In the traditional monetary system, banks and states print coins and bills. In Bitcoin issuance, this is called mining. Simply put, it allows you to own the crypto, without having to buy any. How to mine Bitcoin? What equipment to have, and is it profitable? This detailed article on bitcoin mining will tell you everything.
The more time passes, the more trading platforms offer Bitcoin and other crypto currencies. But, which site to choose right now? Here are our top 3 best BTC brokers France presented above. This is an easy way for beginners to get Bitcoin without mining which is a complex and expensive activity.
There are actually several ways to mine bitcoins. So, we chose to show you how it’s done on the Cloud Bitcoin Mining pool, a simple and cheap method. So above is a step-by-step explanation of what you need to do to mine bitcoin via the cloud mining software. Now we will see in detail this whole procedure of bitcoin cloud mining.
How to mine Bitcoin?
In the following section, we will present you with a complete tutorial that will show you how to perform Bitcoin mining on Cloud mining.
Open a Bitcoin Wallet
First of all, it is imperative to open a Bitcoin Wallet in order to mine the leading crypto currency. Indeed, this step is essential for the holding and security of digital funds (BTC tokens).
In fact, you have two ways to open a Bitcoin wallet:
- Choose a physical wallet: physical storage spaces or USB keys
- Open a web wallet: applications installed on your mobile device or computer
Open an Account on a Cloud Mining Pool
Secondly, it is up to the investor to create an account on a bitcoin cloud mining platform. As a result, you will need to provide the following personal information:
- Email address
- Phone number
Go to the “Mining” tab
Third, it’s time to mine profitable bitcoin. This happens directly after you open your account. To do this, you need to click on the “Miner” tab. In case the mining platform accepts mobile mining, you can do it from your smartphone.
Start Mining Bitcoin
Lastly, it’s bitcoin mining itself. In any case, it is the chosen broker, preferably eToro, that will take care of your BTC mining in peace. In any case, the investor simply has to control the transactions and renew them every 4 hours.
Furthermore, you receive the income from the mining every 30 to 40 minutes. Therefore, these profits can be used to trade digital assets on the platform.
However, it should be remembered that Bitcoin mining is a somewhat complex and expensive activity. Thus, Bitcoin trading is more suitable for beginners, as it is less risky and more accessible.
What Hardware is Required to Mine Bitcoin?
Before you start mining Bitcoin, you need to look at the mining equipment. This is a set of digital “picks and shovels” that will help you achieve your goal. In this section you will find all the components of the equipment dedicated to BTC mining.
Powerful Graphics Cards
For Bitcoin mining, it’s important to have high-end graphics cards. For example, they are a key piece of equipment for performing calculations during mining. This means that you need to consider the power and price of GPUs before you buy them.
That said, there are two main brands on the market. Probably, you will benefit from using either AMD cards (Vega, RX 480/580) or Nvidia cards (RTX 2080, GTX 1070/1080).
Clearly, you should avoid low-cost entry-level GPUs. In other words, go for high-end ones that are worth $1,500 to $4,000.
A High-End Motherboard
Needless to say, the motherboard is the foundation of your bitcoin mining setup. Keep in mind that the number of graphics cards you use depends heavily on the number of PCI Express slots available on your motherboard. At a minimum, you need 6 slots.
Unquestionably, the hash rate will be high whenever your motherboard can support many GPUs. So, you understand how much a motherboard can increase the profitability of your mining.
A High Capacity Hard Disk
Indeed, the hard drive is a no less negligible piece of hardware, which can store the mining software and the operating system. Thus, an SSD hard drive would be a good deal. In this case, opt for a hard drive with a lot of space.
Similarly, a 4GB RAM would also do the trick for fast computing and processing of information. Again, it should be noted that this equipment is both expensive and also requires a lot of research. For these reasons, trading and buying Bitcoins will then be suitable for most traders, especially beginners.
A More Suitable Operating System
Very often, Bitcoin miners are spoilt for choice when it comes to the operating system to use to install the mining software. These include Linux and Windows.
However, we are unanimous that Linux is the operating system you need to mine crypto currency. Consequently, it will not be easy for the uninitiated to use it.
A good power supply
In any case, you should have a power supply whose capacity is higher than the energy consumption of the GPUs.
As an illustration, if you use 3 GPUs of 220 Watts and the other components consume 250 W, the capacity of your PSU should be over 910 Watts.
A Mining Software
Of course, you need to have a mining software to achieve an optimistic result. Certainly, it is important to choose a software that matches your graphics card.
As you already know, bitcoin mining software is compatible with both Linux and Windows versions.
Efficient air conditioning
Knowing that the graphics cards are working full time to mine Bitcoin, this implies that the heat will be permanent. There is a reason to provide adequate air conditioning to avoid the risk of overheating.
In any case, it is best to air-condition your workplace so that your mining equipment does not degrade.
A Secure Bitcoin Wallet
At the end of your mining activity, you need to store your profits in a reliable crypto wallet. Thus, the Bitcoin Wallet allows you to receive the BTC tokens earned from mining.
Much more, there are two types of mining wallet, namely web wallet and hardware wallet. Nevertheless, make sure that the wallet you choose accepts payments related to bitcoin mining.
Remember: Mining bitcoin requires heavy equipment and computer skills. This means that it is not an activity accessible to everyone. Also, mining requires an initial capital outlay.
What is Bitcoin Mining?
At the outset, it is imperative to note that mining bitcoin is quite different from owning bitcoin. To better understand the concept of bitcoin mining, we will review the following key points: origin and definition, work of miners and limitations of bitcoin mining.
Origin and Definition of Bitcoin Mining
Origin and Definition of Bitcoin MiningIn truth, BTC mining is a practice that developed in 2008, with the creation of the blockchain. Since the beginning, it is a process that is based on securing the blockchain in exchange for the token fragments of a cryptocurrency for the miners. In a way, it takes the form of a reward.
Subsequently, the mining of BTC is akin to a conquest of the fragments of the best crypto currency by its users. Illustratively, it looks like gold miners with shovels and picks searching for the precious sesame.
Simply put, mining is similar to validating a BTC transaction, whose data is encrypted on a blockchain. It is a matter of guessing a random number that reflects the resolution of a problem generated by the system. In this sense, it is crucial that your computer is powerful to make several guesses and earn the right to add the next blocks.
As a reward, you will acquire some bitcoin fragments. As a result, new units of crypto currency are created, and the blockchain gets even stronger.
The Importance of Miners
In the third millennium, Bitcoin is mined by extremely powerful computers owned by miners. So how important are miners? At least, their job is to validate transactions, while thwarting double spending.
At the same time, the thorny problem of duplicate transactions has been eliminated with the creation of the blockchain. In any case, this has allowed blocks to be time-stamped before being distributed to all nodes in the network.
Certainly, the transactions are recorded in an immutable way. One could say that the miner’s mission is to legitimize the transactions. By doing so, miners have the imperative task of securing the distributed ledger against malicious actors.
At the end of the day, miners deserve a reward, if only because this activity is energy-intensive. Currently, this reward is 6.25 btc. Specifically, this rate is applicable since May 11, 2020, the date of the third halving of BTC.
The Limitations of Bitcoin Mining
In fact, the promoter of Bitcoin, in the person of Nakamoto, has set a maximum number of coins to circulate. As a result, Bitcoin’s supply is limited to 21 million tokens. Unlike the Fiat currencies, which have no limitations, BTC can never exceed the number mentioned above.
Why limit itself to 21 million coins? It seems that this decision was motivated by the fact that new blocks will be added to the network after every 10 minutes. Another reason is that the rewards given to miners are expected to decrease every 4 years.
Indeed, by 2140, all 95% of bitcoins will already be mined and miners will only receive transaction fees after that date.
How does Bitcoin mining work?
Unlike ETH mining, which simply requires a powerful graphics card, mining BTC is a complex operation. In any case, the miner must have a powerful computer.
How does Bitcoin mining work?
Simply put, the Bitcoin mining process is based on mathematics and proof of work. Through the proof of work system, the Bitcoin blockchain uses a hash algorithm to secure tokens.
What’s more, the essential steps in this process are: the creation of the new block and the validity of the block in question. Here is a step-by-step explanation of how Bitcoin mining works:
- Opening a transaction between two users of the network
- Integration of the transaction in a block
- Verification of the validity of the transaction by the miners
- Search for the solution of the mathematical problem
- Adding a new block to the blockchain
- Diffusion of the block on the whole network
Who Can Mine Bitcoin?
Earlier in this article, we pointed out that bitcoin mining requires heavy equipment. This means that any miner must have adequate start-up capital to acquire all the required hardware.
Also, it is essential that he or she has a thorough knowledge of computers in order to achieve his or her goal. This is a prerequisite for successful bitcoin mining. It will never be possible to make money on the simple installation of mining. Therefore, it is imperative to be able to configure the mining software properly.
In conclusion, bitcoin mining is not an activity that everyone can do. You will have to spend a lot of money on hardware. And if you are not well equipped in the computer field, you will miss out.
If you can’t get Bitcoin mining software, don’t complain. The eToro platform gives you other alternatives for obtaining BTC.
How much does Bitcoin mining pay?
Certainly, bitcoin mining can be a profitable way to get BTC tokens. Previously, any individual could venture into this activity. Now it is no longer obvious, as this activity is profitable for cooperatives and groups of miners.
Thus, an individual can be profitable if and only if he joins a mining pool. Then you have to share the rewards with other miners. Also, it should be noted that miners’ cooperatives are able to predict the possible rewards.
On the other hand, we would like to mention that the earnings from bitcoin mining depend on the power of your mining equipment and the price of the crypto. If we go by some studies, miners’ rewards ranged from 20 to 40 euros in 2017, even though the price of BTC was below $1,000.
Nowadays, the reward for a block of bitcoin is 6.25 btc, yet the price of bitcoin is in an amazing progression. This means that all miners earn a total of 64,125 euros every 10 minutes. However, miners can only touch fragments of Bitcoin.
To put it bluntly, the competition for Bitcoin miners is fierce. We encounter an impressive number of miners, which moreover increases with time. That’s why the salaries are tiny.
The Best Bitcoin Mining Solutions
There are several ways to mine crypto currency, especially Bitcoin. In this section, we will focus on the different ways to mine BTC: cloud mining, mining rigs and mining pool.
Bitcoin Cloud Mining
If there is a more economical way to mine BTC, it is cloud mining. What is it about? Simply put, it’s about using the computing capacity of a Bitcoin mining company.
In other words, it’s a way of renting the mining equipment of the company in question. With bitcoin cloud mining, you don’t need to be a computer whiz, let alone have expensive mining equipment.
Also, you’ll be spared the cost of electricity and the possible risk of damaging your computer’s processor. On the other hand, there are cloud mining platforms that require the services of an intermediary. In this case, your earnings will be reduced. So to speak, you will benefit from choosing a reputable platform.
Examples of Cloud Mining Platforms
- Genesis mining
Advantages of Bitcoin Cloud Mining
- Zero computer knowledge required
- No mining hardware to buy
- No expense for installation and configuration
Disadvantages of Bitcoin Cloud Mining
- Possible risk of the mining company going bankrupt
- Cannot collect rewards in full
The Mining Rig
The mining rig is used when you want to mine bitcoins individually from home. Indeed, it is imperative to acquire an ASIC.
Before buying an ASIC, it is highly recommended to consider a number of parameters, namely price, Hash rate and power consumption.
In addition, bitcoin mining requires the installation of Bitcoin software and its configuration. Besides, miners like BFGminer and CGminer software.
Examples of Rigs for Bitcoin mining
- Pangolin Whatsminer M3X
- Bitmain Antminer T9
- Halong Mining DragonMint T1
- Bitmain Antminer S9i
Advantages of Bitcoin Mining Rig
- High uptime
- High quality installation and configuration
- Great rewards
Disadvantages of the Bitcoin Mining Rig
- Irregular income
- Unsuitable for novice miners – in this case it’s better to trade Bitcoin on eToro for example
- No mining without computer skills
The Mining Pool
The mining pool is a practice that is suitable for beginners and improves your earning potential. It is characterized by the pooling of expenses among the members of a Bitcoin network.
Generally speaking, these are cooperatives or groups of miners who aim to make regular profits. Through the multiple mining nodes, it will be possible to quickly solve the puzzle.
Not only is the income regular, but it is also more stable. And don’t forget that all members of the network will get bitcoin chips as rewards.
Examples of Bitcoin Mining Pools
Benefits of Bitcoin Pool Mining
- Stable and regular rewards
- Suitable for beginner miners
Disadvantages of Bitcoin Pool Mining
- Risk of DOS attacks
- Lower income
What are the advantages and disadvantages of Bitcoin mining?
This is the question we will answer in this section. By reading the strengths and weaknesses, you will decide whether or not this activity is a good business.
Mining Bitcoin: The Advantages
There is no doubt that mining bitcoin is an advantageous activity in many ways. So here are the highlights of bitcoin mining.
- It is possible to earn money and the rewards are paid out in bitcoins
- An activity that contributes to strengthening the security of the network
- Possibility to work with money from home
- The mining equipment does not lose its value in case of resale
- It is possible to increase the chances of acquiring BTC via the mining pool
- A great way to get crypto currencies, including Bitcoin
Mining Bitcoin: The Disadvantages
Despite the privileges encountered in Bitcoin mining, the fact remains that it is also a risky business. Let’s take a look at its weaknesses.
- A complex process requiring computer knowledge
- Mining BTC is an energy-intensive activity
- Mining equipment seems very expensive
- Low profitability due to excessive cost of electricity
- Bitcoin mining contributes to global warming
So for all these reasons, it is obvious that mining is not for everyone. Thus, buying Bitcoin is much more suitable for beginners in this field, for reasons mentioned above.
Mining Bitcoin: Where to Store BTC Tokens?
After earning BTC tokens through mining, the question then arises as to where to store them. In principle, you should keep them in a secure crypto wallet.
However, it is important to point out that many crypto wallets do not yet accept payments from mining. This can be explained by the fact that mining involves the payment of small amounts of money.
Here are some examples of wallets available on the official Bitcoin website:
- Ledger Nano
- Trezor One
- Trezor Model T
Mining Bitcoin, What are the Alternatives?
After reading this article, you should know that Bitcoin mining is not suitable for every type of miner. Beginners will certainly have a hard time adapting to this activity. If you don’t feel comfortable with computers or you don’t have a substantial capital, you should choose another alternative to get BTC. In this part, we have prepared 3 good alternatives to bitcoin mining.
Trading Bitcoin at an Online Broker
Do you want to get Bitcoin easily? If so, the best way is to buy or trade it from an online broker. For this, you need to create a trading account on a secure and reliable platform like eToro. Then, you will have to verify its identity and fund your account. And that’s it, because you’ll be able to trade Bitcoin safely and confidently.
Instead of spending exorbitant amounts of money on mining equipment or cloud mining, you’d be better off using eToro for all purposes. This crypto trading site has a strong security potential, and gives you the opportunity to invest in several other virtual currencies. In conclusion, this platform is great for beginner traders, who can take advantage of its user-friendly interface, demo account and trading training. However, this is not the case in mining.
Participate in Cashbacks and Faucets
Whether it’s cashback or faucets, there are two distinct ways to obtain BTC tokens without spending any money.
On the one hand, the faucets are remunerations granted after in exchange for shares. For example, they can be answers to a quiz / poll / survey, video views or clicks on banners.
On the other hand, when it comes to cashback, it is a matter of giving a percentage of the transaction to the buyer of the Bitcoins. In fact, the payouts are made in BTC. In either case, you only get satochis, which are Bitcoin dust. Given the current boom in this cryptocurrency, it is possible to earn a significant jackpot.
Important: Bitcoin swigs are not a way to get large amounts of BTC. In fact, they only yield very small amounts. Therefore, it is advisable to invest in Bitcoin if you really want to make money from it.
Playing at Bitcoin Casinos
Among the alternatives to mining, you have online casinos that accept deposits in BTC. This means that to play at these BTC casinos, funds deposited in Fiat are converted into BTC.
Surely, any profits will come to you in BTC. Don’t think that this is an appropriate way to line your pockets. It’s just fun.
Mining Bitcoin: 4 Tips Before You Start
Before we finish this guide, we’ll give you 5 tips you need to successfully mine bitcoin. What should you look for?
Have Starting Capital and Computer Skills
In general, bitcoin mining is distinguished by its complexity. For example, it is not for beginner miners for several reasons. As a first step, consider checking whether your capital is sufficient to buy the mining equipment. Also, you should make sure that you can afford the energy consumption costs.
In addition, it would be best to have a high level of computer literacy. This will allow you to install the mining equipment and configure the mining software without any worries.
Analyzing Bitcoin Mining Alternatives
Considering the exorbitant costs of Bitcoin mining, and the requirement to master the computer tool, it is crucial to review the alternatives to mining this crypto currency.
In this article we have mentioned 3 good alternatives in bitcoin mining, namely an online broker, a faucet and the BTC casino. According to us, the best alternative is to buy from an online broker, such as eToro. In any case, it’s up to you to study the three proposals and choose the one that suits you best.
Prefer High Performance Hardware for Bitcoin Mining
First of all, let’s remember that mining hardware is extremely expensive. In fact, prices can go up to 4,000 euros. So you’ll want to spend that kind of money to improve your performance. In other words, look for a better quality/price ratio before buying anything. In any case, it’s worth comparing equipment before you buy.
Get Trained in Bitcoin Mining
Whether you’re a computer expert or a millionaire, it’s a good idea to have some basic knowledge of BTC mining.
Without context, you need to learn this activity before you get started. Going along with this, there are specialized mining sites where you can get trained. Also, be sure to consult with seasoned miners.
Conclusion: Should you mine Bitcoin?
In the final analysis, we confirm that Bitcoin mining is a less glamorous business for individuals. There are plenty of reasons for this. First, it requires a lot of start-up capital to get the mining framework in place. Secondly, it requires computer expertise. Whatever one may say, the big miners (mining pools) are the only ones who can reap significant rewards.
In practice, mining cryptocurrencies is not an activity to be recommended, especially since the gains are anecdotal. And to get BTC tokens, we have found some very good alternatives that are both fast and cheaper.
If you don’t have extensive computer skills, we recommend buying BTC directly from an online brokerage. In this case, we are unanimous that eToro is one of the optimal brokers. So take advantage of its low starting capital and get your BTC tokens quickly.
What does it mean to mine bitcoin?
Simply put, bitcoin mining is the process of validating transactions of this cryptocurrency and recording them on a distributed ledger. It is a process that helps to strengthen the security of the Bitcoin network and maintain its decentralization project.
How does Bitcoin mining work?
Quite simply, Bitcoin mining works in the following steps: First, miners install the mining hardware and configure the mining software. Second, a block is created, containing all verified transactions. Third, the network computers must find the mathematical problem in order to add a new block. Finally, the first computer to solve the cryptographic puzzle gets a reward after adding the new block to the blockchain.
What are the main countries where bitcoin mining is legal?
There are only a few countries where bitcoin is not legal, for example, for religious reasons. Some see it as a form of usury. For example, we can name these countries: Bolivia, Egypt, Pakistan, Morocco, Algeria. However, other countries are very favorable to Bitcoin mining: Iceland, Canada, Sweden, Finland…
What to do before mining Bitcoin?
Well before you start your Bitcoin mining adventure, it is crucial to make sure that this practice is profitable or not. So take the time to analyze all the costs of mining, from buying the mining equipment to consuming energy.
What influences the rewards of Bitcoin mining?
Bitcoin mining rewards actually vary depending on the price of electricity in a particular location. Also, the mining system chosen helps determine the miner’s earnings.