What is Mining in Cryptocurrency?
As a beginner, maybe you’re being confused of the word ‘Mining’, well to
explain this in a very simple way try to imagine golds and how they are
being mined. But before you think of buying a physical shovel and
mattock, let me explain how mining is done virtually. Crytocurrencies like
Bitcoin are mined with the use of computers. Mining requires specialized
computerswhich can find solutions to difficult math problems in order to add a new block into the blockchain.
Anyone who has access to the internet with the right equipment’s can participate to mining and earn bitcoin rewards.
Mining is not that easy, but it depends on how much effort you are putting in your network. To start mining bitcoins, you need to have the all necessary equipment’s for a more effective and successful mining process.
Things you need:
1. Get a Mining Rig- Mining rig can be costly, some chooses to
customize their own, while others often make investment of buying
the best rig to use.
2. Bitcoin Wallet- You can consider this one as an online wallet
where you can store your bitcoins etc… safely. Once you’ve signed
up for a wallet, make sure to get your wallet address – you can see it
as a long sequence of numbers and letters. In keeping your coins,
you must copy your wallet address on a sheet of paper or you can
use some storage device as your back-up in case your computer
crashes. So why you have to do this? It’s just simply because when
your computer crashes all your bitcoins will disappear and they will
be gone forever unless you know your wallet address.
3. Find a Mining Pool- Mining pool is a group of miners that
combines their computing powers to get more Bitcoins. Joining a
pool will give an easier and smaller algorithm to solve. But before
deciding to join a pool you have to considered few things first, and
these questions must be answered clearly.
What is the reward method in the pool?
How stable is the pool?
What are the fees and charges for withdrawal?
How easy is withdrawing funds?
How frequent they find a block?
4. Mining Program- Choose a software depending on the equipment
you are using – when GPUs and FPGAs you must use a host
computer running these two; the standard bitcoin wallet, and the
mining software. Consider also the OS (Operating System) you are
using, for Windows the best software would be the Bitcoin Miner
and BTCMiner, for Linux you can try CG Miner BFG Miner and
EasyMiner, and if you’re using Mac OS, RPC Miner is the best for
you. The mining software will the one to instruct the hardware to do the
work of mining.
5. Start Mining- All is set and you need to start the mining process,
connect your miner and power up – to start you need to put the
mining pool, username, and password. Once configured you can
now mine your first bitcoin reward.