Crypto mining has been an appealing venture not only for the admirers of alternative financial apparatus but also for those people who are interested in investing.
Before deciding to start mining, prospect miners have to keep many factors in their minds, such as favorable legislation of the country they are operating, suitable climate, and electricity and equipment costs. These are the practices until recently.
But, the situation has been changed and became more difficult in 2022. Just a few years back mining cryptocurrency was easy by reading a guide on how to construct a rig for mining coins and all you have to buy is a graphics processing unit (GPU). For online entrepreneurs, this type of income was very attractive, and very soon the global market was flooded with new miners.
Over time, mining has become more complex which led to the appearance of equipment specially made for cryptocurrency mining, such as application-specific integrated circuits (ASICs) which mine more effectively and faster than GPUs. Due to this different types of problems have started rising like equipment availability, green energy concerns, and qualified personnel.
In 2021 summer, it becomes alarming when GPU cards which are the main part of rig and farm were almost impossible to acquire by the buyers. And the latest GPU cards which were available had prices far above their fair value.
The increasing demand for GPUs was further worsened due to the COVID-19 pandemic, making people build and buy PCs during quarantine to entertain themselves, with additional supply chain interruptions around the world.
Nvidia which is the main GPU manufacturer tried to control the demand of miners by installing the hardware which would limit the hash rates, but the miners finally win after finding a way to get around the new features.
The situation has been changed, but not very much at the beginning of 2022. The Bitcoin (BTC) and Ether (ETH) costs dropped at the end of January to the lowest levels since July 2021.
A chain reaction was caused in the GPU market by the fall of price as mining became less profitable and faced threats of a ban in various countries around the world.