GPU or ASIC Mining - Which Is King?
Corey Baldwin / CEO
Intro
One of the first questions you will encounter when setting up a cryptocurrency mining rig is which type of hardware you will be running. There are two major options, choose wisely. Depending on which one you choose to go with will dictate which currencies you are able to mine for.
ASIC Mining
ASIC (Application-Specific Integrated Circuit) hardware is typically associated with SHA-256 currencies with the two most popular right now being Bitcoin (BTC) and Bitcoin Cash (BCH). ASIC miners are built specifically for solving the complex hashing algorithm needed to verify transactions on the blockchain. As a reward for performing these hashings you will be rewarded with a small fraction of bitcoin.
GPU Mining
GPU (Graphic Processing Unit) cards perform a similar function as the ASIC units in that they are performing calculations to validate transactions with the owners being rewarded with an amount of whatever currency they have chosen to mine for. The main differences of GPU mining are the wider availability of currencies to mine for and the use of consumer grade hardware built for multiple other functions besides mining specifically.
Factors to Consider
Energy Efficiency
Without considering a change in the valuation of certain currency, the name of the game for mining profitability is hashing power divided by power use or H/W. The H/W efficiency of ASICs far outclasses GPUs. While at first glance an ASIC will appear to have a very high power draw it would take much more power to achieve the same hashing performance with GPUs. It is also important to note that ASICs will typically require a 240v power source and a 30A breaker to account for the large power supplies needed.
Currency Specificity
ASICs are built to mine a certain type of currency only. A SHA256 ASIC will mine only for SHA256 currencies which is a limited pool in the world of cryptocurrencies. The units are essentially useless for any other function besides mining SHA256 currencies. GPUs are much more flexible with regards to mining currency and allow you switch easily between many popular currencies like Ethereum, Monero, Dash, etc. If a certain currency dies out GPUs can easily be switched to mine for another currency. ASICs do not have this same flexibility.
Noise Pollution
ASICs are loud. This is one of the first things user will notice when turning them on. They should be viewed as industrial equipment with little design thought given to the impact of running them in a home or office environment. On the other hand GPUs are typically consumer grade equipment, originally designed to be used in a desktop computer in a home or office. Running many of these together will obviously increase the noise but not near as much as running multiple ASICs.
Size and Footprint
In comparing hashing performance ASICs will require much less space than GPUs. This is important if your rig will be in your home or if you only have a limited amount of space to set everything up. If space is at a premium where you are, ASICs are generally the way to go.
Lifespan and Resell Value
ASICs by nature only have a useful lifespan as long as the currency type they are mining for. If their specified currency structure dies so does any reason to run these units. In addition, ASICs are constantly being improved to increase the H/s (hashings per second) they can achieve. This means the older units will be at a disadvantage when considering future improvements to H/W efficiency.
GPUs are flexible in currency of choice which allows them to stay in operation regardless of market events. They are consumer grade equipment meant for many other functions such as gaming and simulation, allowing them to be resold to a much wider pool of potential buyers. H/W efficiency has also been increasing at a slower rate for GPUs, meaning newer models invalidate the previous GPUs at a slower rate.
Cost
Perhaps the most important factor to many potential miners is the initial upfront capital expense needed to acquire these units. The perspective of cost should be viewed in two different ways: Cost per given hashing performance or startup cost. Essentially are you starting with a fixed budget or are you starting with a profit/year number in mind.
Starting a mining operation can be a time-consuming and expensive process. Many people have a certain amount of money that they would like to make per year in mind in order to make this effort worth it. With this mindset you can figure out the hashing performance that you need to achieve and work backward. Typically, people with this mindset do not mind a higher initial setup cost as they have built this cost into their long term goal of earnings over the course of a year. For these people we would recommend ASICs as they are much more powerful at the cost of a very high cost/unit.
Others have a certain amount of money that they are willing to spend on starting out before jumping in and making a larger financial investment. Depending on the desired budget, we would advise potential miners to explore which currencies they are most interested in mining based on speculated future performance, how quickly they would like to receive a return on investment, and at what scale would they like to operate. Those with a smaller budget may find GPUs to be a better option due to their low cost/unit and the ability to add more units to the rig in the future as the budget increases.
Summary
All things considered, we have chosen to use BTC ASICs at Capitol Crypto. The H/W efficiency is worth many of the drawbacks, and we have little doubt in the future of bitcoin or bitcoin cash.