The Basics of ASIC Mining For Cryptocurrency

If you want to mine any major cryptocurrencies here in 2017, you essentially need to join a mining pool and have ASIC mining hardware.

This is true even if you want to not lose money, especially in terms of major coins like Bitcoin, even if you only want to mine cryptocurrency as a hobby (if you don’t mind losing money, you can start mining on any consumer CPU/GPU today).[1][2]

Not only do you need to use an ASIC rig (or equally high powered and efficient rig), but you also need a new relatively new ASIC mining rig. Thus, you should buy one at launch and/or at a reduced price if not (because they age quickly).

ASIC Mining Q&A

Let’s assume you understand all of the above and want to mine explore ASIC mining. From that frame there only a few things left to cover:

  • What is ASIC? It is an “Application-specific integrated circuit.” Its essentially a little computer build specifically for a limited set of processes. Its “a system of a chip.”
  • What is ASIC mining? The gist is ASIC describes a type of chip that is ultra specialized in a single set of processes (in this case, mining cryptocurrency). An ASIC miner generally consists of an ASIC chip, power source, fan, and mining software.
  • What ASIC mining rig should I use? The general consensus is Antminer rigs are a good choice. Antminer is a brand, ASIC is a generic term like CPU or GPU (it describes the processors used).
  • What does the term “mining rig” mean? It means at least a device like an Antminer, but potentially a whole rack (or racks) of fans, processors, ASIC miners, etc (like this).
  • Can I build a custom ASIC miner? Building an ASIC miner is possible, but you need to not only deal with programing software (or cobbling together preprogrammed software) but putting together hardware as well.
  • Can I mine any cryptocurrency with any ASIC? Certain rigs will be customized for certain coins. In simple terms, any miner that is built to mine Bitcoin can mine anything that uses the encryption the Bitcoin uses. In other words, any SHA256-based miner like Antminer can mine SHA-based currencies such as Litecoin and Bitcoin.[3]
  • What is a mining pool? Solo mining in this day and age is not a great idea unless you have a lot of power (or are mining an altcoin). A mining pool is a group you join and pay fees too. Everyone splits the take, minus fees.
  • Can I make money mining with an ASIC miner? Yes, you can, but it depends on the price of the coin you mine over time, the cost of the hardware, cost of electricity, and other such factors.
  • How do I know how much money I can make from ASIC mining? You want to figure out the “hash power” (hash rate) of the miner for a specific cryptocurrency and then compute that against electricity costs. See Bitcoin Mining Calculator.

Quick gdax.com walk through.

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Citations

  1. Oh Bitcoin is still a thing? Should I start mining then? In short… probably not.
  2. Antminer on BITMAIN
  3. Can Antminer S5 mine other cryptocurrencies besides Bitcoin?