Mining is the most popular method of mining cryptocurrency. Users donate computing powercomputer to generate a new block in the chainBlockchain, thereby supporting the operation of a decentralized network. For finding the block, the miner receives a reward - a digital coin or Satoshi (part of a cryptocurrency unit).
Each equipment has a hashrate - unitmeasurements signaling its power. For example, a budget laptop hashrate obviously lower than a gaming PC. Therefore, novice miners should pre-weigh potential income and expenses. Do not forget that in addition to the cost of the equipment itself, you will have to pay for electricity, maintenance of equipment.
To start mining cryptocurrency, you also needpre-download the miner - this is special software in the form of standard desktop software. Please note that some programs do not have a graphical tool, that is, they are presented in command line format. Therefore, for successful mining, you need to have confident computer skills.
Cryptocurrency mining methods
Mining can be classified according to differentcriteria. For example, if we take the equipment used as a basis, then the coins are mined: by processors (CPU), video cards (GPU) or ASIC integrated circuits.
Give serious weight to miningcryptocurrencies on smartphones are still not worth it. The effectiveness of the equipment used will vary depending on the hashing (encryption) algorithm of the network. They are different.
Another popular classification of cryptocurrency mining methods is by used capacities. In accordance with this criterion, it is customary to distinguish:
- Cloud Mining– the most profitable format in recent years, whenthe user rents computing power from a large service. With this format, the user does not buy his own equipment and does not maintain equipment, but only pays for electricity. The service deducts a certain commission from clients.
- Solo mining– the user solves cryptographic problemsto find a block using exclusively the computing power of your computer or farm - from two or more processors, video cards or ASIC circuits. The method has been practically not relevant for several years.
- Collective mining– work in so-called pools.Miners unite to increase the total hashrate, which increases the chances of finding a block. The most popular cryptocurrencies are mined exclusively in pools.
The choice of the method of cryptocurrency mining should be done based on which coin you plan to mine and which budget you have.
What cryptocurrencies can I mine?
The best option for 2020 is Bitcoin mining using a cloud mining service — you buy a contract to rent a certain capacity (equipment).
If you want to mine Bitcoin on yourequipment, be prepared to invest hundreds of thousands of dollars in equipment purchases. The complexity of the cryptocurrency network is gradually becoming more complicated, the fewer coins left, the longer the block search process takes.
Almost all cryptocurrencies have a fixed emission, which means that over time they will end. That is why BTC and its altcoins are often compared to precious metals.
In addition to bitcoin, in 2020, novice miners can concentrate on little-known cryptocurrencies that can seriously rise in price in the future, for example:
- Grin is a decentralized network using the CRin + CT hybrid hash algorithm. The cryptocurrency is ASIC resistant, so it can be mined using a conventional computer.
- Haven is a protocol-based projectCryptonight. Proof-of-Work Consensus Algorithm. The best coin is mined by NVIDIA graphics cards, of course, AMD are also suitable, but have a lower hashrate. It’s better not to be stingy and build an inexpensive GPU farm.
- BitTube - Blockchain version of the popularYouTube video hosting. The project is also based on the Cryptonight hash algorithm. Startup capitalization is growing rapidly, so the first miners have already managed to make a profit. For mining, you will also need GPU farms.
- Ethereum - the second most popular cryptocurrencytoday, so if you want something famous, then you should make a choice in favor of ETH coins. ASIC integrated circuits are already in full use for mining Ether, but the relevance of GPU mining is still maintained.
- You can choose absolutely any coin with a lowlevel of capitalization. They are very easy to get, because they are unknown to anyone. The only problem is the probability of a startup failure or hacking. However, this method has the right to life if there is no money for the farm.
Making a lot of money using an ordinary PC or laptop is almost impossible. To generate blocks, equipment of the appropriate capacity is required.
Cloud mining
Based on the problems described above, it becomes obvious that leasing computing power is the best solution in 2020. It really is.
- Firstly, quite a few services, including time-tested resources. Specifically, we use the services of IQMining.
- Secondly, no need to understand the essencemining and comprehending the basics of setting up equipment and programs. After all, in addition to buying farm elements, they still need to be interconnected, maintained, thought out a ventilation system, etc.
Cloud mining services offer beginnersrelatively cheap contracts (leases of computing power), so you can start with minimal investment. Subsequently, cloud mining of coins is transformed into a reliable source of passive income. The main advantages of cloud mining:
- data centers are located in regions with low electricity costs;
- the possibility of automatic extraction of several cryptocurrencies at once;
- no need to delve into the technical features of the equipment;
- Services take care of all issues related to service;
- equipment rental requires minimal investment.
To choose a truly reliable service, be sure to study the rating of the best cloud mining companies.
Mining on own equipment
Cryptocurrency mining on conventional computers andlaptop almost completely lost its relevance. For a stable income, you need to assemble a farm consisting of 6 video cards. In order to increase productivity, join the pool. Combining a hashrate will increase your potential revenue.
Using a graphics card
GPU Farm Average Payback Periodis half a year. For mining, video cards are excellent - Nvidia Geforce GTX 1060 3gb and Radeon RX 470 4gb. However, the equipment is selected in accordance with the coin that the user wants to get.
GPU farm mining is right for you if you:
- well versed in cryptocurrencies;
- Know which software is best suited for a particular hashing algorithm.
- Have experience in servicing computer equipment;
- previously used mining software;
- You know specialized stores where you can buy cheap video cards.
Solo mining on video cards is practically not possible, due to insufficient power.
On ASIC devices
This is the only way to mine Bitcoin onpresent day. One ASIC will cost about $ 1,000. The payback period is 5-6 months, after which the equipment begins to generate income.
ASIC device is a setmicrochips with powerful fans. Such miners are designed specifically for cryptocurrency mining. The leader in the production of such equipment is considered the Chinese company Bitmain.
Some crypto networks implement specialprotocols blocking coin mining using ASICs, but such restrictions rarely work. The most striking example is Ethereum. If start-up capital allows, then an entire farm can be assembled from ASIC devices, which will significantly increase the profitability of production.
How to calculate profitability - mining calculators
Cryptocurrency Mining Calculator - Specialonline tool to calculate the profitability of production, the effectiveness of specific equipment. The calculation is based on the following initial data:
- decentralized network complexity level;
- current value of cryptocurrency;
- power consumption of equipment;
- tariffs for electricity in the region.
Access to calculators is free. The user simply enters the data, and then clicks on the "Calculate" button. This is all you need to know for beginners about cryptocurrency mining. The only thing left is to choose the right coin.
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