Smart contracts – everything you need to know
18.02.2022
151 Views
The cryptocurrency not only gave us a whole new way of payment method. It also…
Cryptomining – this is how it works
The only way to extract new cryptocurrency is by participating in cryptocurrency mining, which is basically a process where you use a computer to solve cryptographic tasks in exchange for getting some cryptocurrency from the network. It is actually a very complicated topic that you can spend hours learning more about, but fortunately you do not have to spend so much time if you just want to get started with mining a little cryptocurrency from your computer at home.
You do not have to invest in equipment – even if it is recommended
When cryptocurrency was new, you could manage to mine money well by using the graphics card on a regular computer, but this period is over. Mining has gradually become something that professional players have taken over, and nowadays most of the large cryptocurrencies such as Bitcoin are mined by giant players who have equipment worth many millions of dollars. It is still possible to extract Bitcoin from your private computer, even if you do not want to be rich in it anymore. This method is called Pool Mining and there are some crypto exchanges that offer this.
Why my cryptocurrencies
The point of my cryptocurrency is that this protects the network / blockchain. The more people who mine with more computing power on the network, the more decentralized the entire network becomes, and the safer it becomes for everyone who uses it. To ensure that as many people as possible use as much computing power as possible, everyone who mines gets a little cryptocurrency every time they are the first to solve the cryptographic task that signs a new block in the blockchain.
It is quite rare to actually be the first to sign a block, and most miners like to participate in so-called “pools” where several thousand people work together to mine, and share the bounty based on how much they have contributed to the mining. This is almost required unless you have an incredible amount of computing power, because without your own mining setup it is very unlikely that you will ever sign a block alone. To put it a little in perspective, you get BTC worth more than half a million kroner when you sign a block, so of course it is not something you do often.
Check how much you can earn on cryptocurrency mining
Most people who mine Bitcoin or another cryptocurrency do so to make money, but it is incredibly unlikely that you will make money on this in Great Britain . There is a lot of competition to sign the blocks, and for the vast majority you will have significantly higher electricity costs based on mining than you earn on the adventure. If you want to invest in cryptocurrency, it is much better to actually buy a cryptocurrency you are interested in, than it is to invest in mining equipment.
It is still possible that it will be profitable again in the future, and you can easily check whether it will pay off by using mycryptobuddy.com ‘s mining calculator. There you only need to enter your electricity costs, as well as how much hash rate you can produce with your machine, then you see how long it takes before you make a profit, and if you will ever do it.
How to know my cryptocurrencies
If you want to mine with your computer, you must first find out what you are going to mine. There are an incredible number of different cryptocurrencies, and some of them are much more profitable to mine than others. Most often, Ethereum is a very good and at the same time safe choice, and this can be mined with regular graphics cards.
Recommended graphics cards for mining
- Nvidia RTX 3090
- Nvidia RTX 3080
- AMD RX 6900 XT
- Nvidia RTX 3070
If you choose Ethereum, you can easily download a miner, and there are many to choose from. Two good alternatives are Claymore Dual Miner and Ethminer. Both of these work well, and are fairly easy to get started with, although it requires some technical expertise.
One should also join a mining pool, and there are hundreds of these. It does not really matter which pool you join, so just choose one with low fees and an ok pool hash rate so that you get regular payouts.
Once you have joined a pool and made the miner work, just leave the computer running while the program is running. Now it solves cryptographic tasks while you can do something else, but if you set the miner to run at full speed, the computer will probably not work well for something else at the same time.
