Mining of world’s first digital currency has become very attractive as bitcoin price increased from cents to thousands dollars. Besides, the competition on this market has significantly risen. Mining is actually a number of calculations intended to create a new block in Bitcoin blockchain. This is the only way the cryptocurrency is issued. Miners can generate a total of 21 million digital coins.
To mine Bitcoin it is necessary to make calculations and find the needed algorithm (hash). The more computing power a miner has, the more chances are there to generate a new block successfully. Moreover, as new blocks appear, further mining requires more and more computing power.
In 2015 it was already 10 thousand times more difficult to mine BTC. It used to be enough for miners to use their PC and graphic cards to “extract” the digital gold. However soon this amount of computing power was not able to carry out all necessary calculations and special ASIC-processors appeared. GPU mining remained very profitable for other altcoins, like ether, but was no longer suitable for BTC.
Today key players of Bitcoin mining market are pools of miners. Each miner of a pool conducts a part of calculations, which increases chances of the whole “factory” to get hash faster. Usually the reward is distributed considering the amount of computing power provided by a particular miner. Earlier this reward was 50 BTC for one block. Back than it was not even enough to buy a can of cola but today this number of coins cost approximately half a million dollars. After every 210,000 blocks are generated (approximately once in 4 years), the reward is reduced two times.
Anyway there’s still a chance to make a fortune on mining and that’s what thousands of users all around the world do. If you want to join them, first of all you should create a bitcoin wallet to store your cryptocurrency. Then you will need an equipment: ASIC-miner, energy block and other components. You will also have to set up power connection and install coolers for your ASICs. After that you can join a pool. That would be a good idea, because your chances to get a reward as a solo miner will correspond to a ratio of your own computing power to computing power of all other miners in the system. So, if you have a lot of huge mining rigs, you won’t need a pool, but if not – that would probably be a good option. You can sign up and connect your computing facilities to a pool according to instructions. As a pool member you will make easier algorithms and the whole pool will generate a new block and get 12.5 BTC for that. You’ll receive a part of this reward too. One more thing, you will also need to install mining software. Many pools have their own software for mining, like for example Bitminer. There are many different programs for mining, such as BTCMiner, CGminer or BFGminer.
The equipment for mining, as well as it’s maintenance is rather expensive, so this may quite difficult for many users. There is an alternative — cloud mining, when a user rents remote mining equipment for a certain time. There are plenty of cloud mining services, for example hashflare and Genesis-Mining. Although cloud mining is about renting cloud facilities but not owning them, if you choose it, you won’t have to pay for power, worry about heat and noise, repair them and maintain their operation. As a result, the profit can not be less than if mining is carried out using owned equipment. So cloud mining, especially if we are talking about BTC, is nowadays rather popular.