What is cloud mining

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Cloud mining

The term “mining” came from the mining industry in which the field was meant. For users (miners, respectively), the concept of “mining” means roughly the same thing — gold mining — only virtual, and in this case Bitcoin (the leading cryptocurrency today). However, there are also Lightcoins, a not so valuable cryptocurrency that can be compared by analogy with virtual silver. Thus, mining is the creation of new crypto coins, for which the miner follows a certain algorithm.

What is this algorithm? So, we have the basis, namely the Bitcoin system. It is on its algorithms that the appearance of crypto coins is based.

Bitcoin has been around for 6 years and has been debugged in such a way that the emergence of new crypto coins does not outperform gold mining in the world. This condition ensures that there is no risk of depreciation of the cryptocurrency, and therefore, an increase in the rate of bitcoins. The receipt of new crypto coins by miners is based on the calculation of the hash (hash amount) –a unique data set confirming the transaction of funds. For such a calculation, you need, of course, Internet access, and quite powerful calculation equipment that provides high mining speed (the power of a conventional PC is not enough here).

In addition, over time, the number of bitcoins received increases and new calculations require more powerful and advanced ASIC equipment, which, in addition, pays off much more slowly than, say, for the period 2012-2013. Moreover, this equipment is not intended for anything else, and even quickly becomes obsolete – in moral terms, of course. Add to this the huge electricity bills, the eternal heat and heat of equipment, and the constant noise of the fans.

Only one conclusion suggests itself: conventional mining in will have practical sense except for large data centers.

However, the situation was somewhat resolved with the creation of the so-called Joint pools – that is, a computer network where mining is distributed among several users, which allows to increase the speed of generation without the need to increase the capacity of the equipment.

Recently, cloud mining is gaining popularity. Its advantages are obvious – you do not need to purchase expensive equipment; Get up in the middle of the night because the mining farm suddenly “fell”; Messing around with equipment setup. You just pay the data center for the required capacity (gigahesh / s) – and then the specialists of the data center will install all the equipment themselves. You will receive your percentage from the cryptocurrency that the data center receives. That is, you are “in share”.

However, even in this case, you need to properly study the issue of earnings through mining.
You should be able to predict mining earnings, assess risks, and most importantly, monitor cryptocurrency exchanges – now, in addition to Bitcoin and Litecoin, there are a number of still new cryptocurrencies, whose advantages are low equipment requirements, and in the future, substitution in the leading position of Bitcoin .

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