What is CryptoMining and Should YOU Do it?
Cryptocurrency mining is the process of using computers to solve algorithms that then reward the user with cryptocurrency.
Mining also takes virtually no effort by the user and can be scaled to produce large amounts of income.
Well that sounds pretty great! But How Does it Work?
Mining uses the idea of Proof of Work (Pow). Simply put, when someone wants to transfer say, 1 bitcoin, to another person, this action has to get confirmed so that it can can be verified. If transactions weren't confirmed by miners, then people could "say" they just received 1000 bitcoin from a random wallet address. This would be quite a big problem.
Luckily, miners use their own hardware, specifically using either graphics cards (GPUs), central processing units (CPUs), or application-specific integration circuits (ASICs) in order to preform complex equations to confirm other people's transactions. This takes both electricity and computer power to do. As an incentive to mine, those that helped to solve these transactions are rewarded with cryptocurrency. This reward is why when you send crypto to another person you must include a transaction fee (sometimes called a miners fee). This fee is used to pay the people who help confirm your transaction. As a miner, this fee is what you are after in order to turn a profit and make money.
So How Can I Start??
In order to mine you need two things: the hardware and the software.
Hardware
As mentioned above, you need to have either a GPU, a CPU or an ASIC. There are many tutorials out there on how to set up your first mining rig and what hardware to choose. In this article I mention the best GPUs to buy right now! https://steemit.com/mining/@thecryptominer/the-best-graphics-cards-to-buy-right-now
So you've gotten all of your hardware together, but how do actually use it?
Software
In order to mine with your new hardware, you must determine what software you want to use in order to mine with. If you're a beginner, then I recommend using a program called nicehash. Simply make a free account and download the free program you need depending on your hardware here: https://www.nicehash.com
Then run a benchmark for your computer and it will auto tell you the best algorithms for your hardware, how much you'll make a day, and how much hash you'll earn every second. Nicehash then automatically converts your earnings into bitcoin that you can then cash out to wallets of your own or sell for regular fiat currency like USD or EUR that can be transferred to your bank or paypal account.
Some Additional Tips
- Build A Rig With As Cheap As Components As Possible.
As of right now, GPU mining rigs can be expensive to build because of the high, inflated prices of GPUs. They are, however, still profitable. Make sure you find the best deals on parts in order to decrease your Return On Invesment (ROI) time and earn back your money as fast as possible.
- Take Electricity Costs Into Account.
Mining costs a good chunk of electricity in order to perform. There are many ways to save on your electricity bill including undervolting or underclocking your cards so that they use less power. Just make sure that you consider this cost when calculating your ROI time.
- Keep Your Cards Cool
Mining can produce a pretty good amount of heat. In order to ensure the longevity of your hardware, adding additional fans near your rig to pull heat away from your cards can make a huge difference in temperature readings. This heat will, however, eventually accumulate wherever your rig is and make a room quite hot. Take this into account when deciding where to place your rigs.
Conclusion
Mining is a fantastic way to pull in some extra money passively. A single rig can earn back how much its worth in as little as 2 months if done properly! That means if you were to invest $5,000, you would be earning $5000 every 2 months or $2,500 every month. That's $30,000 every year! That's the reason mining has caught the attention of so many recently and has contributed to the raise in GPU prices.
You can start with small investments of only a few $100 or invest $1000's. Its all up to you! Plus, if you already have a workstation or gaming computer, then you can start earning for free!
Just Download Nicehash and see how much you could be earning everyday. As long as you keep your components relatively cool, then you'll barely see any life expectancy changes for your computer and you'll be making some extra free money while you're at it! That's why mining truly is one of the best investments you can possibly have!
Disclaimer Although I believe myself to be well rounded in the topic of cryptocurrency, I am no means a financial adviser. Please continue to research on your own and I am not responsible for any losses