Why are GPUs Used for Mining?

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Cryptocurrency mining is a term that is now familiar. But most often, people do not know precisely the process or tools used for crypto mining. Mining is a process of verifying transactions on the blockchain, or hashing blocks. To mine, CPUs, GPUs, or ASIC processing power is needed. Graphics Processing Units (GPU) has been used for years. 

You may wonder, why are GPUs used for Mining? Well, the simple answer is that they are more competent than their counterparts CPUs and ASICs. However, to understand the need for the use of GPUs in crypto mining, we have to unveil some other factors. 

why are gpus used for mining

How Much Data does Bitcoin Mining Use

The bitcoin protocol stipulates that only 21 million bitcoins will exist at some point. Just like gold, bitcoin miners work to bring these bitcoins out a few at a time. A miner runs what is known as a node. It is a powerful computer that keeps the bitcoin network running by running a bitcoin software. 

To run a node, you download the bitcoin software for free and leave a particular port open. The one disadvantage is that it consumes a lot of energy and storage space. As of the end of June 2019, the size of the Bitcoin blockchain has reached approximately 226.6 gigabytes. Memory consumption per block runs in the range of 3 Terabytes and that is a lot of space consumption. 

Each node spreads bitcoin transactions across the network. These mining nodes solve a complex mathematical puzzle. That is, each puzzle is solved by random guesses done by the hash function. The first miner to get the results makes an announcement and all the other miners start working on the next block. Miners currently receive 12.5 BTC as a reward for completing a block. If miners perform these functions, why are GPUs used for Mining?

What is the GPU?

Graphics Processing Unit (GPU) are cards made initially to generate and speed up images on electronic devices. GPUs were generally created for the gaming industry. GPUs are also computer chips that perform rapid mathematical calculations just to render images. However, the advent of cryptocurrency mining, made manufacturers alter their designs to suit miners. Some major companies in the GPU market include AMD, ARM, Intel, and NVIDIA.

The Function of GPUs in Cryptocurrency Mining

When crypto-mining started in 2009, Central Processing Units (CPU) was the mining processor. However, it had its limits, and GPU-based Mining was introduced. A standard GPU can execute a processing speed of 3200 32-bit instructions per clock. Compared to the processing power of the CPU, this is a speed 8,000 times over. 

Equally, GPUs are equipped with a large amount of Arithmetic Logic Units (ALU). These units are responsible for performing mathematical computations. GPUs can perform more calculations due to the ALUs, and this makes them have an improved output during Mining.  

GPUs can carry out multiple tasks, and this is why miners prefer them. GPUs can be used to mine with different algorithms on chains. Also, you can quickly re-sell your GPU as they can be used for other purposes aside from Mining. For Mining, miners would have to set up multiple GPUs for mining rigs instead of a single unit. Also, the miners would have to attach these GPUs to existing infrastructure or computer as they are designed to act as supplements. You will also need enough SSD and RAM to enable the GPUs to function properly. 

To set up a GPU rig, the miner has to connect multiple GPUs to a specially built CPU to increase the overall processing capacity. The miner attaches his GPUs to the CPU’s motherboard that must not have any built-in graphics card. Like we said earlier, the miner needs enough RAM, SSD, and relevant wires. He also needs a support structure and a cooling system to build up his rig. Most miners build their platforms themselves, and so you may need some technical know-how. However, a would-be miner can watch tutorials on Youtube or order for a pre-built rig such as PandaMiner B5 plus.

how much data does bitcoin mining use

Why is GPU Better Than CPU for Bitcoin Mining

Before the advent of GPUs for computing bitcoins algorithm, CPUs were used. However, GPU renders images more quickly than a CPU due to its parallel processing architecture. This is what enables the GPU to carry out multiple calculations at the same time. On the other hand, a single CPU does not have this capacity. You could achieve similar processing power using multicore processors. These processors can perform calculations side by side by combining more than one CPU onto the same chip.

Every computer has a CPU that can perform a single calculation faster than a GPU. CPUs are designed to handle basic computing tasks and operations. Basically, a CPU is created for task parallelism. On the other hand, the GPU is designed for data-parallelism. 

The CPU has less arithmetic logical units and so when it comes to hash required proof of work, its performance is slow. However, you can still mine coins such as Hold Coin, Nexus, Zcash. GPU, on the other hand, can be used to mine coins such as Ethereum, Bitcoin Gold, Monero, Electroneum, and many others.

As compared to GPU mining and CPU mining, ASIC is more preferred. Its mining-hardware solves very complex algorithms. On the other hand, GPU and CPU mining hardware decode graphics algorithms and processor-based algorithms, respectively. However, the attraction GPU mining hardware holds is its offer of more hash power compared to CPU and low electricity cost compared to ASICs.

How Profitable is GPU mining?

Calculating the profitability of using a GPU mining rig has been made simple by nicehash.com. The following are the earnings per day a miner will likely make using the following GPU mining rig.

GPU Earnings/Day
AMD Radeon VII 0.00013100 BTC (1.35 USD)
NVIDIA TITAN V 0.00011600 BTC (1.20 USD)
NVIDIA RTX 2080 Ti 0.00010400 BTC (1.07 USD)
AMD RX 5700 XT 8GB 0.00007800 BTC (0.80 USD)
NVIDIA RTX 2080 0.00007700 BTC (0.79 USD)

On the other hand, the highest earnings per day for a CPU mining is $0.37 by the AMD CPU Ryzen 7 3700X. This goes to show how profitable GPU mining is as compared to CPU mining. 

Pros of GPU mining

  • GPUs are very efficient at complex computation.
  • You can quickly get them.
  • They are upgradable. 
  • Standard hardware.
  • They have resalable value.

Cons of GPU mining

  • High consumption of power.
  • They are not as effective as ASICs.
  • Compared to ASICs, GPUs are less powerful in overall efficiency.
  • You may need large equipment for mining. 
  • They are restricted to mining certain coins. 


A lot of coins still use the proof of work algorithm, and GPUs are still needed to mine these coins. However, compared to GPUs, ASICS a more efficient way of mining coins as they are faster. However, ASICs are very expensive and high maintenance. Moreover, GPUs give you excellent and ideal flexibility from mining a single coin. So, why are GPUs used for Mining? Simple, they are more efficient than CPUs and more cost-effective than ASICs.

Read More: How to tell if you have a Bitcoin mining virus

Are you currently mining any cryptocurrency? Let us know in the comments below!

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