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Some useful information for Ethereum miners

Author: LB 2021-01-14 122

Cryptocurrencies has been invented to spread the concept of decentralization in the financial world. Cryptocurrency networks are very democratic, in a sense that anybody with an Internet connection, some IT knowledge and a digital wallet can join to these networks. Once you are connected to the Ethereum network for example, you can send and receive Ethereum based payments freely and you can also become a mining node. These implies that ensuring the safety of the network is of utmost importance, because if the identity of the participants is not checked, then deciding whether a user is malicious or sincere is no easy task. Therefore it would be expedient to create a network in which malicious users cannot collaborate. For example if the users are well spread geographically in the world, they are less likely to unite in order to carry out a 51% attack for example. In the following article, I'm going to try to shed light on how decentralized is the Ethereum network and how rewarding is it to become an Ethereum miner in 2021.


If you want to obtain numerical data on the Ethereum network, you can use ethernodes.org. You will find detailed statistics on the Ethereum network on this site, such as how many Ethereum nodes are there in the network, the type of client they are using and you can even check the geographical location of these nodes. If we do some analysis on this data, we can find how how centralized or decentralized is the Ethereum network. As I am currently located in Hungary and I can buy mining hardware in this country, my focus will be on the numbers related to Hungary. Let's see a few questions with the corresponding answers in the following sections:


How many Ethereum nodes are there in Hungary in 2021?


Not so many. If you take a look at the next screenshot, taken from ethernodes.org, you can see that there are 32 Ethereum nodes in Hungary, among which 15 nodes are located in the capital, Budapest. This does not mean that there are 32 miners in Hungary, because some of the nodes might not be mining Ethereum. They might be sending or receiving coins or checking account balances.


The number of Ethereum nodes in Hungary in 2021. January.


The IP address of the Ethereum currently connecting from Hungary:


  • 94.27.146.38
  • 94.199.178.233
  • 94.199.178.17
  • 92.249.230.203
  • 92.249.143.44
  • 86.109.65.84
  • 84.236.52.113
  • 81.183.187.253
  • 79.121.36.106
  • 79.120.167.86
  • 78.131.7.116
  • 5.38.207.114
  • 145.236.109.30
  • 178.164.216.14
  • 81.183.187.253
  • 92.249.230.203
  • 94.199.178.233
  • 145.236.123.131
  • 178.164.190.187
  • 84.1.12.5
  • 31.46.83.184
  • 84.0.114.145
  • 84.236.26.96
  • 94.21.105.49
  • 31.46.246.190
  • 46.29.142.209
  • 62.77.130.133
  • 80.98.189.151
  • 80.99.192.182
  • 84.236.44.161
  • 109.199.36.100
  • 217.65.123.137


Next, let me tell you an interesting story about this. So we saw that there are at most 32 Ethereum mining nodes in Hungary. However, the other day when I was looking for high performance GPU cards in Budapest and I went to one of the largest PC part retailers in Hungary, they told me that they have almost run out of stock. They had a few very cheap entry level cards and a few cards that cost over $4000. I tried to asked them whether they have NVIDIA GTX 1080 Ti's or NVIDIA RTX 3080's, but they seemed to have none of these cards. I could not but leave the store and look for alternatives, but I still do not know how I am going to get these cards.


So then, if we think of the fact that there are only 32 Ethereum nodes running from Hungary, then why did the retailers run out of stock? This can imply many things. There is a chance that some of the Hungarian Ethereum miners realizing the profitability of Ethereum mining rushed to the stores and took hold of the entire GPU supply, but if not, then non-Hungarians must be responsible for this. On the other hand, we should not forget the fact that popular games of modern ages, such as the Assassin's Creed Odyssey, the Red Dead Redemption 2, The Witcher 3 or the Battlefield V are very greedy and they covet serious GPU power. Therefore gamers are happy to pay a few 1000 dollars for a NVIDIA RTX 3080 for example and this fact can influence GPU prices too.


Which country has the most Ethereum nodes in 2021?


Just as you would expect it, the United States. 3089 nodes out of the total 11.483 Ethereum nodes are residing in the USA. Right now, this is the 26.96% of the entire Ethereum network, so we are still very far away from a situation when the Ethereum miners in the USA can initiate a 51% attack against the network. German Ethereum miners are the second most numerous. This is interesting, because while the neighboring Austria has plenty of cryptocurrency ATMs, the German regulators are very strict in this respect and there are no cryptocurrency ATMs in Germany as for now. Nevertheless, Germany has 1844 Ethereum nodes and this is approximately 16% of the entire Ethereum network. Germany is followed by China in this list with 1145 Ethereum nodes and they have taken hold of the 10% of the Ethereum network with this.


Mining cryptocurrency in the cloud


On of the most worrying issue in the cryptocurrency networks is the presence of cloud service providers. Unquestionably, tech giants such as Amazon, Facebook, Alibaba and others control a large proportion of the entire word's computational power and recently they have started offering cloud based services to clients. So you just have to register to these platforms, pay a few dollars and you can start using their virtual servers. The amount you have to pay varies based on the resources you are using. GPU clusters are also available to us, because deep learning and machine learning algorithms run very well on these extremely powerful machines with GPU.


Clearly, if a user can train a deep learning module on such a virtual server, he can also mine cryptocurrencies with these GPU clusters. The operation might not produce enough coins on a daily or a monthly basis, because it is not rare to pay $3-400 for a single GPU each month. The current market price of the given coin and the hashing algorithm can influence the profitability and the actual calculation is left to the reader, but depending on our requirements utilizing a virtual cloud server for cryptocurrency mining might be an expedient choice.


Tech giants provide almost access to an unlimited number of servers, so as long as you have enough money, you can rent more GPU power than you can ever dream of. But this also implies, that these companies do have this computational power, so if one of the CTOs wakes up one day and say "let's attack one of the crypto networks", they do have the necessary hardware to carry out a successful 51% attack for example. I guess they would not start with Bitcoin, because the extraordinary hashing power in the Bitcoin network would make their attempt extremely expensive, but other now ICOs can be attacked very elegantly.


Anyway, conspiracy theories aside. If you are interested in this data, you can use the previously mentioned database at ethernodes.org and click on "Network Types". You will see a table like this with the service providers:


Ethereum mining in virtual cloud servers

Amazon is the leading player in this game (as well). Alibaba is in the second place, followed by two German companies Hetzner Online GmbH and Contabo GmbH. And then there are some Chinese cloud providers and some Ethereum nodes are hosted in the Google Cloud.

How to calculate the profitability of a GPU mining Ethereum?


So suppose that you want to mine Ethereum. There are a few important parameters to be considered when you are calculating you mining profitability. Obviously, your PC needs electricity and you have to pay for this and if you are using a high performance GPU, expect to pay more for your electricity bill. I do not know how much do electricity companies charge in the area where you live, you have to check this number for yourself. The next very important parameter is the current market price of the given cryptocurrency. Right now 1 Ethereum is trading at $1104, and as you are going to get Ethereum coins for mining and the market price keeps changing, do not forget to check this value regularly. The performance of your GPU card is also very important. An NVIDIA Tesla P4 GPU is capable to mine with 17 MH per second for example.


In order to calculate the profitability of a GPU, you need to obtain the current profitability rate. You can check this data by accessing the following page: Ethereum (ETH) price stats and information. The "Ethereum Mining Profitability" is the information we are looking for on this page. It was 0.073 USD/Day for 1 MHash/s, which means that if I have a GPU that mines with 1MH/s it is going to earn $0.073 in a day. So if you have an NVIDIA Tesla P4 GPU, it is going to mine you $1.241 per day and $38.4 per month. If you only have a light node and your are mining through a mining pool, then you will have to deduct the pool fee and some taxes should also be paid on this kind of operation.


A GPU with promising profitability


Asus TUF-RTX3090-O24G nVidia 24GB GDDR6X 384bit PCIe GPU in Hungary


Hungarian PC part retailers do sell the Asus TUF-RTX3090-O24G nVidia 24GB GDDR6X 384bit PCIe gamer card, and its current customer price is $2973. This card, according to the data at kryptex.org is capable of providing 125 megahashes per second, and based on the previous calculation it turns out that the GPU will earn you $9.125 every day or $282 every month. You would have to deduct all concomitant fees and if we suppose that the market price of Ethereum does not change, this GPU has a very decent ROI when used for Ethereum mining, because you can recover your initial investment in less than a year. Disclaimer: This is not an investment advise! Do everything on your own risk. The author shall not bear responsibility for any occurred losses!.


Illustration:pixabay.com


Author: LB


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