- Bitcoin mining hardware has evolved over the years according to mining requirements.
- A way to make mining profitable is to invest in proportion to the expected annual profit.
A Brief History of Bitcoin Mining Hardware
At Bitcoin’s 2009 inception, mining was considered a nerdy hobby, rewarding miners with 50 Bitcoins per block using multi-core CPUs. Back then, its value was meager but today, the same reward would be worth around $1.5 Million US dollars.
Despite its low value at the time, mining Bitcoin was worthwhile for enthusiasts. Considering the same 50 Bitcoins per block today, the miner would receive roughly around $1.5 Million at the time of writing.
Initially, CPUs were not used for Bitcoin mining as they were predominantly employed for video games. In 2010, the code for Bitcoin mining through GPUs was released, simplifying the process and making it accessible with a few hundred dollars of investment. However, mining eventually became more challenging, along with increased power requirements.
In 2011, Field Programmable Gate Arrays (FPGAs) entered the market, offering a significant upside by consuming three times less power compared to GPU mining.
Types of Bitcoin Mining Hardware
- CPU: Central Processing Unit: Initially used for mining when the reward for adding a new block was 50 Bitcoins. However, over time, mining difficulty increased, and new hardware like GPUs and ASICs emerged.
Currently, mining Bitcoin through CPUs is nearly impossible and not advisable due to the removal of support from the Bitcoin core. Nevertheless, coins like Monero and Dogecoin can still be mined using CPUs.
- GPU: Graphics Processing Unit: Came into use when mining Bitcoin became more difficult from 2012-2014. A GPU mining graphic card costs between $1000 – $2000 on average and is still affordable compared to ASIC mining. It is the second most used Bitcoin mining hardware and offers multiple coin options for miners.
GPU mining is quieter and suitable for residential areas compared to ASIC mining. The price of GPUs remains in demand due to their necessity for both miners and gamers.
- ASIC: Application-Specific Integrated Circuit: Solely dedicated to mining cryptocurrencies like Bitcoin. Compared to CPUs and GPUs, ASIC miners are designed to solve complex cryptographic equations at a lower cost. After the last two halvings, mining Bitcoin is mainly feasible through ASIC, and newer models are being developed to meet increasing mining requirements.
However, ASIC mining costs significantly higher, even during bearish market conditions, and only a few ASIC miners can mine a full Bitcoin in a year.
Conclusion
It is impossible to predict the scope of Bitcoin mining in the future. In terms of mining hardware, what seems like the epitome of technology, may not even hold an ounce of water in the future.
Talking about the current scenario of Bitcoin mining hardware, a miner has three options, CPU, GPU, and ASIC. Out of these, Bitcoin mining is next to impossible on a CPU mining rig, GPU mining is still sustaining itself and ASIC mining is the most viable option currently.
