Ever fantasized, perhaps if you randomly start digging your land and find tonnes of gold ? Ever wondered if you could own a gold mine? Well, I have and I am sure most of my readers had also dreamed about it. I am not sure that you can fulfill your dream of mining gold, (hope you could) but YES, when it comes to “BITCOIN-VIRTUAL GOLD” or DIGITAL GOLD, you definitely can.
In our previous article we have discussed “What is Mining?“.
Here it is a brief article about “How to Mine?”
How To Mine
Starting to mine your own Cryptocurrency looks quite simple as it only takes a computer, internet and a mining software to begin doing so. But, it is not anywhere near easy to mine cryptocurrency, as they are using sophisticated mathematical algorithms for the mining process, which makes it harder and harder to mine.
Solving the mathematical algorithms is the one of the most difficult task, when it comes to mining. It involves a lot of time, power & energy, and sophisticated hardware. These algorithms makes mining competitive and also, balances the mining time with the number of miners in the network.
Mining may fetch you healthy rewards and also you could start your own Mining Pool, where you can seek investments from your friends/relatives and put it into mining to multiply your reward.Mining is a long term investment and can pay of quite well only if you do it right, but first you need to look at some of the things you should consider before starting to mine as it is a very technical process and needs to be understood quite well.
First thing to do is to find the mining software for the cryptocurrency you want to mine. Most cryptocurrencies will only have one mining client, which is part of the wallet where you can hold the coins, while the big ones like Bitcoin may have different clients to mine through. So once you have found out which mining client you want to use, you will need to register your details with the client and synchronize with the network.
(A list of mining softwares for different Crypto Currencies will be posted here soon. Just subscribe to Kryptomoney.com newsletter to get latest updates.)
From there you have to go to the mining part of the software and enter the values you wish to mine for. If you don’t know what to enter, then you can simply use the default settings and start mining that way. Last thing to do is to press the start mining button and your mining has started. The result however will vary a lot based on the mining hardware you are using and if you are part of a mining pool or not.
The next thing you need to focus on is the hardware which you are using to mine the cryptocurrency with. Using a regular computer’s CPU to mine with will work, but it is nowhere near as effective as if you decide to buy equipment that is made to help you mine faster.
So if you are serious about your mining, you will need to go out and invest in specific mining hardware in other for you to be able to compete with other miners and eventually score a large amount of coins for your efforts. There are several websites that specializes in the mining hardware for cryptocurrencies, who can show you exactly what performance you will get out of buying specific hardware for your computer. What you will need to look for is how many millions of HASHES it will do per second and how much electricity it will be using, so you can calculate the costs contra profit from your mining. ( Hashes are explained in our post WHAT IS MINING?)
The best mining hardware is currently ASIC short for Application Specific Integrated Circuit Chips, which can provide you with up to 1,000 more hashes per second than any other type of equipment. The hashes is what will release blocks that you can mine and is the most difficult part of the mining. Therefore the more hashes your equipment can go through, the higher is your chances of actually getting any blocks to mine and thus get coins.
The last thing you should know before you start to mine is the importance of joining a mining pool. Mining alone can be done, but it will not fetch you those kind of rewards compared to joining a mining pool as you will be mining together with more miners. Mining pools rewards smaller amount of coins at a time than if you would mine on your own, but you will get coins on a regular level compared to when you mine alone, making it more profitable for most miners.
You can find several different mining pool websites online. Also by joining a pool the algorithms you have to solve will be easier and smaller, which is ideal for you as a new miner until you understand the entire process and have upgraded your equipment.
Generally, Mining today takes on two forms:
- Solo mining, where the miner attempts to generate new blocks on his own, with the proceeds from the block reward and transaction fees going entirely to himself, allowing him to receive large payments with a higher variance (longer time between payments)
- Pooled mining, where the miner pools resources with other miners to find blocks more often, with the proceeds being shared among the pool miners in rough correlation to the amount of hashing power they each contributed, allowing the miner to receive small payments with a lower variance (shorter time between payments).
To conclude, now we know WHAT IS MINING & HOW TO MINE, and surely some of my readers had already made a decison to get into mining, but you must be beware as their are lot of fake companies pretending to be a mining pool and would offer you huge returns by investing in their pool. An investor must do a thorough research and only then be a part of mining pool.
Or if, a person who just wants to get cryptocurrency, their are different exchanges which offers different crypto currencies in exchange of fiat currency.