GPU Mining No Longer Profitable After Ethereum Merge
Just one day after the Ethereum Merge, where the cryptocoin
successfully switched from Proof of Work (PoW) to Proof of Stake (PoS), the
profitability of GPU mining has completely collapsed. That means the best
graphics cards should finally be back where they belonged, in your gaming PC,
just as god intended. That's a quick drop, considering yesterday there were
still a few cryptocurrencies that were technically profitable.
Looking at WhatToMine (opens in new tab), and using the
standard $0.10 per kWh, the best-case results are with the GeForce RTX 3090 and
Radeon RX 6800 and 6800 XT. Those are technically showing slightly positive
results, to the tune of around $0.06 per day after power costs. However, that
doesn't factor in the cost of the PC power, or the wear and tear on your
graphics card.
Even at a slightly positive net result, it would still take
over 20 years to break even on the cost of an RX 6800. We say that tongue-in-cheek,
because if there's one thing we know for certain, it's that no one can predict
what the cryptocurrency market will look like even one year out, never mind 20
years in the future. It's a volatile market, and there are definitely lots of
groups and individuals hoping to figure out a way to Make GPU Mining Profitable
Again (MGMPA hats inbound...)
Will anything every recapture the heights of Ethereum
mining? Perhaps, but I wouldn't bet on it. I also wouldn't be against it. It
will either happen or it won't, and I'm not going to worry much more about it.
In the meantime, here's a quick rundown of the current
profitability — or non-profitability — of the current generation graphics
cards.
Of the 21 current generation graphics cards from the AMD RX
6000-series and the Nvidia RTX 30-series, only five are theoretically
profitable right now, and those are all just barely in the black. This is using
data from NiceHash and WhatToMine, so perhaps there are ways to tune other GPUs
to get into the net positive, but the bottom line is that no one should be
using GPUs for mining right now, and certainly not buying more GPUs for mining
purposes.
Sure, you could make the argument that cryptocurrency
valuations might go back up again in the future, and so you could mine at a
loss until that happens. But if you really believe that, why bother investing
potentially thousands of dollars into PC hardware to mine at a very low rate,
when you could just invest directly in whatever coin(s) you happen to like?
As we noted in our recent GPU price check right before The
Merge happened, it's difficult to imagine any scenario in which a lot of the
former mining GPUs don't end up being sold at secondhand markets like eBay in
the coming months. Factor in the warehouse space, power costs, personnel to run
everything, and other infrastructure considerations, and even ultra cheap power
doesn't make GPU mining sensible. It's a good time for mining farms to either
pocket their earnings and sell off their remaining inventory, or cut their
losses and close up shop.
Buying a used graphics card looks like it's set to become
far more tempting in the near future, in other words. Our advice: buy from an
established seller on a market (like eBay) that allows for returns. Conversely,
don't pay cash to someone from Facebook Marketplace that you have to meet in a
parking lot, and definitely don't send anyone BTC or ETH for a used card.
This is all great news for gamers, who for the most part
have spent most of the last year making do with whatever card they had before
the cryptocurrency boom of late 2020. It means AMD and Nvidia aren't going to
be able to charge high prices for any GPU that they hope to sell in large
quantities. We might see RTX 4090 and RX 7900 XT launch with initially high MSRPs,
but just like the RTX 3090 Ti and RX 6950 XT quickly fell below their launch
MSRPs, the same will happen with the upcoming Nvidia Ada and AMD RDNA 3 GPUs.
If you're looking to build a new gaming PC or upgrade your
existing graphics card, just wait a little longer and definitely don't buy any
graphics card for more than $500. Prices on existing GPUs will continue to
drop, and the new stuff is right around the corner.
Jarred Walton is a senior editor at Tom's Hardware focusing
on everything GPU. He has been working as a tech journalist since 2004, writing
for AnandTech, Maximum PC, and PC Gamer. From the first S3 Virge '3D
decelerators' to today's GPUs, Jarred keeps up with all the latest graphics
trends and is the one to ask about game performance.