Until recently, when mining was mentioned, so many people imagined shovels and mountains of sand. Today, however, when the concept sounds, people have all kinds of emotions, from admiration to aggression. The first group feels awe at the new opportunity to earn money, while the second one complains about the inability to buy the right tools (not shovels). So, let’s understand what mining is. Better yet, go here and read the full guide on how to get started and become successful at mining, earn money, and go beyond.
Crypto mining: Explained
The principle of mining in the cryptocurrency industry is a kind of competition, where blockchain experts solve more and more mysteries of the system. Every block you unlock (if you do it before anyone else) earns you bitcoins and other cryptos. You can withdraw them to your e-wallet. Coins can also be exchanged, paid for, collected, and invested.
The main tool (and disadvantage) of mining for users is the need to purchase expensive equipment. It is with its help that research and computations on the blockchain system are carried out. It also requires advanced skills and knowledge to understand how it works, which creates a serious entry threshold for beginners.
The hardware basis consists of Proof of Burn (PoB) and earlier versions of Proof of Work (PoW) systems, which provide energy savings during machine operation. There is also a Proof of Stake (PoS) system, but it is vulnerable to attacks and leaks.
What you need to know if you want to start right now
Here are some points to consider if you’ll decide to start mining right today:
- As mentioned above, you have to buy expensive equipment, such as GPU, FPGA, and ASIC (when buying pay attention to the power of the hash rate – the higher the power, the higher the operation and earning rate).
- Also, you need software, such as BFGminer and CGminer. Instead of buying software, you can join mining pools as well.
- In order for the main equipment to work properly, you need to buy accessories such as cooling fans, power supplies, and spare generators. They will ensure the smooth operation of your crypto-earning machines.
- To withdraw earned money, you need a digital crypto wallet. Create it on any reliable resource.
- If you don’t want or are not able to buy equipment, you can try cloud mining. It’s the same with regular mining, just you buy a cloud solution instead of hardware.
- Try to find inexpensive electricity and high-speed Internet providers.
- Don’t forget that mostly low prices can be a sign of poor quality.
- Explore all opportunities to make your work as safe as possible. Choose reliable providers and partners only.
- Remember, the crypto world and technology development are at an extremely high speed, so become a fan of lifelong education to keep up.
To succeed in mining, earn money in a desirable amount, and stay safe and professional, you have to move gradually and be patient. Don’t expect big profits right away. In addition, do not forget that the rate of bitcoin and other cryptocurrencies changes and no one knows whether the investment will pay off in the period you expect. Consider this type of earning as a long-term passive income.
If you are a beginner, don’t get upset, just start learning the basics of mining and keep up with the developments in technology. Perhaps, while you’re exploring the prompts of the industry, you’ll also have the means to realize and monetize your knowledge and skills.