Cloud Mining Defonition
Cloud mining eliminates the need for miners to own sophisticated computer equipment; instead, they may lease it from third parties and mine. Mining rigs of this type are frequently found in places with inexpensive energy and a colder environment. Cloud mining is advantageous for individuals who do not want to get involved in the intricacies of mining but yet want to reap the crypto benefits.
Cryptocurrency Mining explained
The process of “mining” in the “crypto” world is a system of processing the various “transactions” that have been created on a network. It’s called “mining” predominantly because of how any successfully processed transactions are rewarded with tokens of the system you’re contributing computing resources to…
Specifically, each time you “mine” a “crypto” system, the miner is basically using their computer equipment to calculate the “hash” of a series of “cryptographic” (encryption) transactions.
These transactions are the transactions within the network itself, generated by the way in which you’re able to send “Bitcoin” (or other “currencies”) to different users. The point is that the “hashing” process is the same regardless of which system you end up doing it for, or even which equipment you end up using.
To briefly explain its history, CPU’s were originally used to calculate Bitcoin “blocks”, but as the complexity of the operations increased, people discovered that GPU’s (Graphics Processing Units) were better disposed to handle the “hashing” algorithms required by the various “cryptographic” systems.
From here, other people discovered that you could use FPGAs (field-programmable gate array) and ASICs (application-specific integrated circuits) to create even more powerful hashing systems.
The latter of these (ASICs) has actually become somewhat recognizable as the “go-to” method of crypto mining. The various AntMiner systems (the majority of which are USB-powered) have long since taken over as the “default” mining system…
Types Of Mining Equipment
Whilst the process of “mining” the various “tokens” is the same regardless of which type of system you do it on, there are a number of systems that have been created solely to “mine” the various “crypto” tokens that are available.
The point here is that it doesn’t matter if you see someone with a PC/GPU “mining” setup, or a custom ASIC – the way in which the system works is the same (the only difference lies in the speed through which it’s processed).
This means that if you’re interested in how to “mine” the various “crypto” systems, it’s important to discern the various ways through which you can do it. There are several:
1. PC-based (CPU/GPU)
This is the most standard form of “mining”, as you can just use over-the-counter PC components for it…
Although these types of settings work well for many of the smaller coins, they have long been replaced by ASIC-powered cloud mining solutions, which now dominate the bitcoin space. If you are looking at getting into “mining” (in any capacity), you’ll want to look at the above as a major investment. Whilst you may argue that you could end up using the components yourself, the reality is that they are very highly-priced and ultimately become degraded extremely quickly. They’re also power-hungry. Ultimately, you should consider that if you want to potentially mine “coins” for a cryptosystem, you should be looking at this as a last resort (typically if you don’t want to pay for an ASIC or just simply don’t feel they’re worth the price). The most important element of this setup is having a large array of GPUs (Graphics Processing Units). You’ll be able to find more specifics online; the point is that if you have them all working from one motherboard, it should work well for you
2. ASIC Based (Antminer etc)
As mentioned, all the “hashing” algorithms are the same, which means that you’re able to use the ASICs for any “crypto” system you want. The main supplier of these systems is “BitMain”, which produces the “AntMiner” range of ASIC systems. There are many types of “Antminer”.
These are left to work on their own (you simply plug them into a power outlet and an ethernet connection) – allowing you to accomplish quick “hashing” that is more energy-efficient and stable than previous systems.
As previously stated, the ASIC is now the most effective “standalone” mining technique available. While alternative methods are rumored to be in the works, this is the most efficient one currently accessible.
3. “Cloud Mining” / “Mining Pools” (ASIC)
Finally, “cloud” ( pool ) mining has given a boost to the ASIC paradigm. This is when a group of miners is connected to form a “supercomputer,” allowing for quicker and more accurate processing.
While this is the realm of bigger operations, you may invest in one of these operations as an individual user/investor to increase your mining capability. It’s up to you whether you think it’s a good investment.
Cloud mining is a method of mining bitcoin (or other cryptocurrencies) without having to own a miner (or mining hardware). Simply stated, you acquire shares of mining power – similar to a mining pool – and profit alongside the pool. This implies that all you need is a contract with a Cloud Mining Service provider and a bitcoin wallet.
If you want to invest in bitcoin mining without the burden of operating your own hardware, or if you can’t afford to buy high-priced ASIC mining hardware, the cloud mining services are for you.
Cloud mining, often known as cloud hashing, is a popular idea that involves using (in most cases) pooled hashing power from faraway data centers to allow users to purchase mining power from the gear installed. All Bitcoin mining takes place in the cloud, so there are no difficulties with power, hosting, installation and upkeep.