DIY Crypto Mining

An abstract blue cube made up of smaller cubes, offset and lit from within
Photo by Shubham Dhage on Unsplash

I have a secret in my not-too-distant past: I ran three cryptocurrency miners in the shed in my backyard. Not that it really was a secret because I had to let my backyard neighbor know about it in case they wondered about the whirring noises coming from the shed (which was located closer to their bedroom than it was to mine). I also had a heavy-duty “extension cord” from my basement window across the yard to my shed. I ran the machines for almost two years before my wife and I decided to downsize and move from your house on a quarter-acre lot to a condo with outside space totaling an 80-square-foot deck. So let me tell you about this experience.

I was still working at the time and had some extra cash to invest (read, “play around with”). A friend of mine told me about Bitcoin and how it was this new thing that was taking off. I did a bit of research and found out that you could actually “mine” Bitcoin (and other cryptocurrencies) with a computer — and do it better with rigs that were built especially for mining. So I bought two ASIC miners and later my friend asked if he could add a third one to my setup.

I ran them and made a bit of money — though not much because of the high cost of the electricity to run them. Still, as an investment, with an eye on their appreciation, owning chunks of digits that I could exchange for real cash was…different.

At first, my mining was buying contracts on eBay to hire time on someone else’s miner and have them send the earnings to my digital wallet. This worked, somewhat, because the cost of the contract even a bit more than my electric bill when I ran them myself. But, again, I was thinking in terms of investing so, even though the cost of mining them was about the same as buying them outright, having the capacity to acquire those crypto-digits on my own gave it a sense of intrigue.

There are things you need to consider besides the initial and running costs if you would like to do DIY cryptocurrency mining. First and foremost is heat and noise abatement. Running miners out in the shed in the winter worked just fine. But once the weather warmed up, the heat in the shed would build up — and the hotter your rigs run, the lower the “hashing” performance until a thermal breaker pops and then your machines are dead in the water.

To dissipate the heat, I assembled a 6-inch, insulated vent tube with a fan in it to draw heat away from the machines and pointed it into the vent turbine in the roof of the shed. The insulation also deadens the sound a bit more. This worked fairly well.

Another issue to address is dust. Typically, computers are run in rooms with filtered, air conditioned air blowing around. The shed was just that, a wood-framed structure with plywood sides, my tools and lawnmower, spiders, and a lot of dust. The only thing I could conjure up to filter out at least the spiders and sawdust was a big bubble of cheesecloth. This enabled the air to flow through the cloth which caught most of the dust. It didn’t get it all so I had to go in once a week and use pressurized air to blow the dust off the fans and the circuit cards. Yes, pretty hack but, hey, I was mining digits!

I continued to run my mining operation for almost two years. But then, as I mentioned, my wife and I decided to downsize and move to a condo. We didn’t want to deal with the noise and the heat coming from the miners (which would probably have sounded like an Airbus taking off in our small digs), so we sold them.

Looking back, it was a fun experience. I’m glad I did it. And I’m also glad I got out when I did. Mining cryptocurrency is not for the faint of heart. It’s a hot, noisy, risky business. But it can be profitable if you do it right.

Three Bitcoin coins
Photo by Dmitry Demidko on Unsplash

If you’re thinking of mining cryptocurrency, here are a few things to keep in mind:

1. Make sure you have a good understanding of the market before you start. The prices of cryptocurrencies are volatile.

2. Don’t invest more than you can afford to lose.

3. Be prepared for the noise and the heat. Mining rigs are loud and generate a lot of heat.

4. Have a plan for what you’ll do with your earnings. Hold them in reputable wallets or, if you can stand the added risk, store those digits on a thumb drive (yikes!)

5. Don’t forget to pay your taxes! Cryptocurrency mining can be profitable, but it is also considered income and you will need to pay taxes on your earnings. I live in the US and I have seen tax preparation software like TurboTax adding in questions regarding crypto holdings and trading. Sure, you can try to keep it “off shore” to reduce your tax liability but, again, it’s a risk with a lot more to lose than just your invested time and money. This is a risk I wouldn’t like to take.

So there you have it. That’s my experience with mining cryptocurrency. It was a fun ride while it lasted, but I’m glad I’m out of it now. If you’re thinking of getting into cryptocurrency mining, just make sure you do your research and understand all the ins and outs, and the risks involved.