Ethereum "Mining Methodology": How to Create Strong Profitability & Strong Risk Resistance

Last week, Ethereum researchers said that ETH 2.0 Phase 0 may not go live until early 2021.

Justin Drake of the Ethereum Foundation said in an Ask-Me-Anything event on the Reddit community on Friday that he hopes to have "a public testnet with more than 3 clients and normal operation for 2-3 months" and "a bug bounty program similar to bounty.ethereum.org running for 2-3 months" before the launch of ETH 2.0 Phase 0.

As for the specific time, he mentioned, “All of the above cannot be completed in the third quarter of 2020. Thanksgiving on November 26 and the December holidays are the last chance to launch the network in 2020. I now tend to think that the launch date of Phase 0 will be around January 3, 2021 (the 12th anniversary of the founding of Bitcoin).”

In fact, since 2.0 needs to achieve decentralized POS, there is no clear timetable for the entire 2.0 version upgrade process. The 2.0 beacon chain is relatively independent from 1.0. In order to maintain the stable operation of the network, the POW stage of ETH1.0 will take a long time.

This is good news for miners. However, whether to continue mining ETH still depends on future profitability. From a technical perspective, only mining methods with fast payback, high returns, and strong risk resistance are worth investing in. Specifically, we take the more common graphics card mining and customized GPU mining on the market as examples.

First of all, we can estimate profitability and payback period through machine parameters and coin prices.

It can be seen that customized GPUs have obvious advantages in terms of daily net income and payback period, and can bring miners longer-term additional income; while among graphics card mining machines, RX5700 performs relatively well, but is still slightly inferior to customized GPUs. When making decisions, we should follow the principle of "payback is the first priority, and income is king", and choose high-quality mining machines with high yields and short payback periods.

Secondly, the ability to resist risks can be based on the response mechanism and residual value analysis of the machine to obtain the basis for decision-making. If you want to understand the response mechanism of various machines to the Ethereum algorithm change, you can refer to my other article "Ethereum Mining "Algorithm Game": Customized GPU Mining Machines and Graphics Card Mining Machines, Have You Chosen the Right Mining Machine?" This article will not go into details. Here we mainly focus on the residual value of the mining machine.

At present, the design life of mainstream gaming graphics cards is generally around 3-5 years. However, if the graphics card is running at full load for a long time, the mining temperature will rise accordingly. If the graphics card continues to run at high temperature, it will undoubtedly have a significant negative impact on the life and residual value of the graphics card.

Since mining cards have a long service life, professionals generally do not recommend buying second-hand mining cards, so the residual value of A-card mining cards is lower than that of other second-hand graphics cards. As for N-cards, which are known as "pure mining cards", they have no hardware image output ports, so their residual value is almost 0 after being eliminated from mining machines.

From the perspective of market rules, whether it is a custom GPU mining machine or a graphics card mining machine, the residual value of the machine itself will be consumed over time. However, the core of the residual value of the custom GPU mining machine A10 Pro lies in its "chip", which is the main kinetic energy of the machine's performance. It also has a wide range of applications and a high recycling value.

Specifically, an A10 Pro has about 100 GDDR6 particles, and the price of a single GDDR6 is about US$6. Therefore, the GDDR6 particles in the customized GPU mining machine A10 Pro are worth US$600, which is equivalent to RMB 4,200. GDDR6 particles are also considered to be relatively valuable "hard currency" in the chip field .