GPU mining comes in circles. Every now and again it pushes forward to become overwhelmingly profitable. As people catch on to this, demand for GPUs goes up, and with it their prices. Eventually prices on GPUs launch through the roof, then the price of crypto comes down, and slowly the prices of GPUs deflate, and the circle of life is complete. This cycle has just occurred, and as I write it is in it’s end stages.
The thing is, GPU retailers and manufacturers are a canny bunch. They know that people will pay good money for anything they cannot find cheaper elsewhere, and so once the prices have gone up, they try to keep them high as long as possible. After all, why cancel that profit until competition forces you to?
Another thing to remember is the GPU market is global. As a miner in a country with higher priced power, your GPUs useful life runs out much sooner, but the demand for the cards still exists in other countries.
This works to the benefit of GPU owners like me. I can run the cards for a while in the UK, and then sell them, and normally make a profit at sale. The question of course, is when is the right point to sell, and are you already too late?
Should I wait until the cards are no longer profitable?
At the point when electricity is costing more than the card can produce in cyrpto, you are too late. At that point, all the miners are going to start selling up. Most sellers on Ebay are going to limit their shipping to the UK or Europe, and as people dump cards the value on ebay will crash. At that point, if you paid inflated mid cycle prices you are probably going to make a loss. You may break even of course if you bought early in the cycle, but ebay fees may tip you over. I would therefore suggest you sell cards at a point when they are still profitable to run.
Watch the retail prices carefully
You should be keeping a close eye on retail prices if you’d like to try to make a profit. Nobody is going to pay you an amount on ebay greater than the current new retail price of the card you are hoping to sell. The RX580 for example right now is retail at about £250, and is in stock at quite a few retailers. If you bought a fleet of these cards at £350 a few months ago, then i’m sorry but you’re going to make a loss at sale. If however like me you bought your RX480s at about £170 back before this all happened, then you’re still in good shape.
It’s all about the maths
Of course, you already know it’s all about the maths. As a miner, you’ve done endless calculations. Well this should be no different. You should already know how to calculate how much money your cards are making on a daily basis. Now it’s time to also calculate the devaluation of the cards on a daily basis into that. Your RX580 should be making you a profit (at the time of writing) of about 70p/day, or £21 per month. So then how quickly is it loosing value? If you paid £350 for that card 3 months ago, and it’s now worth £100 less than you paid for it, you’ve made a net loss. So what will happen moving forward?
It’s fair to estimate that most 4GB 580 and 480 cards will be back down where they were before the boom, around the £170, within three months. So that means these cards will loose about £26 of value a month during that period- which is more that you stand to make by mining. You should make your own predictions, and do your own maths, and see what you come up with.
So you’re saying I should be selling now?
Yes, I am. I think the maths right now on almost all cards is they are going to loose value quicker than they are going to print currency. Ultimately this comes down to the question- do you want that monthly income for as a long as you can get it, or is making back the money you spent on hardware a major factor? If you want to make your money back, or a small profit, yes you need to be selling right now. In a few months, a mass market dump will happen and you will end up loosing money on the cards. The cards are probably only churning out about £20 each right now, so they will be devaluing quicker than they are making money. That process will continue until rock bottom, which is when the cards are both not profitable to run at all, and the ebay market is swarmed with sellers.