Hands down, hardly anything can rival the hype of mining new crypto coins nowadays. The most convenient way of obtaining any of the cryptocurrencies is via various crypto exchanges, like Binance for instance. However, there are cryptocurrency investors that prefer the thrill of mining crypto coins on their own. The more creative and tech-savvy can even build their own crypto miners, choosing the most powerful and speedy processing components based on the digital currency they want to mine.
Because ASIC miners are specially built for completing algorithm problems when mining the world’s most popular and valuable cryptocurrency, this article will look at the possibility of creating your own ASIC miner from the comfort of your own home.
But first, let’s review the fundamental principles that create the backbone of blockchain technology in order to fully comprehend the idea underpinning cryptocurrency mining, as well as the aspects you need to consider before you construct your own ASIC miner.
The Mechanisms Behind the Bitcoin Blockchain
Bitcoin (BTC) is the first popular cryptocurrency project based on blockchain technology. Developed by Satoshi Nakamoto, blockchain technology was projected to tackle the problem of expected double-spending in digital currencies using highly advanced cryptography mechanisms.
To fix this issue, this brand new technological solution implemented multiple algorithms in order to cut the transaction fees. Moreover, the underlying principles of blockchain technology have been successful in increasing transaction verification times while simultaneously ensuring the security of its users’ digital money on the blockchain.
Instead of being stored in a single centralized directory of transaction data that resembles a conventional register of accounts in a bank, the blockchain ledger is disseminated among all nodes (i.e. computer units) in a decentralized peer-to-peer system.
In addition to the blockchain network’s decentralized nature, the adoption of the self-executing smart contracts for blockchain-based transactions by the blockchain developers eliminates the need for a centralized bank or regulatory institution to act as a reliable middleman for the process.
How Are Consensus Algorithms Used on the Blockchain?
Distributed ledgers are, in fact, decentralized networks that enable a secure transaction to be completed without the involvement of a third party. This is accomplished through the use of various consensus approaches integrated into the blockchain’s network architecture.
PoW (Proof of Work), PoS (Proof of Stake), and the SHA-256 algorithms are the main underlying protocols that support the Bitcoin blockchain network. These protocols guarantee that all network nodes (i.e. computing units) agree on the version of the confirmed block of transaction data before it’s uploaded to the blockchain.
At this point, I recommend that we take a thorough look at the following algorithms due to their critical significance in the upkeep of blockchain’s safety, transparency, and integrity.
Proof of Work Algorithm
Hypothetically, the encrypted transaction data can be copied by a blockchain user in order to use the same digital currency several times. Aiming to prevent the potential double-spending problem, Bitcoin developers have implemented the Proof of Work (PoW) algorithm to address this probable issue with no further delay.
Because tackling the hard arithmetic job created by the PoW algorithm requires a significant amount of electrical power, the miner who successfully solves the mathematical puzzle is rewarded with new crypto coins for the invested time, effort, and – electrical energy. As an added bonus, the computer node that successfully solved the challenge is chosen to be the next one to validate and add the pending transaction to the blockchain.
Proof of Stake Algorithm
Unlike the PoW algorithm that requires proof that miners have done their work in securing the network and the digital assets stored on the blockchain, the Proof of Stake is a consensus algorithm that focuses on the miner’s stake invested in the process.
Namely, this protocol requires the users to stake a portion of their digital assets in order to gain a right to validate the next transaction block on the blockchain. Simply said, if the crypto miners come across a block that they believe can be added to the chain, they will authenticate it by putting a portion of their digital assets at stake. The miner with the biggest economic stake, as well as the highest hashing power, gets the right to validate and add the new transaction block on the blockchain.
To maintain the transaction secure and immutable, blockchain facilitates the SHA-256 hashing algorithm. Standing for Secure Hash Algorithm, the SHA-256 hashing algorithm processes the transaction data with the help of a computer program that performs math tasks on the input data. In this way, this hashing algorithm scrambles the blockchain transaction information into an immutable 256-bit long hash digest value that is difficult to be decoded.
When used in conjunction with the Bitcoin blockchain network, the SHA-256 hashing algorithm helps to ensure the legitimacy of all transactions while also safeguarding the network from unauthorized modification of both user and transaction information.
When it comes to cryptocurrency mining, Scrypt is one of the more popular algorithms that is employed to provide strong password security. It is intended to serve as a cryptographic safeguard for online services that store backup copies of operating systems resembling UNIX.
Basically, this algorithm adds complexity to the mathematical task that miners need to solve in order to validate a block on the blockchain. For this, the Scrypt algorithm requires a lot of space on the memory card. Hence, the tasks of this algorithm can’t be easily solved with an average GPU or CPU computing unit. Some of the cryptocurrencies that make use of this algorithm include Litecoin (LTC), Dogecoin (DOGE), CashCoin (CASH), etc.
Cryptocurrency Mining Explained
Mining cryptocurrencies is the basic mechanism upon which the first cryptocurrency project was created. Bitcoin miners employed highly complex mining algorithms to verify transaction data blocks and upload them to the Bitcoin network, thus forming the blockchain. Bitcoin miners receive bitcoins as a reward for performing a Proof of Work and submitting the solution to the solved math problem.
In turn, their mining efforts earn them approval to validate the next transaction block on the blockchain. Miners also contribute to the formation and security of the blockchain network in this manner.
The Difference Between CPU, GPU and ASIC Mining
In cryptocurrency mining, specialized hardware is equally as important as the mining software mechanisms in terms of efficiency and speed. Compared to the CPUs (Central Processing Units) and GPUs (Graphics Processing Units), ASICs are the prevalent choice for mining by the more experienced and dedicated crypto miners.
The following portion of this article will examine the advantages and disadvantages of each piece of hardware, as well as their processing speed, power consumption, and overall profitability.
CPU miners, although being rather sluggish when it comes to computing the hashing algorithm operations, are an excellent starting point for those new to the crypto mining world. Let’s not forget that at the time Bitcoin was initially introduced to the crypto ecosystem, the only way to mine new coins of this cryptocurrency was through the Central Processing Unit (CPU) and the Bitcoin core wallet. In this regard, CPUs also served as a starting point for the future developers of specialized mining hardware.
With the increasing popularity of Bitcoin and other cryptocurrencies, the demand for exceptionally high hashing power among cryptocurrency miners has become a reality. As a result, these processing units are no longer useful to Bitcoin miners, who are now employing more sophisticated and powerful processors for their crypto mining operations.
Graphics Processing Units, or graphics cards, can also be used for mining cryptocurrencies. While these microchips are not as potent as ASIC microchips, they do provide more versatility in their use. Graphic cards are an indispensable component of gaming PCs, but there must also be at least one GPU installed in a Bitcoin miner.
While there is a large variety of GPUs available on the market, Nvidia and AMD microchips are considered to be among those that provide the greatest overall performance as well as the highest hashing power when it comes to cryptocurrency mining operations.
GPUs can be used for mining coins that rely upon more sophisticated algorithms, such as Ethereum (ETH) or Bitcoin Gold (BTG). They can be easily obtained and upgraded. On the downside, the graphic processing units used in the mining process do not offer a powerful performance like the ASIC chips. Furthermore, these microchips require a significant amount of electrical energy implying higher electricity costs, and are only capable of mining a limited number of different currencies.
To begin with, ASIC stands for an Application-Specific Integrated Circuit, meaning that every ASIC chip has its unique algorithm. Therefore, it only generates cryptocurrencies with comparable algorithms. The ASIC microchip is optimized for performing a single hashing algorithm as rapidly as possible. This high hash rate makes an ASIC miner an excellent choice for the highly competitive Bitcoin mining operations. Additionally, the nodes with an ASIC chip that conduct a mining operation consume far less electric power than the GPU or CPU computing nodes.
If we combine the high hashing rate of a Bitcoin ASIC miner with its low power consumption, the end result would be a highly profitable mining machine. However, there are a few caveats to this modular system.
For one, ASIC miners appear to be highly expensive because the hardware elements which are integrated into the node to achieve greater mining performance typically come with a high price tag. Secondly, nodes equipped with an ASIC chip are application-specific (as the name indicates) and cannot be upgraded or used to mine any cryptocurrency other than the one for which they were designed. Finally, these computing units are quite noisy and are difficult to repair.
Things to Consider Before Building Your DIY ASIC Miner
Probably the most essential factor to consider before creating your own ASIC mining machine is its intended application. Considering the fact that ASIC stands for Application-Specific Integrated Circuit, you can only mine one cryptocurrency with this miner because the hardware is engineered to compute a single algorithm.
In the case of Bitcoin mining, you’d presumably want a technological solution that can solve the SHA-256 hashes in the most feasible way. This Bitcoin miner, which has been specifically designed for this purpose, will never be able to aid you in mining any other cryptocurrency except for Bitcoin itself.
Also, what you should check for in an ASIC mining rig is the hash rate, also known as mining power, which is often expressed in terahashes per second (Th/s), gigahertz per second (Gh/s), or megahertz per second (Mh/s).
Last but not least, be sure to verify the noise level, power consumption, and – of course – the pricing of the components you intend to use in your DIY ASIC miner before you start constructing your mining rig and plunge into the crypto mining waters.
How to Set Up Your Own ASIC for Bitcoin Mining?
A Bitcoin mining ASIC node usually consists of a rig frame (preferably one made of aluminium), a motherboard with a set of microcircuits (able to house at least 8 video cards), an ASIC microchip processor (the more powerful, the better), a memory card of at least 4GB RAM, storage hard drive, and cooling fans. It also needs connectors, Internet access, and a power supply source. Having a backup power generator is always a good idea too, in case the electricity goes off.
As soon as you have assembled all of the necessary components for your DIY ASIC miner, it is time to set it up and start mining new cryptocurrencies. This should be a relatively easy process, compared to the building of your mining unit. In a few simple steps, here’s what you should do:
- First and foremost, you must secure your power connectors and connect the miner to a power source of some sort.
- After that, connect your ASIC miner to the Internet through a network cable.
- In order to obtain the IP address of your miner, you must first access the configuration menu of your router.
- After you’ve accomplished the third step, you’ll need to log into the operating system of your miner in order to configure your mining pool, as well as your crypto wallet. (In case you don’t have a wallet for your digital assets, it’s advisable that you create one in this step. Decide on the cryptocurrency you want to earn through mining, and then look into the many wallet options available for that particular coin.)
- Save your adjustments and restart the processing unit when you have completed setting up your mining configuration. After that, you may go back to the miner and work with the new settings.
Best Bitcoin Mining Hardware ASIC Machines
The customized Bitcoin ASIC mining machines with high performance have become a real sell-out among Bitcoin miners willing to invest more into this venture. Specialized in creating new bitcoins, ASIC machines come in various types that differ in hash rate, power consumption, efficiency, and cost.
The first place that newbie miners or hobbyists looking for a convenient ASIC unit is usually on eBay or Amazon, depending on their budget. The models Antminer S9, Antminer S19 Pro, and WhatsMiner ASIC are included in the group of the most popular ASIC miners available on the market today.
With the Antminer S9, you may mine bitcoins with one of the most powerful Bitcoin mining hardware devices presently available on the market, but it’s also one of the most expensive ones. In order to use its full potential, you’ll need to utilize a power supply unit alongside the Antminer S9.
Anyone willing to invest in this mighty mining machine, however, should be warned that it will not survive more than a year of active mining. Namely, Antminer S9 is expected to reach its physical limitations in terms of performance within a year. This is an important fact, especially given the miner’s pricing and market reputation.
Antminer S19 Pro
The Bitmain Antminer S19 Pro is also considered one of the most powerful Bitcoin mining rigs currently available on the market. Bitmain’s latest generation custom-built chip powers the Antminer S19 series with a throughput of less than 23J/TH. Its 5nm semiconductor chip provides the highest hash rate for mining BTC, BCH, and BSV. With 3.5 or 4.5 kilograms of weight respectively, the Antminer S19 Pro is also significantly lighter than its precursors in the S series.
Though somewhat less effective than mining gear from the Antminer S9 and S19 series, this Bitcoin miner is still considered to be among the finest of its kind. WhatsMiner may have a slight performance disadvantage, but it is unquestionably more stable throughout mining activities.
A Few Words Before You Go…
Since the introduction of the world’s first cryptocurrency project in 2009, cryptocurrency mining has become a popular topic among traders on the digital assets exchange market. As a result of the fact that Bitcoin miners were rewarded with new coins each time they solved the complicated math puzzle produced by the consensus method, developing the most powerful type of computer equipment for crypto mining opened the door to a whole new realm in the cryptocurrency universe.
Namely, more and more traders have started to invest in expensive hardware built specifically for mining particular crypto coins. Among the wide selection of components and technical solutions on the market, the ASIC chips proved to be among the most powerful ones to enable fast computing of the mining algorithms.
The ASIC miners appear to have it all when compared to the CPU and GPU processing units: a powerful motherboard, a higher hashing rate, a low electricity consumption, and a practical construction design. Finally, the crypto miner’s sole responsibility is to weigh the possible profit from crypto mining against the hardware costs before investing in an ASIC miner or any of the advanced hardware or software components that go with it.