Expensive Graphics Cards and Mining Cryptocurrency

If you’ve wondered why graphics cards are so expensive – new or used, you might have wondered why. You might have also been told that it’s due to people using these graphics cards for mining, and then been annoyed that you have to pay a lot of money to get a better graphics card. Or maybe that’s all just me… but I’ve been looking into this, and playing with mining cryptocurrency; here’s what I learnt.

I bought a new PC for home with the following specifications:

The key component here is the NVIDIA RTX 3080 graphics card, and you’re lucky to get one at the time of writing for $2000AU. When NVIDIA first launched the 3080 amongst other cards in late 2020, their RRP was $1139AU. A huge price increase – so why does mining cryptocurrency affect the pricing?

To actually use your GPU to mine can be incredibly easy. Platforms such as Nicehash let you set up within a few minutes, and just run a piece of software that sorts it all out for you. The barrier to entry is very low with methods like this, and Nicehash act as a service to allow people’s GPUs to mine cryptocurrency, take a cut of the money made, and pay the people doing the work in bitcoin (and to clarify, Nicehash aren’t getting their users to mine bitcoin itself, but several other options are available – and the market constantly changes, so there’s not one particularly good ‘coin’ to mine).

There are other options such as mining Ethereum, or using HiveOS – and I’m not recommending Nicehash in particular, but it’s the one I’ve tried and makes explaining things easier.

Coming back to my above computer – if I chose to run Nicehash, they have a calculator to show how much you could make:

Ignoring electricity costs (I’ll get to that later), running the Nicehash software based on the time of writing’s Bitcoin to AUD rate, I would get paid $5.38AU of bitcoin each day.

If my RTX 3080 cost $2000AU to buy, and I left Nicehash running on it, it would take 371 days to pay for itself – if the value of Bitcoin didn’t change. At 371 days, I also still have the RTX 3080. You can probably see the problem here already, and why so many people are now mining cryptocurrency.

Historically, the value of graphics cards drops as new models come out. However, due to crypto, value has gone up. Supply can’t meet demand, and older cards have increased in value because they can pay for themselves, then start making profit with enough time and power. The NVIDIA GTX 1080 Ti which came out in 2017 at a RRP of ~$900AU. They’re still worth about that on the second hand market, because:

Buying one for $900 would take 281 days to pay for itself. That’s better value than my new 3080.

Nicehash have a list of cards, recommended general overclocking settings, and the expected performance on one particular type of coin. the MH/s is a million hashes per second measurement, which is the actual work your card needs to do to make money:

Also note that some of the newer cards are ‘Lite Hash Rate Limited’ or LHR. This is due to NVIDIA trying to make the new cards less lucrative to miners, which is what my card is. The market for newer, non-LHR cards is of course stronger with the market paying much higher amounts for these cards, being twice as efficient. Spending $3000AU on a non-LHR RTX 3080 could make more financial sense than $2000 on a LHR RTX 3080.

Of course power isn’t free – unless you have solar during the day, and enough batteries at night, so there’s running costs to consider, and the other hardware required to run the GPU. There are mining rigs that can be built fairly cheaply, running many cards at once back to a motherboard/CPU/GPUs to provide more MH/s and therefore profit:

In these rigs, devices called ‘PCIe Risers’ are used to connect the GPU back to the motherboard. The GPUs would normally need a 16x PCIe slot, but these adapters can connect to a 1x PCIe slot – so a motherboard with lots of PCIe slots is what people look for in a mining rig. Plain USB can also be used, like this Asus motherboard with 20x USB ports on the motherboard itself:

None of the above is definite – things that happen in the world affect the value of cryptocurrency – including events like China banning cryptocurrency altogether which can throw values up or down. While there’s enough money in cryptocurrency though, this will continue; unless there’s an absolutely huge market crash (which could happen just like in anything lucrative). NVIDIA could work out how to build newer cards that are worse at mining, while still being better at gaming graphics – but new NVIDIA cards aren’t due out until late 2022. AMD has a similar problem as NVIDIA, with similar profits being possible.

A Guide to Cryptocurrency Terms

A Guide to Cryptocurrency Terms

The financial industry uses a lot of jargon that is quite difficult for people new to the topic to comprehend. The cryptocurrency industry is no different, as it mixes tech talk with investing terms, which can make studying its markets even more challenging.

I have addressed topics like this before in my ‘Cryptocurrency Trading’ article, and touched on a few key terms you should know. In order to expand your understanding of terminology a little further, here are some more common cryptocurrency terms that I’ve come across and thought needed defining:



A cryptocurrency address is the same as a person’s home address; it’s the “location” where a person can receive or send cryptocurrency from. The only difference with a digital address is that its string of letters and numbers are unique to each cryptocurrency holder, functioning like an ID.



Altcoin refers to cryptocurrencies other than Bitcoin. Alternative cryptocurrencies like Ethereum or Dash are altcoins that people can mine and invest in.



This refers to investors taking advantage of a price difference of the same cryptocurrency on two different exchanges. This is possible because there are a lot of online cryptocurrency exchanges in the world that offer digital funds at different prices.


Bearish / Bullish

A bearish cryptocurrency market refers to one with a sluggish demand for digital assets, which tends to drive prices down. A bullish market, on the other hand, is the opposite of a slump. When investors are bullish on a cryptocurrency, its prices usually go up.



A bot is a program that lets people use pre-programmed commands for trading cryptocurrencies. This is similar to the trading software used by Forex traders. Bots can be programmed to protect investors from accumulating high losses by stopping trading when the capital drops by a significant amount.



A block is similar to a notebook page, and it is used for the purpose of writing and storing data.



Blockchain is the technology that powers cryptocurrencies. It is the framework used for creating digital ledgers involving transactions. A blockchain is basically a network of people and computers all working together in order to produce cryptocurrencies.


Block reward

This refers to the reward given to people for solving difficult mathematical equations related to mining cryptocurrency. The block reward is different for every cryptocurrency. For instance, the block reward is currently at 12.5 coins per block mined on the Bitcoin network, and the next halving event takes place in May 2020. This will bring down the block reward to 6.25 coins.



A price correction happens whenever a cryptocurrency experiences an all-time high. Assets get “corrected” whenever a price spike happens because investors sell their holdings when the value of the coins gets high enough for trading.


Hard Fork

A hard fork is a change of the rules to a digital currency’s blockchain. FXCM explains that it is a “permanent change in the rules of a digital currencies blockchain”, particularly in mining, which requires the support of the majority of people using the network. A hard fork usually happens when developers find a solution to recurring bugs or weaknesses from the old blockchain.


Hash Rate

A hash rate refers to the length that it takes for a computer to discover a block, as well as the time required for solving mathematical equations for mining.



An initial coin offering (ICO) is a new cryptocurrency being offered by fledgling entrepreneurs who are hoping to get funding from venture capitalists. The entrepreneurs will pre-sell their new cryptocurrency to venture capitalists before they go public.



Mining is the process of solving mathematical equations on a certain block. Once the equation gets solved, cryptocurrencies come out as the reward.


Mining Rig

This is a computer, or a set of computers, designed for processing blockchains. They are made up of several expensive graphic cards that speed up the mining process of cryptocurrencies.



P2P means “Person to Person,” which is a method of sending and receiving cryptocurrencies without the need of an intermediary. P2P transfers are what make cryptocurrency transactions cheaper and more direct than sending money abroad through a bank.


Smart Contract

A smart contract is an agreement between two parties stored on the blockchain, and is much more secure than paper contracts. Smart contracts can also be used to define benchmarks that must be met before payment can be made.


Soft Forks

Soft forks are updates to an existing network. The updates are implemented on the same network, unlike hard forks that affect a completely different block.



People usually send unencrypted files over the internet. Attaching a word document on an e-mail or sending pictures via Messenger are usually unencrypted methods of sending files. Tokenization is the act of encrypting data by turning them into a string of random letters and numbers. All data sent between wallets are tokenized on the blockchain, making cryptocurrencies virtually tamper-proof.



Bitcoins need to be stored in a wallet for easier access and to keep them secure. There are two types of wallets: software-based and physical wallets. Software-based wallets are online wallets that collect data on a person’s cryptocurrency holdings. An offline wallet, on the other hand, can store data on cryptocurrencies in the same way that a DVD can store computer files.

Hopefully these terms help make more sense of the cryptocurrency world!