In the last couple of years Bitcoin and, more generally, cryptocurrencies, have become a hot topic. Nowadays almost everyone is familiar with these terms, even though the mass-adoption of these technologies is still a work in progress.
Since cryptocurrencies’ price mostly evolves by offer and demand, their value oscillates often and significantly. Since they are increasing in popularity, even more now that Facebook has just presented Libra, their own cryptocurrency, it seems plausible that in general they will keep increasing in price.
While high-level explanations of the blockchain technology can provide a very good description of how this technology works, getting into it is not a straightforward task. Luckily, platforms like our Cudo Miner allow you to earn cryptocurrency within a few minutes and no effort.
There are different hardware options to mine cryptocurrency, but we strongly believe that GPUs are the ones with better future prospects. With the imminent and inevitable rise of distributed computing this statement becomes even stronger, as the earnings provided by GPUs will greatly increase the profit made by mining cryptocurrency.
In this post we present a study on the earnings and Return Of Investment (ROI) of GPU rigs, for three of the most popular GPUs in the current market. As we show below, they are a very profitable investment, which will become many times more valuable after the release of our distributed computing platform, Cudo Compute, later this year.
Calculating the ROI of GPU mining rigs
In this study we consider three different GPUs:
- GTX 1080 Ti released on March 2017
- RTX 2080 released on September 2018
- RTX 2080 Ti released on September 2018
We are using the earnings that are obtained by our Cudo Miner platform for the calculations. The data we are using is from June 19, 2019. Typical mining rigs usually have 6 to 8 GPUs. In this post we consider rigs with 8 GPUs (the ROI is exactly the same for all of them though).
In what follows, all prices are given in GBP. Also, for the 3 years ROI we are assuming that all hardware is sold after 3 years of continued use. We also assume that the price of that hardware will have dropped 60% during that time, which are typical values that can be found in websites like eBay. Thus, the ROI decreases approximately by 0.6 in all cases if the hardware is not sold.
1 The ROI is calculated as (current value of investment – cost of investment) / cost of investment.
With typical Wholesale UK electricity rates(0.08£/kWh) the earnings are:
| 8 GPU rig | Initial investment | VAT | 24×7 monthly earning | 24×7 yearly earning | ROI after 3 years without VAT |
|---|---|---|---|---|---|
| GTX 1080 Ti | 4000 | 800 | 321.34 | 3856.03 | 2.49 |
| RTX 2080 | 4400 | 880 | 375.21 | 4502.49 | 2.67 |
| RTX 2080 Ti | 7320 | 1464 | 599.13 | 7189.57 | 2.55 |
All prices in £
With typical Feed-In Tariff UK rates (0.04£/kWh) the earnings are:
| 8 GPU rig | Initial investment | VAT | 24×7 monthly earning | 24×7 yearly earning | ROI after 3 years without VAT |
|---|---|---|---|---|---|
| GTX 1080 Ti | 4000 | 800 | 378.94 | 4547.26 | 3.018 |
| RTX 2080 | 4400 | 880 | 414.38 | 4972.50 | 2.99 |
| RTX 2080 Ti | 7320 | 1464 | 656.73 | 7880.77 | 2.83 |
All prices in £
As we can see, just counting the money earned by mining the initial investment is recovered within one year in all cases, especially if VAT can be reclaimed on the initial purchase. Notice also that with these numbers, capital allowance grants businesses the opportunity to reclaim the corporation tax of the money earned by mining, which we are assuming for the ROI.
Another important assumption is that all earning numbers are calculated based on the performance of our Cudo Miner platform with that hardware on June 19, 2019. This is a reasonable assumption. The GTX 1080 Ti card is already over two years old, and as we can see it still performs extremely well.
With the RTX 2080 Ti earning more in one year than the initial costs for setting up the rig, the tables above suggest that the net earnings after that would be considerable. Furthermore, a second hand GTX 1080 Ti currently costs around £500, and so after reselling the hardware about half of the initial investment would be recovered (in our calculations we have assumed that the hardware is sold again at 40% of its initial price after three years).
There is a factor which we have not taken into account here, and that is extra electricity cost due, mainly, to the cooling system. With many different cooling systems being offered in the market, and with imaginative solutions to reduce costs being studied, we want to stress that this factor has not been considered in the numbers above.
One last factor to take into account is the high volatility of the cryptocurrency market. However, as we have argued the market is likely to at least stay at similar prices in general. Since our Cudo Miner platform optimises the hardware, scans the crypto market and mines the most profitable coin for each hardware configuration at every moment, the maximum profit will always be obtained using our platform. Also, our development team is continuously working on implementing new features, which ensure the hardware optimisation.
GPU rigs are a profitable investment using Cudo Miner
All in all, we have shown that mining cryptocurrency with GPU rigs and our Cudo Miner platform is a profitable investment. And as we have mentioned at the beginning, this investment is likely to become many times more profitable when our Cudo Compute platform goes live later this year. Stay tuned for very exciting news and investment opportunities!
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