Aleo: A New Era for Simpler and More Efficient Crypto Mining

Introduction

Aleo is a new first-layer blockchain platform that utilizes zero-knowledge proof technology, supporting the creation of scalable and private applications. The Aleo network consensus, AleoBFT, is a hybrid consensus structure combining PoS and PoW. It generates KSNARKs proofs through PoW, while PoS is used to achieve real-time final confirmation of blocks.

For ASIC miners accustomed to BTC mining, this article introduces the basic principles of ALEO mining and expected earnings. We hope it can help you understand how to participate in the ALEO ecosystem.

More Details About Aleo

Aleo’s use of zero-knowledge proofs makes mining unique because these proofs allow the verification of transactions without revealing any sensitive information about the transaction itself. This aspect of privacy is a significant departure from other blockchain networks where transaction details are typically transparent and publicly visible on the blockchain.

Mining Aleo can be more computationally intensive due to the complexities involved in generating and verifying zero-knowledge proofs. However, it offers miners the chance to participate in a network that upholds a higher standard of privacy.

The actual process of mining Aleo will depend on the specific consensus mechanism it uses, which is usually outlined in the project’s whitepaper or documentation. As with any mining, potential miners should consider the cost of their hardware, the electricity consumed by mining, and the overall profitability which depends on the market price of the Aleo tokens they receive as a reward.

Aleo introduces a mining system that’s designed to be simpler and potentially more profitable than others, with the following features:

  • Easy to start and manage, Aleo mining aims to be more user-friendly. With a simple setup, miners can start mining with a single click, expecting a smoother and steadier mining experience.
  • Aleo mining supports a wide range of hardware, particularly GPUs, making it more inclusive. This inclusivity means that more people can join Aleo mining and possibly start seeing profits within just 5-6 days, which is much quicker than with Filecoin.

At the commencement of the Aleo mainnet, 1.5 billion Aleo Credits will be distributed in the following manner:

  • Early backers will receive 35%.
  • A combination of public distribution and grants will account for 25%.
  • The Aleo Company and the Aleo Foundation will each share 16%.
  • Employees and individuals who have contributed to the project will hold 16%.
  • Strategic partners are allocated 8%.

Consequently, after a decade, it’s anticipated that the public will possess over half of the Aleo Credits, leading to a gradual and steady decentralization away from the early backers, bolstering the community’s distribution.

Mining Revenue Prediction

With ALEO mining gaining traction, what are the expected returns from ALEO mining using the popular Nvidia 3090 or miners? Let’s delve into the projected performance and revenue.

Miners Power Cost (Watts) Daily Power Cost (USD) Hashrate (C/S) 4 months Profit (coins)
Nvidia 3090 GPU 3662 24.57 26700 448
FPGA ColEngine P2 1400 12 19800 332

  • Coins Daily Total Mined: 397,440 coins (Daily output = 12 blocks/hour * 23 coins/block * 60 minutes * 24 hours = 397,440 coins)
  • Testnet data indicates a total network hashrate of 1,000,000,000 C/S, and with the mainnet recently launched, the hashrate is expected to double at least, reaching 2 billion C/S.

If ASIC miners are anticipated to go online within 5 months, with a monthly hashrate increase of 30%, then the coin production for the 3090 GPU can be calculated as follows: If you mine for 4 months, you could potentially accumulate a total of 448 coins.

What about the token price? Before its Series B funding, Aleo was valued at 1.45 billion USD, with a total supply of 1.5 billion coins. The private sale coin price was approximately 0.96 USD. Taking Filecoin as a reference, which had a private sale price of 0.75 USD, its price soared to 200 USD upon launch and then fell back to around 30 USD. This price level lasted for nearly 5 months, so for a conservative estimate, I’ll use 10 USD per coin.

On conclusion, the total estimated mining revenue will be more then 3500 USD within only 4 months.

Potential Risks

The development progress of ASIC miners is crucial. If ASIC miners are released right when the mainnet goes live, then purchasing GPU miners now may lead to them being idle and potentially having to be sold at a discount. But from the information I’ve obtained, this risk appears relatively minor. After the mainnet launch, GPU miners should still have about 3-6 months of operational time. Firstly, Bitmain’s development progress on ASIC miners isn’t rapid; they are not available for pre-order yet, and even if they were, it would still be a futures purchase requiring at least two months to receive the machines.Secondly, delaying the launch of ASIC miners also helps Aleo to continuously expand its hashrate. Since Aleo operates on a PoW-like mechanism, the number of miners at the early stage of launch is crucial. With a large number of idle GPUs available, it’s the optimal choice to enhance the network’s hashrate in the initial stages after the mainnet launch. Switching directly to ASIC mining would not only raise the entry barrier for miners but could also lead to hashrate centralization, which is detrimental to network security.

Overall, Bitmain is likely to give the market a 3-6 month period for GPU mining, regardless of whether ASIC miners are already available or if further improvements are needed in line with algorithm optimization before their launch. Miners won’t be able to purchase them immediately, thus there’s still a window for GPU mining.

ABOUT APEXTO Mining

APEXTO is a leading name in the cryptocurrency mining industry, founded in 2007 and venturing into mining technology in 2017. Based in Hong Kong and Shenzhen, China, we specialize in offering top-tier mining machines, including multi-brand miners, and innovative cooling solutions like Hydro-Cooling and Oil Cooling systems to ensure optimal performance. Our expertise in blockchain technology, coupled with a knowledgeable team and dedicated sales force, has earned us the trust of clients globally, including in the US, UK, Canada, Australia, and Russia. At APEXTO, we’re committed to providing a superior shopping experience, ensuring customer satisfaction and efficiency in mining operations. We pride ourselves on direct manufacturer access, allowing us to offer competitive pricing and making mining accessible and efficient for everyone.

Aleo promises high liquidity and potential for growth. It’s designed to be less risky and more rewarding than traditional mining, possibly offering 3-6 times the returns of other GPU mining. In summary, Aleo stands out with its innovative approach to crypto mining, promising a more efficient and private way to mine. It’s getting attention for good reasons, and for those interested in crypto mining, Aleo might just be the next big thing.

 

 

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