Mining. Bitcoin Mining. Ethereum Mining. Cloud Mining. CryptoCurrencies Mining.
How to get CryptoCurrencies like Bitcoin?
Ok. This gets a bit technical with Mining. What is mining? Why it is required? What the miners get? Well, not all those dealing with CryptoCurrencies should know about mining. Those who buy, sell, trade CryptoCurrencies can do so as they do it like buying shares, bonds or commodities. Strictly speaking, they need not know mining or for that matter anything about Blockchain Technology or Cryptography.
What is Mining?
But there are those who acquire CryptoCurrencies (like Bitcoin) by doing mining. Though mining can be done as a business by using technical resources, and suitable hardware/software and access to the Internet, usually miners know a bit more about Blockchain technology. It may be a puzzle for many that currency is earned through mining. For some, the process of mining may seems to be understood but anyway not understood fully!
Why mining is required?
Let us start with a simple definition to get in to mining. Coin mining is the process by which transactions are verified and added to the public ledger, known as the Blockchain. A transaction happens when one person (from his account) sends Bitcoin to another person (account). This transaction is submitted to miners for verifying and adding to the ledger (of transactions). Now we know why mining is required and how important this process is.
How to do mining?
Mining is a computationally intensive process. And so, it requires high power processor (CPU), graphics card (GPU), Memory etc., There are server farms and specialized mining hardware available (like mining ASIC). They are called as mining rigs. Mining rigs can be built by assembling parts or bought as a unit. Now there are mining cloud services wherein we can avail computing power. Genesis is one of the most used cloud mining service.
Proof of Work – PoW and Proof of Stake PoS
Mining can be done individually or as a pool. The profitability of mining process can be calculated or estimated using mining calculators. Cryptocompare is one of the popular online calculator. Some of the metrics every miner should be aware of is hashing power, difficulty level and power consumption etc., There is a concept of Proof of Work – PoW based on which the mining is rewarded. Of late, Proof of Work is getting replaced with Proof of Stake – PoS.
Is it profitable to do mining?
Mining can be a profitable provided we do have the necessary resources and do the process efficiently. Owning mining rigs and doing it increases initial hardware investment cost and the profitability is also high. So many have reported that they have started early and earned a lot! Going in for mining cloud services reduces the initial investment but profitability may be lesser. As of April 2017, it is reported that the cumulative revenue of Bitcoin mining is US $ 2 Billion!
Chain Scripts will be adding more on Ethereum Mining in another script.
/Malick, Chain Scripts, Chennai, India.
‘I have no special talent. I am only passionately curious’. -Albert Einstein