When the price of a single bitcoin went over $200, it was time for a second look. It seemed too good to be true: you run a program on your computer for a while, and then like magic, cash appears!

To test this “free cash” mechanism, I set up some gear and mined bitcoin 24/7 for one month to see if the resultant crypto-currency could end up as dollars in a real bank account. Long story short: it worked. Based on preliminary estimates, a few high-end graphics cards net several dollars per day at current rates — even after electricity costs.

Here’s the basic process:

1. Buy and assemble the hardware.
2. Select and configure the software.
3. Create accounts with two different mining pools.
4. Create an account with an online bitcoin wallet to hold, convert and transfer bitcoin.
5. Mine and watch bitcoin appear in your mining pool accounts.
6. Transfer the bitcoin from the mining pool accounts to your online wallet.
7. Use the wallet service to convert bitcoin to USD, and transfer it to your real bank account.

Bitcoin is no joke, and getting it running smoothly was no joke, either. To get a smoothly functioning, unattended 1GH/s, there were several problems to overcome. At first, I tried using an old Dell XPS system, but the case ventilation and power supply proved inadequate. The video cards overheated and caused a thermal shutdown. Instead, I set up two rigs using some newer hardware and the 600W 80-Plus power supplies I had available.

Here’s the hardware setup for the experiment:

Graphics Adapters

1 Sapphire Radeon 7950
1 Sapphire Radeon 7850
1 XFX Double D 7850
1 Powercolor 7970

Motherboards/CPU’s

1 Gigabyte Z77-DS3H with an Intel Core i3-3220
1 ASUS P8Z77-V LK with an Intel Core i3-3570K

Power Supplies

2x OCZ 600W 80-Plus — I’d recommend going with an 850W power supply instead.

Cases

2x Corsair Mid-ATX cases, but in the final analysis, which case might be irrelevant

Storage

Because I was pushing the power supply limits, I selected whatever low-wattage storage I had available — a laptop SATA drive in one case and an SSD in the other. I don’t have the patience to run off a USB flash drive.

These components were chosen because they had a solid price/performance ratio or were already owned.  Incidentally, the Z77-DS3H makes a nice hackintosh.

There are plenty of bitcoin mining guides online, so I’ll avoid duplication and focus on a list of problems and the solutions that enabled me to run a solid 24/7 test operation. First, a couple of notes.

Cooling

For a basic air-cooled setup, I recommend the 2-fan graphics card models. My samples, especially the 7950, all have some noisy fans at high RPM, so I prefer to run then at about 60% speed to keep them reasonably quiet, stable, and friction-reduced.

After trial and error, it seems that just about any normal ATX PC case, even with a bunch of fans, is going to struggle to keep two high-end graphics cards cool when they are running at full capacity. If you intend to mine bitcoin using an ATX case, it’s a much simpler proposition to run with an open case, and use a low-wattage desk fan or box fan to cool it. Be aware that removing part of the case will also remove part of the EMI shielding, but I haven’t run into any issues so far.

Graphics Card Positioning and Configuration

In an upright mid-tower configuration, heat seemed better distributed with the higher end graphics adapter in the bottom slot. This wasn’t intuitively obvious.

Because my power supplies were only 600W, I placed one 79XX and one 78XX in each chassis to evenly distribute the power consumption and heat. Each chassis went in a separate room.

Selecting Software

Linux and Windows both work well as platforms. At first, I had stability issues in Windows, and later, configuration problems in Linux, so start with whichever platform you’re more comfortable. I haven’t tried OS X. As for mining software, cgminer is the way to go.

Mining Pools

There are plenty of mining pools. Eclipse and BTC Guild are popular choices.

Wallets

MtGox and Coinbase are popular choices.

Results

The crazy photos of ridiculous fire-hazard bitcoin mining setups now make sense. With that kind of volume, some real money was probably made with those Frankenstein GPU farms — especially by early adopters. The problem is, as more people mine, the difficulty level goes up and less coin can be made using the same hardware. I’ll keep running these rigs for a bit and see how it goes. If the gear eventually pays for itself, then great. If not, I have some nice gaming gear.

Here is a list of problems/solutions encountered.