Can you make money mining Ethereum in South Africa

Cryptocurrency mining – using consumer-grade graphics cards or ASIC (Application-Specific Integrated Circuit) hardware to mine blocks on a blockchain – sees users earning the cryptocurrency of a blockchain.

As ASIC devices are prohibitively expensive and usually only applicable to a specific blockchain, mining rigs comprising standard PC components and an array of powerful graphics cards have become extremely popular.

Graphics-card rigs can be used to mine a number of altcoins, including Ethereum – the second-biggest cryptocurrency in the world.

The once-off cost of purchasing a mining rig, the monthly expenses of running it, and how much money you can make are outlined below.

Mining Rig

Component Price
Motherboard Biostar TB250-BTC R1,599
Processor Intel Celeron G3930 2.9GHz R829
Memory Kingston DDR4 2,133MHz 4GB R532
Storage Corsair Force LS 60GB SSD R776
PSU Andyson 1,200W Modular PSU R3,599
Chassis Cooler Master test bench R995
Graphics Cards 6x MSI Radeon RX 580 4GB R3,687 x 6
PCIe Risers 6x USB PCIe Riser card R145 x 6

Total R31,322

Users will also have to connect their rig to a mining pool, set up mining software, and create a cryptocurrency wallet.

It is also important to note that many AMD and Nvidia graphics are not in stock in South Africa – including RX 580 cards – due to global shortages. This can substantially drive up the price of available cards.

We will examine the income generated from the build used to mine Ethereum.

Running Costs

According to Cooler Master’s power load calculator estimate for the rig, this build’s energy consumption comes in at 1.03kWh.

The rig will run 24 hours a day, meaning the cost of electricity becomes a notable factor when determining profit.

The electricity cost of running the rig – using the City of Joburg’s power tariffs for users consuming between 2,000kWh and 3,000kWh per month – is R1,238 in a 31-day month.

Additional factors to consider when running a mining rig are the heat and noise generated.

To keep the rig from overheating – and its noise driving you crazy – it is best to run the rig in a cool, dry room away from living or sleeping areas.

Profit

An Ethereum mining rig with six Radeon RX 580 4GB cards mining to the Ethermine pool currently produces an average hashrate of 148MH/s.

This equates to an estimated monthly payout of 0.83475 ETH, which was worth R4,105 at the time of writing. Subtracting the electricity cost incurred brings the monthly profit figure to R2,867.

This means you can theoretically pay off the component costs of your rig – excluding assembly and setup costs – in just under 11 months.

However, forecasting profit on mining is not that simple, and there are multiple factors to consider.

If the price of Ethereum drops substantially, which is a possibility, your revenue drops accordingly.

Blockchain improvements and block size changes can also affect the profitability of a rig.

If Ethereum becomes less profitable than other altcoins, however, it is easy for miners using graphics-card rigs to switch to other cryptocurrencies.

A way to implement this solution is mining program NiceHash, which automatically selects the most profitable coin to mine and pays out its users in Bitcoin.