More and more people are seeking how to mine Ethereum in 2024.
The numbers don’t lie: Ethereum is the second most widely used cryptocurrency, just after Bitcoin.
As the second largest market capitalization in the crypto world, it remains a lucrative opportunity for miners all over the big network.
Who can start mining Ethereum?
The story of Ethereum begins in 2015 when the beta version was first launched.
Developed by Vitalik Buterin, Ethereum featured its virtual machine, or EVM, which integrated running smart contracts as a basis for the representation of various financial agreements, e.g. swaps, coupon paying bonds, and options contracts.
These individual smart contracts helped the Ethereum blockchain become (and remain) completely transparent, decentralized, and self-sufficient.
The use of Ethereum is not yet as ubiquitous as that of fiat currencies, but it is certainly heading in that direction.
It can be used to complete employment contracts, to provide leverage as a trusted escrow, and to execute bets and wagers of all sorts.
Ethereum is growing the community around it, fostering stability and furthering its growth rate. Everything indicates that Ethereum is here to stay.
This is precisely why most financial and cryptocurrency experts predict that mining Ethereum will remain profitable, even more profitable than mining Bitcoin.
Ethereum miners earn more on average than those who mine Bitcoin according to the latest statistics, which indicates that Ethereum has more potential over its main rival when it comes to an offer to newcomers.
Crypto gold rush anyone?
What Does It Mean to Mine Ethereum?
As nobody is born all-knowing, first things first, for those who have joined the race only now. What is Ethereum mining? It has nothing to do with pickaxes, headlamps, and deep underground.
It is a computational process of discovering hashes that requires a lot of electricity and hard work from your PC’s processor.
The end result of this process is a more stable and better sorted blockchain, as well as more Ethereum in circulation and a more secure and transparent system as a whole.
In other words, miners contribute to creating, maintaining, and verifying the whole system, and as a reward they receive portions of every transaction they go through, as well as completely new tokens.
As every cryptocurrency has a cap on the total number of tokens in circulation, it is progressively more difficult to “mine” more tokens.
The difficulty adjusts itself based on the number of miners and tokens in circulation–for the end result of precisely one block solved every 12 seconds.
The process is based on the Ethereum Proof-of-work (POW) system. Wait, what? Give us a second.
What’s the Ethereum POW System?
In its essence, the Ethereum Proof-of-work system is a means of having consensus on information between all the nodes of its network.
It is a protocol that makes every end point agree on the state of data recorded in the blockchain.
The main purpose of POW is to eliminate the possibility of breaches, attacks, and frauds with Ethereum cryptocurrencies.
By having miners and other participants solve complex mathematical and logical computations and functions as part of verifying every transaction, the system “creates” blocks and makes it impossible for anyone to wipe existing transactions or fake new transactions in the network.
No double-entries possible! And, as mentioned before, this incredibly tasking labor is precisely why miners get their rewards.
How Profitable Is Ethereum Mining?
The factors of Ethereum mining profitability are numerous and the limitations boil down to several costs, such as the needed amount of electricity, various fees, and the cost of hardware required to run the computations.
Reward per Block
As of the “Constantinople” milestone, which was in February 2019, Ethereum provides the miners 2 ETH per each block mined, in addition to the transaction fees.
This number is not etched in stone, however, and you can always check it on sites devoted to tracking down these statistics, e.g. etherscan.io.
Mining crypto coins is by no means easy. Solving a block requires solving a complex calculation, something that requires hardware that can pack a punch.
Furthermore, the more miners there are, the more difficult the problem gets. This also means that the miners with the most powerful processing powers get the most of the profit.
To sum up, the network difficulty depends on the total number of miners and the total processing power of the hardware of each miner.
These stats also gets tracked by sites, like for example ethstats.net where you can always check the current status of Ethereum network difficulty.
Instead of going solo, miners tend to use mining hash pools which multiplies the total processing power at their disposal.
More processing power means solving a block more quickly and getting more profits. Afterwards, the spoils get shared accordingly.
This remains the most reliable way of getting an income from mining Ethereum.
The processing power has already been mentioned as the decisive factor when it comes to speed and reliability of solving blocks.
Those who take mining seriously should always strive to obtain cutting-edge technology, updates, and innovations in mining machines and GPU models.
This can either (or both) cut their electricity consumption or (/and) increase their hash rate.
Ethereum blockchain receives updates just as about any other relevant software. This means that some of its core features, such as the proof-of-work system, might get changed or abolished.
POW will stay as is at least until 2023, though.
How to Mine Ethereum: Different Mining Methods
There have been several ways to effectively mine Ethereum to this day, so let’s touch on each of them for a moment.
A viable method several years ago, CPU mining utilizes the central processing unit in order to solve blocks.
It has been a while since this method is no longer used, as it is very slow compared to other methods.
Although it requires nothing but a PC and some dedicated software, it fails to bring profits today with more advanced methods active in the field.
This method is much more popular nowadays than CPU mining. Instead of relying on the central processing unit, GPU mining focuses on one or more graphics processing units in order to solve blocks.
It does not require too much in financial investment and retains a solid level of efficiency at mining Ethereum.
An average rig consists of a processor, a motherboard, and a frame that holds multiple graphics cards.
Now comes the tricky part. ASIC mining stands for Application-Specific Integrated Circuits. In essence, it refers to using devices and systems specifically designed for crypto mining.
Compared to every other method, it performs much better since it can allocate more computational power than generic, all-purpose systems.
Using ASIC systems raises quite a bit of controversy in the crypto community as it poses a threat to equal chances for all miners.
There have also been reports of misuse and influencing different crypto economies by ASIC farms, but no such reports refer to Ethereum.
One of the two methods of “joint” mining effort, cloud mining remains a very viable way of mining Ethereum.
It relies on miners paying a big company or some other third party group to rent out their mining equipment.
The usual deal includes that all profits go to the miner, but it comes with a fixed upfront cost.
The massive processing power of industrial-grade mining rigs ensures an advantage over every other mining method, but the upfront cost is usually very high.
This method also comes with some risks, as there is no way to guarantee that the profitability of mining Ethereum will keep rising or even remain stable.
Also, users don’t get to update hardware and software of the mining rigs.
While plausible and possible, maintaining a good degree of profitability with going solo is pretty difficult, perhaps even very unlikely.
This is due to high competition that teams up (via cloud or pool mining) and outperforms individuals in the big race to solve blocks in the least amount of time.
In order to make solo mining profitable, users would have to establish a big presence on the network, most commonly by having a mining farm with 100+ GPUs.
The maintenance cost of these farms can get critically high, as the investment, electricity bills, and ventilation/heating solutions mount up fast.
The most viable and common method, pool mining, represents joint efforts by miners who team up to beat the competition and share the profits among themselves.
Pooling together increases their probability of solving a block before the competition, leading to more profits per miner on average than if each of them went solo.
Which One Is the Best for Me?
This largely depends on the amount of cash that you are willing to invest in crypto mining and whether you can afford the responsibility of owning and maintaining a mining farm.
While CPU mining remains obsolete, GPU mining is viable, as well as a bit unstable ASIC mining.
However, the most popular options are still joint efforts, cloud and pool mining, and they come with reduced investment thresholds to start when compared to solo mining.
Hardware & Software Requirements for Mining
- Mining application: Ethereum relies on the Ethash algorithm, so take care that the mining software you choose fits the algorithm.
- Mining pool address: If pooling is your choice, you should do some research on available groups and weigh over which one is most suitable.
- Graphics Card: A GPU with 3GB RAM is enough to mine Ethereum, but the more the merrier. Stick to desktop PCs, although some gaming laptops have high-end GPUs.
- GPU drivers: A no-brainer here.
- Crypto Wallets: As a digital currency, Ethereum cannot be stored anywhere, so once you are ready to earn some you will have to have a crypto wallet on you.
- Operating System: Our piece of advice is to stick to Windows 10, although Linux is a (worse) alternative.
As for the mining-specific software, check these criteria out first:
- Maximum hash rate: This is tied to your hardware performance, so check it to see whether it matches. In any case, your maximum hash rate will be limited to the lower number, whether it is hardware- or software-capped.
- Mining methods: We have already said that much depends on your mining method; the software used varies between those.
How to Mine Ethereum in 2024
For the sake of brevity, we will not discuss how to mine Ethereum with the inferior methods, but will rather stick with pool mining.
Since GPU, CPU, and ASIC mining fell out of fashion, a mining pool is a much more preferable option of mining Ethereum.
Step 0: Installing/Updating Graphics Card Drivers
This should go without saying because acquiring the latest updates should be done in every case whatever it is that you do with your devices, but just in case let us remind you that the most up-to-date drivers bring out more from your hardware, which translates to more processing power and more chances of making a profit.
Step 1: Pick a Mining Pool
Once again, the benefits of joining a mining pool are reduced investments, lower entry threshold, and much more stable chance of earning a profit.
Our working example in this guide will be Ethermine as the best and most popular mining pool according to many.
Why? The reasons include, but are not limited to, anonymous mining (you only need your wallet address, no registering needed), a fee of just 1%, and a real-time PPLNS (pay per last N shares) payout method.
Step 2: Obtain a Crypto Wallet
If you have already done anything with crypto currency, the chances are that you already possess a crypto wallet. If not, well, you really can’t do much with crypto without it.
Hardware wallets tend to be more secure and more expensive than software ones.
It is up to you which one you’ll get, but in this guide we will store our Ethereum in the Coinbase wallet.
- Visit their official site.
- Download either the Android or iOS version, then open it on your phone.
- Click the “Get Started” button. After getting some safety tips, the option for creating a wallet will pop up.
- Make up a strong pin code. Facial recognition and fingerprint authentication are also available options.
- Voila! All done and ready to use.
Step 3: Pick a Mining Software
Step #4: Create a BAT File
Launching the mining process requires you to make a BAT file. Ethminer’s default settings suit most GPUs, so let’s use that (copy it from the website).
How to create a BAT file? It sounds difficult, but it is just a new text document created by right-clicking on the directory and then New > Text Document.
The key is in the naming: name the new file “startmining.bat” and click yes. Right-click on the new file and select “edit”, then ctrl+v the info from the site into the text file.
Next, choose the server that is closest to your location and a backup server, just in case.
Then, enter your Ethereum wallet (Coinbase in this example) address where you store your Ethereum profits.
Follow this by a “.” and your PC name. Save the file and execute the batch file.
Step #5: You’re Mining
Once the batch gets executed (~2 mins approx.), the hash rate will appear. This is the sign that you’re ready, done, and mining. Congrats!
There, a comprehensive 101 guide to mining Ethereum is complete.
Going from scratch with the basic info on the concept of mining Ethereum to the practical step-by-step initiation process, anyone can start mining right now.
Of course, getting started is easy, but actually earning any significant amount of Ethereum depends greatly on your setup, circumstances, the preferred method, etc.
One thing is sure, however. Ethereum mining isn’t going anywhere anytime soon.
As the second most popular and reliable cryptocurrency, it is often referred to as the second non-altcoin and thus commands great respect from miners, traders, and even non-crypto marketers around the world.
We’re not afraid for the future of Ethereum. Neither should you be. So, if you are really willing to devote yourself to mining Ethereum, there should be no obstacles in your path to crypto cash influx.
You might as well start now and upgrade your equipment as you go. Grow from a single GPU to a GPU farm, nothing should really get in your way.
Anyway, you now have the required knowledge to start your own Ethereum mining career, whether by going solo or by joining a mining pool.
You do not have to listen to mining success stories, you can make a mining success story on your own!
In any case, we do wish you good luck and we hope that the info provided here will be of use on your journey.
That’s all for how to mine Ethereum in 2024. Good luck!