Is Ethereum GPU Cloud Mining with AWS, Hetzner or OVH Profitable?

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Is Ethereum GPU Cloud Mining with AWS, Hetzner or OVH Profitable?

Recently I discovered that two cloud hosting providers, Hetzner, based in Germany, and Ikoula, based in France, offer cloud-based GPU plans, as part of their dedicated server offerings. I was curious to see if these plans would be economically worthwhile for Ethereum cloud mining, so I ran some hypothetical projections to test this idea.

I was also intrigued to see if these product offerings could be an alternative to the Ethereum cloud mining plans which have popped up online and have received a lot of negative coverage. Many of these contracts do not make economic sense. Lastly, I was interested to see if they could show more potential profit when compared to mining Ethereum with Amazon Web Services (AWS), which is quite unprofitable according to multiple articles that I’ve read.

Important: to keep the projections really simple, I did not account for Ether price changes or mining difficulty changes. I assumed the conditions today would be static for the next 12 months. This is obviously not realistic! However my goal was to test if the plans make sense given the conditions at the time of publication, so this was enough for an initial quick test.

If you are curious about how I chose certain numbers for this test, such as has rates for different GPUs, Ether generated per month, and so on, see the notes at the end of the article.

Ethereum Cloud Mining with Hetzner

Hetzner is a long established web hosting provider based in Germany. They have a decent reputation, so I was excited to test their new GPU offer. Their GPU plan includes a single GTX1080 GPU, there’s an initial setup cost of €99, and the ongoing monthly cost is €99. The setup takes approximately 1 week according to their website.

Name Detail
Setup cost €99
Monthly cost €99, excl VAT
GPU name GeForce GTX1080
Mh/s per GPU 23 (approx.) [1]
ETH price €800 (conservative assumption at the time of writing) [2]
ETH mined per month 0.0647 (approx.) [3]
Eur generated per month 51.76 (approx.)

Test 1: Ethereum Cloud Mining with Hetzner – single GTX1080 – 12 Month Projection

  • The blue line is the costs, which is €198 in month 1 due to the initial €99 setup fee, and drops to €99 per month thereafter.
  • The red line is the Ether income from mining. In reality, this will vary a lot.
  • The yellow line is the net position. Based on current conditions, this cloud GPU plan will never make a profit, as the line never goes above zero, in fact the losses will increase over time.

Important: these numbers are highly subject to change, due to the volatile nature of the price of Ether and the changing difficulty of mining on the network.

Conclusion: at the time of writing, cloud mining with Hetzner’s GPU plan is not feasible. Theoretically, if the Ethereum network block difficulty were to drop, and the price of Ether were to increase, it’s possible that this might be viable in the future. The price of Ether would have to more than double for this plan to make economic sense, and if that happened, the difficulty of the network would also rise in tandem to take advantage of the increased profit.

Try it yourself! You can change the numbers to test different conditions or assumptions in my Ethereum cloud mining calculator.

Ethereum Cloud Mining with Ikoula

Ikoula is a web hosting company based in France, which I had not heard of prior to this test. Their GPU plan includes a GTX1070 GPU and optionally a second GTX1070 for a discounted price. There is no setup cost. The ongoing monthly cost is €120 for a single 1070, and an additional €65 for a second 1070.

I decided to run two separate tests, for their single GPU and dual GPU product offers.

Test 2: Ethereum Cloud Mining with Ikoula – single GTX1070 – 12 Month Projection

Name Detail
Setup cost €0
Monthly cost €120, excl VAT
GPU name GeForce GTX1070 (single GPU)
Mh/s per GPU 32 (approx.) [4]
ETH price €800 (conservative assumption at the time of writing)
ETH mined per month 0.08689 (approx.) [5]
Eur generated per month 69.51 (approx.)

  • The blue line is the costs, which is a constant €120, as there are no setup costs.
  • The red line is the Ether income from mining. In reality, this will vary a lot.
  • The yellow line is the net position. Based on current conditions, this single GTX1070 cloud GPU plan will never make a profit, as the line never goes above zero. Once again, the losses will increase over time.

Conclusion: at the time of writing, cloud mining with Ikoula’s single GPU plan is not feasible.

Test 3: Ethereum Cloud Mining with Ikoula – dual GTX1070s – 12 Month Projection

Name Detail
Setup cost €0
Monthly cost €185, excl VAT
GPU name GeForce GTX1070 (dual GPUs)
Mh/s per GPU 32 (approx.)
Number of GPUs 2
Total Mh/s 64 (approx.) [6]
ETH price €800 (conservative assumption at the time of writing)
ETH mined per month 0.1738 (approx.)
Eur generated per month 139.04 (approx.)

  • The blue line is the costs, which is a constant €185, again there are no setup costs.
  • The red line is the Ether income from mining. In reality, this will vary a lot.
  • The yellow line is the net position. Based on current conditions, this dual GTX1070 cloud GPU plan will never make a profit, as the line never goes above zero. Once again, the losses will increase over time.

Conclusion: at the time of writing, cloud mining with Ikoula’s dual GPU plan is also not feasible.

Overall Conclusion

So there you have it – currently GPU cloud mining with Hetzner or Ikoula is not economically viable, even with somewhat optimistic assumptions.

However, if you are interested in generating a passive income stream with crypto, please check out this detailed guide that I wrote. This is a nice, profitable passive income alternative to cloud mining.

Notes

[1] For the GTX1080 hash rate, I selected a single 1080 on whattomine.com. It’s not clear if a modified BIOS or software such as MSI Afterburner is used to achieve the indicated the hash rate on that site. For cloud mining, a modified BIOS is obviously not an option, and installing MSI Afterburner would require using Microsoft Windows, which means an additional monthly fee is charged on top of the fees mentioned above.

[2] Prices are from CoinGecko.

[3] For the Ether mined per month, I used CryptoCompare’s site with 23Mh/s selected.

[4] I have read conflicting Mh/s rates for the 1070, and cannot verify it directly myself. I decided to test with the optimistic assumption of 32Mh/s initially (whattomine mentions 30Mh/s), and if it was profitable, or close to being profitable, test with a more conservative Mh/s rate. The same caveats regarding a modified BIOS, Afterburner and Windows from note 1 also apply.

[5] The Ether mined per month is from CryptoCompare’s site, with 32Mh/s selected.

[6] All the same conditions from the single 1070 test apply, with the hash rate multiplied by two, therefore the total hash rate is 64 Mh/s. Of course, the same caveats regarding a modified BIOS, Afterburner and Windows from note 1 apply here too.

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