A Word About Mining
Remember earlier when we said there was more to Crypto-currencies than our simple explanation? Well, this is what we were talking about. Miners play a pivotal role in most, but not all, crypto coins.
Let’s Break it Down.
Remember we mentioned the public ledger and suggested everyone has a copy? Well, that’s not quite right. Sure, anyone can have a copy of the blockchain and many folks do, but it’s not something an average person would do. For the moment let’s call those that do the Miners.
Let’s Start With Why.
Taking Bitcoin’s blockchain as an example, the actual data is approx 150gb and carries the details of every transaction that has ever occurred. That’s a lot of space on your hard drive for what is essentially a bunch of numbers. So why would anyone want that kind of information? This is the important bit, without this information the whole system fails and there’s needs to be multiple versions of it. So how does Bitcoin ensure there are enough people with the data? You’ve probably already guessed, but in case you haven’t, it rewards people to store the blockchain and it does this by giving them an essential role in transactions.
These stored versions of the blockchain are all linked and are known as nodes. The more nodes a system has, the faster it works and the more secure it is. Folks who operate these nodes are known as miners and their part in the blockchain is critical. When any transaction is completed on the blockchain it needs to be validated. This is done by communicating with various nodes and once it is ratified the transaction adds itself to the blockchain and thus the blockchain grows. To do this the miners must solve an equation, think of it as cracking a code. It is this code that gives crypto-currency its name.
As a reward, the miners that actually solve the equation are given a portion of Bitcoin for their trouble.
The Problem With Power
Back in the day, you could mine Bitcoin with your humble home PC. You’d need fast broadband and a dedicated machine, but it was possible. These days as the supply of Bitcoin shrivels, the computations involved are staggering and for anyone other than the most dedicated mining farms, it’s just not worth it in terms of energy and money.
Are the Days of Mining Over?
Not on your Nelly! The Bitcoin gold rush has ended, but there are other coins out there based on the same technology and which can still be mined with the right help.
Coins which can be domestically mined for profit include.
- Gridcoin and more…
There are two ways to profit from crypto Mining.
1. Buy a dedicated rig.
2. Join a mining pool.
If you decide to go it alone, you’ll need specialist equipment. You can find mining rigs on the big Chinese electronics sites like Banggood and occasionally on sites like Ebay. It’s not for the faint of heart and don’t expect much at first. With practice and dedication and a little bit of luck though you could easily make a passive income of say $13/15 dollars a day/ That might not sound like much., but remember that is literally money for nothing.
If you’re not a computer whiz, then a mining pool is a better option. Mining pools use their resources collectively to mine for coins and as such you don’t need as much of the fancy gear, still expect to shell out for at least a basic rig though if you want any mining pool to take you. The rewards again will come in slowly, but there is literally no effort involved beyond the initial set up.
Another way to get involved in a mining pool is cloud mining. The idea is simple. Instead of actually owning the gear yourself you essentially fund a mining project. In return for your investment the miner reward you with a passive income from their efforts. The hard work is done on remote servers. The benefit is that you won’t need to worry about noisy computers and unexpected energy bills, but clearly you need to get involved with a team you can trust.
Ask us about our mining programs.