Categories: Crypto Currencies

How to Mine Ethereum? Pros and Cons

Created in 2015 by the Canadian-Russian programmer Vitalik Buterin, the Ethereum cryptocurrency (ETH), also known as Ether, has become the second most popular cryptocurrency in the world and the most traded altcoin over the years.

Ethereum is an open source platform that greatly simplifies the implementation of blockchain technologies in different structures in order to optimize business processes. Immediately after the launch, such computing software developers as Microsoft and IBM showed interest in it. Moreover, Ethereum became the first cryptocurrency in which they made direct investments. We have prepared an up-to-date guide for mining “digital silver”, which will be equally useful for beginners and experienced Ethereum miners.

How to Mine Ethereum?

Everything is tied to ethash, the hashing algorithm used by the Ethereum network. It hashes the metadata of the last block of the system using a special code called nonce. The network sets a target hash value for each new block, after which all miners in the network try to guess the nonce value leading to this result. The cryptographic principles behind this hashing make it nearly impossible to randomize the nonce.

Therefore, the only way to find the code you need is to iterate over all possible options sequentially until the only correct one is found. In the end, the solution found is the Proof Of Work of the computer detecting the correct nonce.

To start ETH mining, you must:

  • Register an Ethereum wallet;
  • Select and purchase the necessary equipment;
  • Decide on the pool;
  • Select and configure mining software.

Previously, the most popular program for producing ETH was software from Claymore Miners. But there are many other, more advanced solutions on the market today. So, Ethereum is mined by TeamRedMiner, LolMiner, T-Rex, Phoenixminer, Ethminer and other programs.

So, to start ETH mining with Ethminer, download the installation file to GitHub → install the program on your computer → create a bat file by entering the following values into it:

Setx GPU_FORCE_64BIT_PTR 0

Setx GPU_MAX_HEAP_SIZE 100

Setx GPU_USE_SYNC_OBJECTS 1

SETx GPU_SINGLE_ALLOC_PERCENT 100

Then we launch the program by entering the following parameters:

The -G parameter is responsible for launching the program through a video card with the OpenCL framework (such cards as GPU Radeon and NVidia are suitable);

The -F parameter specifies the login required to connect to the pool (you can get it on the page of your pool);

farm-recheck is a parameter for checking the health of the entire system.

Let’s start mining

So, we have finished the basic configuration of the miner, then proceed to fine-tuning. For this we use 2 parameters:  cl-local-work and cl-global-work.

First, install cl-local-work 128 —cl-global-work 8192, adding these parameters to the end of the miner launch line. As a result, it should look like this: ethminer.exe -G -F —farm-recheck 200 —cl-local-work 128 —cl-global-work 8192.

To determine the appropriate cl-local-work for the video card, we invoke the command ethminer -G –list-devices for OpenGL and ethminer -U –list-devices for CUDA. We will find the cl-local-work we need in the CL_DEVICE_MAX_WORK_GROUP_SIZE report.

To get a report, you need to create a bat file in the program folder. This report will also provide information about the amount of memory on the video card.

When the miner is successfully installed and ready to go, you need to:

enter the pool address and account number in the edited files → activate the start file.

If the settings are correct, the miner displays the number of involved video cards, the hash rate of each card, as well as the time spent on new blocks.

Pros and Cons of Ethereum mining

Pros:

  • Unlimited emission;
  • High market capitalization of the coin;
  • Ethash hashing algorithm, which makes it impossible to randomly select the correct block values;
  • Availability of mining on various equipment, including rented;
  • It is used not only for online settlements, but also for the implementation of “smart contracts”;
  • Various ways of withdrawing mined coins.

Cons:

  • Expensive equipment wears out or breaks down, and video cards need to be replaced;
  • High energy costs;
  • Solo and PC mining are not cost-effective;
  • ASIC mining is not very cost-effective;
  • When the network switches to PoS, Ethereum mining will cease to exist;
  • The high volatility of the ETH rate makes investing in the coin high-risk.

CONCLUSION

ETH mining is a laborious process that requires mathematical precision at all stages. It is necessary to carefully approach the issue of purchasing and setting up equipment: purchase up-to-date and working software, the right hardware, etc.

An important nuance is also the choice of the mining pool, since Solo ETH mining is not profitable in 2021.

It is worth taking into account the fact that in the near future, ETH mining may end altogether (in connection with the transition of the network to the PoS protocol).

 

 

Olivia Chloe

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