Mining - what is it in simple words

In the last year, there was a boom in the extraction of bitcoins and other popular cryptocurrencies in the world. Video cards were bought instantly, despite the increase in prices. All this is associated with a sharp increase in the cost and popularity of cryptocurrency, especially Bitcoin. As a result, many people began to earn virtual money. I will tell you what mining is, its types and features, I will give useful tips.

Types of mining

There are three of the most common ways to mine crypto money - pools, solos, and cloud mining.

Pula

Mining pools are coin mining servers that distribute hash (block calculation tasks) between network user capacities, which are connected separately.

If at the very beginning of the emergence of cryptocurrency to cope with mining, a regular computer with average values ​​could do it, today pools are one of the few options that allows you to really make money. An alternative option is the purchase and maintenance of expensive equipment.

All network participants send the power pool of personal equipment to solve the cryptographic unit. For this, they get earned coins. The user will receive his fair share in any case, even in a situation if the power of his equipment is insignificant.

Pool benefits:

  • The absence of fraudulent risks (no one can influence the withdrawal of funds from the pool or stop it, unlike cloud mining);
  • No need to buy expensive equipment and spend money on electricity;
  • Proportional and guaranteed distribution of profits depending on the size of the contribution of each user.

There are several criteria by which mining pools differ - functional, cryptocurrency produced, commission for withdrawal, payment method, capacity requirements, etc.

Solo mining

It is carried out only on the equipment that is available to the user. The power of other miners are not used. If weak equipment, it is recommended to join the pool.

The advantage is that there is no need to share the received coins with other users, the disadvantage is a long search for the block. Moreover, today in the world of cryptocurrency there is a high competition, as a result of which it is no longer possible to find a block of such crypto money, like ether or bitcoin.

For solining, you should choose a simple coin with a low capitalization. You will also need to download the wallet from the official website of the cryptocurrency developer.

Cloud mining

Cloud mining is the acquisition of a certain amount of capacity in an organization that has opportunities for solo mining. It buys powerful equipment and delivers parts of its capacity to users.

Pros:

  • No need to spend money on buying your own equipment and electricity.
  • It is not necessary to have technical knowledge of mining.
  • No need to control the operation of devices.
  • Typically, the cost of entry starts from $ 10, but there are offers from $ 1.

Minuses:

  • Most of the "companies" on the Internet cloud mining are scammers. They close the project immediately after receiving the necessary profit from unsuspecting users.
  • The duration of the contract with the organization does not exceed 24 months, so it is impossible to predict the profit and return on investment.
  • The user will not have the equipment that he could sell and get extra money.

What is a miner

There are two interpretations of this word.

  1. A miner is a person engaged in mining. Some users have turned the process into a profession. Officially, it does not exist, however, many people have become rich, and continue to receive income through mining.
  2. Miner is a special program that allows you to earn money. It solves certain math problems. And for each correct decision receives a reward (a coin of the chosen cryptocurrency). All cryptocurrency transfers are recorded in the general transaction log transmitted to the miners. The program selects one hash from all existing combinations that matches the private key and transactions. When the mathematical problem is solved, the transaction block is closed, after which another problem is solved.
ATTENTION! If you are not interested in cryptocurrency and have not installed any programs on your PC, but the computer is noisy and freezes, and the video card is heating up, it is possible that a miner is working on your personal computer. I recommend running a full system scan with a licensed antivirus.

How much can mining bring

Earnings per day when soloining depends on several factors:

  • The cost of electricity (sometimes they are able to reduce or reset the income).
  • Power equipment (the number of video cards that are involved in the process).
  • Exchange rate.
  • The relevance of the chosen cryptocurrency (if it is very popular, then it is started to be mined all over the world, which reduces the production and complicates mathematical tasks).

If you choose cloud mining, then the profit depends on two factors:

  • The amount that was invested in the project.
  • The duration of the network of the selected company.

If you are lucky, you can recover costs and make a profit.

As for pools, the power of individual user equipment affects the amount of earnings.

Useful information

  • If you decide to install a stand-alone wallet on your PC and not use the online service, be sure to copy the wallet.dat file to the USB flash drive, then print and put the paper in a safe place. If the computer suddenly breaks down and all the files on it are erased, then without a wallet. Dat you can never go to your wallet again. All earned will disappear.
  • Before you engage in mining, explore alternative ways to get cryptocurrency - for example, buying coins on the stock exchange instead of directly mining them.
  • Regularly track new cryptocurrencies, study their prospects. Perhaps by acquiring some cheap coins at the start of an activity, you will be able to get rich in the future.

So, mining is a risky way to make a profit, but with constant market research and a certain amount of luck, you can make good money.

Watch the video: 70 English Words सखन क Easy Way. Learn Vocabulary For Beginners Through Hindi. Awal (October 2019).

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