Siblings Ishaan and Aanya Thakur first learnt about cryptocurrencies from their father Manish Raj, a former Wall Street investment banker, who would tell them about alt coins over dinner and at bedtime. The stories piqued their curiosity, leading them to learn more about how to mine digital tokens.
From making just $3 on their first day of mining cryptocurrencies in April this year, the Texas, US-based brother and sister have made huge strides since and are now earning more than $35,000 a month by mining three digital tokens.
“We started mining just to learn about technology, but it is more fun if we can also make money along the way,” says nine-year-old Aanya. “Mining seems complicated at first, but it’s simple actually,” the fourth grader adds.
“Once the computers are set up, the machines run by themselves with just a little extra work. Since school has started, we can only do crypto mining work on weekends,” the grade 9 student says.
“My parents make sure that we focus on school first. We have hired technicians at a Dallas data centre to help when necessary. Since we are at school, the technicians monitor the machines to make sure they are running smoothly,” he adds.
Cryptocurrency mining uses sophisticated computers that solve complex computational maths problems, according to Investopedia.com. Mining has a magnetic appeal for many investors interested in cryptocurrency because they are rewarded for their work with crypto tokens, the website says.
For instance, Bitcoin miners receive Bitcoin as a reward for completing “blocks” of verified transactions, which are added to the blockchain. Miners need either a graphics processing unit (GPU) or an application-specific integrated circuit (ASIC) to set up a mining rig, according to Investopedia.com.
Cryptocurrency mining in the earlier days was relatively easy and could have been done with a computer’s central processing unit, says Devesh Mamtani, chief market strategist at Century Financial. However, mining has witnessed a rise in difficulty levels and miners need to have the latest technology, he adds.
“A layperson can do crypto mining with a decent gaming system. Then, they just have to plug their details into a mining website/hash power broker, which will provide them with a digital wallet where the cryptocurrencies will be credited,” Mr Mamtani says.
A hash power broker is an integrated marketplace that connects sellers with buyers by using the sharing economy approach, he explains. Hashing power is the power that your computer or hardware uses to run and solve different hashing algorithms. These algorithms are used for generating new cryptocurrencies.
“We primarily mine Ethereum, but also do Bitcoin and Ravencoin,” Ishaan says. “We choose what to mine based on what’s optimal for each chip we have. Most of our chips are Nvidia RTX 3090, which is great for Ethereum. But when we get other chips, we mine other currencies.”
The siblings use cryptocurrency exchange platform Coinbase to store the digital tokens they mine.
On September 7, cryptocurrencies plunged amid El Salvador’s troubled roll out of Bitcoin, the world’s largest cryptocurrency, as legal tender.
Bitcoin is currently trading above $44,000, according to CoinDesk, having fallen as much as 17 per cent on September 7 before paring some of its loss. The downdraft also swept across other digital tokens, such as Ether and Dogecoin.
Bitcoin hit a record of about $65,000 in April, driven by a tide of liquidity, fast-money bets and optimism about growing demand from institutional investors. But critical commentary later emerged, including the environmental cost of the energy consumed by computers that underpin Bitcoin.
An intensifying cryptocurrency clampdown in China also soured the mood. Bitcoin fell below $30,000 after the May rout.
The siblings did not make any initial investment to mine digital tokens. Instead, they converted two gaming computers into mining rigs using graphics cards, which can perform a high volume of calculations for mining. Their father took out a personal loan to help them buy more equipment.
“On our first day of mining on our gaming computer in April, we made $3. As we added more processors, we made $1,000 in the first month of May,”…