Bitcoin mining is an essential part of cryptocurrencies as all the transactions need to be verified through computation of complex mathematical equations for a reward. While mining can be profitable it has its own requirements and limitations. Bitcoin mining is not as easy, given the volume of transactions and also because many miners are already dedicated to Bitcoin mining. However, the mining requirements and opportunities with Bitcoins is immense as it is getting more and more popular each passing day. So, if you’re looking forward to participate or start with Bitcoin mining here’s what you should know to begin with. It is not at all easy as it involves complicated hardware. Today, in 2018, Bitcoin mining involves the use of application specific integrated circuit or ASIC, chips. This hardware is not available on the cheap and is further expensive to run it as well.
Bitcoin mining is profitable, but …
It is important to keep in mind that Bitcoin mining is also not very pocket friendly as it is an expensive affair. One must have access to adequate resources such as electricity along with a powerful network connection. Before you actually head into the process of mining, it is important to use a Bitcoin calculator to check if you’re actually able to turn your investment into a profit.
How to bitcoin mining
Below are the different steps involved in the mining process of the Bitcoin:
Step 1: Pick the right type of Hardware and become bitcoin miner
To begin the mining process, you will first have to purchase a high-quality ASIC miner. There are a whole lot of options available in the market which are very much similar in terms of hardware. Pricedat close to USD 2,200, the Bitmain’s Ant Miner S9 is one of the most sought after mining machines in the business. In case you are short in terms of budget, you can always opt for a second-hand mining machine. In order to save a few bucks, you can also go for a mining machine with old hardware such as an old gaming GPU. It could be just enough to get your work done very economically.
Step 2: Make sure you pick a good bitcoin mining pool
Post hardware setup, you will have to make a choice of either mining the Bitcoin alone or actually joining a pool of miners. Though self-mining could mean you get better rewards, there could be situations where you would mine for months and still not earn even a single unit of the Bitcoin. A mining pool means smaller rewards but guarantees you Bitcoin units at the end of the mining operation. Hence, make sure that you choose a good mining pool with a low fee which helps meet your mining requirements.
Step 3: Make sure you download the right software
This step involves the downloading of the right type of software. It also involves linking up your hardware with a secure digital wallet. The setup process is dependent on the choices you have made so far. If everything is done properly, all you have to do is connect the miner to the computer, log into your pool network, run the software and you are ready to start mining.
Step 4: Make sure you keep a check on the number
The last step involves keeping a good track of the numbers involved in your mining operation. Make sure you keep a good record of the electricity costs. This helps you forecast whether the operation is profitable for you or not. This also helps you take a decision whether to carry on with the operation or not. These were some of the most important steps involved in the process. Bitcoin mining has its benefits but at the same time, must be carried out with a strategy. The competition is ever increasing and given the popularity of the alternate currencies more and more players are entering the market. Therefore, it requires added human resource, time and investment if you want to be successful. For some, it could be life changing while for others, it could become a liability. it is better for beginners to buy bitcoin and hold.