mine the big 10

Cryptocurrency mining happens everywhere and has now become a mainstream industry. Governments all over the world produce their own currency. Miners fulfil this function in the cryptocurrency world. South Africa uses the Rand (ZAR) and the United States uses the US Dollar (USD). People usually exchange fiat currencies for either investment purposes and for overseas transactions. This is usually costly as fees go straight to the bank as a service charge. Nowadays, money can be generated from home and sent in an instant using the internet and online banking. Cryptocurrency mining and crypto, in general, has changed the way that money works for the average user. As a result, the financial sector decided visiting banks was an inconvenience, and drifted toward using online beneficiaries.

Today, blockchain technology is responsible for the world’s most secure financial transactions. The development of cryptocurrencies such as the worlds first, Bitcoin, and other coins such as Ethereum, Bitcoin Cash, Litecoin, Monero and many more assisted in streamlining this process. All crypto transactions are encrypted and stored on the blockchain’s public ledger. With specialized- cryptography software, the blockchain provides all users verifiable and secure transactions online. This software encrypts all information using mathematical algorithms, then cryptography is applied to secure and validate every transaction taking place on the blockchain.

About Bitcoin

As it stands, Bitcoin (BTC) is the digital gold of the cryptocurrency world. Bitcoin sets the gold standard on the crypto markets, hence, all cryptocurrencies that aren’t bitcoin are altcoins. The unknown inventor of bitcoin, Satoshi Nakamoto, developed the coin to be an electronic peer-to-peer financial system with no central entity. As a result, Bitcoin is a decentralized cryptocurrency that avoids all 3rd party involvement from central banks or government authority.

All bitcoin transactions are stored on a digital public ledger called the blockchain. This blockchain operates using a secure system named cryptography. Cryptography is used to provide users with signed and secure transactions at little to no fees by using mathematical algorithms.

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Bitcoin had a favourable year in 2013 as the cryptocurrency started to gain widespread popularity. Eventually, this resulted in large price surges for bitcoin, consequently increasing the valuation of Bitcoin. For example, in 2010, the price of 1 Bitcoin went up by 1000%. The price of a single bitcoin went from $0.008 to 0.08. By the end of 2013, Bitcoin’s valuation was floating between $650 and $800. Steadily rising in value, the price of bitcoin hit its peak in 2017, reaching just over $19,000 (Over 270,000 ZAR). Now, as of writing this post, the market cap for bitcoin is $112,111,694,044.

Digital Silver, Ethereum (ETH)

Co-founded and released in 2015 by Vitalik Buterin, Ethereum quickly became the cryptocurrency with the second biggest market cap. Ethereum was designed as an open-source platform. It introduced the idea of smart contracts to the cryptocurrency world. For a scale of how quickly this coin grew; in 2016, 1 Ethereum coin (ETH) was worth $10, and the market cap was just over $1 Billion. Now, Ethereum’s market cap is well over $21 billion. It may be worth noting that despite Ethereum and Bitcoin being somewhat similar, they are two completely different cryptocurrencies with their own goals.

Ethereum used the technology bitcoin uses and expanded on it significantly. Ethereum is a whole network, complete with its own internet browser, programming language, and its own payment system. On the Ethereum network, Ether (ETH) is the token that fuels transactions. As Ethereum uses blockchain technology, all transactions are approved by miners by using the proof-of-work system.

What is mining?

For years, mining cryptocurrency has been a safe and accessible way for crypto users to increase their return on investment. While crypto mining can be a lucrative investment, the barrier of entry is quite high. In order to mine cryptocurrency, users will need specialized computer systems paired with software in order to solve complex mathematical algorithms. These algorithms verify the authenticity of all transactions that take place on the Ethereum network. Whichever user cracks the maths algorithms first gets a varied amount of whichever cryptocurrency token they are mining. There are 3 types of cryptocurrency mining. These are;

  1. Pool mining (Recommended)
  2. Cloud Mining (Not Recommended)
  3. Solo Mining (Not Recommended)

Pool Mining

If you’re considering joining a mining pool using your own computer system, there are a few tools you will need to maximize your efficiency. Here will be a short list of what you need in order to begin pool mining cryptocurrencies;

  • A wallet able to hold your cryptocurrency tokens
  • The latest GPU drivers
  • An application used for mining (e.g. Claymore miner)
  • A mining pool address
  • A Graphics card (GPU) with a minimum of 3gb VRAM
  • A compatible operating system (64-bit version of either Windows 7 or 10)

Is it worth it?

Every mining pool comes with a different interface, but the principle of mining stays consistent. In order to check how much you’ve mined, you will need to go to your mining pool’s website and enter your public wallet address. Once you’ve searched this, you will be able to see all the information regarding your cryptocurrency mining endeavours.

Despite pool mining being the best option for mining, it is mainly for the experienced miners who prefer to have more control over their mining hardware. Occasionally, pool mining works similarly to cloud mining. Miners have an option for a remote data-centre can host their hardware, will still retaining full control over how it is set up. However, when using a mining pool, the mining company charges a maintenance and electricity fee. In doing this, the miner is able to control any risks with the maintenance kits and any hardware shipments.

Pool mining involves a community of miners that come together in order to combine their computer systems to increase their crypto profitability as well as income stability. Hence the term mining pool. The bigger a mining pool is, the less the payout is. This is because, in a mining pool, everyone involved agrees that if one of them solves a mining block, they will share the reward with all users in the pool. As a result, how often you will be finding blocks and sharing them with people will vary depending on which pool you are in. Not all mining pools are the same.

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Solo mining

When researching into cryptocurrency mining for the first time, solo mining might seem like a good idea. The reality, however, is that solo mining is a free-for-all. When solo mining, you are competing with other people, and you will only receive your reward if you are the first person to solve the algorithm. When solo mining, you are competing with a large network of miners, some of which are companies with an abundance of resources. In order to make worthwhile profit solo mining, you would either need 100+ GPUs, or you would need to get consistently lucky. But even with 100+ GPU systems, this much computing power comes with disadvantages.

Disadvantages of solo mining

  • Heating problems; After a while, your equipment will become very hot. Without proper cooling, your equipment faces the risk of damage. When trying to make a profit by mining solo, you will need to make more money than you spent on the equipment in order to make a profit. If your equipment breaks, making a profit will take far longer as repair costs will need to be added to the initial money spent on equipment, delaying profit.
  • Ventilation; To counteract overheating, ventilation is key. If you don’t have any cooling systems set up for your mining rig, lots of fans and cool air are a must. Keeping your mining equipment cool ensures its longevity and reduces the risk of equipment faults in the long run.
  • Electricity Costs; Mining cryptocurrency comes hand in hand with high processing power. As a result, electricity costs are an expensive factor that comes into play when mining crypto. An example of this would be; if you were using only 10 graphics cards to mine crypto, electricity costs would be $3-4 USD per day. With a 100 GPU mining rig, these electricity costs will shoot up to a whopping $30-40 USD per day. This is an important factor to consider when attempting to make a profit with solo mining.
  • Storage; When mining crypto, noise, and space are 2 important factors. With several fans cooling your mining equipment, the noise will become an issue. If you have over 100 GPUs just to competitively solo mine, you’re going to need a garage or a warehouse to efficiently set up your rig. Most professional crypto miners use either warehouses or remote locations in order to store all their equipment.

Cloud Mining

With cloud mining, you are paying for someone else to mine for you. Businesses that offer cloud mining services often have their own mining farms set up. They charge users a fee to rent space on their mining server. Once a user pays this fee, they will receive all of the rewards generated by the mining rig on the space they rented. Cryptocurrency mining doesn’t sound like a smart idea for the person hosting the service, but it’s available nonetheless. I mean, why would someone pay for expensive mining equipment in order to mine crypto for someone else? In the same light, why pay someone to mine for you if you can just invest that money into your own mining rig? If your argument is “a mining rig is too expensive” then why don’t you buy crypto from a cryptocurrency exchange instead?

Believe it or not, we’ve had multiple threats from some cloud mining providers for exposing the cloud mining fallacy. Read how people lose money getting caught in the cloud mining trap.


Though these are valid questions, much like the other cryptocurrency mining methods, there are pros and cons. For example, a benefit of cloud mining is that you negate all responsibility for the equipment. If the equipment breaks you have no need to pay for it. Paying for a cloud mining service is basically just paying for a certain amount of work to be done. Repair costs are not the user’s responsibility. Be that as it may, some cloud mining companies charge their users for electricity and repair costs to catch them out. Be sure to read your contract vigilantly in order to avoid this.

As you’ve paid the money up front, if the cryptocurrency you’re mining goes down in value, you won’t be able to get a return on your investment. Users can’t cancel cloud mining contracts before they finish. Also, you won’t be able to change the mining software or hardware provided by your cloud mining provider.

What cryptocurrencies can I mine?

You can’t have cryptocurrency mining without investment and maintenance fees. As well as this, you will need to purchase expensive mining equipment that uses high processing power in order to solve mathematical algorithms on the blockchain network.

Bitcoin (BTC)

logo btc

As Bitcoin is the most popular cryptocurrency in the world, the network of miners tied to it is one of the largest. As a result, many bitcoin miners have shifted toward cloud mining services (such as Hashflare). This is because the mining rigs these services provide are often of the highest quality. Consequently, investment costs can be high with slow returns on profits as mining difficulty increases. Bitcoin uses the Proof-of-Work consensus algorithm for mining.

 

Ethereum (ETH)

logo eth

Ethereum is a decentralized platform – similar to bitcoin – that runs on smart contracts. Following the price bubble in 2017, many investors decided to join the cryptocurrency mining industry. With bitcoin mining returns getting lower over time, people have turned toward mining altcoins. Ethereum is the second largest cryptocurrency after Bitcoin. As a result, the Ethereum network of miners is still very large, but not as vast as Bitcoin’s. Ethereum uses the Proof-of-Stake consensus algorithm for mining.

 

Litecoin (LTC)

logo ltc

Designed to be mined on the average CPU, Litecoin has also been optimized for better efficiency when being mined with a GPU. As Litecoin has no support from ASIC mining hardware, it is often the first cryptocurrency new miners attempt to mine. Litecoin uses a hash function called Scrypt as an alternative to the more common SHA-256 hash function. SHA-256 and Scrypt are mining algorithms for the Bitcoin and Litecoin protocols. Similarly to bitcoin, Litecoin also operates within the Proof-of-Work consensus mechanism.

Bitcoin Cash (BCH)

logo bch

Originally a hard fork of Bitcoin Classic, Bitcoin Cash increases the size of blocks on the blockchain to increase transaction processing speeds. Recently, many miners have flocked to BCH in order to raise the value of the asset. If you have a powerful mining rig, the reward for completing a new block is currently 12.5 BCH. As a result, mining BCH can be very profitable if you purchase an ASIC miner. ASIC miners are specialized computer systems built solely for the purpose of mining cryptocurrencies. Bitcoin cash uses the Proof-of-Work consensus mechanism for mining.

 

Monero (XMR)

logo moneroSimilar to Bitcoin, Monero is an open-source virtual currency aimed at decentralization and fungibility. As it stands, there is no hardware configuration that works best for Monero mining. Monero uses a custom Proof-of-Work consensus mechanism called ‘CryptoNight’. Monero has seamless generic hardware mining as a focus point. With Monero, the performance gap between GPUs and CPUs is very small. As a result, ASIC miners are an unnecessary expense when attempting to mine Monero. The best option for Monero mining is to acquire a few quality yet affordable CPUs and stack them.

 

Dash (DASH)

logo dashBuilt as an open source peer-to-peer cryptocurrency, Dash allows for private and instant transactions with a self-funded and self-governed infrastructure. Dash mining is very difficult as it can only be mined using specialized equipment. GPU and CPUs are invalid when attempting to mine Dash. Only Dash-compatible ASIC miners are able to mine DASH tokens. While you can attempt to mine DASH with a CPU or GPU, it will not be cost effective due to slow mining results.

 

 

Cryptocurrency mining risks?

The abundance of scams and hacks related to the cryptocurrency world has caused many investors around the world to be speculative when it comes to mining cryptocurrencies. However, most of these investors miss the main concept of cryptocurrencies. Decentralization. With decentralization, comes volatility. All crypto users should be aware that they are entirely responsible for their own crypto assets. There are many risks involved in investing cryptocurrency, hence why people are encouraged to do their own due diligence before investing their finances. While you can avoid many of these risks; here are a few you should take note of before getting involved with crypto mining.

  • Corrupt mining pool organizers; mining pool administrators are in a position where abusing their power can be profitable. Be sure to join a mining pool with reputable administrators. If you don’t, you face the risk of people pinching your profits or even taking everything and closing the mining pool completely.
  • Hackers; Occasionally, advanced hackers gain access to mining pools. This can be a very big problem as once this happens, they are often able to figure out a way of emptying the wallets of everyone in the mining pool.
  • High costs of electricity; Be sure to compare the electrical costs for mining with the cost of your mining hardware. Your return is highly dependant upon the costs you spent to start mining. If your electricity costs are more than your daily crypto return for mining, you will never make a profit unless the price of the crypto you are mining skyrockets.
  • Cryptocurrency’s valuation; If the price of cryptocurrency goes down, the return profit from mining will be worth far less. Mining cryptocurrencies during a dip or volatile market environments can be a huge risk.

Should I just trade crypto instead?

If mining crypto is too much of a task for you, you can always trade cryptocurrency assets instead. Our cryptocurrency exchange offers users the ability to buy and sell cryptocurrency in real time with other traders. iCE3X users are able to deposit fiat currency directly from their personal bank account and instantly start trading on our exchange. We offer a variety of the top cryptocurrencies and even offer 0% trading fees when trading against ADA/BTC and XMR/BTC.

 

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Disclaimer Notice:

This article is intended to educate and should in no way be seen as investment advice or an enticement to use the ice3x.com platform. Bitcoin is highly volatile with big profit opportunities but you should also remember that you could lose part or all of your investment whenever you take part in any high risk investment. Bitcoin trading is not a regulated industry in South Africa, which in itself carries additional risks. IF YOU ARE NOT AN ASTUTE BITCOIN TRADER, SEEK INDEPENDENT FINANCIAL ADVICE BEFORE MAKING ANY INVESTMENTS.