Not everyone can afford to run a mining rig, and as such, an alternative may be required. There are several techniques which can be used to mine; however, some of the methods are relatively inexpensive, while others need a substantial investment to use them in the mining process.
Here are the main methods:
- Cloud Mining
Cloud mining is the easiest way to mine a cryptocurrency. It is less demanding and very cost-effective. It’s done by renting out mining rigs from large corporations; with an agreement lasting for a specified period of time, usually between two years and beyond. All the earnings from the mining rig are then sent to your digital wallet, minus the cost of maintaining the platforms, as well as the cost of electricity.
Those that offer cloud mining services own extensive facilities to undertake the task as well as a number of firms that operate as one. They also have a great deal of knowledge in the mining of digital currencies. There are two ways of cloud mining – free and paid. Free cloud mining tends to be slow and also comes with other conditions, while paid cloud mining helps a user to start earning profits earlier and faster.
- CPU mining
CPU mining is using your computer to undertake the mining of cryptocurrencies. It’s simply done by installing a number of programs in your computer, and then you begin the mining process. However, this method is prolonged and may take a long period of time before you can get meaningful earnings.
This method is not recommended as it leads to overheating of your computer and high electricity costs.
- GPU mining
Graphics cards are used to mine. It’s one of the more popular methods used in mining, and even companies that offer cloud mining uses several of the GPU rigs that are interconnected. The graphics cards usually provide an excellent hash rate also, which is ideal. This method is better than using your CPU to mine.
There are several GPU mining rigs available in the market, and at the cost of about $3,500, you can acquire an excellent rig to aid you in the mining of cryptocurrencies.
- ASIC mining
ASIC is a connotation of Application-Specific Integrated Circuit. Bitmain is one company which produces the chips, and they’ve been designed for one purpose, and not for general use. They are the leading miners of cryptocurrency compared to other mining rigs. ASICs have so much power that they have overtaken all the other miners.
The Antminer s17 is currently the best mining rig on the market. It’s powerful, and its return on investment comes sooner in comparison to other mining rigs. However, it’s also the most expensive, which is why it requires a high amount of initial capital.
What You Need To Know About Mining
Cryptocurrencies are talked about by everyone. The profitability and decentralized quality have made it the hot topic of discussion throughout the world, and it’s easy to understand why that is. Of course, some speculate the cryptocurrency bubble will burst, while others believe it’s the futuristic way for business transactions. In 2009, when Satoshi Nakamoto came up with the Bitcoin idea, few knew the potential of cryptography. It wasn’t until years later when the price of Bitcoin increased at the rate of 1000% when people realized the potential. More digital currencies have followed suit, and there’s no end in sight of alternatives to Bitcoin.
Most cryptocurrencies are injected in the market through mining. Volunteer software developers and tech-savvy individuals mine using a series of interconnected computers around the globe. At the heart of digital currency is a digital file known as a blockchain. Every transaction taken in the network is recorded in the blockchain, and as a result, the blockchain becomes the ledger in the trading of cryptocurrencies.
Mining is done by finding solutions of complex mathematical equations. When a block is found, the system validates it, and the one who finds the solution is awarded a certain number of the digital coins. The complexity of these arithmetic equations increases with every found solution. To limit the number of coins available in the market, all mined coins are halved after a certain period of time.
As the complexity of the equations intensifies, standard computers are not equipped to find the solutions of the arithmetic equations. Mines have been created to aid in finding a solution in the shortest time possible. However, mining rigs are not easy to set up and require a high power input. Also, the mining components are equally expensive.