What is the fastest way to mine bitcoins? It depends what type of architecture you’re using, but graphics cards are losing the battle to faster devices.
Graphical processing units (GPUs) have traditionally been used for mathematically intensive operations. They are designed to handle floating point numbers, which are used in the calculations necessary to display complex graphics. This also made them useful for the heavy mathematical lifting used to break password protection. Russian company Elcomsoft made a whole business from software designed to do that.
Now, these cards have another use: mining bitcoins. Their number-crunching power can be applied to the hashing algorithm used to generate the digital currency. The more hashing calculations that can be made, the more bitcoins can be generated. The creation of bitcoins is therefore related to the time and computing power available, resulting in the measurement of megahashes per second (Mhash/sec).
There are two main vendors of high-end graphics cards: AMD and Nvidia. A study by ExtremeTech in mid-April found that AMD GPUs excel at bitcoin mining, outperforming the Nvidia cards. This is in contrast to the conventional situation in gaming, where NVidia’s GeoForce 600 GPUs have been getting the upper hand, the study noted.
AMD’s cards are better at mining because they do better at manipulating integers, which is more appropriate for the bitcoin mining algorithm.
"Should you mine if you have an Nvidia card?" asked the ExtremeTech article. "You can, but be aware that power costs make this a losing proposition if Bitcoin prices decline to historic values."
For a graphics card to do anything useful, it needs a software driver. This is a software program that lets it talk to a computer and take instructions from it. Without the software driver, the bitcoin mining software wouldn't be able to use the GPU as its "brain".
Most applications rely on software drivers provided by the graphics card manufacturers themselves. However, other software drivers also exist, written by a community of third-party volunteers. These are known as "open-source" drivers.
AMD engineer Tom Stellard has modified the open-source drivers for the Radeon HD5000 and HD6000 graphics cards so that they could work with open-source bitcoin mining software. This lets people mine bitcoins without relying on the manufacturer's own software.
Stellard's work enables a patched version of a bitcoin mining program called BFGMiner to work on the devices. BFGMiner is a free tool designed to run on a variety of bitcoin mining platforms. It includes features such as a remote interface, so that a bitcoin miner can be controlled from anywhere.
Comparing GPUs is all very well, but a new generation of hardware is appearing that advocates say will outperform them all. Field-programmable gate arrays (FGPAs) are integrated circuits that can be configured to perform specialist tasks. Several companies have appeared offering specialist bitcoin mining "rigs" that they say offer higher performance while consuming less energy.
Tom Van Ryper, founder of the one-man company ModMinerQuad, sells a mining rig that mines bitcoins at around 840 Mhash/sec.
"GPUs really in my opinion became completely worthless for mining a year ago," said Van Ryper, who started mining two years ago with an AMD Radeon 5870 GPU. At the time, he was making eight bitcoins each day.
As more bitcoins are produced, the hashing algorithm used for mining makes it increasingly difficult to produce more. Two years on, Van Ryper said that his Quad mining unit may make a quarter to half a bitcoin each day. At current rates, that’s still $25-$50 per day, he added.
The other factor is the electricity used. His FPGA-based device use far less energy than GPUs, consuming around 40 watts: "It uses maybe a dollar of electricity a day."
The Radeon 7970 generates 650 Mhash/sec, according to independent comparisons, and can draw up to 250 watts running applications such as bitcoin mining. Assuming it draws this power, it would offer 2.6 Mhashes/watt, compared to -- on the low end -- 20 Mhashes/watt for Van Ryper's Quad.
Organizations have begun to appear touting bitcoin mining rigs based on application-specific integrated circuits. These are configured by the manufacturer to carry out specific tasks, and are not reconfigurable later. The upside is a vastly improved performance. An ASIC-based system recently developed by specialist mining rig firm Avalon has a 66,300 Mhash/sec capacity with a 620-watt overhead, equating to 106 Mhash/watt.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.