What Do You Need to Start Cloud Mining or Hardware Mining?
People are talking about cryptocurrencies around the world, with bitcoins being hailed as the most popular of the lot. Try surfing the Internet, and almost every website you visit shows an advertisement promoting bitcoins, bitcoin exchange platforms, bitcoin cloud mining service providers, bitcoin mining pools, and the likes. That shows how much of a global phenomenon bitcoin has become since a programmer, or presumably, a group of programmers discovered it in 2009.
Initially, bitcoins were created to bypass geographical boundaries when making money transfers. Eventually, bitcoins extended their reach and have since been used as a digital currency when paying for goods and services. Bitcoins pretty much function like real money, except for their manner of acquisition. Unlike fiat currencies (such as the U.S. dollar), which are government-issued, you acquire bitcoins by buying them, using exchange platforms, or mining them.
Of the various ways you could acquire bitcoins, you’re probably intrigued by the concept of mining. After all, mining is usually associated with tangible things like gold, diamond, and other precious minerals, whereas bitcoins are digital. That brings us to the question, “How are bitcoins mined?”
Bitcoin Mining in a Nutshell
Bitcoin mining is how network nodes verify bitcoin transactions and add these to a blockchain public ledger. This blockchain is a data structure that allows the identification and tracking of said transactions so the information could be shared across a trusted network of computers. The verification process mentioned previously involves solving complex mathematical codes, and whoever decodes the codes first would be allowed to add the verified transaction to the blockchain.
Those who solve the codes successfully acquire bitcoins in the form of rewards awarded to them for verifying the transactions. Verification of bitcoin transactions is crucial as it makes the overall cryptocurrency payment network more trustworthy and secure. At the same time, the process introduces new bitcoins into the current supply of cryptocurrencies in circulation.
It is worth noting that bitcoin mining is considered legal, depending on where you live. Because cryptocurrencies generally pose a significant threat to governments’ control of financial markets and fiat currencies’ dominance, many countries consider using and mining cryptocurrencies as illegal. Still, more countries view them as legal than not.
Who Could Mine Bitcoins?
You know how traditional miners set up mining rigs to aid them in their undertakings? The same goes for bitcoin mining. Those determined to mine bitcoins need to set up mining rigs in the form of high-powered computers, stable Internet connection, and state-of-the-art cooling system.
Aside from the costly equipment, mining bitcoins using your tools would result in high electric consumption. You will need to have a padded bank account if you want to start mining bitcoins on your own.
Does that mean only those with money to spare could mine bitcoins? Not necessarily. These days, there are mining pools and cloud mining service providers with which users could create accounts. These providers allow bitcoin miners who don’t have their equipment to use their mining facilities instead.
Necessary Tools for Mining Bitcoins
From the preceding section, we’ve learned that you have two options when it comes to mining bitcoins. One is hardware mining, where you would be using your equipment to mine, and the other is cloud mining, where you would be signing up for an account with a cloud mining service provider to use their facilities.
Of course, choosing the manner with which to mine bitcoins is entirely up to you. At any rate, the following is a simple guide to help you set up what you would need to start either cloud mining or hardware mining.
Components of Bitcoin Mining Hardware
As already implied earlier, the cost of building your mining rig is quite daunting. And taking into consideration the cost of your energy consumption, hardware mining is a costly investment. Still, if you have the means to go for it, here is a list of things you would need for your mining system:
- Mining hardware – You have the option to choose between Application-Specific Integrated Circuits (ASICs) or Graphics Processing Units (GPUs). These two are the highly-preferred hardware today. Remember the complex mathematical codes that nodes need to solve to verify bitcoin transactions? With the ASIC, a chip is necessary to solve the problem, whereas, with a GPU, a graphics card is responsible for solving it. GPUs are somewhat flexible, while ASICs are restricted to a particular set of functions. The most noteworthy difference between the two is speed – GPUs are fast, but ASICs are much faster.
- A central processing unit (CPU) – This doesn’t have to be top-notch, but some suggested brands are Intel Celeron, Pentium, or Ivy Bridge. A modern multi-core CPU with 4-8 GB of RAM could ensure performance stability.
- A motherboard – For hardware mining, a good motherboard is the Asus B250 Mining Expert.
- A power supply – You would need a robust power supply for mining, preferably 1000W, and some good choices are Corsair HX1200i and EVGA SuperNOVA 1600.
- RAM and storage – Some miners suggest Newegg Patriot Memory 4GB DDR. On the other hand, an 8GB RAM is recommended if you’re running a Windows OS.
- An essential operating system.
- A cooling system – This is necessary because you’d want to keep your hardware cool, in the literal sense. Some miners are finding liquid immersion cooling technology an excellent way to cool mining hardware. The company 3M has a liquid product called Novec that is meant to cool circuit boards directly. That is done by submerging the boards in the liquid in some open bath system for easy access.
Incidentally, if you dabbled in CPU gaming before, you might already have some of these components lying around.
Requirements for Cloud Mining
Believe it or not, there is not much you would need if you’re opting for cloud mining. Data centers realized that many people wanted to join the mining bandwagon but didn’t have the required tools to do so. Hence, they decided to rent out their hash power to third-party providers. On the other hand, users can lease or purchase mining equipment from these providers, and mine bitcoins from a remote data center.
Of course, you would still need a computer or a laptop and a good Internet connection to get started with cloud mining. However, here are the minimum (recommended) requirements:
- A desktop or laptop
- Some ARM chipsets (1 GHz)
- An operating system (Windows 7/8.x/10, Mac OS X, or Linux)
- At least 350 GB of disk space
- 1 GB of memory (RAM)
Some people prefer cloud mining to eliminate cost barriers, technical barriers, and high electric consumption. Moreover, setup is easy – you register for an account with a provider, log into the cloud mining platform, and sit back while watching your returns.
Again, the choice of whether to go the cloud mining route or do hardware mining is up to you. At any rate, whichever you choose, you would be receiving outputs regularly. Hopefully, through this article, you would have an easier time deciding.
