What is mining?

miners mining statue

Cryptocurrencies are shaking the world and mining them is an excellent way to earn money without having to buy actual coins. With hundreds of crypto currency ranging from a $0.001 coin to a $17500 Bitcoin, you can choose which coin you want to mine. Governments, banks and large enterprises are starting to be actively involved. Fortunately, not a lot of people are familiar with crypto currencies. This gives you the chance to tap into this money-making industry and reap rewards before others jump in. Only a few people have peeked into the technologies and ideas that these crypto currencies aim to bring in the future. They have invested in it and are also “mining” it. The profits have been outstanding so far and more and more people are getting involved - and the longer you wait, the less you can earn!

But what is mining?

Just like natural resources such as gold and coal, crypto currencies are also mined.

Mining cryptocurrencies has 2 roles:

  1. Releasing a new "coin".
  2. To secure and verify transactions that are happening on blockchain.

            Unlike normal currency transactions being confirmed and regulated through banks, crypto currencies’ transactional data appears to public on a ledger known as Blockchain. Each block can be said as a page that contains the data of transactions. That is why it is called as blockchain. Mining helps to confirm these transactions on a blockchain. Miners also run cryptographic hash on blocks. Hash require complex computations.  These hash are important because they make a block secure. Once a block has been accepted in the blockchain then it can’t be altered. Miners anonymously validate these transactions. For their help, miners are rewarded a crypto currency. Proof Of Work is the term coined for the assistance of miners in validation of transactions.

         You need a computer and software to mine a crypto currency where your CPUs or GPUs processing capabilities are utilized for crypto currency mining. CPU mining was earlier more common but with the rise and power of GPU mining due to GPU’s better performance, people now mostly use GPU mining and CPU mining is obsolete. This is the reason graphic cards have become more expensive. You can get back your investment in a GPU in a few months through mining and can continue to reap its rewards for a few years. By special tweaking of software and hardware, you can even increase your profits by increasing performance. Specialized stores such as EU mining offer preassembled and preinstalled computers for mining. All you need to do is plug and earn!

        The more a crypto currency grows in popularity and demand, the harder the problems becomes for miners to solve. Bitcoin mining was extremely profitable in the beginning but right now it is not feasible enough to mine Bitcoins at home. Entire factories in China are set up with hardware to mine Bitcoins. This is where Ethereum mining comes in. Ethereum is the 2nd most popular coin after Bitcoin - it was $8 at the start of the year and has now crossed the $600 mark. Mining Ethereum has several advantages over mining Bitcoin:

  1. It is still possible to mine at home using "mining rigs"
  2. It is mined using GPUs, so even after mining becomes obsolete you are left with valuable graphic cards which can be sold and you can return your investment

mining rig

Mining is exploding lately and there is no end visible. For now, mining Ethereum is still possible but it is extremely difficult to get GPUs, motherboards and equipment - so head to the store and start mining before it is too late!