How are cryptocurrencies mined?
The miner is an investor who provides energy, computing space and time to sort the blocks. They send their solutions to the issuers when the process hits the correct hash.
Miners get rewards who are parties to the transactions by participating in the process. These are responsible for increasing the circulation of a particular cryptocurrency in the market.
Each digital currency has a withdrawal limit. So when the rewards are reduced, the inflow of new cryptocurrencies is also reduced.
Basically, the purpose of mining cryptocurrencies is based on the creation of new units of currency and in maintain the integrity of the blockchain ledger, which helps prevent illicit transactions.
How to mine with Ethereum?
There are different types and models of mining. The way of mining depends on the type of process and the hardware used.
CPU mining
CPU mining can only be done with certain cryptocurrencies. Usually this process is done through the power of the GPU. While CPU mining can be leveraged, it can be unprofitable if the networks involved are difficult to mine.
It used to be a viable option almost 5 or 6 years ago, but because of this its popularity has decreased due to falling profits.
GPU mining
This is the most popular method for people who are dedicated to mining Ethereum. Use one or more graphics processing units.
It is both relatively cheap and efficient to build a mining rig made up of GPUs. A standard one consists of a motherboard, a processor, and a platform frame that houses the graphics cards.
ASIC mining
Asic Mining.jpg
The miners SO C they are the majority way in which Bitcoin is mined. SO C are the English acronyms for Integrated Circuit for Specific Applications.
Precisely the ASICs increased their popularity with Bitcoin, and became the specific processor optimized par excellence for block mining.
cloud mining
Cloud mining consists of a process in which a company hires platforms for mining, through an agreement that fixes the earnings for both the company and the miner’s crypto wallet.
One drawback related to cloud mining is that you have to pay the money in advancewhich means that you will not get your money back if the price of ETH goes down. You also won’t be able to change company-provided hardware and software.
solo mining
It presents a high degree of competition due to the large number of participants in the network. It is a method that can generate profitability in the event that the person has a good amount of resources to remain in the network.
In January, a story circulated on social media about a solo miner with only 126 TH of Hash Power (pretty low) who managed to mine a block and In exchange, he obtained more than 250 thousand dollars of reward in Bitcoins.
Mining in pool or pools
mining-pool.jpg
Swimming pools? Yes. Ethereum can be mined using pools. It is a process in which a pool combines its computational resources into a mining pool.
Miners prefer to join pools because the difficulty of the Bitcoin network is increasing and doing it in a group increases the chances of obtaining a reward. In addition, there are more and more miners looking for this cryptocurrency, so doing it in a group is one of the best options.
Source: Ambito
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