Mining Bitcoin and other cryptocurrencies can be expensive and confusing at first, and many wonder if mining Bitcoin is even profitable for the average miner. The complex mining gear needed to mine Bitcoin isn’t cheap and you need to keep things up to date. But is there another way of mining Bitcoin?
USB mining lowers the barrier to entry for solo miners and makes it relatively easy to do. But can it compete for Bitcoin hashrate and does it make Bitcoin mining profitable?
When Bitcoin first launched in 2009, difficulty was so low that miners used standard multicore CPUs to mine bitcoin at a block reward rate of 50 per block. Anyone who had a computer with decent spec at the time could have earned a few dollars a day mining bitcoin. CPU mining became outdated, however, when miners realized they could increase their hashrate by using their graphics cards.
Bitcoin grew in value, and in 2013, Application Specific Integrated Circuit (ASIC) miners such as Antminers, took over the Bitcoin mining scene. ASICs are hardware devices specifically built to mine Proof of Work (PoW) protocols.
The increased hashpower from ASICs meant many GPU miners were no longer able to compete and had to switch their mining operations to easier to mine script-based altcoins. Today the mining of Bitcoin and many significant cryptocurrencies are carried out predominantly using ASIC miners. A drawback, however, is that ASIC miners are expensive and a decent rig would set you back thousands of dollars.
Related Reading: 5 Profitable Altcoins To Mine in 2020
USB ASIC Miners
USB ASIC mining devices have been growing in popularity and due to their low set up costs are seen as an easy and fun way to get into crypto mining. A USB ASIC miner, provided it has the correct software, is capable of executing the mining on home devices at a certain speed of hashing.
To create a better hash tag rate, it is possible to use USB hubs to attach multiple USB miners to the same device. For example, a device with six miners of 333 MH/s attached can generate 2 gigahashes of mining power.
A problem for many ASIC miners is that their mining rigs cannot be reconfigured and consensus algorithms are constantly changing to become ASIC resistant. This means that miners who invest heavily in ASIC devices are often left out of pocket when consensus algorithms change.
USB miners are no exception, nevertheless, while regular miners can cost thousands of dollars, USB devices are far cheaper than regular ASIC miners and generally costs anywhere between $50 and $150 for the top spec, greatly mitigating the risk of financial loss. USB devices are also portable and easy to set up, with little or no technical skills required.
Bitcoin Halving Difficulty
Bitcoin halving which is due to take place in May 2020 will result in 50% fewer Bitcoin being generated in every 10 minutes. The reduction in mining reward and profitability is expected to put the mining community under scrutiny and many ASIC miners will be unable to generate profits.
To combat the effects of the halving, a new generation of ASICs are under construction and reported to have up to 500% more hash rate than previous models. Current USB ASICs fail in comparison and have considerably lower hash power and are not going to be of much use after the halving event.
The main drawback to USB miners is their relatively low hashrate. Hashrate determines how much profit a miner makes and USB ASIC devices have a significantly lower chance of finding a block and earning the mining reward.
USB miners simply cannot compete with regular ASIC miners and the high electricity costs make it near impossible to generate a good return on investment, especially as the difficulty increases.
Overall, USB mining is not going to make you rich, but they are fun and educational devices. They’re a great introduction to mining for the novice, and users get to learn about various aspects of mining such as the hardware and software, without having to make such a heavy investment.
If you don't have enough money to lay out for a proper mining rig, USB mining could be for you.
Author: Ronan Mullaney