- Scott Melker previously avoided mining bitcoin because he wasn’t technically savvy.
- But mining farms are making it easy and accessible for almost anyone to mine cryptocurrencies.
- Through a website, he was able to buy an ASIC and mine remotely. Now, he only pays for electricity.
When Scott Melker first transitioned from music to crypto, he would often get comments like “go back to DJing” or “stay in your lane,” he told Insider. As a response, he jokingly called himself “The Wolf Of All Streets.” He wanted to demonstrate that people can excel at more than one thing and should never let others try to box them in.
That name stuck, and he never looked back. Melker is now a crypto trader, the host of a podcast called “The Wolf of All Streets,” and the author of The Wolf Den newsletter. He has interviewed influential names in the crypto and finance space such as Michael Saylor, co-founder of MicroStrategy, and Dan Held, director of growth marketing at Kraken. He’s also amassed almost 550,000 followers on Twitter.
He told Insider he’s recently taken on a new arena: crypto mining, a process that uses nodes to verify transactions on the blockchain, in exchange for rewards in the form of crypto. In Melker’s case, it’s bitcoin. Although Melker has been investing in the digital asset since 2016, mining it is an alternative way for him to continually and passively add to his position.
But Melker isn’t rolling up his sleeves and getting technical or building any farms anytime soon. He became a miner with the click of a few buttons and a credit card.
Crypto mining is becoming increasingly competitive. The big players are setting up rigs in countries with either clean energy access or low electricity rates, and they’re buying up the latest equipment. This type of high-level access has been raising the bar and pushing individual miners out of the race.
But a recent trend has been making it easy and accessible for almost anyone to compete on the same level. Hosting farms are now jam-packed with ASICs and GPUs that belong to miners from all over the world. Companies that have the infrastructure and access to low electricity rates are now the buzz. This is what brought Melker into the game.
"Mining is something that I was always interested in, but honestly, never willing to take the jump to make it happen," Melker said. "It's obviously technologically challenging. It wasn't particularly attractive with the cost of energy where I live."
Melker was also worried that he wouldn't be able to operate and fix an ASIC if it slowed down or broke. But companies like Compass Mining are making it as easy as ordering a product from Amazon.
Melker learned about the opportunity after having the company's CEO on his podcast. He then went ahead and ordered a few Antminer S19 pros, which are models that mine bitcoin. He did this at a time when China began to ban its miners, so he assumed competition would drop..
"You choose the ASICs that you want. You buy [the ASICs] from them [Compass] and they host them at a facility," Melker said. "You just pay the energy costs and that's it. You never see your miner, you never touch your miner. You never have to be concerned with maintaining your miner."
The models currently available on Compass include the Antminer S19j Pro, which retails for about $8,200. The downside to buying them is that demand has increased so dramatically that current wait times range anywhere from five to seven months before the ASICs go online.
Melker initially ordered a few to test them out but then realized they were a great return on his investment. He's since ordered more but has to wait a few months before his new batch goes online.
His miners are hosted at two different facilities, one in Manitoba, Canada, where Melker said his electricity cost is about $147.50 a month per miner. And, there are a few in Russia, where his electricity is slightly cheaper at about $108.81 a month per miner.
Although there's a noticeable difference in electricity costs per location, where your miner ends up depends on availability. However, locations can be viewed before purchasing the miner. The batch you order from will determine which of the locations it ends up in.
As for gains, Melker said both his miners earn a similar amount, which is around 0.00084155 BTC a day. Daily earnings can vary, and a recent screenshot of Melker's account showed one miner earned about 0.00080368 BTC, or about $38, in a 24-hour period.
According to ASICMinerValue, a website that estimates the profitability of various miners, the S19 pro generates approximately $33.60 a day, or $1,008.06 a month, at $0.06 per kilowatt-hour, based on bitcoin's trading price as of September 7.
Melker doesn't plan on selling his bitcoin, and foresees these profits increasing if bitcoin's price climbs.