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What Is the Best Cryptocurrency to Mine?

Joshua Morris -

Cryptocurrency mining offers crypto-enthusiasts a great opportunity to earn income from crypto. But it is worth the effort only in the case you choose a cryptocurrency to mine correctly. While Bitcoin remains the major crypto based on market capitalization, it is far not the most profitable crypto to mine unless you join a big ASIC mining rig. On the other hand, there are coins that can be mined with a GPU or a CPU. So what about exploring different mining types and checking what coins are the best to mine?

How to Mine Cryptocurrency

It is still believed widely that mining is nothing more than the creation of new coins. However, mining is much more than this. Crypto mining is also the validation of transactions and adding them to a distributed ledger. With it, mining serves to prevent double-spending. New coins are generated to award miners for keeping the distributed ledger secure.

To start mining, you need special equipment. Some coins can be easily mined with CPU, while others require GPU, and some, like Bitcoin, can be mined with ASIC miners only. To start mining, you need to:

  • Purchase equipment if needed (while some coins can be mined with your usual PC or even a mobile phone, others cannot).
  • Download and install mining software.
  • Start mining (some networks require their miners to be online 24/7 while others do not).

Types of Crypto Mining

There are three main mining types depending on the equipment you need:

  • CPU mining, or processor-based mining.
  • GPU mining, or video-card based mining.
  • ASIC mining, or application-specific integrated circuit mining.
  • FPGA mining, or field-programmable gate array mining.

CPU Mining: Does It Still Work?

Bitcoin mining with a CPU is not efficient anymore. However, there are many coins that were created to be mined with a CPU. Those are ZCash, Monero, Bytecoin, and some more. The main target of these coins is to make mining accessible to ordinary people, those who cannot afford expensive ASIC miners.

Another aim of these projects is to keep the network decentralized. In the case of Bitcoin, mining is becoming increasingly centralized around huge mining rigs. If the coin can be mined with a CPU, practically everybody can become a miner thus supporting the network’s decentralization.

Coins to Mine with CPU

GPU Mining Is More Efficient Than CPU

While CPU mining is cheaper, it is not the most efficient way to earn profit from mining. Most miners that mine the majority of large-cap cryptocurrencies have already moved to GPU mining. GPUs have a higher hash rate and are more efficient than CPUs. While CPU’s hash rate is measured in kh/s, GPU’s hash rate is measured in megahashes per second. Just to compare, a miner using a 40 mg/s GPU has 2,000 more hashing power than a miner using a 20 kh/s CPU. Moreover, miners tend to create mining pools to multiply their hashing power.

Coins to Mine with GPU

ASIC Miners Are Used for Mining Specifically

ASIC miners are developed to perform one activity only – mining cryptocurrency. The first ASIC miner was created in 2012. It was 200 times more powerful than a standard GPU miner of that time. ASIC miners’ power is measured in terahashes per second. The most recent ASIC miners can reach up to 100 ths/s which is incomparably higher than even the most efficient GPU miner.

One ASIC miner costs from 2,000 USD and higher. But purchasing an ASIC miner doesn’t guarantee income. Electricity costs, network difficulties, high volatility of crypto, and competition make their adjustments. To be efficient, you’d need to join a mining rig and combine your hashing power with other miners to get mining awards.

Needless to say that ASIC mining can be profitable if you are going to mine expensive cryptocurrencies such as Bitcoin. It is one of the reasons why cheaper coins are mainly mined with GPU.

ASIC miners are usually created to mine specific coins only or coins that rely on the same algorithm. So, an ASIC miner that mines Bitcoin is optimized to mine coins that rely on the SHA-256 algorithm. ASIC miners created to mine Litecoin can be used to mine other coins that rely on the Scrypt algorithm, and so on. These limitations are one more reason why the biggest part of the mining market is still dominated by GPU miners.

Coins to Mine with ASIC

FPGA Mining Combines the Best of Both Worlds

FPGA mining or field-programmable gate array mining is believed to combine the best features of GPU and ASIC mining. FPGA mining is much faster and incomparably more efficient than GPU mining. FPGA miners have the ability to reconfigure themselves to mine a wide array of coins. This flexibility makes them win compared to ASIC miners that can be used to mine specific coins only.

FPGA miners can be changed or configured directly in place after they have been delivered to the destination provided by a customer. The gate array refers to the logic gates. They can be programmed and optimized for the needed purpose, for example, for cryptocurrency mining.

Depending on the miner and the coin it is mining, the cost might vary from some hundreds to some thousands of USD.

The main drawback of FPGA miners is that the setup is not as user-friendly as other options. You might need to set up the gate array and to create software. Not every miner can do it. As an option, you can download an FPGA bitstream. It simplifies the setup process significantly. But for it, you will be charged a developer fee which might be up to 8% of your income from mining.

Coins to Mine with FPGA

You can configure an FPGA miner to mine any coin you need. Among the most interesting options, along with the main coins, we’d highlight the following:

Cloud-Mining Provides You With an Opportunity to Mine without a Rig

Just like you can buy cloud storage, you can buy a cloud mining service or contract a cloud mining provider. Cloud mining allows you to mine crypto without purchasing mining equipment and exposing yourself to maintenance requirements.

You can purchase a mining contract or hash rates. Alternatively, you can even rent ASIC miners. Consider that in the latter case, you will be responsible for their setup and maintenance which is connected with additional expenses.

How to Choose the Best Coin to Mine in 2022?

You cannot mine each and every coin. To choose the most profitable cryptocurrency to mine, you need to consider several factors.

Cryptocurrency mining hardware

Your mining hardware is one of the main limitations. If you have a GPU, you are limited to the coins that are ASIC-resistant. With an ASIC miner, you can mine a couple of coins for which the ASIC was made. If you use an FPGA miner, you can configure it to mine any coins you are interested in.

Mining difficulty, block awards, and market price

Another limitation is connected with the mining profitability. It depends on such factors as:

  • Mining difficulty: the higher the mining difficulty is, the less profitable is the mining.
  • Block award: the higher it is the more profitable is the mining.
  • The cryptocurrency price: the higher the coin costs the better it is for you.

Mining pool

You might have done everything correctly but if you make a mistake with selecting a mining pool, you may never see the expected profit. Here are some features you need to pay attention to when selecting a mining pool:

  • Fees: the lower the fees are the more profitable your mining is. The fees might vary from 0 to 3%.
  • Minimum payout: choose a pool with the lowest payout possible. Some pools will allow you to withdraw as many funds as you have which is very convenient.
  • Reputation: choose a pool that has the best reputation.
  • Pool uptime: the best pools have 100% uptime.

Risks of Cryptocurrency Mining

Mining, while being considered a relatively safe activity, comes with some risks. Before deciding to start mining crypto, consider the following to see whether it is suitable for you.

High upfront costs

If you are not going to buy ASIC-resistant coins, you need to purchase expensive mining equipment. One ASIC miner can cost from some hundreds to some thousands of dollars. Sole mining is not always profitable. So, you might need to join a mining pool and pay fees. Calculate all the upfront expenses before you decide to plunge into mining activities.

New blockchain technologies

They are already here - coins that do not need to be mined. With their increase in cost and popularity, mining might become obsolete.

Cryptocurrency volatility

The mined cryptocurrency might drop in price. It might make coin mining unprofitable.

Bankruptcy

The coin might fail. In such a case, you will stay with mined coins worth nothing.

Bottom Line

Mining cryptocurrency, even if considered safe, is connected with many challenges. You need to consider many details and calculate everything in advance. But if you do everything correctly, you can count on a relatively stable profit.

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