Bitcoin Mining 101

Bitcoin Mining 101

By | 2017-12-19T22:09:31+00:00 September 16th, 2017|Tags: , , |

What is Bitcoin mining?

Bitcoin mining can seem like a rather complicated procedure but in reality it’s easy, affordable and almost anyone can do it, so let us get started on learning about everything that maybe important when it comes to bitcoin mining! But first of all, hows does it all work? Bitcoin mining is done by using the SHA256 double round verification process. Bitcoin mining computers solve math problems and the more power each miner generates, the more Bitcoin is rewarded for the miners efforts.

Bitcoin mining guide for dummies and the curious

Bitcoins are now mined using special computers that are built and designed for one sole purpose and that is to mine Bitcoins. But why can’t you simply use a normal computer to mine bitcoins? Simply because you will end up using more electricity, have less power and produce less bitcoins so you will end up making a loss. Bitcoin computers are specially designed to consume as little electricity as possible, generate the most amount of power and produce the most amount of bitcoins.

1) So the first thing would be to do is buy a bitcoin miner, to help you decide which one is the best for you, you can take a look at a cryptocurrency mining calculator such as coinwarz that enable you to see how profitable a miner would be at a specific point in time depending on the coins price. For some miners and cryptocurrencies, the return on investment can be less then a month.

2) The next step is to download a bitcoin mining software such as Easyminer which is a free, easy to use software. You can turn it on and just simply leave it to do the work.

3) You will need to place the coins you have earned somewhere, so for that you will need a bitcoin wallet such as Trezor, opendime or you can use a universal wallet such as Copay.

4) Next make an account on a Bitcoin exchange such as Coinbase and Kraken (I don’t recommend storing Bitcoins on these exchanges) and sell them! Many exchanges offer same day sales and are very convenient and reliable.

Another thing you can do which is optional but highly recommended is to join a mining pool which are groups that work together to solve a block (a math problem) and share its profits. Mining pools are usually more profitable as they combine their computer power to solve math problems. As without a mining pool you can be mining or months or even a year and not receive a single bitcoin. Currently mining pools such as Slush pool or BitMinter offer such services.

Why mine in the first place?

So, now that you know about how to mine Bitcoins in 4 to 5 easy steps, you maybe asking why should you start in the first place? Bitcoin mining is extremely secure and usually mining not just bitcoins but other cryptocurrencies can yield a high return on investment. With bitcoin mining their isn’t a whole lot you need to do, other then leave your miner on, let it mine and once you have enough coins, just sell at an exchange and do it all over again. It’s easy, simple and uncomplicated which has lured many Chinese businessmen and investors, many of whom have become extremely successful from mining bitcoins and have opened their own bitcoin farm where all they do is mine bitcoins.

Let us talk about money for a second, with regards to certain cryptocurrencies and certain miners you can make a return on your investment in a month depending on market conditions. Bitcoin miners are very affordable and can provide a steady source of income with minimal effort. Which has attracted your average Joe and created millionaires. To put Bitcoin mining into perspective, it is like owning your own digital gold mine and the miners as your workers that don’t need a salary, food, water, housing and etc. All miners need is electricity and a computer.