Cryptocurrency mining is a process by which new coins are introduced into the existing circulating supply, as well as a process used to secure the network the coin operates on. Miners are rewarded with cryptocurrency for verifying and committing transactions to the blockchain.
Ethereum, the second-largest cryptocurrency by market capitalization, uses a proof-of-work algorithm.
Can AMD Mine Bitcoin?
AMD video cards are often used to mine for Bitcoin, but is this still profitable in 2020? Let’s take a look at the current state of affairs and see if AMD can still mine for Bitcoin profitably.
Bitcoin mining is a process by which new bitcoins are introduced into the market. In order to be competitive in Ethereum mining, AMD cards are often used because they offer more computational power than Nvidia cards.
It is important to be aware that the process of mining Bitcoin with an AMD processor is not recommended. The proof-of-work algorithm used by Bitcoin, known as SHA256, requires a lot of computing power and energy. As a result, the process of mining Bitcoin with an AMD processor can be extremely inefficient and costly in terms of electricity. Furthermore, due to the intense competition in the Bitcoin mining space, it is highly unlikely that an AMD processor would be able to produce enough hashes per second to have any chance of earning a block reward. As such, it is not recommended to mine Bitcoin with an AMD processor.
The current price of Bitcoin is $9,700 as of June 2020. In order for mining to be profitable, miners need to bring in more revenue than they spend on operating costs such as electricity and hardware. The break-even point for Bitcoin mining is when the value of the coins mined equals the cost of operation. At $9,700 per coin, miners need to be bringing in about $140 per day to break even.
This means that if you’re using an AMD card to mine for Bitcoin, you need to be bringing in about $4.80 per hour.
The difficulty of mining also needs to be taken into account when determining profitability. The difficulty of mining adjusts every two weeks in order to maintain a block time of 10 minutes. The higher the difficulty, the more computational power required to find new blocks and earn rewards. As of June 2020, the difficulty level is 18.
65 trillion. This means that you would need around 2,000 terahashes per second (TH/s) of computational power to find one block every 10 minutes on average.
If we assume that you’re using an AMD Radeon VII graphics card which has a hashrate of around 100 MH/s (megahashes per second), you would need around 20,000 of these cards running 24 hours a day in order to find one block every 10 minutes on average. At $500 per card, this would cost you around $10 million just for the hardware! And that’s not even taking into account electricity costs or other operating expenses.
As you can see, it is currently not profitable to mine for Bitcoin using an AMD card unless you have access to very cheap electricity or a large amount of computational power.