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How To Mine Ethereum In 2021 In 5 Easy Steps

August 23, 2021
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    According to the latest data, Ethereum is the world's second-largest cryptocurrency by market capitalization. Since its inception in 2015, Ethereum has not only developed as a blockchain but is also active in mining.

    Let's brush up on the basics of mining and deep dive into the world of Ethereum mining to learn more about the types and requirements, and most importantly—how to mine Ethereum in 2021.

    What Is Crypto Mining?

    In the crypto world, mining refers to the verification and recording of cryptocurrency transactions on an Ethereum blockchain ledger. For this, miners have to solve complex computational math problems, and then they’re rewarded with cryptocurrency.

    Miners also have to invest lots of computer processing energy, and time for solving these problems through mining blocks. When they hit the right hash, they submit the solution to the issuer.

    What Is Ethereum Mining?

    Similar to Bitcoin mining, Ethereum mining is an event wherein the volume of Ether circulation is increased via the mining of the coin. Technically, this implies creation, verification, and ad blocking the blockchain to secure the Ethereum network. Mining Ethereum uses the proof-of-work (POW) system and consumes a lot of electricity.

    What Is Proof Of Work?

    Ethereum network operates on the consensus protocol called Proof-of-Work, or PoW, in short, to confirm the consensus about the Ethereum blockchain data. The main objective of this protocol is to prevent the exploitation of the blockchain network, as it is impossible to form or delete fake transactions. It does so by making its participants solve computational problems and rewarding them in return. Another crucial goal of Proof-of-Work is to release new currency in the system.

    Miners can verify transactions by solving hashes as they solve complicated puzzles:

    • Puzzles
    • Integer factorization
    • Merkle tree-based puzzles
    • Hash sequences
    • Functions

    As a result, it serves the purpose of

    1. Production of new blocks on the network
    2. Prevention of blockchain abuse
    3. Prevention of double-spending
    4. Ensuring that network functions don't rely on third-party or middleman

    Factors Determining Profit On Ethereum Mining

    Numerous factors like power consumption, hardware, and software cost will affect the profits that you can make as an Ethereum miner. There are six major factors of profitability when it comes to mining.

    • The reward for each block
    • Mining difficulty
    • Up-time
    • Mining pools
    • Mining hardware
    • Proof-of-stake model

    Reward For Each Block

    Ethereum miners receive 2ETH as rewards along with the transaction fee for each block they mine. Websites such as etherscan provide the latest updates on Ethereum rewards (ETH).

    Ethereum Mining Difficulty

    Just like Bitcoin mining has its own share of mining difficulties, it's the same with Ethereum. The difficulty level in mining refers to the difficulty of puzzles and problems that miners can solve, which increases as the number of miners with powerful hardware access the market. Websites like will provide the latest updates on the mining difficulty levels.


    Another profitability factor for Ethereum mining is uptime. Uptime is the time that your mining rig is online and mining.

    Mining Pool

    Miners combine the hashing outputs and many mining rigs to find blocks and earn rewards (ETH). This is a much more productive option compared to mining with dedicated servers or solo mining.

    Mining Hardware

    Compatibility and updates—these are the two important things that miners have to keep an eye for. This will not only help them save a considerable amount of money but also increase the hash rate and minimize your electricity bills.

    Proof-Of-Stake Model

    The existing proof-of-work model of mining Ethereum will not be effective after 2023. Transitioning to the proof-of-stake model will ensure profitability.

    Requirements For Mining Ethereum

    Comparable with Bitcoin mining, there are certain hardware and software requirements for Ethereum mining. Here's a list of all that you'll need to start mining Ethereum:

    Hardware Requirements

    1. 3GB RAM GPU: Mining Ethereum with CPU cards is not a profitable option. Desktops with 3GB RAM GPUs are best suited for mining. Apart from desktops, there are certain gaming laptops with high-end graphic cards that you can use to mine Ethereum

    2. GPU Drivers and Ethash ASIC mining machines

    3. Mining efficiency increases when the unit power consumption is lower than the hash rate. A unit power of 1.2W/M can reduce the electricity cost rate by 5%.

    Software Requirements

    1. Mining software: The Ethereum software you use should be compatible with the Ethash algorithm, which Ethereum uses

    2. Operating System: A Windows 10 (64 bits) is the most recommended OS for mining. However, Linux OS can also be used, but won't be as productive

    3. Cryptocurrency Wallet: A crypto wallet (hot and cold wallets) will be required to receive the rewards and ETH

    4. Mining pool address

    It must be noted that no specific mining software is required for ASIC miners. The only requirements are electricity and an internet connection.

    Your mining requirements must finally have the two criteria:

    • Checking your mining hardware before opting for mining software will help you maximize the hash rate.
    • There are various types of mining, and your mining software will differ accordingly.

    Types Of Ethereum Mining

    Based on the software and hardware that Ethereum miners use, there are various types of Ethereum mining:

    1. CPU Mining

    As the name suggests, CPU mining requires a central processing unit (or CPU) for Ethereum mining.  To mine Ethereum using this method, a miner just requires a computer and a few mining software. The slow processing speed of CPU mining and decreasing profit led to its decline and it has not been in use for almost 5 years now.

    2. GPU Mining

    GPU Mining is the most popular method of crypto mining. Mining Ethereum requires one or more graphic processing units and is a comparatively cheaper and more efficient way to build an Ethereum mining rig. Mining rigs consist of the following components:

    1. Motherboard
    2. Processor
    3. Rig frame consisting of graphic cards

    3. ASIC Mining

    Application-Specific Integrated Circuits, commonly called ASIC are devices used to specifically carry out crypto mining. Unlike CPU and GPU mining, ASIC mining has more productivity as it has more computational or mining power. As a result, the Ethereum production as well as the miners' earnings is more.

    4. Solo Mining

    Many miners choose to mine alone or carry out solo mining. Solo mining can be a plausible option for you if you have enough resources to have a big presence in the network. This is because there's a large number of participants in the network.

    Solo mining will require mining farms which are very difficult to maintain as there can be issues related to heat and ventilation. Apart from that, these rigs consume a lot of electricity, more so if your rig has over 10 graphic cards installed.

    5. Pool Mining 

    Another way to mine Ethereum is by using mining pools. In pool mining, the computation power of many miners is combined to achieve a mining pool. This helps them find blocks easier, which leads to more profits. The pool members receive mining rewards (ETH).

    Combining hashing outputs is a more profitable and productive option as compared to mining with a dedicated server.

    6. Cloud Mining

    Alongside pool mining, cloud mining is a great way to mine Ethereum. In this process, miners can rent their mining rig, which is governed by a contract. According to the agreement, all the profits that a rig makes will be transferred to the miner's wallet.

    Cloud mining is a viable option for those who cannot invest sufficient money in mining rigs. Another advantage of cloud mining is that it has more processing power as it is the combination of several rigs which results in large-scale mining.

    Despite having a slew of benefits, one drawback of cloud mining is that money has to be paid beforehand. So even if there's a drop in the price of Ethereum, you won't be getting your money back. Also, there's no option to change the hardware and software presented by the cloud mining organization.

    How To Mine Ethereum: Pool Mining Step By Step

    Now that we know the basic details about Ethereum mining, including how mining works, the types of mining, and mining equipment, it's now time to start learning how to mine Ethereum. From the discussion points above, it is now evident that a mining pool is much more profitable than a solo mining.

    The first step to mining is to ensure the proper installation of graphic card drivers. Once your installation is complete, follow the steps given below and start mining!

    Step #1: Mining Pool Selection

    The first step to start mining in pools is to join a mining pool. As discussed earlier, in a mining pool you can share resources, resulting in minimizing your mining costs and more productivity. The right mining pool will increase your chances of finding a block.

    Features Of Mining Pools

    • Anonymous Mining
    • Real-time PPLNS payout scheme
    • Transaction fees as low as 1%

    Best Ethereum Mining Pools

    • Ethermine
    • F2Pool
    • Nanopool
    • Sparkpool

    An important point to remember is that, in order to join a mining pool, you'll need your wallet address. Signing up won't be necessary, as you can mine anonymously.

    Step #2: Crypto Wallet Creation

    In case you don't have a wallet already, you can create a cryptocurrency wallet. You can choose from the wide range of software wallets and hardware wallets from the list of the best cryptocurrency wallets. If you're looking for accessibility, you can choose a software wallet, and if security is your main concern, a hardware wallet will be the best option for you. But whichever wallet you choose, make sure that the wallet supports Ethereum.

    Step #3: Mining Software Selection

    Once your wallet is created and set up, you've to select the mining software for Ethereum. Some of the best ones are Ethminer and EasyMiner.

    Step #4: BAT File Creation

    You will need a BAT file to finally start mining. Follow the given steps to create a BAT file.

    1. If you're using Ethminer, you can use their default setting which is compatible with most GPUs.
    2. Once you've copied it from their website, navigate to the Ethminer software from Github.
    3. Next, right-click on the directory and click on New and choose "Text Document" to create a new text document.
    4. Add a file name with a .bat extension and click on "yes" on the pop-up.
    5. On the new file that you created, right-click and choose "edit".
    6. Paste the copied information to the batch file.
    7. Choose the server that is nearest to your location along with a backup server. (For instance, Asia is the main server and EU is the backup server)
    8. Enter the wallet address where you'll receive your mining fees. Your Ethereum wallet address will be followed by a dot (.) and the name of your mining machine.

    Step #5: Start Mining!

    Finally, save and execute the batch file, and you're ready to start the mining operations. You'll know that the process has commenced when you see the hash power on the mining console.

    The Bottom Line

    Ethereum network has been operating on the consensus protocol called Proof-Of-Work, or PoW, in short, to confirm the consensus about the Ethereum blockchain data. But it has been the aim of Ethereum to transition to Ethereum 2.0 with the new Proof of Stake consensus. Their new code update is known as the Ethereum Improvement Proposal 3554 (EIP-3554).

    As the transition takes place, the miners who use Proof of Work will continue receiving rewards. But as the process of Proof of Stake grows, there'll be a gradual decline in transactions’ revenue for PoW.

    How To Mine Ethereum FAQs

    1. How long does it take to mine Ethereum?

    Considering the current difficulty level, mining 1 Ethereum takes about 60 days.

    2. Is Ethereum easy to mine?

    Just like Bitcoin mining has its own share of mining difficulties, it's the same with Ethereum. The difficulty level in mining refers to the difficulty of puzzles and problems that miners can solve, which increases as the number of miners with powerful hardware access the market. Websites like provide the latest updates on the mining difficulty levels.

    3. What is the GPU specification mining Ethereum?

    The most recommended GPU specification is a desktop with 3GB RAM. Apart from desktops, there are certain gaming laptops with high-end graphic cards that you can use to mine Ethereum.

    4. How to mine Ethereum in 2021?

    The first step to mining is to ensure the proper installation of graphic card drivers. Once your installation is complete, you have to select your mining pool, set or create a wallet, select the appropriate mining software, create a BAT file and finally—start mining.

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