Written by Jaran Mellerud

This article breaks down the five essential factors to consider when purchasing your ASIC miner, providing you with a comprehensive understanding of the decision-making process.

An ASIC transforms electrical inputs into hashrate outputs. Similar to any machinery used in a production process, achieving optimal output with minimal input is the primary determinant of success. Essentially, the goal is to maximize the efficiency of your machine.

Efficiency is measured in joules per terahash (J/TH), representing the pivotal factor in selecting an ASIC miner. As illustrated in the chart below, a more efficient machine has the capability to generate bitcoin at a lower cost.
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Assuming a hosting fee of $0.058/kWh, which we provide in Ethiopia, the Antminer S21 Pro boasts a remarkably low bitcoin production cost of only $26.3k. Given the current bitcoin price of $52.9k, this machine delivers an impressive gross margin of 50%. Similarly, other highly efficient models such as the Antminer S21, WhatsMiner M60S, Antminer S19 XP, and Antminer S19K Pro also maintain acceptable gross margins, thanks to their superior efficiencies.

The chart presented above clearly indicates that, at an electricity cost of $0.058/kWh, it is prudent to choose a machine with an efficiency of 25 J/TH or better to guarantee cost-effective bitcoin production. Drawing from our experience, we recommend opting for a machine that consistently delivers a minimum gross margin of at least 40%.

We have recently been selling many S19K Pro, which has an efficiency of 23 J/TH. It is a relatively efficient machine, but comes at a significant price discount to the most efficient models like the S21 Pro.

The key takeaway is to always opt for a reasonably efficient machine, regardless of your electricity cost. Investing in a machine that generates minimal bitcoin and becomes outdated within a year is counterproductive.

Our general recommendation is to consider machines with reasonably high efficiencies rather than opting for the highest-end models, which often come with substantial price tags. However, it's essential to factor in electricity costs, and in cases where electricity costs are relatively high, selecting the latest models might become a necessary decision. Achieving an optimal balance between efficiency and purchase price is crucial in making a well-informed choice for your mining setup.

Given the significant impact of efficiency on machine prices, it's crucial to conduct a return on investment analysis for machines with different efficiencies and prices. This evaluation helps identify the machine that provides the highest return, and we are here to assist you in that process.
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When acquiring an ASIC miner, you're essentially investing in the machine's hashrate, which represents the computational power it will deliver over its operational lifespan. Since the machine serves no purpose other than mining, its value is entirely tied to the hashrate it can generate. This is reflected in ASIC prices, which are typically denominated in dollars per terahash ($/TH).

In the preceding section, we highlighted the critical importance of the machine's efficiency. Following closely behind in significance is the hashrate, the output of the machine. A higher hashrate is inherently advantageous, as it contributes to better overall performance.

Why is the hashrate of a machine so pivotal? Consider a scenario where you purchase a machine with a minimal capacity of 1 TH/s and incur a $150 shipping cost to bring it to your facility. Would such shipping expenses be justifiable for such a small hashrate purchase? The answer is no. Opting for machines with higher hashrates minimizes shipping and handling costs per unit of hashrate, providing economies of scale. In essence, a greater hashrate results in reduced bitcoin production costs, excluding considerations of efficiency.
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The chart above highlights that the WhatsMiner M63S currently leads the market with an impressive hashrate of 390 TH/s. To put this into perspective, consider the Antminer S9, which held the title of the most popular ASIC miner just a few years ago with a hashrate of 14 TH/s. The WhatsMiner M63S surpasses this by delivering nearly 30 times the hashrate, underscoring remarkable technological advancements and substantial improvements in power density within a relatively short span of a few years.

If you are interested in securing the world’s most hashrate-dense machine, we provide it in Finland hosted at $0.07/kWh in our heat reuse project. Learn more about this project here.

The ten most hashrate-dense machines are all specially-designed for hydro- or immersion cooling. The air-cooled machine with the highest hashrate is the Antminer S21 Pro, with 234 TH/s.

Overall, in the current market condition per September 2024, we recommend you choose an ASIC miner with a hashrate of minimum 120 TH/s. Anything less, and you will have very high other operating costs per unit of hashrate, making the investment not worthwhile. You have to get some economics of scale on the shipping and handling. Also, rackspace is worth something, so you want to have a higher hashrate per unit of rackspace.
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Ensuring a longer lifespan for your ASIC miner is crucial, as it directly correlates with the amount of bitcoin it can mine over time. Therefore, when selecting a model, it's essential to take into account the machine's proposed durability.

Predicting a new model's durability in advance can be challenging as practical testing is often necessary. Waiting before purchasing new models means that others can test them for you first, providing insights into potential faults. However, some issues may only surface after the first few months of operation.

It's worth noting that the initial batch of a model might have higher failure rates compared to later batches. Manufacturers, having tested machines at scale with end-users, can address and rectify small errors over time. Hence, caution is advised when considering the purchase of the first batch of a machine.

Historically, certain machines have exhibited higher failure rates and poorer durability than others. For instance, within the Bitmain models, the S9 was well-regarded, whereas the S17 faced significant issues. Subsequently, the S19 series performed exceptionally well and continues to do so almost four years after its release.

In terms of reputation for durability, MicroBT's WhatsMiner generally outshines Bitmain's Antminer and Canaan's Avalon. When opting for a new and untested machine, WhatsMiner is often considered a safer choice than Antminer due to its robust construction, longevity, and performance in various ambient environments.

Used machines are typically more affordable than new ones due to their limited durability and inherent uncertainties. However, it is generally advisable to lean towards new machines to minimize the risk of failure and prioritize durability.

In summary, durability is a crucial yet sometimes overlooked factor in the machine selection process. An ideal ASIC miner should have a long lifespan, enabling extended use for bitcoin generation or potential resale after a few years.
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Time is money in bitcoin mining. The sooner you initiate mining operations, the more bitcoin you stand to accumulate—it's that straightforward.

When acquiring machines, there can be lead times from the moment you make the purchase until the machines are plugged in and operational. This timeframe can vary, ranging from less than a day if the machine is already on-site to several months for large orders of machines that are yet to be manufactured.

Generally, longer lead times make the machine acquisition less appealing. Our advice to clients is generally to acquire machines in the spot market to minimize lead times. Futures orders are typically recommended for substantial quantities or when exceptional futures prices are available.
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When purchasing anything, maximizing the value for your investment is essential. Minimizing capital expenditure allows for the acquisition of more machines or more hashrate. Therefore, the goal is always to minimize the price paid for a machine.

The price of ASICs is commonly measured in USD per terahash ($/TH), enabling the comparison of prices across models with different hashrates. The true value of an ASIC lies in its ability to generate hashrate, making it crucial to seek a high hashrate capacity per dollar spent on the machine.

Prices for different models vary based on factors mentioned earlier in this article, such as hashrate and efficiency, with machines typically priced on a days-to-payback basis. Other considerations impacting the price include the durability of the machine and its lead time.

It's important to recognize that, similar to any other purchase, paying the highest price doesn't necessarily equate to the most value. Two key questions to consider regarding machine price are: 1) "How much value do I need, and are there features I don't require?" and 2) "Is this particular model overpriced?" Opting for a less efficient but less expensive model can often result in significantly higher returns on investment.

To choose the optimal model based on price, it's crucial to assess the efficiency and hashrate needed for your specific requirements. Additionally, avoid models that are overpriced relative to their value, such as the Antminer S19 XP.

A well-thought price analysis involves comparing the payback period between different machines. This calculation determines how many days it would take to recoup the investment with each machine. Older-generation and used models may offer shorter payback periods, especially with cheap electricity, but they come with higher failure risks and quicker depreciation. New models can tolerate longer payback periods. Generally, clients are advised to purchase new machines if they offer a projected payback within three years, and old machines if they pay back in less than one year.

For those interested in purchasing machines, reaching out to us for a return on investment analysis and assistance in choosing the correct model is recommended.
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As a trusted partner, we are committed to helping you choose the machine that provides the maximum value for your investment. Our continuous evaluation of the market enables us to offer excellent recommendations on the best-performing machines.

Our services encompass everything from conducting a return on investment analysis for different machines to sourcing the machines for you. Moreover, we offer the option to place and operate the machines at our world-class hosting facilities globally, providing a true turn-key bitcoin mining solution.

​If you are interested in starting to mine bitcoin, contact us here for a free consultation.