We take a Butterfly Labs Bitcoin miner, plug it in, and make it (virtually) rain.
Aurich Lawson
This is the second in a two-part series exploring Butterfly Labs and its lineup of dedicated Bitcoin-mining hardware. In part one, we looked at the company and the experiences customers have had with it. In part two, we share our experiences running a Bitcoin miner for a couple weeks.
Toiling in the Bitcoin mines
There is a whirring, whining presence in my dining room. I notice it every time I walk through. Every day, it sucks down about one full kilowatt-hour of electricity. In a year, it will consume almost $100 worth of juice—and that's on top of the $274 it costs to buy the box in the first place. Oh, and it's hot, too. If I moved it into my office and could stand the noise, I could keep a cup of coffee comfortably warm on top of the thing. Why on earth would anyone want such a disagreeable little machine in their home?
The short answer: every day, that machine magically generates something like $20 in bitcoins.
The BFL miner: A video intro
Allow me to introduce you to the Butterfly Labs 5GH/s "Jalapeño" Bitcoin miner.
A newbie and his miner
Ars Senior Business Editor Cyrus Farivar tapped me on the shoulder a few weeks back with a proposition. "I've got a Butterfly Labs Bitcoin mining box," he explained. "There aren't that many in the wild right now. I'm working on a story about the company, but I'm about to go on vacation. Do you want to see if you can get the thing working while I'm out?"
I was intrigued. Bitcoin? That's the electronic currency that's quickly rocketed from lame nerd project to ludicrously valuable hot topic, right? I didn't know a lot about the world of Bitcoin other than the fact that "mining" them involved people building custom PCs with tons of video cards to handle the math. I certainly didn't know how to "mine" bitcoins myself or what to do with the things once I had them. I just knew that people eventually try to trade them in for cash somehow (but how to do that was also a total mystery).
And yet here was the opportunity to take a piece of hardware I'd never heard of and see if I could use it to magically create some money out of nowhere. I told Cyrus to send me the Butterfly Labs miner. As he trekked off to Peru for his vacation, I settled in with the little black box.
Butterfly Labs is a company that has drawn a fair amount of controversy for what the Bitcoin community at large perceives as a string of broken promises. The company sells ASIC-based Bitcoin miners—machines that are built around customized chips that do nothing except compute SHA-256 hashes very quickly. Its smallest miner (the one I had to get working) is codenamed "Jalapeño" and computes a bit over five billion hashes per second (or 5GH/s). The problem is that Butterfly Labs started selling the machines long before it actually had a product to sell. It began taking paid-in-full preorders back in mid-2012, and thousands of customers opened their wallets for Bitcoin miners ranging from the small 5GH/s miner at $274 all the way up to the large 500Gh/s miner, which costs $22,484.
Butterfly Labs promised certain performance targets to customers—it initially felt confident that its application-specific integrated circuit (ASIC) designs would deliver one billion hashes per second for every 1.1 watt of power consumed. This proved extremely optimistic. Hardware delivery slipped multiple times. Now, a full year later, the first few real live Butterfly Labs boxes are finally being shipped, though no small number (as many as 30) were sent to journalists to review rather than to paying customers.
New Miner, Radeon 4x5770 Linux Bitcoin Mining
But when the little black box showed up on my doorstep, I had no idea about the deep and extremely vocal Bitcoin community or the story behind Butterfly Labs. I didn't really even fully understand what the miner did. I simply knew that I wanted to get this thing working and make some money.
Out of the box
The 5GH/s Jalapeño miner is a black rounded cube with a brushed metal finish. The only connectors on the exterior of the device are on the back: a mini-USB port for data and a power plug. Near the power plug are a series of small red LEDs that the device uses to tell you its status, though there was no documentation in the box to explain what the LEDs meant. The front of the cube contains another red LED to indicate power.
There are two sets of vents, one low on the front and the other high on the rear. The device's internal 80 mm fan draws cooler air up from the front through the fins of the large heat sink mounted on the ASIC chip. It expels the now-warm air out through the top vents.
Front view of the Butterfly Labs 5GH/s Jalapeño miner. The understated Butterfly Labs logo is on the top of the device; visible on its front are the air intake vents.
Front view of the Butterfly Labs 5GH/s Jalapeño miner. The understated Butterfly Labs logo is on the top of the device; visible on its front are the air intake vents.
guiminer – An Extensive Tool For Bitcoin Mining
As of late there’s been a been a great buzz going around about Bitcoin. the latest P2P digital currency. One of the main activities of getting Bitcoins is through a process called mining.
In order to successfully conduct Bitcoins mining, you’ll need a working “miner” that will make good use of your hardware (more about that later). There are a handful of miners out on the Web, but many of them have a narrow window of hardware it can work with, or it is difficult to (easily) control because it only runs via a command line.
No need to fear, though, because there’s a great program that comes with a GUI that does all the dirty work!
What are Bitcoins About?
Before we start, we need to understand a little better what Bitcoins are and what the mining process consists of. Bitcoins are pieces of virtual money that can be traded around just like regular money, but with extremely low transaction fees (paid in Bitcoins). Bitcoins can also be exchanged for other currencies such as the US Dollar, Euro, etc.
Their value changes based on demand, which can be tracked at Mt. Gox or BitcoinCharts. At the time of this article the BTC to USD exchange rate is $10.90/1 BTC, but this rate can change every 5 minutes. Bitcoins are created by solving a puzzle that involves getting a certain result with random hashes, which is effectively what mining is all about. Another important feature of Bitcoin is that everything is done anonymously.
More information about Bitcoin can be found in this well-written article .
Starting guiminer
guiminer is essentially a GUI interface that can control multiple different mining applications at the same time, which come bundled with the program on download. It is available for Windows, and also offers early support for Linux. If you’ve never used Bitcoin before, you must install the official Bitcoin client to have a wallet and Bitcoin address (where you can send and receive Bitcoins from). Once you’ve done that you can go ahead and launch guiminer.
Interface and Miners
The interface is pretty simple. The default miner that opens will use your GPU’s OpenCL capabilities (if it’s from AMD). Otherwise, you can choose to create a new miner. Here you can also choose “Phoenix” (a miner from a different developer), a CUDA miner (meant for nVidia cards), a CPU miner, and a custom option.
I highly recommend you choose OpenCL for AMD cards and CUDA for nVidia cards. You should probably leave the CPU miner alone because the hash rate will be very low compared to your GPU, which is capable of doing many parallel computations at the same time.
For example, my AMD Phenom II X6 1100T processor gets roughly 3.5 Mh/s (megahashes per second) while my AMD Radeon HD 6950 graphics card gets on average 320 Mh/s.

Whom to Mine For
Once you have your miner selected, you can choose where to mine for. You can try doing things solo, where if you manage to land a block, you’ll get a total of 50 Bitcoins, all to yourself. That’s, at the time of this writing, about $545! However, you’ll either have to be very lucky to get a block, or you’ll either have to spend many months running 24/7 before you finally get one. You could also increase the horsepower and add multiple GPUs or even additional mining rigs to get the number of megahashes higher so that it won’t take months and months.
Another choice is to choose to enter a mining pool. Mining pools combine the efforts of all the members involved in order to get blocks a lot faster. The resulting Bitcoins then usually get split proportionately among all the involved and active contributors. It will most likely take you just as long to get 50 Bitcoins through a mining pool, but you’ll get paid after every couple hours of work you contribute instead of waiting until you get a lump sum of 50 BTC. guiminer comes with a number of preconfigured mining pools, so you can choose any of them, register beforehand, make sure you entered your Bitcoin address in your profile so you can get paid, and then start mining for that pool.
Extra AMD Graphics Card Settings
If you’re an AMD/ATI graphics card holder, you’ll want to be aware of the AMD Overdrive feature in your Catalyst Control Center software. This feature allows you to overclock as well as underclock your graphics card, to give you either more performance (and more megahashes) or more power and heat savings (and less megahashes). If you feel safe to do it, you can play around with the settings on that page, but please stay on it for a while and monitor the stats about graphics card, especially the temperature. If it starts climbing too high, you’ll either need to change your settings or manually adjust the fan speed if you can (should be on the same page).
For more information, you can check out this article .
Conclusion
Despite all it’s criticisms, Bitcoin seems to be picking up speed at a rapid pace. There are also an increasing number of online stores that accept Bitcoins as a valid way to pay, so keeping some in stock may be a good idea. However, if you have the time and resources, getting Bitcoins from almost nothing through mining is quite a reward. If you stick to it (and possible add some extra omph to your hardware), you’ll have a nice sum of money at the end.
What do you think of Bitcoin? Are you interested in or do you already do Bitcoin mining? Anything else you want to address on this matter? Let us know in the comments!
If you have any questions related to what's mentioned in the article or need help with any computer issue, ask it on MakeUseOf Answers —We and our community will be more than happy to help.
Beginners Guide to Mining Bitcoins
One of the biggest problems I ran into when I was looking to start mining Bitcoin for investment and profit was most of the sites were written for the advanced user. I am not a professional coder, I have no experience with Ubuntu, Linux and minimal experience with Mac. So, this is for the individual or group that wants to get started the easy way.
First thing you need to do is get a “Bitcoin Wallet”. Because Bitcoin is an internet based currency, you need a place to keep your Bitcoins. Got to http://www.bitcoin.org and download the Bitcoin client for your Operating System. Install it the client will begin to download the blockchain. Downloading the blockchain can take a long time and will be over 6GB of data. If you have data caps, I would recommend ordering a copy of the blockchain on DVD to keep from going over as it is growing exponentially. Click to order the bitcoin blockchain by mail. Once the client is up to date, click “New” to get your wallet address. It will be a long sequence of letters and numbers. One of most important things you can do is make sure you have a copy of the wallet.dat file on a thumb drive and print a copy out and keep it in a safe location. You can view a tutorial on how to create a secure wallet by clicking the link on the top of the page. The reason is that if you computer crashes and you do not have a copy of your wallet.dat file, you will lose all of your Bitcoins. They won’t go to someone else, they will disappear forever. It is like burning cash.
Now that you have a wallet and the client, you are probably roaring to go, but if you actually want to make Bitcoin (money), you probably need to join a pool. A pool is a group that combines their computing power to make more Bitcoins. The reason you shouldn’t go it alone is that Bitcoins are awarded in blocks, usually 50 at a time, and unless you get extremely lucky, you will not be getting any of those coins. In a pool, you are given smaller and easier algorithms to solve and all of your combined work will make you more likely to solve the bigger algorithm and earn Bitcoins that are spread out throughout the pool based on your contribution. Basically, you will make a more consistent amount of Bitcoins and will be more likely to receive a good return on your investment.
The pool that I’m involved in is called Slush’s Pool so I will be giving instructions on how to join there but feel free to look at other options. Follow the link to go to their site and click the “Sign up here” link at the top of their site and follow their step by step instructions. After you have your account set up, you will need to add a “Worker”. Basically, for every miner that you have running, you will need to have a worker ID so the pool can keep track of your contributions.
If you are mining with an ASIC, please go to our Mining with ASICs page. The following will only pertain to GPU miners.
Most of the mining programs out there are pretty complicated to setup and will frustrate your average user. Recently a great program has come out to get the most basic of users started. The program is called GUIMiner. Click the link and download the program (Be careful, some of the ads are set up to look like the file download). Install and run the program and add in your information from Slush’s Pool. Remember that the user name is actually the worker name. The worker name will be your user name, dot, worker ID (username.worker ID) and the password from that worker ID.
Mac users should look into using Astroid
Now that you are set up, you can start mining. If you feel like you want to make more Bitcoins, you might want to invest in mining hardware.
To see how much your current hardware will earn mining Bitcoins, head over to the Bitcoin Profitability Calculator .
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