity costs. Coming back to our example, the AntMiner S19J Pro generates $1.26 daily, assuming you pay around 10 cents/kWh for electricity. It'll take roughly 13 years to recover your $6,000 investment. Electricity will probably cost more in that time, or your ASIC miner may bite the dust, meaning you'll never break even. So unless you already have a big mining outfit or live in a wonderland where electricity is almost free, you should stay away from these ASIC miners on Walmart's marketplace.

The Ethereum Merge has occurred, and as expected, GPU mining profitability has plummeted. Will things eventually recover, or will the best graphics cards finally be free from the cryptomines? We're anticipating a flood of used graphics cards hitting places like eBay, so we wanted to grab this snapshot in time of GPU prices on eBay over the two weeks prior to The Merge.

We've been tracking GPU prices on eBay for the past 18 months or so, and we've watched the most popular cards for mining purposes fall from unsustainable highs to somewhat reasonable values. Granted, you're taking a risk buying a used graphics card, but if you stick with the RTX 30-series and RX 6000-series, it's probably not that risky. Maybe. Anyway, let's get on to the numbers over the past two weeks, and we'll compare those to eBay GPU prices from the month of August.

There's nothing too surprising with the trends shown here. We've been watching GPUs drop in cost on secondhand markets most of this year, and with Nvidia RTX 40-series Ada GPUs, AMD RX 7000-series RDNA 3 GPUs, and Intel Arc Alchemist GPUs all slated to launch in the next few months (or sooner), people continue to sell off their existing graphics cards for whatever they can get.

Interestingly, the lowest prices on some models are much better than the average prices we're showing here. It's difficult to say if every alleged sale on eBay actually ends up going through — buyers and sellers have been known to cancel — so if you're patient it's potentially possible to get an even better value on a card that's up for auction.

Overall, we saw prices come down on every GPU from the current generation, with an average decline of 6.9% (weighted by the number of each GPU sold). The biggest change was on the RX 6950 XT, which dropped 16%, though it should be noted that volume is very low at just four cards sold in the past two weeks. The RTX 3080 12GB also saw an impressive 11% decrease, with 51 GPUs sold.

If you're looking for a new graphics card, you should also check retail GPU prices and see how those compare to eBay pricing. Most cards are 10–15% cheaper on eBay, but the price premium for a brand-new card is probably worth paying. Let's quickly look at the previous generation cards as well.

Previous generation Turing and RDNA GPUs dropped slightly more in price, though now we're dealing with graphics cards that are potentially up to four years old — some of which possibly mined for most of that time. AMD's RX 5700 XT, RX 5700, and RX 5500 XT 8GB all dropped by close to 20% compared to the month of August, while the RTX 2060 price actually increased slightly by 3.4% — sort of ironic, considering brand-new RTX 2060 cards are one of the best values right now.

Nvidia's RTX 20-series GPUs are holding on to some remaining value much better than AMD's RDNA GPUs. That's basically where things were prior to 2020, as the Nvidia marketing was strong and there was a case made for getting a card with ray tracing and DLSS support. Still, it's a bit ludicrous that you can buy an RX 5700 XT for less than an RTX 2060 on eBay these days.

According to our GPU benchmarks hierarchy, the RX 5700 XT is 30% faster than the RTX 2060 at 1080p medium, 34% faster at 1080p ultra, and 38% faster at 1440p ultra. Heck, even the RX 5700 basically ties the RTX 2060 Super — admittedly that's without factoring in DXR or DLSS. Anyway, if you're looking for a reasonably fast GPU that costs less than $250, the RX 5600 and 5700 series cards certainly warrant a look.

The question now is where things will go from here. It feels like GPU prices on existing hardware are standing on a precipice, waiting for a massive fall. Traditionally — meaning outside of the past two years of abnormality — we would expect all the current generation hardware to be selling well below launch MSRPs, in an effort to clear out any remaining inventory right before AMD and Nvidia release new graphics cards. That hasn't happened yet, at least not for Nvidia.

The fastest RTX 30-series GPUs like the RTX 3090 and 3080 series are more reasonably priced than before, but really it's only the RTX 3090 Ti and RTX 3080 Ti that are selling well below their earlier MSRPs. Those were drastically inflated to begin with, so cutting the 3090 Ti from $1,999 down to $1,099 wasn't particularly hard to do. But the vanilla RTX 3080 10GB still starts at around $739 at retail right now, and the RTX 3050 through RTX 3070 are also selling above MSRP.

There are lots of rumors about specifications and potential performance for the upcoming GPUs circulating. If those are even close to accurate, we could see RTX 4080 cards selling for under $999 while delivering significantly better performance — and power efficiency — than the RTX 3090 Ti. Now toss on the aftereffects of the Ethereum Merge and it's difficult to imagine that a good chunk of the ~20 million GPUs that were mining Ethereum won't end up being sold off in the next month or two.

As we noted in the main Ethereum Merge article, right now most GPUs are now making less than $0.50 per day, and that value continues to drop. Short of some GPU minable cryptocoin surging to the front in the near future, most large-scale GPU miners would be better served by closing up shop rather than continuing to pay for power, space, support, and infrastructure.

In the early hours of today, September 15, 2022, the Ethereum community stood breathless. At 2:43 AM EST, there were over 41,000 people viewing an "Ethereum Mainnet Merge Viewing Party" via YouTube. The reason: a software upgrade to the Ethereum Virtual Machine (EVM), known as The Merge, the second most important event in Ethereum's history barring its creation. After the first validator node was successfully brought online (with more following suit), Ethereum's Proof-of-Work (PoW) ceased, replaced with Proof-of-Stake (PoS). Gamers and GPUs rejoice!

The Ethereum Merge has been a long time coming ever since its proposal (in December 2020) as a possible upgrade to Ethereum. The Merge's main feature is to enable Ethereum to transition from the energy-intensive PoW method to the far less demanding PoS. In PoW, validators/miners employed the best graphics cards and perhaps a few ASICs to crunch the cryptocurrency's Dagger-Hashimoto algorithm, securing the blockchain in the process and ensuring transactions are processed correctly.

PoS does away with the computationally intensive security method. Instead, validators will have to show they have a stake in Ethereum's future by holding the equivalent of 32 ETH (~$50,615 at time of writing) in their node. Holding these 32 ETH units theoretically means that these validators have Ethereum's well-being on their minds, since working against it or "poisoning" transactions would likely eat into Ethereum's market perception and value, in turn reduce the value of their staked Ethereum tokens.

One concern that's been raised against the new PoS method is that centralized exchanges can participate in the staking process: users will be able to stake their ETH directly with services such as Coinbase. This has raised questions regarding the true decentralization of Ethereum. Institutions and law enforcement having greater power over centralized exchanges than they do on individual/organized miners has been one of the Merge's discussed aspects. Lido, a community-run validator collective, controls over 30% of the stake on Ethereum’s PoS chain. Coinbase, Kraken and Binance — three of the largest crypto exchanges — own another 30% of the network’s stake. That reads as a few key players being trusted with the keys to the kingdom.

That said, Ethereum's $60 billion ecosystem of cryptocurrency exchanges, lending companies, non-fungible token (NFT) marketplaces, and other apps are now supposedly more secure and scalable.

Perhaps more important for our readers and PC enthusiasts (granted, some of which likely did plenty of mining), The Merge and the PoS transition finally put an end to GPU mining on the Ethereum network, which has been online since July 2015. Speculation prior to The Merge was that this would lead to a flood of used graphics cards from AMD's RX 6000-series and Nvidia's RTX 30-series hitting secondary markets. The result is that graphics cards that are already selling at a discount, such as the $680 RX 6900 XT, could fall even further.

Until yesterday, the Ethereum network counted around 900 TH/s of primarily GPU-driven computing power. That's the equivalent of roughly 9.5 million RTX 3080 cards, but more likely a large mix of slower and older GPUs were also participating — meaning there was probably closer to 20 million GPUs involved with Ethereum mining, give or take. This doesn't necessarily mean that a mix of 20 million cards are going to suddenly hit the market, of course. If miners do choose to offload their graphics cards, though, Nvidia and AMD could see some difficulty in selling new graphics cards at retail.

At least some graphics cards have been put to work on alternate mining cryptocurrencies such as Ethereum Classic (whose hash rate has already doubled since The Merge, up to 158 Terahashes per second) and Ravencoin (also almost doubling from 8.9 TH/s up to 15,9 TH/s). But the more miners turn to these coins, the higher the mining difficulty imposed by the network, which will drive profits down. Cryptocurrencies using PoW generally follow a formula that adjusts the difficulty of the algorithm to control the flow of new coins into circulation. This means more people are competing for a limited resource, and if price doesn't surge in lockstep with hash rates, the profitability of mining will plummet.

Above, you can see the data from NiceHash's Mining Hardware page, which is still based on the pre-Merge values. We ran some quick tests, using NiceHashMiner (and NiceHash's QuickMiner) to see where things stand right now. Prior to The Merge, a GPU like the RTX 3090 could gross around $2.80 per day and the RTX 3080 sat around $2.30 per day, almost entirely thanks to Ethereum mining. Now? Oh boy, how things have changed.

An RTX 3090 running NiceHash Miner decided Autolykos with the most profitable choice for mining. At 245 MH/s, it was bringing in BTC equivalent to around $0.65 per day, while the PC consumed 400W (about 330W from the GPU). Ethereum Classic meanwhile ran at 120 MH/s and consumed the same 330W, potentially bringing in $0.33 per day. At a baseline estimate of $0.10 per kWh, that's $0.80 in power used by the GPU per day, and $0.96 for the entire PC, meaning every coin right now is well into the unprofitable range with NiceHash.

Here's the full set of NiceHash Miner benchmarks for the RTX 3090, running the latest version 3.1.0.0 of the software. The GPU was tuned for memory intensive workloads like Ethereum, however, so these results should only be taken as a rough baseline of what could be achieved.

What about direct mining? WhatToMine's RTX 3090 data suggests you could gross up to $1.35 per day with mining Ergo (ERG) mining, which uses the Autolykos algorithm. GPU power might be tunable to as little as 260W, which means you could potentially net $0.70 per day. That's still far less than half of what the RTX 3090 was doing prior to The Merge, and it remains to be seen if any coin can emerge from the collective with sustainable mining profitability on GPUs in a post-Ethereum world.

The abandonment of GPU mining also means that Ethereum is improving its energy efficiency by leaps and bounds. Since graphics cards no longer need to run complex computations to power and secure the network, Ethereum's energy consumption footprint (and carbon footprint) has been reduced by 99.9%, simultaneously cutting worldwide power consumption by 0.2% (which is still much less than the worldwide energy consumption of electronics left on standby, by the way).

Interestingly, no price-action occurred for Ethereum post-Merge, positive or negative. That's partly because most exchanges put a freeze on Ethereum trading while waiting for the network transition to take place. It's also possible that speculation had already made its way into the pricing over the past few weeks, especially since the last successful testnet for the Merge, Goerli, occurred little more than a month ago.

While the main Ethereum network has done away with GPU mining, existing communities of miners may still attempt to keep their cash-cow running. Several proposals to copy the Ethereum blockchain while keeping mining capability (also known as a hard fork of the network, which we've seen happen with Ethereum Classic) have gained some ground within the mining community. Making a new coin based on an existing coin isn't difficult; the real problem will be convincing the cryptocurrency users of the utility of such a coin, to give it some perceived value.

The founder of Thodex, a sizeable Turkish cryptocurrency exchange service, who fled the country with $2 billion last year, has been arrested. He now faces some 40,564 years in jail.

Last year various cryptocurrency-related scams weighed in at $7.7 billion. Some of the scammers stole thousands; some ended up with millions. Still, perhaps the most notorious crypto scammer ever is supposedly Faruk Fatih Özer, the founder of Turkish cryptocurrency exchange Thodex. They allegedly fled the country in April 2021 with about $2 billion that belonged to around 400,000 Thodex clients. 

Faruk Fatih Özer was recently arrested in Albania after Interpol issued an appropriate order. The local police found the former Thodex chief exec in Vlorë, Albania's third most famous city, reports Decrypt. Co. The identity of Özer was confirmed using biometric results.

While some Thodex employees were already detained in April 2021, the manhunt for Özer continued for over a year. As a result, he and other founders and executives of the ill-fated crypto exchange are now facing 40,564 years for each, Bloomberg reported earlier this year.

Before abandoning operations abruptly in the spring of 2021, Thodex had worked since 2017 and had about 700,000 clients in Turkey, where cryptocurrencies have been widely used to protect investments as the national currency lira has been in a secular decline for years. However, since almost everyone established a cryptocurrency exchange in Turkey, the government imposed considerably stricter rules in early 2021 to crack down on this industry.

Big cryptomining operations have got into big debt in 2022. However, their mining hardware is still worth a princely sum. A case in point is US-based Stronghold Digital Mining (SDIG), which released its latest set of financials earlier this week. One of the most eye opening observations in the financial statement was that SDIG recently cleared $67.4M in debt by selling off 26,200 of its mining rigs.

Selling off over 26,000 mining rigs hasn’t left the Stronghold mines, upon which its future prosperity largely depends, empty. The firm says it has retained approximately 16,000 Bitcoin miners with a hash rate capacity of over 1.4 EH/s and total power draw of 50-55 megawatts.

Though losing the majority of its mining rigs to clear a debt (and 2.5 EH/s of crypto mining power), SDIG reckons that if the market conditions change favorably it will be able to buy up more mining rigs at a keen price. In brief, there are four major factors SDIG management will be watching; cryptocurrency pricing, power pricing, and mining rig pricing and efficiency.

Some other good news for SDIG is that it has updated its financing agreement with Whitehawk Finance LLC, adding a flexible extra pool of $20M borrowing, doubling the term to 36 months, and reducing near-term payments. With the $67M debt paid off from the sale of mining rigs, Stronghold has $47M liquidity for opportunistic investment.

Stronghold’s Vertically Integrated Advantage

A cryptomining company selling off its rigs doesn’t sound like a very hot investment. SDIG has a strength compared to many other miners, though, as it is vertically integrated. As well as owning and operating mining rigs, it owns and operates approximately 165 MW of power generation capacity. Its Scrubgrass and Panther Creek plants in Pennsylvania burn coal refuse, which is a waste byproduct of legacy coal mining operations for power and renewable energy credits.

With its mining operations scaled back to <56MW that leaves a lot of excess power to be sold. It says this is a good time to scale back Bitcoin mining due to the higher power prices / demand. Stronghold’s flexibility to divert power to mining or outgoing supply for the best profits are a clear advantage in this business.

Cryptocurrency prices are well off the lows we saw in June 2022. ETH has climbed back to nearly double its June low, and BTC is about $5,000 up from its June lows, sitting today at around $23,500. Last month, in a news article about the cost of Bitcoin mining, we reported that a Bitcoin currently costs about $13,000 to mine, thanks to new energy efficient ASICs from the likes of Intel and Bitmain. Selling this coin for $23,500 obviously provides some scope for profits. Whether this is an attractive business to be in depends on your feeling about the prospects of crypto over the longer term.

The top three Bitcoin mining companies being traded on the US stock market lost more than $1 billion in the second quarter of 2022, according to a report from Bloomberg. The losses, which were matched by those of the crypto exchanges miners rely on to bring their funds into the real world, came after the collapse of cryptocurrency prices, which led to the value of the companies’ holdings being written down.

The three companies, Core Scientific Inc., Marathon Digital Holdings Inc. and Riot Blockchain Inc., posted quarterly earnings reports that show losses of $862 million, $192 million and $366 million, respectively. Elsewhere, the US crypto exchange Coinbase Global registered a loss of $1.1 billion in the same period, while major Bitcoin investor Microstrategy Inc. also lost more than $1 billion.

The cause seems to be the drop in cryptocurrency prices as miners sold off their coins to cover their costs and fund expansion, as well as repay their debts, and this appears to be continuing into the third quarter of the year despite signs prices were rising again.. July saw the second highest Bitcoin sales of the year so far, with 6,200 coins sold. This follows a June in which 14,600 coins were sold, though only 3,900 were produced, according to figures from Arcane Crypto. Core Scientific is thought to have sold 80% of its holdings.

At the same time, the big mining concerns are taking out loans, with Marathon Digital taking out $100 million (and selling off mining rigs to raise a further $58 million) and Core Scientific going for a $100 million common stock purchase agreement with a private equity firm.

Bitcoin remains profitable for large-scale commercial operations, with each block solved currently worth 6.25BTC, or roughly $120,000 at today’s prices. Energy consumption remains one of the major costs, with US electricity costs rising 12.6% in the last year. The price of the ASICs used to mine the coins has dropped, according to figures from Forbes, by up to 70% this year. As prices fluctuate, less efficient miners tend to give up, leaving the market in the hands of those with higher-performance mining equipment.

Mining profitability, measured in dollars per terahash per second, peaked in 2017 at $3.39/TH/s. Today it sits at around ten cents/TH/s, having been at 41 cents in 2021.

Ethereum's successful update of its last testnet, Goerli, means the Web3 platform is in the final throes of a technological transition that's been a long time coming. Goerli was the last test before the final upgrade to Ethereum's Virtual Machine (EVM), the software platform powered by the Ethereum cryptocurrency. The Merge, which refers to the hard-fork of Ethereum's mainnet proper, will bring a series of changes, chief of which is the transition towards a Proof of Stake (POS) model instead of the current, graphics-card powered Proof of Work (POW).

Goerli is just the last in a series of testnet upgrades that have been happening throughout the year. Each testnet upgrade aimed to diagnose potential code vulnerabilities, issues, and unforeseen circumstances that could render Ethereum's network inoperable. That the last testnet finally concluded its transition means the EVM's gears are well-oiled for a successful transition come September.

The Merge's main feature is that it will enable Ethereum to transition from the energy-intensive security method known as Proof of Work (where validators/miners employ graphics cards to solve the cryptocurrency's Dagger-Hashimoto algorithm, ensuring transactions are processed correctly) toward Proof of Stake.

Proof of Stake does away with the computationally intensive security method; instead, validators will have to show they have a stake in Ethereum's future by holding the equivalent of 32 ETH in their node. Holding these 32 ETH units theoretically means that these validators have Ethereum's well-being on their mind (since working against it or "poisoning" transactions would likely eat into its market perception and value, in turn reducing the value of their staked Ethereum tokens). 

The adoption of POS has been speculated as the next step toward Ethereum's institutional adoption. Environmental concerns have been cited as a reason for it not being more widely used as a development platform.

It has also been a thorn in the sides of PC enthusiasts, as it drove never-before-seen races from miners towards securing the latest graphics cards from both Nvidia and AMD to use for mining purposes. While AMD seems to have made it relatively unscathed through the recent GPU mining rush, Nvidia has had to take multiple steps to reduce this added demand's impact on its products. This led to the introduction of a software lock on its cards that detected cryptocurrency mining workloads and capped performance (the so-called Lite Hash Rate limiter), as well as by offering a cryptocurrency-specific GPU lineup, the Cryptocurrency Mining Processor (CMP) series.

In response to the successful testnet merge, Ethereum's price has enjoyed substantial positive action, increasing by 12.6% in the last 24 hours, building the cryptocurrency's market momentum towards a 19.58% appreciation during the last week. 

Ethereum has gone the same way as Bitcoin, stocks, and most other cryptocurrencies, crashing hard during the current bear market that's still being felt on account of macroeconomic (rampant inflation and severely reduced consumer spending) and geopolitical concerns (namely, the Russian-Ukrainian war and high tensions in the border between China and one of the world's most essential semiconductor nodes, Taiwan).

The cryptocurrency market is already making its moves regarding adopting or refusing Ethereum's transition, with several proponents defending a hard-fork of the EVM that would enable them to keep leveraging the POW model to keep miners in the game. This has been a matter of heavy contention within Ethereum's community and has prompted certain cryptocurrency players to throw their hats on one side or the other.

It remains to be seen where the chips will ultimately fall come Ethereum's mainnet Merge in September, but the odds - and software engineering - seem to be on the side of a successful transition and a new age for the cryptocurrency.

Cryptomining has been in the headlines in recent months for all the wrong reasons if you are a cryptocurrency investor or speculator. It isn’t all doom and gloom for crypto, though, as we have recently reported on newer, more efficient mining equipment becoming available from the likes of Intel and Bitmain. Moreover, on Thursday, Bloomberg reported that the cost of mining Bitcoins had reached a 10-month low.

Some may have scoffed at the new ASIC cryptomining systems becoming available this summer, considering the dire valuation charts for all the major blockchain-based currencies. However, it now looks like new efficient mining systems coming online are quickly having a beneficial impact on the bottom lines of mining operations. Even with the ongoing crypto crash, the difference between costs and crypto valuations makes mining operations sound highly profitable for the time being.

According to data from JP Morgan, at the start of June, cryptomining operations were spending $24,000 to mine one Bitcoin (BTC). Today, they expect to mine a Bitcoin after spending only $13,000. To put that into perspective, you can sell 1 BTC today for almost $21,000, which is better than a 60% profit.

The Bloomberg report asserts the reduction in mining costs is entirely down to the deployment of more energy-efficient mining rigs. One must also remember that this is happening while energy prices are rocketing worldwide. That makes the mining cost reductions and efficiency of the latest mining equipment all the more impressive.

Cheaper Mining to Result in Lower Bear Market Valuations?

Interestingly, a crypto valuation theory shared in the source report suggests that lowering the production cost could negatively impact BTC valuations. In other words, some see the production cost as a resistance line buoying BTC, and perhaps other major cryptocurrencies. If this line can be shifted down, so too can crypto valuations when we are in a bear market.

We mentioned above that 1 BTC is worth about $21,000 today. Some might feel the valuation is very low, but if we learn from history and the two previous bull/bear markets Bitcoin has been through, we should expect it to drop to about $13,000 before the pain ends (80% down from its peak), and before there can be a recovery. However, where we stand in 2022, with a war in Europe and on the precipice of a recession, we shouldn’t expect things to pan out exactly the same, or reverse as quickly as in 2018 and late 2020.

Overall, it is interesting to see such a dramatic cut in the costs of Bitcoin mining (and likely other currencies too). Whether reduced mining costs will contribute to further reductions in valuations, or help miners stay afloat during this slump, remains to be seen. Similarly uncertain are the depths of the worldwide inflation, recession and financial issues we will see through 2022 and beyond.

Bitmain launched its long-awaited Antminer E9 system today. The firm claims that one Antminer E9 system has the crypto-computing power to match 25 Nvidia GeForce RTX 3080 graphics cards. That is quite an achievement, which Bitmain measures in Ethereum mining performance terms. In brief, the Antminer E9 is capable of 2,400 MH/s of ETH mining performance, white eating up to 1,920W, and its efficiency is at 0.8 J/M.

Since it first teased the Antminer E9, the specs appear to have changed somewhat, with no real explanation from Bitmain. Last April, Bitmain teased that it was about to launch a specialized Ethereum miner capable of 3,000 MH/s, using 2,556W, with an efficiency of 0.85 J/M. At the time, it boasted that it could out-mine 32 GeForce RTX 3080 graphics cards. Today, the finished shipping product is said to offer a mining performance equivalent to 25 GeForce RTX 3080. However, it seems to be a little more efficient. So Bitmain might have changed the Antminer E9 specs for pricing, efficiency, or another reason - but the company didn't provide any explanations.

Bitmain's Twitter account says that the Antminer E9 should be available today. We checked the site just a couple of hours after the touted hardware sales started, but it wasn't available. It may appear on the Bitmain retail site later; however, it isn't showing when the check box shows sold-out products.

The Antminer E9 has been through a prolonged gestation period since its teaser regarding the Ethereum targeting system in April 2021. At the time, Bitmain said it would launch "very soon," but the company seemingly encountered problems releasing the ASIC miner. Bitmain didn't share the pricing for the Antminer E9, either. Cryptocurrencies aren't such an attractive investment as they were in the pre-war, pre-double-digit inflation, pre-recession spring of 2021.

As well as the crypto crash, which has paused chiefly since mid-June, there is another significant negative to the prospect of investing in a specialized ETH miner today. The oft-delayed 'Merge' where ETH mining ends, due to the transition to a Proof of Stake (PoS) model, is firmly penciled in for August this year. Sadly, there have been multiple setbacks, so that it could suffer another delay again.

Intel has shipped its Blockscale ASIC product. It has been quite a journey, with the project initially becoming known to outsiders by its Bonanza Mine codename. In April this year, we got news that Intel's Custom Compute Group had a fully formed product dubbed the Blockscale ASIC (Application-Specific Integrated Circuit). Moreover, it announced a flurry of design wins from cryptocurrency mining heavyweights such as Argo Blockchain, GRIID Infrastructure, HIVE Blockchain and others.

Back in April, the Blockscale ASIC was said to be due for delivery to customers in Q3 2022. Today, Intel's Raja Koduri, the firms well known EVP and GM of the Accelerated Computing Systems and Graphics (AXG) Group, eannounced that the Blockscale ASIC is already shipping.

Koduri offered his congratulations to the ASIC development team. Celebrations would surely be called for, as they shipped the Blockscale ASIC in Q2, beating their own Q3 2022 projection. The Intel AXG boss added that he was looking forward to seeing how partners would "improvise around Blockscale and our open design."

If you're looking for some deep technical information on the cryptominer, check out our Blockscale ASIC deep dive from April, or you can peruse the official Intel product brief. The Blockscale ASIC is manufactured by TSMC for Intel on the N5 process. For its specialized purpose, accelerating SHA-256 (Secure Hash Algorithm-256) calculations, it is both very fast and efficient. The ASIC's speed and efficiency will be of great interest to cryptominers. Intel has previously claimed the Blockscale ASIC offers "over 1000x better performance per watt than mainstream GPUs for SHA-256-based mining."

Going by the numbers, this ASIC can achieve a hash rate of 580 GH/s, with power consumption between 4.8 and 22.7W, and power efficiency of 26 J/TH. The flip chip LGA package size is a very modest 7.5 x 7mm. There are on-chip sensors for both temperature and voltage to help monitor systems and tune performance.

Intel's timing to enter new markets like discrete GPUs and crypto ASICs might look very unfortunate for those looking in, but between planning, execution and delivery there is a large zone of no return. However, most business like this is cyclical, and we are pretty sure there will be coming GPU booms, and perhaps another cryptocurrency boom too – if highly speculative investments become attractive again.

It's no secret that cryptocurrency prices have plummeted, and the potential profits from GPU mining have gone right along with them. It's been a while since we've updated our best GPUs for mining because it's not advisable to invest in new hardware at this point, nor has it been for many months. 

But we were curious about the potential profits miners may or may not have realized over the past two years, so we decided to do some research based on the price of Ethereum versus the cost of hardware and power. In short: if you didn't sell your currency before the crash, you have probably spent more than you earned.

Below, we've selected ten of the most popular graphics cards for cryptocurrency miners. These also happen to match up nicely with the best graphics cards for gaming, assuming you could actually find any of the GPUs in stock for a reasonable price. To keep things simple, we're only looking at Nvidia's original non-LHR models to give us the standpoint of people who might have picked up a card right on the day of the GPU launch.

The numbers we'll present assume 24/7 mining, with no pool fees. We've used our own calculations for power draw and hash rates, erring perhaps on the higher end of the profitability spectrum. We've also used a price per kWh of $0.10, which may or may not be similar to what you'd pay, but it represents at least an easy starting point. Finally, we've calculated things with no selling of mined coins — the "HODL" mindset, in other words.

These are strict numerical estimates, which are almost certainly better than what anyone doing real mining experienced over the past 20 months or so. We're also not including the cost of the rest of the PC, and prices on GPUs were all over the place so we've used a somewhat conservative estimate, meaning most people paid more than what we're showing in the table. You should probably add at least $750 for the cost of a CPU, motherboard, PSU, RAM, storage and case. We'll stop there and let the numbers speak for themselves.

Depending on whether you're a miner or someone looking for some schadenfreude, that table ought to make you rethink the value of cryptocurrency mining. The fastest mining GPU on the planet for most of the past two years, the GeForce RTX 3090, would have netted a sum total of 2.7 Ethereum, probably less. Two months ago, on April 1, that would have been worth about $7,425 — not a bad haul for a graphics card that might have cost $2,000–$2,500. Even after paying the nearly $500 in electricity costs for all that mining, you still would have had a nice little chunk of profit.

But today, if you're still holding? Chances are you barely broke even, unless you got a good deal on the card. We know almost no one was paying MSRPs on the GPUs when they launched, and eBay prices were often double or more the MSRP. Factor in the cost of the rest of the PC (roughly $750–$1000 for a full mining rig) and the time to get things set up and running, and things look even worse.

We'll get to our second estimate of potential profits (losses) in a moment, for those that didn't start mining as soon as the various GPUs were available, representing a more likely scenario. But first, let's go through some of the other popular GPUs of the past year or two.

The RTX 3080 was supposed to cost around $700, but for much of 2021, it sold for $1,500–$2,000, perhaps more. If you got a good variant right around the time the GPU launched and mined 24/7 since then, you might have netted over $800, despite the crash in crypto prices. Maybe. The RTX 3070 and RTX 3060 Ti were also potentially profitable, depending on when you started mining and how much you paid for the cards, while the RTX 3060 that launched in February 2021 fell short even if you got the LHR v1 that was "cracked" by Nvidia's own driver team within weeks of launch.

What about AMD? All of the Navi 21 GPUs have similar hash rates and power requirements, while GPU prices ranged from as little as $1,000 (briefly) for the RX 6800 to as much as $2,000 for the RX 6900 XT, depending on when in the year you bought them. The RX 6800 XT and RX 6800 launched several weeks before the RX 6900 XT, netting an extra $100 from mining, but all of the AMD GPUs were likely unprofitable if you're looking at how things stand right now.

The RX 6600 XT is in an even worse position since it hasn't been available for even a full year yet, with current potential earnings after power sitting at just $146. Hopefully you didn't purchase a bunch of those cards for mining at $650 each, which would put you about $500 behind on each GPU!

But what if you weren't quite able to begin mining right when the GPUs launched? Here's a different look at the same data, only this time we're going with mining since June 1, 2021 — we've removed the RX 6600 XT from the list since it wasn't available yet. We used slightly lower prices than we were tracking last year on eBay as the GPU cost estimate. As you'd expect, less time mining means fewer coins mined, and the raw profits in Ethereum have been on a steady decline during most of the past two years.

The RTX 3090 wouldn't have mined even a single ETH in the past year. Subtract the power cost and we estimate only $756 in the value of mined coins, for a card that very likely cost $2,500 or more. You would still have the GPU, but the balance sheet would be sitting about $1,750 in the red — without factoring in the rest of the PC cost, or for institutional miners the warehouse and infrastructure cost.

Other GPUs that didn't cost quite as much fared a bit better, at least in terms of how much money you would have lost, but none of these GPUs would be anywhere close to "profitable" if you didn't start mining until June of last year.

This is likely why many mining groups are now looking to sell off all of their mining equipment. If they can recover a decent chunk of the cost, maybe they broke even. But we didn't include air conditioning, warehouse space, or infrastructure and personnel costs, either. So it's not hard to imagine some mining farms being very far in debt right now.

There's another alternative we should consider: the "sell as you go" mentality for mining. The idea here is to recover initial costs as quickly as possible, and only start holding cryptocoins once you're in the black.

The above assumes that you jumped on the mining bandwagon on March 1, 2021, when things were still looking pretty awesome from a mining perspective. The prices come from our GPU price index, for the month of March, except for cards that launched after March 1 (like the RX 6700 XT and RX 6600 XT), where we used the first month of pricing data. Then we assume selling off all the mined Ethereum on a daily basis — that's probably not realistic, but even if you did it once per week the results would be similar to what we're showing here.

If you did this to try and recover the cost of your hardware as quickly as possible — and again, we're only looking at the GPU cost; the rest of the PC could easily add another $1,000 if you were building six GPU mining rigs with dual high-end power supplies — a few of the GPUs might have come close to being profitable, but other factors mean pretty much everyone lost money. No one would have broken even, despite mining for 483 days. Unless you got a lower price on the GPUs, naturally, or if you held your coins and sold at the peak of Ethereum's pricing bubble.

How much money, or at least potential money, you could have gotten out of Ethereum mining over the past 18 months or more isn't a straightforward answer, just in case that wasn't already clear. There's a relationship between when you started mining, what GPU(s) you used for mining, how much you paid for the hardware, and when or if you decided to sell the coins for "normal" money. So far we've looked at three possibilities, but let's take the fourth: Absolute maximum theoretical profits from Ethereum mining.

This is, quite literally, the best-case scenario for how things stand right now. We assume you started mining the day each GPU was released, that you mined Ethereum 24/7 and had no extra fees, and that you sold whatever Ethereum you were currently holding at the peak price, relative to when you mined the coins. Oh, and you still have the GPU(s), which continue to be worth at least a decent chunk of change.

To give a specific example, Ethereum hit its highest price ever (at least so far) on November 8, 2021. That price was $4,811, at least for the daily average price according to Etherscan.io. Maximum profits would come if you held all your ETH until that day, which in the case of the RTX 3090 would have been 2.30 ETH mined. After that date, the next highest remaining price for Ethereum occurred on November 9, 2021, at $4,732. This time, a 3090 miner would have only had 0.00214 additional ETH available to sell, worth about $10. We continued holding or selling up until the end of the data we used, which was on June 26, 2021.

No one actually made this much money off of newly mined Ethereum (per GPU) since the various current generation GPUs launched, which is why it's a theoretical maximum. Realistically, quite a few people sold off some Ethereum at the previous peak of over $4,000 in mid-May, 2021. Actually, a lot more likely sold after the peak, when prices dropped by nearly 50% and stayed in the $1,800–$2,500 range for a couple of months. A more realistic scenario then is to have sold most of the mined Ethereum for $2,500 or so, but that would be yet another table of potential returns.

If you were savvy enough to mine and hold Ethereum from 2020 up until sometime between April 2021 and May 2022, you likely ended up with some decent returns. But the same people that held from 2020 all the way until late 2021 were just as likely to keep holding, which puts them back at the initial table. Some cashed out and made money, some cashed out at least enough to cover their costs, and some are holding for the next big wave.

Bottom Line for Cryptocurrency Mining

This almost certainly won't be the last time we hear or write about cryptocurrency mining. However, it should be a sobering look at what you can expect long-term. If you get in right at the start of the next wave, pocketing the profits as you go, you could definitely make back your investment. Getting a good deal on the graphics card in the first place will go a long way toward putting your endeavor into the black as well.

The biggest factor of course is the gambling aspect of cryptocurrencies. Some people bought a few coins right before the bubble and managed to sell those coins for as much as 10X what they initially paid. And they did all of that without mining. You could also end up making money if you mined coins and sold at the right time. Either way, though, it's basically speculation and gambling.

For those that didn't get in early, or overpaid for hardware, or got nervous and sold at the wrong time, or any other number of possible routes, they lost money — some people and companies lost a lot of money. The real winners were mostly the graphics card manufacturers and scalpers. Both happily took in people's money, laughing all the way to the bank.

This past cryptocurrency bubble had some similarities to the previous bubbles we saw in 2017 and 2014, but it lasted a lot longer. Perhaps that was due to the pandemic and supply chain issues, and we certainly wouldn't try to bet on what might happen if or when we see the next cryptocurrency hype wave. However, some are still in it for the long haul, and if they can cover the costs for many years and Ethereum shoots back up to its previous high, and then continues on to set new records, they'll look incredibly prescient. On the other hand, those who can't hold out for perhaps five or more years of waiting will likely get caught holding the bag yet again. 

Is it that time already? Every three weeks we get an insight into European graphic card pricing trends and insight from 3DCenter. The latest survey data, which considers a host of prices across Germany and Austria, marks a milestone this time around as the average AMD graphics card is now 5% cheaper than MSRP. Nvidia's cards have kept a tentative grip on MSRP+ pricing, with the green team's average graphics card at 2% above MSRP.

The last time we reported on the 3DCenter data, three weeks ago, we noted that graphics cards were slowly descending to their MSRPs. The averages were helped by some big price cuts to premium products, but some 'core offerings' remained stubbornly overpriced, by as much as 30%. In the latest survey there is still imbalance in pricing. These prices are focused on European countries, but they give us a general insight into which direction they are going.

Probably the worst place to be as a GPU buyer in late June 2022 is one looking for the traditional sweet spots for good value performance gaming from the best GPUs. Those pondering buying an AMD GPU will see that the most 'overpriced' examples are centered around the Radeon RX 6600 (~20% over MSRP). Nvidia fans will find the most 'overpriced' GPUs are the GeForce RTX 3060 Ti (17%), RTX 3060 (11%), and RTX 3050 (13%). Of course these prices are the result of supply and demand, which indicates people are still willing to pay more for this level of performance, or shortages persist across these mainstream products.

If it is indeed shortages keeping the mainstream gaming cards over MSRP, by the time of the next survey there could be some more dramatic movements. The Tom's Hardware graphics editor Jarred Walton is of the firm opinion that the GPU deluge has begun.

The phenomena we are observing now is largely due to the collapse of cryptocurrencies as speculative capital takes flight to less risky assets. This follows typical investor / speculator behavior when faced with a recession. If you are interested, please check out our article with logic and reasoning backing up our assertion that things are starting to go south rapidly in the GPU market. Our article on the GPU deluge includes consideration of both new and used graphics card prices (data from June 15).

For extra fuel on the GPU pricing bonfire, please also consider that the next gen GPUs from AMD and Nvidia are expected to launch within the next four months. Traditionally, tech markets go cool ahead of a refresh, causing retailers and used sellers to cut prices deeper.

While GPU makers are reluctant to talk about sales to miners, analysts from Bitpro Consulting estimate that Ethereum miners purchased $15 billion worth of GPUs over the last 1.5 years, Bloomberg reports. When combined with the prices of other parts for their mining rig (CPUs, PSUs, chassis), the amount of money spent on Ethereum mining hardware globally would look even more impressive. Miners might have consumed about 10% of discrete GPU supply in the last 1.5 years. 

When Ethereum pricing rose steeply in October-November 2020, millions of people started mining Ethereum coins to make some easy money. They used graphics cards bought at retail, and their purchases coincided with skyrocketing demand from gamers as both AMD and Nvidia released very competitive Radeon RX 6000 and GeForce RTX 30-series cards in late 2020. Those GPUs are still the best graphics cards around. 

Demand from both gamers and miners exceeded supply, so prices shot through the roof. This is why the average selling prices of GPUs, which were already high in late 2020 due to the rise of PC gaming during the COVID-19 pandemic, increased to unprecedented levels. In Q1 2021, a high-end graphics card (which carries an MSRP of $649 or above) cost $1,358 on average, whereas the average selling price for a lower-tier GPU was $1,062, according to Jon Peddie Research. 

Based on data from JPR, desktop GPU sales totaled $51.8 billion for all of 2021. That was spread across the 49.021 million GPUs sold — a four-year high. As far as average pricing is concerned, we're talking about $1,056 per unit in 2021, which is about two times higher than the average price for a high-end graphics card in Q3 2019, so the inflation is obvious. 

Now that we know the approximate average pricing for a graphics card in 2021 and the amount of money miners spent on GPUs, we can estimate that Ethereum miners consumed roughly 14.2 GPUs from the fourth quarter of 2020 to the end of the first quarter of 2022. The number is not completely accurate, though, as some miners used special-purpose mining cards (not counted by JPR), whereas others used gaming notebooks to mine. As such, the actual number of GPUs that went to mining farms could be different.  

Nonetheless, 14.2 million is significant given that we're talking about six quarters when Ethereum mining thrived. In fact, from Q4 2020 through Q1 2022, about 73.55 million desktop discrete GPUs shipped. Keeping in mind that nowadays the market of standalone GPUs splits roughly 50:50 between desktops and laptops, it looks like Ethereum might have consumed about 10% of the whole discrete GPU output from Q4 2020 to the end of Q1 2022. 

However, it's even harder to quantify how many GPUs were used for both gaming and mining. 

Ethereum value has dropped by 70% this year, so it is unlikely that anyone will buy a stable of new graphics cards for mining Ethereum. People who bought their cards and rigs early enough probably earned some hefty profits on them when Ethereum was at its peak. But those who began mining last year are months, if not years, away from recoupling their investments. Bloomberg's story also includes a report about a man who invested $30,000 in cryptomining hardware in mid-2021 and has only earned about $5,000 worth of crypto so far. We're sure plenty of other miners have found themselves in the same position. 

Update 6/13/2022 05:35 PT:

The valuation of Ethereum has continued to drop over the weekend. When we wrote about the 15-month lows being hit, we would never have predicted a drop to 18-month lows by Monday. At the time of writing 1ETH is worth just $1,239. This represents a near 15% drop in value over the last 24 hours. We've updated the original story to reflect the updated news.

Updated Story

Cryptocurrencies aren't faring well as we hit the second weekend in June. Ethereum has been hit particularly hard in recent hours. Not only has the broader cryptocurrency market seen a sell-off in the wake of the current US inflation report, but Ethereum developers are also indicating that the difficulty bomb will be delayed again. This is leading some to worry that the merge will also be delayed. Ethereum (ETH) carries a valuation of $1,239 at the time of writing, down about 15% on the day and sitting at its lowest ebb for the last 18 months.

So, the cryptocurrency market as a whole is currently feeling some ill effects from Friday's consumer inflation report published by the US Labor Department. WSJ surveyed economists who had expected the consumer price index (CPI) to rise 8.3% in May, but the government said it increased 8.6% to a 40-year high. As a result, US stocks fell sharply, and crypto behaved as we have become accustomed, by following tech stocks down the pan – but exaggeratedly.

With inflation so high, moneyed individuals tend to move away from the risks of the stock market, and this movement amplifies more speculative investments. Many view cryptocurrencies as highly speculative.

The misery of ETH holders has been compounded by reports suggesting the difficulty bomb has been kicked further down the road. On Friday, developers decided to disable the difficulty bomb from earlier in the month, and will deploy it again at a later date. According to the Bloomberg report, developers found some bugs with software for the merge on one of the oldest testnets of the network and thus decided to push back the bomb. When the difficulty bomb does drop, it should help clear out ETH mining operations as the network finally begins transition from transition of ETH from Proof of Work (PoW) to Proof of Stake (PoS).

With the now regular push-backs, uncertainties emerged, raising doubt about things playing out in the way the Ethereum execs and devs have outlined. Ethereum co-founder Vitalik Buterin stated the merge could happen this August if the devs didn't uncover any significant issues. Though Buterin also mentioned that the merge could be pushed back to September or October. Tim Beiko, who coordinates Ethereum developers, is worried about developer burnout from moving too fast. Beiko estimated that there was a 1 to 10% chance the merge won't happen at all this year in an interview with Bloomberg.

PC DIYers have a love/hate relationship with ETH and GPU-based crypto mining. On the one hand, it lets those with powerful graphics cards profit from otherwise idle computer time, perhaps helping to pay PC hardware bills. On the other hand, colossal GPU mining operations sprung up, stripping consumer outlets of GPUs and encouraging price gouging and scalpers. 2022 may see the end of this era.

The state of New York has doubled down on energy-guzzling cryptocurrency mining farms. Last month, a bill passed by the state Assembly that directly targets Proof-of-Work (PoW) blockchains such as Bitcoin and the yet-unMerged Ethereum. The measure imposes a two-year moratorium on new PoW mining farm installations powered by carbon-based fuel. However, it leaves projects based on renewable energy sources or less energy-intensive Proof of Stake (PoS) mining operations ticking along unencumbered.

Following China's crackdown and an outright ban on cryptocurrency mining, many operators re-localized to Kazakhstan and the United States, sometimes placing undue strain on existing power infrastructures. Chief among the U.S. options for miners was the state of New York, due to its relatively cheap power sourced from hydroelectric facilities and a rising number of decommissioned or otherwise disabled carbon-based powerplants that cryptocurrency mining specialists could spin up with relative ease. 

It's estimated that renewable sources account for 50% of New York's energy production. Interestingly, a recent analysis led by Microstrategy places around 60% of Bitcoin's total power consumption as being derived from renewable sources.

The narrative surrounding cryptocurrencies' weight on the world's power grid and projected environmental impacts has led lawmakers to dial-in limitations on mining. Alongside the moratorium, the bill also enshrines a study on the environmental impact of mining facilities in New York, which aims to cut 85% of its greenhouse gas emissions by 2050.

The moratorium isn't currently being enforced, as it still needs to be approved (or vetoed) by Governor Kathy Hochul. Hochul last month received a $40,000 donation from "a chief executive of a company that runs a former aluminum plant turned cryptomining facility", according to The New York Times.

Lobbyists with The Bitcoin Association have spoken against the measure over fears of the "soft-ban" being eventually extended or turned into a full-fledged cryptocurrency mining ban in the state. It is threatening to leave and relocate to more mining-friendly states, such as Texas.

Nvidia stock took a beating in after-hours trading on Thursday, after the company shared [PDF] its Q1 results and guidance for Q2 expectations. Investors were seemingly not happy with 4% lower than expected revenue for 2Q ($8.1 billion); $500 million of which Nvidia attributed to the Russian-Ukranian conflict and COVID-19 lockdowns in China.

Perhaps more telling, however, is the reduction in Nvidia's CMP (Cryptocurrency Mining Processor) cards' revenue, which the company introduced into the market as a way to lure cryptocurrency miners away from gaming-oriented GeForce cards.

Following the downturn in the cryptocurrency market and macroeconomic / geopolitical events, alongside increasing odds of Ethereum's Merge event, revenue from CMP cards has been declining at a breakneck pace, showcasing the fickleness of blockchain-related demand. From $266 million in Q2 2021, CMP revenues declined to $105 million in Q3, ending in a comparatively measly $24 million for Q4 2021, further falling in Q1 2022 towards an unspecified, "nominal" value, according to Nvidia. As per usual, Nvidia states that it can't accurately forecast how much of its gaming GPU revenue comes from cryptomining. 

The stock fall happened despite strong QoQ (quarter-over-quarter) results for the green giant. Buoyed by its bread and butter markets, Nvidia posted an 8% increase in quarterly growth for 1Q2022 alongside a 3% increase in earnings per share to $1.36 compared to Q4 2021.

Nvidia's gaming segment registered an impressive 31% growth YoY - which the company even gloated about, claiming gamers were spending $300 more on new GPU technology, on average. But considering the ongoing back and fort between Nvidia's Lite Hash Rate limiter and several circumventions developed by mining-focused software providers, investors must be cautious - there's no way to know exactly what percentage of Nvidia's gaming growth is still attributable to cryptocurrency mining.

Investors apparently weren't swayed by the company's ongoing, $15 billion share buyback program, which will run through 2023.

Nvidia shares are down an incredible 50% YoY from their ATH of $326 in November 2021, following the worldwide economic turmoil following the COVID-19 pandemic, Russia's invasion of Ukraine, and rising inflation rates across the world prompting fears of an economic recession. They're not the only company in this state - most tech stocks have taken a beating as investors look more towards operating profits rather than speculative bets on companies' future value.

Desktop form factor graphics cards packing mobile Nvidia GPUs appear to be readily available in China. Twitter's I_Leak_VN spotted multiple RTX 30 series designs available on China's Taobao online market place, and shared mining performance tables featuring these unofficial products. VideoCardz picked up on this story and unearthed an image which appears to show scores of these graphics cards being prepared for shipping.

From the Taobao listing images, the Nvidia GeForce RTX 3070 mobile GPU packing desktop graphics card appears to be the most popular of these unofficial mobile / desktop mashup products available now. They are priced at around 3,800 Yuan on average, which makes them roughly $560 as of this writing. 

The asking price isn't exactly a bargain for the gaming power that an RTX 3070M offers. In the US you can buy a proper desktop RTX 3070 for around $600. If you have pondered over RTX 30 laptops and desktops you will also be well aware that the mobile and desktop GPUs aren't created equal. See this table for comparison:

The most crucial differences between the two graphics solutions tabulated above is that the mobile version has its CUDA cores and GPU clock speeds pruned back significantly. Moreover, it runs with a lot less power on tap. The ~115W TDP quoted for the mobile GPU was how it was usually configured in the tight confines of a laptop. The Chinese hybrid solutions are mostly configured with twin fan coolers and have higher TDPs (single 8-pin power connector on the card).

So, what is the use of an RTX 3070M desktop graphics card if it isn't much cheaper, its content creator and gaming performance isn't going to be as good as the original desktop model, and the brand/build quality is suspect? It all comes down to cryptomining performance. Nvidia's laptop GPUs don't have an LHR technologies holding them back from working at their full potential down the silicon mines.

If you buy a new GeForce RTX 3070 graphics card from one of the big brands today, it will feature LHR technology, paring back ETH mining performance to about 30 MH/s. Nvidia recently struck back at a NiceHash workaround which effectively boosted the desktop RTX 3070 GPU ETH mining hash rate back to about 60 MH/s. However, buyers of the RTX 3070M desktop graphics cards won't need to worry about this whack-a-mole game, as they aren't buying LHR GPUs, and these lower power alternatives purportedly achieve up to approximately 65 MH/s. They might be more power efficient while mining, too, which could reduce costs involved in mining.

This isn't the first time we have reported on the repurposing of RTX 30 series mobile GPUs for desktop mining cards. In March we noted that the RTX 3060 Mobile was proving to be a popular choice for this kind of gray market activity.

If you are purely into PC gaming and content creation it is probably best to avoid these mashup mobile / desktop products. Desktop GPU pricing is slowly dropping to a more reasonable place. And with 'the merge' of Ethereum expected to actually happen in August, and next gen GPUs galloping along in Q3 and Q4, there will hopefully be plenty of nice GPU bargains over the summer.

The possible end to cryptocurrency mining on the latest and greatest GPUs seems to be looming, as Ethereum's long-in-the-making move to Proof of Stake is poised to finally advance this Summer. Speaking at blockchain and Web3 event Permissionless, core Ethereum Developer Preston Van Loon said that code for The Merge is ready for deployment, with final testing currently underway for a tentative main release in August.

Originally slated to occur in 2019, the Ethereum network's Merge event marks the point at which the blockchain's security and consensus mechanism switches from the current Proof of Work (PoW) model, in which miners use their GPUs to number-crunch transactions in the network, to the less hardware and energy-demanding Proof of Stake (PoS) design. That transition will mark the end of GPU mining on the Ethereum network, whose token value (around $2,000 at time of writing) makes it one of the most profitable coins to mine (by far) without the need for specialized equipment such as Intel's Blockscale ASICs.

The Merge towards PoS should also allow Ethereum to claim higher energy efficiency compared to other PoW-based blockchains (such as Bitcoin) by reducing the overall energy requirements for system security and transaction processing by an estimated 99,95%.

The news comes at a time where the classic high-performance GPU players, AMD and Nvidia, are gearing up for their upcoming next-gen graphics cards (RX 7000 and RTX 40-series cards, respectively). With current expectations on actual hardware launch dates, The Merge occurring in August would hopefully prevent a repeat of escalating GPU prices which hit the best current-gen offerings from AMD and Nvidia, which have only recently achieved a semblance of normalcy.

Intel, the newest player in this discrete GPU field, is still in the process of launching its discrete Arc Alchemist GPUs, which the company already confirmed wouldn't carry a software limitation on cryptocurrency mining. Once again, The Merge happening as planned could impact mining-buoyed demand for these cards, depending on their workload performance.

Additionally, The Merge is expected to cut the issuance of new ETH tokens by about 90%, thus reducing the rate at which new Ethereum tokens enter circulation, introducing higher scarcity and - as market players hope - higher pricing.

All things considered, Ethereum's transition to Proof of Stake should significantly reduce the usage of GPUs in blockchain workloads, thus eliminating most of the additional, forked market demand for new GPUs. This means a possible end to cryptocurrency-specific GPU income for manufacturers AMD and Nvidia, and a potential overflow of second-hand, mining-used GPUs towards the secondary markets, further impacting GPU pricing and availability. There are many moving parts here; let's just hope The Merge stays on course for once.