Explainers

ASIC vs. GPU Mining: What’s the Difference?

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Image Credit: Samer Daboul/Pexels

You may have heard about ASIC miners. Perhaps you’re considering buying one, but what exactly are they? How do they differ from GPU mining, and are they worth bothering with? Here are the essential facts.

What Is an ASIC Miner?

An ASIC is an application-specific integrated circuit. They are mini-computers with specialist processors, designed to excel at one single task. This task doesn’t have to be Bitcoin mining, it can be anything from a digital voice recorder to a modem. Because of this specialized design, ASICs are far removed from the general-purpose central processing units (CPUs) and graphics processing units (GPU) used both for “traditional” mining of cryptocurrency and your everyday computing needs.

Because ASIC miners are so specialized, it’s hard to find a multi-purpose ASIC. An ASIC designed to mine Bitcoin won’t work with Litecoin. Herein lies the confusion. If a Bitcoin ASIC won’t work with Litecoin, how is it possible to mine both on the same unit? As ASICs represent one component of a mining rig, it’s possible to buy a device with many different ASICs inside, each one optimized for a different blockchain.

ASIC mining rigs often include redundant power supplies, high-power fans to keep the internals cool, and network interfaces and storage devices to connect to and store the blockchain.

ASIC miners are far more efficient at mining Bitcoin and other cryptocurrencies than GPUs, but they still suffer some of the same problems such as power consumption, excessive noise, excessive heat, and limited supply.

ASICs designed to mine Bitcoin are highly efficient at calculating the SHA-256 hashes used with Bitcoin’s blockchain. Equally, Litecoin ASICs excel at calculating Scrypt hashes. ASICs can mine any cryptocurrency running the same algorithm. A Bitcoin ASIC can mine Bitcoin Cash, for example. Technically, any ASIC can mine any other cryptocurrency, but it would be an expensive and inefficient waste. You’re almost always better off using a GPU or even a CPU to mine a cryptocurrency than an ASIC designed for a different algorithm.

ASICs are not magical devices. They are not a free Bitcoin money tree, and they still earn less when the Bitcoin halving happens.

How Do ASICs Work?

ASIC miners are computer processors just like you have in your computer, but what’s so special about them? To really explain how they work we’d need to look at processors in general at a transistor level, but that starts to get very technical.

Processors are very good at performing calculations, but they need to handle a huge variety of different tasks. Calculating cryptocurrency hashes is something they can do, but other types of processor can do this better. GPUs are better than CPUs at performing these calculations, but there is still room for improvement.

ASIC processors contain more of the components required for cryptocurrency mining calculations (or any other intensive task) and less of the general-purpose components. There are three different types of ASIC processors:

  1. Fully-custom
  2. Semi-custom
  3. Platform

Custom ASICs work best with one task. This may not be cryptocurrency mining, rather, specific calculations, some of which are used during cryptocurrency mining.

Semi-custom ASICs are designed with some flexibility. ASIC mining rig manufacturers can change these processors depending on the mining algorithm they wish to use.

Finally, platform ASICs work to a set criteria. These can vary, but again they offer some amount of customization to the mining rig manufacturer.

If you’re purchasing an ASIC miner (that is a complete mining rig, not just the processor), then you don’t often need to consider what type of processor to buy, as the manufacturer has figured this all out already.

Why Should You Use an ASIC over a GPU?

ASICs are without doubt one of the best ways to mine Bitcoin or other cryptocurrencies. They are more efficient than GPUs at mining cryptocurrencies and are often cheaper than a high-end graphics card.

ASIC miners are specifically designed to mine Bitcoin or other cryptocurrencies and as a result, you are not competing with any other markets such as 3D modeling or video gaming.

Like mining with a GPU, you need to understand the hash rate and calculate the total cost of purchasing and running an ASIC with the estimated block reward you can expect to earn over the life of the miner. If you have cheap electricity, perhaps powered by renewable sources, then it’s an easy decision. Although, make sure you’re not breaking the law if you use government-subsidized electricity, which often prevents the use of mining rigs, even ASICs.

Although ASICs are very good at mining cryptocurrency, that doesn’t mean that GPUs are bad at mining, and there are some circumstances where you may want a GPU. If you don’t have space or the money for both a high-end computer and an ASIC, GPU mining is a good option. GPUs are also good for playing video games, which you can’t do with an ASIC, so using them for a multi-purpose computer is also a good choice. ASICs are best used for a dedicated mining rig, sometimes with more than one running to earn more money.

Let us know what you prefer on our Twitter, @blocksdecoded.

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Joe Coburn
Joe is a senior software developer with a degree in computer science from the University of Lincoln, UK. He is currently a Senior Writer for Blocks Decoded. Formerly, he was on the editorial team. As a writer at MakeUseOf, Joe has seen his work shared by Adobe, the Arduino Foundation, and Lifehacker. He has collaborated with Anker, BenQ, iStock, Ledger, Ultimate Ears, and many more. Joe loves all aspects of blockchain and cryptocurrencies, particularly the technical details.
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