everyone seems to want in on this
cryptocurrency boom
bitcoin topped 58 000 for the first time
ever in february 2021.
bitcoin spiking as we learned just
moments ago that tesla bought 1.5
billion
of the cryptocurrency bitcoin crossing
50 000 for the first time
ever it's not going to be a straight
line judge but it's going 100 000
i think in 2021 the more people that own
and use it and then
begin to transact on it the more
valuable uh
the bitcoin is itself ether the world's
second biggest cryptocurrency has also
been hitting new record highs this year
and even the price of dogecoin
a cryptocurrency invented as a joke that
doesn't have the same serious function
and institutional backing is something
like bitcoin surged more than 50
after an elon musk tweet while it's
easier than ever to buy a small fraction
of one bitcoin using
for example an app like coinbase that's
not the only way to get your hands on
crypto cash
you can also mine for it before the
pandemic took hold in the u.s
we went to a blockchain production
studio in brooklyn to learn how to mine
for bitcoin's biggest rival
ether here's how it works
and how much it costs digital mining is
kind of like real life mining
except that instead of shovels and
dynamite it's accomplished with software
and computers
a minor is essentially just running a
computer program
that solves a complex math problem
solving that math problem
is how crypto transactions are verified
so that money correctly moves from
a to b the miner who solves the problem
first is awarded crypto cash by the
algorithm for their bookkeeping efforts
in the 12 years of history not a single
entry on its blockchain
has been fraudulent now they processed
probably close to 10 trillion dollars of
transactions and not a single false
entry
in the mean you know that same 12-year
period of time what percent of
banking system activity was false it's
probably close to seven or eight percent
to achieve that kind of security
while being completely permissionless
anyone can actually
transact on this i mean that's a pretty
incredible feat can you explain to me
what we're looking at right now
so this is an ethereum mining rig and
this is just like any other computer
that you would build on your own
only instead of having an actual case
that all the components live in it's in
an open area like this
and you need to do this because when the
gpus are running they get really hot and
it's important to have like a lot of air
circulation
lee learned how to mine watching youtube
videos
this was back when he was still mining
in his spare time and so the main
components here this is your power
supply this is your motherboard this is
what wires up all the logic on the
computer
you need to have an operating system
running on your motherboard
so this is an ssd isolated hard drive
and i have a specific operating system
called fos
installed on this this is an nvidia
geforce gtx 1080 gpo
and this is a graphics card that people
use mostly for gaming but
these are also really good for mining
cryptocurrencies
once this is sewed into place we need to
plug it into the power
supply
and then we need to plug in the data so
that
the graphics card can read from the
computer and then
plug this guy in so what's this last
plug here so this is a sata cable this
is so that it can get data out of the
motherboard
so once it's all wired up like that this
is ready to go we can just turn it on
and we'll start mining you just turned a
computer into
a rig a mining rig yes all in this rig
costs roughly fourteen hundred dollars
because of the parts that you see
here
the only other thing left to do create a
wallet a wallet is a digital address for
crypto cash
and then how long does it take for it to
actually start mining this should just
automatically start connect to the
network it knows your address you'll see
it start going in a couple
minutes when the rig is mining what it's
actually doing is running what's called
a hashing
algorithm so it's computing millions of
math equations to work out all those
digital transactions
but this mining rig isn't doing all
these math problems in a vacuum
it's actually competing against miners
all over the planet
to be the first person to verify a block
of transactions
someone wins this race roughly once
every 13 seconds
and whoever wins is awarded to ether
they also get a transaction fee which
averages out to about 2.3 ether
but there's a mining pool fee that has
to be paid which is about
one percent of the block price plus the
transaction fee
when you combine all three at today's
prices that comes out to about sixty
four hundred dollars
and is everyone using the same hashing
algorithm everyone uses the same hashing
algorithm it's completely democratic
it just depends on the hardware that you
have and the cost of your electricity
so the only advantage you would have is
if your gpu runs faster than someone
else's or
your electricity is cheaper yeah there's
no way to shorten to shortcut it
this rig with only one graphics card can
run roughly 27 million math equations
every second
that sounds like a lot right but on
ethereum's network right now
there's 400 trillion math operations
happening every second
so lee's rig in brooklyn accounts for
around 1 15
millionth of the entire ethereum network
that's why people join
something called a mining pool a pool
lets a single miner combine their
hashing power
with thousands of other miners all over
the world they could be in afghanistan
they could be in dubai
they could be in europe or south america
you're all
sharing your resources together and it
doesn't matter where you're physically
located
so you are working together these people
to compete to solve a block faster than
anybody else
it's one giant competition between
everyone that's on the network
so it's a race between you and your
computers and the computers in your
mining pool versus the computers and
other mining pools
let's fast forward an hour teaming up
with my mining pool here's how much i
managed to rake in as a miner
okay so is it actually worth it to spend
all this money
on gear and electricity in order to mine
for crypto coins
let's look at the map our one graphics
card rig costs roughly fourteen hundred
dollars
tack on five more graphics cards and
we're 4 400.
if we run this rig at full capacity with
all six gpus
it can earn about 0.348 ether per month
which is roughly 550.
these rigs require quite a bit of power
so electricity cost is a big factor
where you live in the united states also
plays a major role
and how much it costs to mine since
there are stark differences in
electricity prices from state to state
alaska
hawaii california and connecticut have
the steepest electricity costs in the
country
new york is also one of the priciest
states where electricity bills are
concerned
so it doesn't necessarily make sense to
mine here in new york
but it's a totally different story where
electricity is less expensive
just take washington state it's got some
of the cheapest power sources in the u.s
so there the profits can outweigh the
costs
outside the u.s the prices drop even
lower a study released in 2018 by elite
fixtures
showed that countries like egypt and
kuwait are among the places where it is
least expensive to mine for bitcoin
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but one important thing to keep in mind
is that the size of the prize that
miners win
exponentially decreases over time back
in 2017
it was five ether but it's been cut down
a few times since then
rewards are now to ether but again you
get a transaction fee for each completed
block
and those fees something they call gas
prices
keep going up so there's definitely
still money in mining for ethereum
and unlike bitcoin there is no cap on
the total number of ether coins you can
mine
the supply is endless