How to start cloud mining – 5 steps
Bitcoin has been making a splash since its launch in 2009, and any crypto investor strives to obtain a number of these coins to their crypto portfolio. There are various ways to get your hands on this world’s most stable cryptocurrency and the easiest one is to buy it on the exchange. But the idea to receive it “for free” by mining is so tempting that thousands of prospective miners are always on the point of hunting for digital wealth.
Of course, you should keep in mind that this method of obtaining BTCs can hardly be called absolutely free as you need to buy mining equipment and pay for electricity used while you do your business. But if you still want to try mining, this article will uncover some essential things that will help you to start.
What Bitcoin mining is?
Forget about coal mines. They have nothing in common with current hi-tech methods of making money. Today, mining is closely connected with computers and non-fiat currencies. In short, when you “mine” Bitcoin, you actually validate Bitcoin transactions on the blockchain. Mining forms a backbone of the Bitcoin network as it would become dysfunctional. Miners ensure the security, stability, and functionality of the entire system, and they are rewarded with some Bitcoin at the end of their toils.
The process of mining is not as complicated as it may seem to a newcomer. Just take some steps to be ready to start right now.
Step 1. Equipment for mining
Bitcoin was originally designed to allow anyone to participate in the mining process using a personal computer. But today, it is impossible to join the mining community without investing thousands of dollars and having access to cheap and plentiful electricity. Mining is a competitive business with lots of players and the more computing power you can offer, the better your chances of actually obtaining BTC.
To make your mining activities profitable, you need to buy special hardware. I hope I’ve already convinced you to give up an idea about your PC as it never works. The specialized hardware is called application-specific integrated circuits (commonly referred to as ASIC).
Before finally deciding on a certain ASIC model, consider carefully its basic operational characteristics. Look at this table to compare some popular miners offered by different manufacturers.
How to do cloud mining?
Do you lack the space, equipment, or electricity required? Don’t feel discouraged, you have a great opportunity to start cloud mining by buying a Bitcoin cloud mining contract.
This idea is based on utilizing a remote datacenter with shared processing power. This means that you don’t need expensive equipment or high technical knowledge. You simply rent processing power directly instead of buying the hardware and paying for electricity.
The advantage of such an approach is obvious – your overall costs are reduced. But at the same time, this means less profit and higher risks for users.
How to set up cloud mining? To avoid fraud, try to deal with reputable platforms even if some unknown services offer better conditions to you. I recommend you to pay close attention to this list:
- ECOS. This is a platform where you can get access to real mining power without any extra effort.
- Genesis Mining is one of the largest world’s cloud mining providers.
- EasyMiner. They promise to make industrial cryptocurrency mining accessible for everyone.
Step 2. Required software
Once you’ve settled a matter of your equipment, its location and power, you need to decide on special software as mining is impossible without it. There are lots of free programs that are compatible with various types of mining hardware and can run on most operating systems.
Look at this list of the mining software that is considered to be the best by the crypto community:
Step 3. Choose a mining pool
Mining pools are groups of miners that join their hashing power to mine Bitcoin more quickly and efficiently. In the current situation, it is hardly possible to earn anything in BTC if you try to do it alone. Mining with a group, you have better chances for reward. Any mined Bitcoin is shared among all users on a pre-established formula.
Mind that you needn’t pay anything before joining a mining pool. Instead, the pool takes a percentage of the Bitcoin mined (typically 1-2). Btc.com, Via BTC, and F2pool can be given as examples of popular, successful, and well-established mining pools.
But if you don’t want a company, you can always remain an individual miner. This approach is called solo mining. But keep in mind that in this case, you will probably see no reward at all.
Step 4. Create your Bitcoin wallet
Or use the one you have. You need a wallet to which BTC will be transferred from your mining account. As BTC is the most popular token, it is supported by almost all popular wallets, that’s why you’ll find a good solution without any problem. You can choose between two variants of wallets: hot and cold ones.
Cold (hardware) wallets are physical electronic devices that are reliable but rather expensive. Hot (software) wallets can be downloaded for free but they are much less secure. The choice is yours.
Step 5. Be kept up-to-date
And last but not least: never neglect information that can influence your mining activities.
The bottom line
Bitcoin mining is a topic of the day. The maximum supply of BTC is limited and every miner strives to get a piece of the pie until the BTCs number reaches 21 million. You can also try to find your way to profit via mining. Good luck!