What is hashrate and how to determine it?
Mining is a modern form of making money on cryptocurrency, which requires some investment at the start; and after that, you pay only for the consumption of electricity, which can be a lot. You can mine on video cards or processors. Most miners who do this professionally choose the video card option due to the increased profit potential. Technically, any video card is suitable for mining, but the key question is its performance (speed), which relates directly to its profitability. The hashrate of video cards is a key indicator that reflects the actual power of the equipment. For mining cryptocurrencies, video cards are chosen precisely based on their hashrate, the rest of the parameters are of secondary importance.
If you decide to seriously engage in mining, you need to clearly understand which video cards you can mine with, based on each card’s greatest performance. In this article, the Traders Union’s experts will tell you everything about what a hashrate is, how to calculate it, how to choose a video card by hashrate, and where you can buy cryptocurrency with the most advantage.
Start trading cryptocurrencies right now with Binance!What is hashrate?
“What is hashrate?” is a query that is trending in search engines in many countries today. To find the answer, start with the basics. Mining is the process of obtaining cryptocurrency through the reproduction of mathematical calculations by equipment in the blockchain.
The required calculations can be performed on different equipment. Video cards are more powerful and faster than processors, so they are used more often. The key indicator of the effectiveness of any crypto-mining device is its hashrate. In English-language sources, the words hashrate or GPU hashrate are used in relation to video cards. Processors, on the other hand, use CPU hashrate.
Hashrate is the potential of the computing power of the equipment, which is expressed in the number of operations performed by it per unit of time. The total computing power of the blockchain network is also called hashrate.
It is the hashrate of the video card that determines how much you can mine and earn when mining cryptocurrencies. The unit of measurement is hash per second. The higher the indicator, the more productive the video card, and the greater is the profit.
What does hashrate depend on?
The hashrate of a video card (GPU hashrate) is determined by the model (its parameters). This refers to the clock frequency of the GPU itself and random access memory (RAM). The parameters can be increased by overclocking using specialized software, changing timings, and in other ways.
Factors that affect the hashrate:
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amount of video memory;
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series (optimal DDR5);
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bus width (at least 256 bits);
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cooling system.
If you have a goal to increase the hashrate of a video card for mining with the help of software, you have to install three programs on your PC for: (i) monitoring the characteristics of the equipment, (ii) controlling overclocking, and (iii) conducting a stress test. A typical algorithm looks like this: the program for overclocking is launched, in it the “Power Limit” slider (or similar device) is set to the maximum, and the “Core Clock” slider is only set by a few points. Finally, the card is tested on a modern computer game.
You need to load the video card to 100% and play at that load for at least 2 hours. If the operation of the device is stable, the overclocking software starts again and the “Core Clock” slider, which is responsible for the clock frequency, is shifted by a few more points. This is how the hashrate of a video card for mining cryptocurrencies is gradually increased. The video card cannot burn out - as soon as it reaches its power limit, it will automatically return the default clock frequency settings and original values will be reset.
How to compute the hashrate of a video card?
You can mine on any video card, but if you intend mining efficiently not every video card is good for that. It is impossible to find out the actual hashrate of the equipment without operating it, because the indicator depends, among other things, on the mined cryptocurrency and the algorithm of a particular blockchain. Therefore, a video card for mining needs to be connected and start mining cryptocurrency; then run a special program.
Examples of such programs:
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Nice Hash Miner – while mining Bitcoin;
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Claymore’s Dual Ethereum – while mining Ethereum;
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EWBF's CUDA ZCash miner – while mining ZCash.
The What To Mine service allows you to find out the hashrate of a video card, regardless of the mined cryptocurrency. You need to go to the official site of What To Mine, enter the model of your video card, and the number of cards present. After that, click on the “Calculate” button and the following data will appear on the screen: the approximate hashrate of the video card for mining, electricity consumption, and potential profit.
To get the result with What To Mine, you do not need to connect a video card. However, the calculator gives only approximate information, while programs tailored for a specific cryptocurrency and a specific mining algorithm calculate the GPU hashrate of a working card with a high degree of accuracy.
Notice that cards with the same model number may have different performances levels if they are produced by different companies. There are several services (for example, MiningChamp) that show the average hashrate for different models and manufacturers.
The hashrate of a video card is calculated in h/s (hashes per second). The ZeroCash network uses sol/s (solutions per second). There are kilohashes (kh), megahashes (mh), gigahashes (gh), etc. There are 1,000 hashes in one kilohash, 1,000,000 hashes in one megahash, 1,000,000,000 hashes in one gigahash.
How to calculate profit when you know the hashrate?
Now you can find out the hashrate of the video card, but it is more important to identify its profitability, which directly depends on the hashrate. This is not difficult. Above are examples of services you can use to find out both the hashrate itself and the potential income. From the indicator of potential income, you need to subtract electricity costs, which are determined by the same services. You will not have any other expenses.
You can use third-party calculators . This is a calculator that shows how much Bitcoin can be mined on your hardware. Note that the calculator will not determine the hashrate of the video card for mining because this indicator must be entered manually. As well as other parameters such as the commission of your mining pool.
Is it worth mining cryptocurrencies on video cards?
Video cards for mining have the following advantages: stable passive income, the ability to mine several cryptocurrencies at once, and the absence of the need to constantly monitor the operation of the equipment. To mine cryptocurrencies, you need to take care of only two things: a high-quality internet connection and electricity without interruptions. Disconnecting either of these sources leads to a loss of profit.
Video cards are many times more powerful than processors. If you have several powerful video cards with a high hashrate and they are correctly overclocked, you can mine quite a lot of cryptocurrency and earn good money. But there are two points that you must consider. The first is the price. A modern AMD Radeon RX 6800XT graphics card, ideal for mining, costs about $2,000 (as of January 2023).
The second point is the settings. You need to properly connect the video card, download good software (also expensive), and configure it with optimal parameters. One cannot do without special knowledge in the field of IT (including knowledge of hardware) or you will need the help of an experienced specialist. Video cards for mining cryptocurrencies are an effective, but far from easy way of earning money.
Is it possible to make money on cryptocurrencies without mining?
Now you know what the hashrate of video cards is, what it depends on, how to calculate the various parameters, and the potential income from mining cryptocurrencies. But you can make money on cryptocurrency in other ways, too. These are cryptocurrency trading, staking, and various investment methods, such as cloud mining. It is beneficial to dwell on each of the listed options in more detail.
Cryptocurrency trading
Trading in the cryptocurrency market operates according to the same principles as in any other financial market. You register with a crypto exchanger and start tracking the assets you are interested in such as Bitcoin. Only buy a cryptocurrency if you expect it to grow. If all goes well, try to sell it at the peak of the price before it starts to fall again.
You can buy cryptocurrency using fiats or another digital asset. There are always various sell options available. When trading, you must trade with the trend or trade against the trend, so learn to use the tools for fundamental and technical analyses. With cryptocurrencies, it is even possible to perform scalping, like with ordinary fiat currencies. Today it is a fairly popular way of earning money.
Staking and investing
Staking is the lending of a cryptocurrency to a blockchain project at a percentage. Your exchange, if it offers staking, acts as an intermediary between you and the project in which you are investing. Usually, an integrated service is launched, where all current projects are presented as a list. Choose one (or more).
Staking projects differ in these particulars: used asset, minimum deposit, investment period, percentage of profit. Assume you have Ethereum, and you are not trading this cryptocurrency right now, but your exchange’s staking list contains a project that needs Ethereum for development. Assume you invest 1,000 ETH (Ξ) in a project and after a specified period (for example, 30 days), you will receive back the invested deposit plus interest. The interest rate can range from 1-2% with minimal risk to 100% or more for risky projects.
There are other options for investing in cryptocurrencies, for example, a landing page (lending to users of a cryptocurrency exchange). Many crypto exchanges offer their own investment projects.
Cloud mining
Thanks to modern technology, you can mine without even having the right equipment. Cloud mining is a method of mining cryptocurrency using the rented computing power of a remote data center.
For example, some companies have a huge mining farm and are ready to provide you with several of their video cards for a rental fee. The remuneration is most often fixed, but sometimes it can be a percentage of mining.
It is quite logical to view cloud mining as investing in cryptocurrency. You rent equipment, it mines the chosen coin for you, and you get passive stable payments. It is technically simple, but it is important to find a reliable service with favorable terms.
The best exchanges for making money on cryptocurrencies
If you decide that buying mining equipment and setting it up is too expensive, a crypto exchange can be a good alternative with minimal investment. This is a platform that provides users with access to the international cryptocurrency market for making transactions in crypto-crypto and crypto-fiat pairs. Top exchanges also offer staking, landing, cloud mining, and other services. Take a look at the top 3 crypto exchanges with the most favorable options.
Binance
This is one of the largest cryptocurrency exchanges in the world, offering cryptocurrency trading on the spot and futures markets. There is margin trading with leverage up to 1:10. They have all the most popular coins (over 400 at the moment), and you can buy cryptocurrency with direct payment using a standard credit card.
The minimum deposit is $1. Exchange commissions are below the market average. For example, when trading on the spot, the fee for a newly registered trader is 0.1% for a taker/maker. The commission decreases with increasing trading volume. You can get an additional discount of up to 25% for keeping the BNB token in your account.
The Binance exchange launched a proprietary P2P trading service (direct transactions between users). There is staking with a wide range of projects and complex solutions. For example, there’s the Binance Earn program, which allows you to invest cryptocurrency in blockchain products with high profitability and an auto investment function.
Kraken
It is an American crypto exchange with a minimum deposit of $10. It offers a large selection of about 100 cryptocurrencies for trading. There are spot and margin trading of indices, futures, as well as OTC trading for large transactions.
The platform has low fees. For example, for spot trading, the fees are 0.16/0.26% for the maker/taker. Commissions decrease with increased trading volume. The exchange is suitable for beginners because it has an intuitive interface and has all the main options for depositing and withdrawing funds, including bank cards and electronic payment systems.
Kraken offers traditional staking for passive earnings. Additional advantages include a modern security system, a plethora of training materials, and a highly stable operation.
ByBit
This young exchange launched in 2018, and currently, there are over 100 cryptocurrencies available for trading in its pool. There are crypto-to-crypto and crypto-fiat pairs. In addition to spot and margin trading with leverage up to 1:100, the exchange offers derivatives trading (perpetual USDT (₮)), inverse perpetual, and inverse futures contracts).
Trading commissions on the platform are at the top level, about 0.1% for the spot. The account can be funded and withdrawn using bank cards and electronic transfer systems, and third-party crypto wallets. There is an advantageous referral program with training guides for beginners.
In terms of investment, ByBit offers a flexible staking service with guaranteed income, an innovative dual mining service, and DeFi mining.
Summary
Now you know what a GPU hashrate is, what it depends on and how to evaluate the profitability of cryptocurrency mining based on the hardware hashrate. Mining is a progressive source of passive income, however, it requires significant investments at the start and IT knowledge to set up the system.
Therefore, many people choose alternative options for earning money, such as trading and staking on crypto exchanges, and other types of investment. Cloud mining can also provide substantial passive income if approached wisely.
In Part 2 of this article, the Traders Union will look at the top platforms that offer modern opportunities to earn money on cryptocurrencies. Binance, Kraken, and ByBit are leading cryptocurrency exchanges with a large selection of assets, low fees, and practical investment solutions.
FAQs
Why is video card mining so popular?
Mining is the process of making money on cryptocurrency by providing the blockchain system with the power of computing equipment. Video cards are much more powerful than processors, so they allow you to mine more cryptocurrency within the same time.
What is GPU hashrate and what does it affect?
GPU Hashrate is the number of computational operations (hashes) performed by it per unit of time. Hashrate is measured h/s. It reflects the actual computing power of the GPU, the higher the hashrate, the more you can earn from mining.
What is the disadvantage of GPU mining?
For effective mining of cryptocurrencies using this method, you need powerful GPU. The most optimal options cost about $2000. This is the first difficulty - high start-up costs. The second difficulty is setting up the equipment, it is not easy to do it without special knowledge.
How else can you make money on cryptocurrencies?
Buy and sell cryptocurrency by doing classic trading. There are also different investment options, such as staking and landing. You can trade on a P2P service. Plus, cloud mining is a way to generate passive income, in which you are remotely provided with computing power for mining cryptocurrency.
Team that worked on the article
Dwight specializes in risk, corporate finance, alternatives, fintech, general business trends, and financial markets, and he has broad experience managing complex projects. Dwight is an author for the Traders Union website.
Dwight was a financial columnist for The Wall Street Journal and The New York Times during the Great Financial Crisis. He has served as Editor-in-Chief of Worth, a personal finance magazine for the wealthy, and as Editor of Risk, the premiere global publication about derivatives, risk management, and quantitative finance, based in London.
He has also served as Managing Editor at The Economist Group and ran the Americas operations of two British trade publications.
For the last 12 years, Dwight has worked as a freelance writer and editorial project manager, serving clients in the financial technology, banking, broker/dealer, consulting, asset management, and corporate sectors. This has given him considerable experience in idea generation and project management, working collaboratively to help clients meet their goals with little or no supervision.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).