Why I’m Mining Ravencoin
And the state of crypto mining.
I mine crypto to stack Bitcoin.
That’s my goal — ultimately earning more BTC by converting the mining rewards from my GPU mining rig.
In 2020, I built an Ethereum mining rig. I got the rig up and running right before the cryptocurrency bull market. Soon after, there was a graphics cards shortage and any available or secondhand rig parts were overpriced.
While I was able to add cards to my rig in late 2020, I waited until August 2021 to add another. I was able to get one GPU at a Micro Center for MSRP. The supply chains seem to be catching up but products are still limited — the Micro Center limited customers to one GPU per person.
The Ethereum London upgrade went into effect and miners and mining pools are feeling its impact.
I started my GPU crypto mining journey on Ethereum.
I bought ETH first in 2016 and a large part of my cryptocurrency portfolio is due to those early ETH purchases. Those, along with the Bitcoin I bought in 2015, are responsible for the bulk of my current holdings.
ETH 2.0’s Impact on Mining
Ethereum is moving away from mining.
The network is implementing proof-of-stake to replace proof-of-work (mining) and that’s going to impact a lot of miners.
- Ethereum is now “burning” ETH
- Mining profits down ~20%
- Eventually, mining is going away
Several things are happening to Ethereum right now.
The recent London upgrade started the process of “burning” ETH. You can track the total ETH that’s burning up here.
The immediate impact on crypto miners like myself is a decrease in mining profitability.
My primary near term issue is not necessarily around the decrease in profitability. ETH is still one of the most profitable coins to mine, if not the most profitable on some graphics cards.
My main concern is around mining pools and their payout structures following the recent changes.
The mining pool that I use to ming ETH raised its minimum payout threshold in the days following the London upgrade. This isn’t a deal breaker when it comes to mining but it does impact my decision-making. I prefer a lower payout threshold so that I don’t leave large amounts of crypto in essentially a mining pool account that I don’t have access to.
The specific mining pool that I use increased their minimum payout threshold for ETH miners by 4x. That means you’re waiting about four times as long to hit your reward payout and receive your crypto in your personal wallet — and that’s a rough estimate. That timing could increase over time as Ethereum continues to move away from mining.
RVN— Mining Alternative
Ravencoin is by no means a cure-all solution for GPU miners but it does seem to be filling the gap for the time being.
Some miners mine other coins such as Ergo, Conflux, Monero, ZCash, Ethereum Classic, and Beam to name a few.
I’m mining RVN in the near term while I wait to see how things unfold with Ethereum mining pools and the general state of Ethereum. Ravencoin has also been surprisingly profitable on my mining rig.
I’ve been mining it off and on since February and have switched over to mining 100% RVN as of August.
Ravencoin does use a more intensive mining algorithm than Ethereum. This is to prevent centralization on the network and continue to make Ravencoin ASIC-resistant. I’ve had to adjust the overclock settings on my cards for better performance but this is standard procedure when mining.
Why I Like RVN for Now
- frequent payouts
- all my cards can mine it
Put simply — in the near term, Ravencoin is a reliable alternative to Ethereum for me based on why I mine cryptocurrency.
What Miners Do With Their Rewards
- cash out to fiat immediately
- convert to BTC or other coins
- hold that coin on spec
- earn interest on that coin
GPU and and at-home crypto miners have different approaches to mining. They have different end goals. My goal is to ultimately earn more BTC by converting my mining rewards to Bitcoin. I don’t convert immediately upon receipt of my mining rewards though.
With Ravencoin for example, I’m holding it short term on spec that it will appreciate in price relative to the price of BTC and that I’ll have more favorable conversion rates down the line.
I did the same thing with ETH, keeping some of it in an interest earning wallet while I wait to convert to BTC.
What you aim to get out of crypto mining impacts how you’re reacting to the state of mining right now.
The Future of Mining
The future of GPU mining is very up in the air at the moment. While Ethereum is phasing out mining, it’s still profitable to GPU mine in the near term and many miners are ramping up ETH mining efforts.
When it won’t make sense to mine ETH, however, is the million dollar question… Their network roadmaps and timing have been historically inconsistent and even though we witnessed the London upgrade, many think we have at least until early next year to mine ETH.
As I said though, I’m mining Ravencoin for now. I like having the option to receive my rewards daily in most cases. This lets me easily convert to BTC or cash out if I decide to without having to wait days or weeks for an ETH mining pool to pay me out. There’s always a chance I switch back to ETH sometime soon but for now, RVN suits my needs.
It remains to be seen whether or not Ravencoin or other top coins in terms of mining profitability can properly fill the gap left by Ethereum.
Unfortunately, I don’t know what the state of crypto mining, particularly at-home GPU mining, will look like one year from now. The move to Ravencoin by many Ethereum miners has seemed to work well but time will tell whether or not these alternative coins can support the amount of computing power that will be leaving Ethereum over time.
I’m watching what other, larger GPU miners are doing. I’m tracking what’s happening with Ethereum. I’ll continue to monitor my rig’s profitability on Ravencoin and am open to pivoting if needed.
Are you a GPU miner? If so, what are you mining right now and what do you think the future of GPU mining looks like?
Thanks for reading! I am not an investment or financial advisor. This is not financial advice. All opinions expressed are mine alone. If you want more content like this, sign up for my weekly email.
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