A few months ago mining was so incredibly profitable that making a living off it was almost easy. Of course nothing so easy can last in a world of competition, and now a grim reality has begun to set in. The savage rise in altcoin prices has stopped, and difficultly is at an all time high.
So is it possible to make a living as a miner? I think the short answer is yes, of course it is, but only if you are lucky enough that your circumstances suit it.
Mining, in it’s simplest form is rather like a high interest bank account. The more you invest, the more returns you will see. The speed of those returns we call Return on Income, or ROI. This is normally expressed as a length of time. So if you buy a £500 graphics card and it will make you £500 of mined coins in one year we would call that a 1 Year ROI.
The total real cost of mining is of course not just the graphics card. You have to cover the other system hardware. You have the major overhead of electricity. You also need a space to put the hardware, a method of cooling it, shelving on which to mount it. These costs all add up. On a small scale where you just have one rig with a handful of cards stuffed on a wooden frame somewhere in a dark corner of your house these costs end up not mattering. However as you begin to scale up it quickly becomes a problem. One rig can go in a corner of your house, but ten rigs would require a small room be hired. That small room is commercial property, and suddenly those wooden frames are a fire risk- and metal frames are expensive. If you solve that, you’ll soon have a landlord worried you’re pulling 95% of the capacity of his wiring loop, and asking you to pay for an electrician to do upgrades. I know, I’ve been through all of this. The little bit of money you had left pays the electricity bill, and at the end you wonder why you bothered. Oh and the open window? That invalidates the insurance so please close it- but also the room going over 30*C is a fire hazard too, and there is no electric capacity for air conditioning, so use magic to cool it please.
Of course, that is in many ways a worst case scenario, but it illustrates some of the pitfalls you should be looking out for.
You can do your own maths, I wont list it all out here. What most people find is that mining works only on either a very small scale, or a very large scale. You either build one rig, or you build 100 rigs. That comfortable zone in the middle only really works if you happen to have free space, free electricity, or a landlord who doesn’t give a damn. Maybe what that really means is it works great as long as you’re in Eastern Europe, or China, or generally anywhere less developed.
So, could you make a living as a miner? I think as a general rule as I write this in July 2017, you can’t expect an ROI quicker than 1 year. If you could find graphics cards going at MSRP then maybe, but right now the card costs are so inflated just paying for those is going to take 9 months, without even taking anything else into consideration. So the question then is do you have enough money to invest? If you need to make £25,000/year to survive (a rough average British wage) then you are going to need around £25,000 to invest sitting around. You could borrow it from the bank, but you’ll spend the whole first year paying it back and taking nothing home to live off.
However, if you’re living in China and need £10,000/year (that’s about $12,500), and have low cost electricity, then I think you could live off it very easily.
In terms of maintenance, i’m confident that a single person could keep a £25,000 farm operating well with a fairly relaxed schedule. It would not be a job for a sociable soul, and you’d probably very soon never want to see another computer ever again- but there would be those glorious days or weeks when the systems all just ran as they were supposed to, and you could take the day to do as you wished as still get paid. The initial setups would be hard work and take weeks, but if you did a good job you’d then enjoy the fruit of your labour for a long time to come.
Keep in mind things could also get rather a lot worse. In 3 months time that ROI could have stretched to 18 months, or 2 years. That’s the risk you take.
So mining then remains more of a gold rush in most of the world, rather than a real solution to day-to-day income. Mine away, but if like me you live in Western Europe, don’t quit your day job.