These dedicated miners discovered ways to make home mining possible, if not exactly profitable, using everything from an ASIC-heated swimming pool to a homemade soundproof container.
Cryptocurrency has become institutionalized, from large mining corporations constructing industrial-scale coin-churning facilities to mainstream banking institutions placing wagers on this formerly subterranean economy.
But what if you're an old-school cypherpunk who thinks that unless you mine your own coins, you're not really in cryptocurrency? Can you still make a living and live in the world of megafarms?
The most expensive and power-intensive mining equipment, bitcoin mining ASICs, have seen their prices drop as a result of the bear market, which has decreased mining's profitability. ASIC prices have reportedly returned to their pre-bull market levels as of early 2021, according to data from mining company Luxor.
Meanwhile, the cost of energy has been rising both domestically and internationally over the past two years, making mining economics difficult for casual fans.
CoinDesk looked into the options for home miners that are currently accessible. We didn't come across a lot of positive information for someone seeking something more than a hobby. Speaking with some home miners made it evident that the industry is competitive and that it is unlikely to grow beyond a small niche.
In addition to running a home construction business in Texas, Garrett Casada is the proud proprietor of Suck It Up Mining, a two-man operation with a garage packed with mining machinery. Invoking the desire to "suck up" as much mining capability as possible and the tenacity required to be a miner, the term seems fitting.
"Sometimes, you have fantastic days in mining, and then they pass a new law or something; just suck it up, and move on!"
On a ranch in rural Texas, Casada and his lone employee, a programmer, have been mining a wide range of cryptocurrencies. Two graphics processing units (GPUs) were the initial two components in 2020, he claimed.
Currently, his farm comprises 80 ASIC miners hashing new blocks for the blockchains of Bitcoin, Zcash, Litecoin, and Dogecoin, as well as numerous racks of GPUs and CPUs, the majority of which are devoted to Chia. They use one megawatt of power together, and their monthly electricity costs are $20,000.
The earnings? Not a big deal. Casada is currently preserving the coins he has mined.
"Due to the low price of coins, I haven't sold any in the past year. I would hardly make back the electricity if I sold it now, he acknowledges. Bitcoin is fantastic, but you have to keep it.
Bitcoin is fantastic, but you have to keep it.
However, things were better in the bull market: "In 2021, our utility bill was $80,000, and we were profitable," said Casada.
He attempted to use solar panels to generate power on his own, but so far that has not been successful. According to Casada, he spent $150,000 on 300 solar panels, which are presently generating roughly $1,000 worth of solar power each month on the roof of the mining garage.
Casada provides a rough calculation for anyone wanting to replicate his experiment anyhow: for two S19 ASICs produced by Antminer, which cost roughly $3,000 apiece, you need 20 solar panels in addition to $30,000. With such a setup, you may earn $2 to $5 in bitcoin per day.
It would probably be preferable to use the same amount of cash to just purchase some bitcoin on an exchange and hold it, according to Casada.
In order to make use of the extra heat produced by his bitcoin miner, Gerald Glickman, a bank employee from Virginia, decided to build a water-heating system for the pool in his backyard.
Glickman acknowledges he isn't the most skilled person he knows. It required a good deal of study and inquiry, he stated. "Around the house, I'm not Mr. Fix-It."
However, Glickman was able to construct his mining-powered water heating system because of strong enough motivation, a wealth of web resources, and some assistance from his friend, the electric engineer.
The miner is enclosed in a water-resistant container while submerged in dielectric oil. The miner warms the oil before pumping it through thin pipes into a heat exchanger, where the pipes come into contact with water recycled from the pool. As a result, the oil cools and flows back into the mining container, and the water warms up and returns to the pool.
Glickman estimated that the total cost of the device—including the Antminer S19j Pro ASIC and a few days of labor—was around $6,000.
"My time was probably better spent on research and safety measures. My wife was pretty dubious," he continued.
According to Glickman's calculations, the system has been operating for two months and has generated just enough heat and bitcoin to cover the cost of power.
But he hasn't yet started selling his coins. Because Glickman thinks bitcoin is the currency of the future, he views his mining endeavor as a front for purchasing a small amount of bitcoin each day.
Will Foxley, a former director of content at Compass Mining and a home miner himself, declared, "I'm mining in the red."
Outside of his parents' home, Foxley set up a single Whatsminer ASIC in a self-built wood and plaster container.
He began this trip a year ago, but after the first month, Foxley (who is also a former CoinDesk writer) said he unplugged the three computers he bought because they kept overheating inside the container and turning off on their own.
He stated, "Just when you think you have a setup and you believe it's going to work, something stops working. "You need to iterate frequently."
Foxley restarted his mining operation last spring with just one ASIC, and he has already been mining bitcoin for three months. He stated he chose the Whatsminer device because Bitmain's Antminer ASICs, which are well-known to be popular with large-scale miners, are less tolerant of higher temperatures. Additionally, Whatsminer does not require a three-phase electric system to be plugged into, unlike some other miners, so you don't need to make additional modifications.
Read more about the unlikely rise of home bitcoin mining in Don't Call It a Comeback.
Since Foxley resides in Colorado, where the cost of electricity is about 12–13 cents per kilowatt-hour, running the ASIC increased his monthly power bill by $200. He estimated the price of the custom, soundproof box at between $300 and $500, plus an additional $300 in electrical supplies.
Foxley claimed that while the ASIC has been operating, he has been able to generate around 2% of a bitcoin by mining within a mining pool. That's only worth roughly $580 right now, which is hardly enough to cover his expenses.