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Author Topic: Bitcoin Mining  (Read 521 times)

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Offline nicolaswritesTopic starter

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Bitcoin Mining
« on: April 02, 2018, 05:19:13 PM »


What is it?
When Bitcoin was created by Satoshi Nakamoto, he visualized it in the same way Gold works in the business world as something that is limited in supply which in turn increases its value over time. Nakamoto also went a step further by ensuring that getting Bitcoin is not a cakewalk as it requires a lot of effort and resources to acquire or create it. Mining can be simply defined as the way in which Bitcoin is created by the use of computers which are coupled with specialized Bitcoin mining hardware (ASIC miners) which then solve humongous amounts of mathematical puzzles with the chance of getting a Bitcoin reward at the end of such a process.
Another facet to Bitcoin mining is that which people with huge computational power at their disposal use that computational muscle in order to help in maintaining the Bitcoin network by making sure every transaction that gets added is 100% genuine, in exchange for a token fee at the end of the verification process. This incentivized protection of the Bitcoin blockchain is the core reason why it has so far eluded any attempts of hacking or compromising it by attackers.
Mining Opportunities and Limitations
Bitcoin Mining has always been a very attractive endeavor, and the rise of the digital currency in value and use around the world only amplifies its lure for people who want to be part of the gold rush of the 21st century. With Bitcoin presently trading at thousands of dollars compared to hundreds it was trading just a couple of years ago, a lot of people now find mining Bitcoin a much more attractive choice than forking out $15,000 to simply buy it at an exchange.
There are however limits to the reach of this facet of acquiring Bitcoin for the interest public, as mining is a rather technical field that requires someone with intimate knowledge on how the industry works in order to successfully run it. Mining is also no longer  a feasible venture for individual or at-home small mining rigs, as with the increase in competition in mining Bitcoin, big industrial scale mining outfits all over the world have pushed out the small miner where they stand little or no chance of getting a reward that is worth or better than what they originally invested.
 
 
Mining Hardware
From the beginning all that was needed for the mining of Bitcoin was the minimum required computational power to solve the mathematical puzzles that the computers do. This needed the appropriate hardware to carry out the task and as the mining of Bitcoin has evolved, so has the hardware needed to make it happen also changed. The following are the Bitcoin mining hardwares that have been used over time.
·         CPU Mining: This was the very beginning of Bitcoin in 2009, when it was brought online by Nakamoto. Simple desktop CPUs at the time were more than what was required to carry out the calculations for the mining process at the time. But this was a time when Bitcoin was an unknown quantity and the only people who truly benefited were cryptography enthusiasts who also didn’t have much idea what treasure they had at the time.
·         GPU mining: As Bitcoin started gaining value, slowly but surely, it began coming to the attention of the public and a race ensued as to who will mine it the most before the mining process got even harder. At the time a group of developers figured out a way to deploy computer graphic cards which were more powerful than CPUs (almost 100 times) with an added advantage of comparatively lower electricity consumption in order to mine the currency.
·         ASIC Mining: The latest stage of Bitcoin mining hardware came along in 2013, when crypto enthusiasts who wanted to outpace the competition created a dedicated hardware which would take Bitcoin mining to industrial dimensions for the first time in its existence. Advanced-Specific Integrated Circuits or ASIC miners were created purposefully to kick-start an arms race that would end up pushing out every small mining rig in the world and make modern Bitcoin Mining the exclusive forte of industrial outfits instead. ASIC miners are created for nothing other than cryptocurrency mining, and have huge advantages over previous hardware both in computational power and lesser electricity consumption. Since 2013, only modified versions of ASIC mines have been created as there has not been any brand new hardware created yet for the industry.
Mining Pools
As the race for mining Bitcoin became ever hotter, owners of small mining rigs were pushed out of business, where the relative cost which the small miner accrues for mining is much greater than the reward they get in the end, if any. This kick-started another idea in which these small miners began to group and pool their small hashing powers in to bigger ones that could competitively mine Bitcoins against the large scale industrial operators. Mining pools are very popular today as people who forked out a lot of money on mining Hardware now have a way to get back their investments by signing up to mining pools where any Bitcoin reward is shared among the participants in proportion to the hash power they contributed towards the mining process, with a commission going to the company that brings them all together.
 
 
Cloud Mining
Another way of mining which is definitely the most popular and most convenient for everyday investors, is what is known as cloud mining. The cloud mining outfit as the name implies is a company in which anyone interested in mining for Bitcoin or other cryptocurrencies can buy-in to, with their fiat currency. They in turn get allotted a certain hash power from an already established industrial mining rig somewhere around the world, where it is immediately deployed to mine their Bitcoin. As long as the cloud mining contract runs, the user gets the Bitcoin mined with a commission also going to the company that is setting up the mine.
The genius behind cloud mining outfits is that for the first time anyone can conveniently take part in the creation process of Bitcoin notwithstanding their capital. It takes off the need to know any technical detail of the mining process, rid them of the need to continuously pay for the huge electricity bills and mining hardware cost that incurs on them, and it also is the most convenient as the miner doesn’t have to suffer sleepless nights from the noisy mining rigs that are kept in their homes.
 Most Popular Cloud Mining Outfits
The field of cloud mining due to huge demand is seeing a tremendous growth with many outfits coming out now and then. But the three best known outfits are:
ü  Genesis Mining: This is the oldest and most well-known cloud mining companies in the world. It currently has the biggest market share of this niche and offers cloud mining contracts for Bitcoin, Litecoin, Ethereum and a dozen other altcoins. Genesis Mining has mining farms spread in very well hidden locations. It has very attractive custom mining options but its maintenance fee for Bitcoin mining contracts is not the lowest in the market.
ü  Hash Flare: This is an Estonian based cloud mining company with a growing popularity for their very flexible contract options, and offers of unlimited contracts to interested buyers as well. Hash Flare is known for its immediate payouts with the lowest GH hash rate prices in the industry, but their downside is that their long-term maintenance fees are not the most attractive.
ü  Miner Gate: Another company that has been in existence since 2014 with very solid payout records is Miner Gate. The location of the company remains unknown but with over 14 different coins supported, it provides for one of the widest cloud mining options of any company in the industry. Miner Gate is also very popular for its very transparent pricing, but has rather higher withdrawal thresholds compared to other outfits. 
 
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Offline Bandys

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Re: Bitcoin Mining
« Reply #1 on: May 24, 2018, 03:32:55 PM »
Mining is a great option to generate the bitcoins and other altcoins but people are little bit worried about the electricity cost due to continuous running of the harddrive. Are you facing any kind of such issues?

Offline KiraMan

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Re: Bitcoin Mining
« Reply #2 on: May 29, 2018, 09:44:14 PM »
I've heard a lot that nowadays bitcoin mining is completely unreasonable, is this true? Many resources say that the train's left the station long time ago.

Offline Adelle

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Re: Bitcoin Mining
« Reply #3 on: June 13, 2018, 10:54:03 AM »
I've heard a lot that nowadays bitcoin mining is completely unreasonable, is this true? Many resources say that the train's left the station long time ago.
I think there is some truth in that. The pay is not as it used to be. The competition is great. There is also the cost of power to mine. If the pay is reduced, you can't keep up with electricity cost. In the end, you'll be left with nothing as profit.
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Offline bitcoinwest

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Re: Bitcoin Mining
« Reply #4 on: June 14, 2018, 07:48:39 AM »
mining is good but pay is little

Offline Coinini

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Re: Bitcoin Mining
« Reply #5 on: June 14, 2018, 01:44:31 PM »
Mining is waste of energy. There is already more innovative technology. Emission mechanism tied to the supply. There is Nebula Network - it's decentralized storage cloud with emission mechanism tied to the supply in form of computational power and disc space. Thanks of it it's rock stable and independent from Bitcoin.

Offline jitenrajput

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Re: Bitcoin Mining
« Reply #6 on: June 18, 2018, 04:28:45 AM »
I think there is some truth in that. The pay is not as it used to be. The competition is great. There is also the cost of power to mine. If the pay is reduced, you can't keep up with electricity cost. In the end, you'll be left with nothing as profit.


Yes, even I think so. Cloud mining can be profitable but the hardware mining isn't any good as it used to be before. The puzzles are getting more difficult and even the competition. The reward is reducing and costs are increasing. Thus, profit is affected.
Cryptography & Bitcoin Consultant @ encrybit.io


 

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