Let's start with the most basic – the essence of mining and defining the process of creating new crypto money. If you simplify the term as much as possible, it turns out that it consists in mathematical calculations that are carried out on computers, farms or specially organized large mining centers. The latter are entire hangars stuffed with “iron”, they have enormous computing power and consume a large amount of electricity. The most common currency at the moment is bitcoin, which has become almost synonymous with the concept of “cryptocurrency”.

In simple terms, cryptocurrency mining is a computational task based on a cryptographic algorithm (hence a cryptocurrency). In the course of mining, new crypto coins are issued.

In the case of Bitcoin, the block reward in the early years was 50 BTC. In 2012, the size of the issue decreased to 25, and from 2016 – to 12.5 BTC. In accordance with forecasts, the emission will slow down by 2040, the reward for creating a block will not exceed 10-8 BTC. Further construction of new blocks will be carried out only at the expense of commissions.

Start mining

This article deals, as you understood above, about mining on a video card and step-by-step instructions. This mining guide is for beginners. We will set up mining, connect, install software, overclock the video card, and so on.

How cryptocurrency mining works in simple words

The term mining is borrowed from the English language in the literal sense (mining) is mining. Therefore, a set of equipment for generating cryptocurrency blocks is often referred to as a rig. In the language of blockchain engineers, mining is the support of the functionality of a cryptographic network by creating blocks in the Blockchain using computer technology. GPUs and integrated circuit devices are best suited for these operations. The crypto-miner uses the power of the computer hardware to solve the cryptographic equation, which will close the block.

A miner who finds a digital signature is paid a certain amount of digital coins. Cryptocurrency mining guarantees the integrity of the blockchain ecosystem, miners control the movement of assets, protecting the network from double-spending.

Mining bitcoins

Ten years ago, few people knew what cryptocurrency was. Bitcoin mining was easy to run on a dual-core processor. But, as conceived by Satoshi Nakamoto, after every 2016 decrypted cryptoblocks, the difficulty of mining increases. Difficulty is a system parameter that indicates how difficult it is to compute the hash function that will be the next proposed target for the network. As soon as the miners find 21,000 new blocks, the halving takes place. This term, the same is English, the word halving means halving, that is, the award of the owners of drilling rigs is halved. Halving and controlled emission (bitcoin has a size of 21 million cryptoblocks) relieve the blockchain network from the problems inherent in paper money. No one can turn on the printing press uncontrollably,

Thus, the difficulty of mining BTC gradually increased, and the reward for the created block decreased, and the time came when the use of the CPU became unprofitable. The time has come for graphic adapters, soon they learned how to assemble mining farms from them. FPGA devices tried to compete with them for some time, but then both of them supplanted ASICs.

But the mining of cryptocurrency on video cards has not stopped. New crypto networks have appeared that are not available to ASIKOV, and gpu-rigs continue to work safely on the creation of digital coins to this day.

The main ways of mining cryptocurrency

We list all the available methods for earning virtual coins.

3 Choosing a miner

For mining cryptocurrencies on SHA-256 algorithms, scrypt, you can use any of the popular miners:

cudaminer – for mining on video cards (GPU) Nvidia
cgminer – for mining on ATI video cards (GPU)
pooler cpu miner (minerd) – for mining on processors (CPU)

Types of cryptocurrency mining

Interested in mining cryptocurrency but don't know where to start? There are hundreds of cryptocurrencies that are designed for mining.

So, first select the coin you want to mine. Then, in order to start mining, you fundamentally need equipment.

A slight deviation from the topic. There are already more than 5,000 different cryptocurrencies in the world, but not all of these cryptocurrencies are mined, and moreover, of those that are mined, not all can be mined on Video cards, ASICs or processors. Each coin is mined in a specific way!

Different types of equipment used in cryptocurrency mining

Each coin uses a specific mining algorithm, and each of these algorithms can only be mined using specific hardware.

For example:

Bitcoin uses the SHA256 hashing algorithm, so it can only be mined using the SHA256 ASIC.
Litecoin uses the Scrypt algorithm, so it can only be mined with the ASIC Scrypt.
Dash uses the X11 algorithm, which again requires the X11 ASIC.
Zcash uses the Equihash PoW algorithm, which was previously mined using graphics cards (GPUs). But currently, you can only profit from mining Zcash (ZEC) with the help of ASICs.

What are ASICs? ASIC (Application Specific Integrated Circuit) is a machine that is designed to mine a specific algorithm, and they are only good at that.

READ:
Everything you need to know about ASICs in simple words

You will not receive any profit if you mine ASIC coins using a GPU or CPU. But don't worry, there are hundreds of other ASIC resistant coins out there.

For example, Monero uses the RandomX Proof-Of-Work algorithm, which is only optimized for graphics cards and processors. But what if you don't have a GPU or any specific hardware, but are still interested in mining? This is where cloud mining comes into play.

1 Choosing a fork

Quite a lot of Bitcoin forks have already appeared, as well as cryptocurrencies based on their own source code. The main criterion for selection is the profitability of cryptocurrency mining. A secondary criterion, for example, for me is its liquidity, i.e. ease of circulation of cryptocurrency in the so-called “Real money” (rubles, dollars, euros in your bank account).
The encryption algorithm used is also important. Bitcoin is based on SHA-256, it makes sense to mine bitcoins now for owners of expensive farms. But for example scryptuses RAM intensively. This makes it problematic to use and create special ASIC processors for scrypt cryptocurrencies and makes it possible to effectively use ordinary computers with video cards for mining.

Mining profitability

In other words, how much cryptocurrency can be earned per unit of computational complexity (as it can be taken as the hashrate unit, hash / s is measured).
It makes sense to evaluate the profitability for yourself personally, for example, in the number of coins you receive per day or per month.
For example, my Nvidia GTX 770 video card allows me to mine Feathercoin at a speed of 210 khash / s, receiving ~ 6 FTC per day from the pool, which, depending on the exchange rate, gives me a profit of 60-100 rubles per day.
The following resources will help you assess the profitability:

2 Pool selection

The pool commission is of key importance for your mining profit – the percentage of the block amount that goes to the pool during mining, the rest of the block reward is shared between the pool miners. You also need to pay attention to the commission from transactions for withdrawing coins from the pool to your wallet. The additional capabilities provided by the pool for monitoring workers and viewing their statistics are important.
You need to register on the selected pool, create logins and passwords for your workers. It is desirable that there are as many workers as there are computers you will have to mine cryptocurrency. However, you can run mining on several computers with one worker, then their processing power and results will be summed up.

Wallets and software

Okay, you bought the mining hardware, but how to get the money you earn if you don't have a bitcoin address. You can easily create a personal crypto wallet yourself by downloading the appropriate application to your home computer or smartphone. There are web resources on the network, by registering on one of them, for example, on Blockchain info, you will receive a personal page with an address and a set of tools for performing transactions. There are also physical wallets for storing cryptocurrency offline. They guarantee the complete safety of your funds, but they are not cheap (minimum $ 50).

In addition to a crypto wallet, you need a personal computer to prepare ASIK. First, download the IP Reporter application, and further settings are made through the browser. When bitcoin was mined on cpu, and then on video cards, the installation of special programs was required. Some of them, for example, BFGMiner, are still available for download. Such software can be used to set up production on ASIKs in solo mode. But, nevertheless, it is better to join the pool for collective mining.

Cryptocurrency mining methods

Mining can be classified according to various criteria. For example, if we take the equipment used as a basis, then the coins are mined: by processors (CPU), video cards (GPU) or ASIC integrated circuits.

It is still not worth giving serious importance to the mining of cryptocurrency on smartphones. The efficiency of the equipment used will vary depending on the hashing (encryption) algorithm of the network. They are different.

Another popular classification of cryptocurrency mining methods is by the capacity used. In accordance with this criterion, it is customary to distinguish:

Cloud mining (cloud miming) is the most profitable format in recent years, when the user leases computing power from a large service. With this format, the user does not buy his own equipment and does not service the equipment, but only pays for electricity. The service deducts a certain commission from clients.
Solo mining – the user solves cryptographic problems to find a block, using exclusively the computing power of his computer or farm – from two or more processors, video cards or ASICs. The method has practically not been relevant for several years.
Collective mining is work in the so-called pools. Miners unite in order to increase the total hash rate, which increases the chances of finding a block. The most popular cryptocurrencies are mined exclusively in pools.

The choice of a method for mining cryptocurrency should be done based on what kind of coin you plan to mine and what budget you have.

What cryptocurrencies can you mine?

The best option for 2020 is Bitcoin mining using a cloud mining service – you buy a contract for the lease of a certain capacity (equipment).

If you want to mine Bitcoin on your equipment, be prepared to invest hundreds of thousands of dollars in purchasing equipment. The complexity of the cryptocurrency network is gradually getting more complicated, the fewer coins left, the longer it takes to find a block.

Almost all cryptocurrencies have a fixed issue, which means that over time they will run out. This is why BTC and its altcoins are often compared to precious metals.

In addition to Bitcoin, in 2020, novice miners can focus on little-known cryptocurrencies that can seriously increase in price in the future, for example:

Grin is a decentralized network that uses the CRin + CT hybrid hashing algorithm. The cryptocurrency is ASIC resistant, so it can be mined using a regular computer.
Haven is a project based on the Cryptonight protocol. Algorithm for reaching consensus Proof-of-Work. Best of all, the coin is mined by NVIDIA video cards, of course, AMD are also suitable, but they have a lower hash rate. Better not be stingy and build an inexpensive GPU farm.
BitTube is the Blockchain version of the popular YouTube video hosting service. The project is also built on the Cryptonight hashing algorithm. The startup capitalization is actively growing, so the first miners have already managed to make a profit. For mining, you will also need GPU farms.
Ethereum is the second most popular cryptocurrency today, so if you want something famous, then you should opt for ETH coins. ASICs are already in full swing for Ethereum mining, but GPU mining is still relevant.
You can choose absolutely any coin with a low capitalization level. They are very easy to get as they are unknown to anyone. The only problem is the likelihood of a startup failure or a hack. However, this method has the right to life if there is no money for the farm.

It is almost impossible to earn a lot using a regular PC or laptop. Generating blocks requires equipment of the appropriate capacity.

Cloud mining

Based on the problems described above, it becomes obvious that renting computing power is the best solution in 2020. This is indeed the case.

First, there are quite a few services, including time-tested resources. Specifically, we use the services of IQMining.
Secondly, there is no need to delve into the essence of mining and comprehend the basics of setting up equipment and programs. Indeed, in addition to buying farm elements, they still need to be connected to each other, serviced, thought over a ventilation system, etc.

Cloud mining services offer newcomers relatively cheap contracts (contracts for the lease of computing power), so you can start with minimal investment. Subsequently, cloud mining of coins is transformed into a reliable source of passive income. The main advantages of cloud mining:

data centers are located in regions with low electricity costs;
the ability to automatically extract several cryptocurrencies at once;
no need to delve into the technical features of the equipment;
services take care of all issues related to the service;
equipment rental requires minimal investment.

To choose a truly reliable service, be sure to study the rating of the best cloud mining companies.

How much can you earn from home mining?

You can calculate the current income on special online services, one of the most popular https://whattomine.com/calculators. It has data on the profitability of mining most cryptocurrencies on popular ASIC and GPU models. Please note that the price of bitcoin and other altcoins may skyrocket in just a day.

What device should I buy? If you want to mine bitcoins, then definitely ASIC. The new miner for mining Bitmain Antminer S19 Pro +110 Th costs $ 2407 on the official website of the manufacturer. But at the same time, the entire batch of devices has already been sold out by pre-order. On the official dealer's website https://www.antminer-russia.ru/ this model costs 189,000 rubles plus shipping costs by a transport company, if you are not a Muscovite.

With an electricity price of $ 0.06 / kWh, the ASIC will pay off in about 22 months. Such a long period is due to the fact that halving (halving of the award) has already occurred on the bitcoin network, and, so far, the exchange rate of digital gold is marking time. In the 11 years since the Bitcoin blockchain ecosystem has existed, the block reward has already been cut three times. After the first two halvings, the coin's price skyrocketed in a few months. Now the whole crypto community is looking forward to a new dash, so hurry up and jump on the rocket.

But what if there are no conditions for placing ASIK? How to mine bitcoin on pc? Directly, there is no way only to mine alternative coins and exchange them for digital gold. Consider home mining methods.

Is it profitable to mine on a home PC

With the growing popularity of Bitcoin , it has become unprofitable to mine it on home computers.

If you are hoping to generate income of several hundred dollars already at the initial stage, we advise you to take a closer look at concepts such as cloud mining or creating your own farm.

The work of a miner on a regular PC will bring up to hundreds of dollars in income per month. We recommend using this method only if you have a PC with a good level of performance and while working with it, you do not use even half of the video card's resource. For example, you have a powerful gaming PC at your disposal, but you rarely run games on it and constantly use only a browser and simple programs. In this case, the periodic work of the miner will not harm the system. Also, you should not mine bitcoins on your home PC around the clock. Limit yourself to 6-8 hours a day.

How to start mining bitcoins

How to start mining bitcoin? First of all, you need to understand what equipment or service will be used for mining.

With the advent of ASICs – special chips designed for digital counting units, the speed of computing processes has increased many times over. At the same time, mining has become more secure: the system is protected from hacker interference and guarantees the operation of long block chains.

To date, entire model lines of ASIKs have been developed, which give incomparably higher performance. Conventional computers are not able to compete with them, therefore they are no longer relevant in the BTC mining market.

Mining farms

A modern mining farm is a complex of equipment that includes several ASIC devices assembled in one place, having different or the same capacities, which allows to increase the speed of mining and ensures ease of maintenance of the equipment.

What is Bitcoin mining

The principle of mining is that computers around the world, located in different parts of the earth, solve mathematical problems, the result of which is the generation of a new blockchain – the blockchain.

Blockchain is a chain of blocks that stores information about all transactions / money transfers for the entire existence of the Bitcoin network.

The mining process is not controlled by any authority and is distributed across all network participants, which ensures complete decentralization and data security.

How Bitcoin mining works is reflected in the infographic:

All transactions are recorded on the public Bitcoin network, and the data is transferred to the miners along the chain. The goal of their actions is to find one single hash out of a million combinations that matches all new transactions and a secret key, without which it will be impossible to receive a reward.

The hash looks something like this:

067f8e487c8a89ef95tm7a4321a0

When the computer selects the correct hash, the block is closed, the miner or participants in the mining pool receive a reward for it and start generating the next block.

Mining is divided into amateur and industrial.

In the first case, coins are mined on a computer using a special program installed on a PC with a powerful video card → today it is long and ineffective.

In industrial mining, a whole complex of special equipment is used, called ASIC. It includes powerful computers, video cards and cooling systems that are combined into a farm → efficient but costly.

Bitcoin mining process

The creator of the first cryptocurrency, Satoshi Nakamoto, composed the program code in such a way that digital money was protected from inflation. For this, it is provided:

Limit on the number of coins (21,000,000 BTC).
Correlation of computational complexity.
Reducing the reward to miners after every 210,000 blocks mined.

Payments are halved, but this is only beneficial, because due to the scarcity of Bitcoin, it is constantly growing in value. To mine bitcoins yourself, you need not only special knowledge, but also start-up capital to purchase computing equipment and pay for electricity costs.

You can immediately exchange the earned coins for fiat. But, in a period when the bitcoin rate is significantly lower than the historical maximum, it is inappropriate to spend cryptocurrency. Check out the materials on the Internet, look at the prices and decide for yourself whether such a business is profitable for you. After all, crypto mining is a business, not a hobby. Mining bitcoins at home is a commercial enterprise that is organized for the purpose of making a profit.

Cryptographic Algorithms

Despite the fact that the task of the Byzantine generals was solved back in the 90s, blockchain is a more difficult task. All its nodes are in constant change mode. The cryptographic algorithms here are different from those used in the Byzantine puzzle.

Most cryptocurrencies use proof-of-work (PoW) and proof-of-stake algorithms. Read more about PoW and PoS in the article.

The mining of currency based on PoW is usually called mining (mining), based on PoS – forging (forging).

The most common algorithm used by cryptocurrencies is SHA256.

The task of the algorithm is to hash blocks of transactions. SHA256 generates a 256-bit hash.

Well, then you know everything: the blocks are lined up in a continuous chain, the miners receive their 12.5 BTC per block.

Mining speed is measured in hashes per second (h / s). As it turns out, the hash can be calculated using pen and paper. If you decompose the algorithm mathematically, you can achieve a speed of 0.67 hashes per day (with a 12-hour load, this is approximately 0.000016 h / s). However, this is most likely not the best way to mine, since modern miner systems are capable of building blocks at a speed of several terahashes / sec, which is a quintillion times faster than a person.

In addition to SHA256, the following crypto-encryption algorithms are known:

Scrypt
ECDSA;
SHA3-512;
Equihash
Ethash.

Table. The most famous cryptocurrencies with types of algorithms:

A more detailed version of the table: Cryptocurrency mining algorithms

Good sites for earning bitcoins using a browser or processor.

Faucethub. Mining in the browser. This is not only a convenient micro-wallet and cryptocurrency faucet rotator, but also the ability to mine bitcoin on your PC right in the browser. Go to the “mine” tab, clicking on “start” will start mining using your processor.
Computta. When registering, a bonus of 100,000 satoshi. Mining with the program. A new foreign site for mining on your computer. Advanced mining settings on a PC, combining mining using a processor and a video card at the same time, a system of bonuses, ranks, a developed affiliate program, as well as a 1 mBTC bonus upon registration.
Coinpot. Mining bitcoin in a browser, on your website or blog. A good micro wallet for faucets with instant withdrawal, as well as the ability to earn bitcoin (bitcoin), bitcoin cash (bitcoin cash), dash (dash), dogecoin (dogecoin) and litecoin (litecoin) on any computer in two clicks.
Nicehash. Earning bitcoin using the program. If you cannot assess the capabilities of your computer, then with the help of this project and its nicehash miner program, you can choose the most efficient way to extract bitcoin automatically.

Cryptocurrency mining software

All mining programs work according to the same principle. Only the conditions of the mining site can differ.

Before installing the application, read the working conditions on the developer's website.

List of the most popular programs for mining Bitcoins and other cryptocurrencies:

CGMiner;
Bfgminer;
SGminer;
Ccminer;
Claymore miner.

How to mine Bitcoin on your computer

We figured out that Bitcoin is mined only on Asiks, so it's impossible to mine it just on your video card in a PC!

However, there are several good ways to mine Bitcoin by GPU mining.

The first method is mining other cryptocurrencies (algorithms) that are mined on video cards.

The second method is mining through a special NiceHash program.

Both of these options will ultimately bring you Bitcoin, and we'll tell you how to achieve that!

The difficulty of mining bitcoins

In the Bitcoin network, the difficulty of mining a new block is recalculated every 2016 blocks, that is, approximately twice a week. The difficulty level can increase or decrease depending on the time spent creating a new batch of blocks, and how much it differs from 2016 minutes (20160 * 10). On average, it takes 10 minutes to generate 1 block. The reward for one block found is now 12.5 BTC.

The likelihood of a miner receiving a reward during this time is the ratio of his computing power to the computing power of the entire network. If it is small, then the chances of picking up the award are also not high.

Since the complexity of Bitcoin mining is constantly increasing, users are invited to organize mining in several ways:

Special equipment for mining

Asik is a compact and energy efficient device, the only purpose of which is to extract cryptocurrency using a specific algorithm. For example, the Bitmain Antminer S17 Pro 56 Th model runs on the SHA-256 algorithm. On this device, you can mine 35 coins, including:

Bitcoin;
Bitcoin Cash;
Bitcoin SV;

It is impossible to reprogram ASIK, created for bitcoin mining, for Zcash, Litecoin, Sia. But on the other hand, one such miner weighing 5-6 kg and a consumption of 2-2.5 kW can bring its owner $ 300-400 in net profit per month.

Innosilicon is developing the G32 1800 ASIC to work on the Cuckatoo31 (GRIN.) Algorithm. At the current coin rate and electricity price of $ 0.06, it will bring $ 211 per day. Fast payback, small size and relatively low energy consumption made ASICS miners. But, they have one serious drawback – high noise levels. It is almost impossible to operate ASICs in an apartment. Those wishing to mine cryptocurrency using devices based on integrated circuits will need a special room or a mining hotel.

Sources used and useful links on the topic: https://miningbitcoinguide.com/mining/sposoby/chto-takoe-sut-vidy https://mining-help.ru/articles/15-kak-nachat-maining-kriptovalyuty-novichkam -s-nulja-nachalo-2017.html https://altcoinlog.com/chto-takoe-maining-cryptocurrency/ https://habr.com/en/post/207844/ https://bytwork.com/articles/ vidy-mayninga https://altcoinlog.com/maining-bitcoina/ https://Mining-CryptoCurrency.ru/kak-nachat-majning-poshagovaya-instrukciya/ https://bitgid.com/majnit-bitkoiny-na-domashnem -kompyutere / https://cryptonisation.ru/majning-bitkoinov-sut-processa-s-chego-nachat-vidy-i-dohodnost-zarabotka/ https://inworker.net/cripto_bitcoin/dobit_bitcoin_na_compyutere.htm https://bytwork.com/articles/mayning-bitkoina-pk

Post source: lastici.ru