Mining for Bitcoins and Turning Them into Cash
by Alex Kerya | Aug 1, 2014 | Crypto News
When you ask yourself, “How do I mine bitcoins?”, it’s important to realize that you could actually have a variety of different answers come your way. One person will tell you to purchase your own mining hardware and start a mining facility of your own, while others will claim it’s not even worth getting into the mining business. There are many different levels of mining to look at, and it’s also important to know what to do with those bitcoins once they have been mined and placed into your Bitcoin wallet. Let’s take a look at some of your options if you’re thinking about becoming a Bitcoin miner for profit or as a hobby.
Purchasing Your Own Hardware
If you want to start mining for bitcoins, the first thing you’ll need to do is get some serious hardware. Although CPUs and GPUs were powerful enough to mine bitcoins in the early days, there has been a rather substantial increase in the network hashrate over the past few years. ASIC devices that are built specifically for solving Bitcoin blocks are now the norm in the world of Bitcoin mining, and you’ll need to have one of these devices if you want any chance of mining some bitcoins in the near future. Although the early Bitcoin adopters were able to mine on their laptops without much effort, newcomers to the space need to spend thousands of dollars on equipment before they can get started. If you’re in the market for such a device, then you’ll want to look at the offerings from companies such as CoinTerra, Avalon, and Hashfast.
On a side note, it should be mentioned that there is actually a trick to get around the ASIC miner requirement. In addition to Bitcoin, there are also other cryptocurrencies that use different mining algorithms to secure their networks. GPU mining is usually still rather prevalent on these networks, which means the devices used to mine these altcoins are also much cheaper. If you can’t afford one of the ASIC devices to mine bitcoins, then you may want to look into mining an alternative cryptocurrency. Once you have mined the altcoin, you can then exchange it for bitcoins on an exchange.
Finding the Right Mining Pool
Now that you have your mining hardware, you can download the required software and get started with the mining process. You won’t be able to do any mining on your own these days because there are large pools of miners that are now used to make sure that payouts are able to be received on a more frequent basis. When you join a mining pool, you will earn a proportional share of each block reward found by that pool based on the total amount of hashing power that you are pointing to the network.
Although there has been some controversey related to the GHash.IO as of late, the reality is that it’s still the best pool on the market. This mining pool is actually so popular that much of the mining power of the entire Bitcoin network became centralized around this pool in early 2014. The owners of the pool now limit their share of the overall hashrate to 40% to make sure that the Bitcoin protocol can remain as decentralized as possible. If you’re not interested in using GHash.IO, then you may want to look into P2Pool as a new, decentralized option.
The Most Convenient Option
If purchasing your own hardware, downloading the right software, and finding the perfect mining pool seems like a lot of work, then you should rest easy knowing that you are not alone. The good news is that CEX.IO actually offers a more convenient option that anyone can figure out. If you want to purchase bitcoins on the CEX.IO platform, all you need to do is purchase GHS. CEX.IO is kind of like a Bitcoin stock exchange where you can purchase shares of hashing power on the GHash.IO mining pool. As soon as you’ve purchased your GHS, you will notice that your asset has already started merge mining bitcoins, namecoins, and other SHA-256 cryptocurrencies for you. The rewards from your share of the GHash.IO hashing power are then placed directly into your CEX.IO wallet, which means you can conveniently cash them out for dollars on the best bitcoin exchange. With the cloud mining and exchange options available on CEX.IO, there is no reason to search for another Bitcoin mining solution.
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