Bitcoin mining is a bit like a bingo game, where you compete with everyone to try and be the first to find a winning prize. In this case, the prize is won when you find a winning block hash. And by using more and more powerful software, miners are able to test more combinations per second to try and crack it.
The thing is, the Bitcoin network adjusts itself every couple of weeks to ensure the time taken to crack a block hash remains around ten minutes. So if a lot of miners are working or there’s a major improvement in the software, the network adjusts to make the job even harder… and slows things back down again.
So without getting too bogged down in the technical aspects, this mining process is designed to release a preset number of bitcoins to the network over time and actually supports the price by limiting supply. It also secures the network from abuse by putting a very high price on any attempt to disrupt the network.
So Why Bother With Bitcoin Mining?
The thing is, most Bitcoin users don’t mine. They jsut purchase Bitcoins that have been mined by others. Mining for profit is very competitive and requires specialised equipment and knowledge.
The volatility of the Bitcoin price also tends to make it a highly speculative operation… what might seem to be a viable operation could become wildly unprofitable overnight if the price has a major correction…
So most Bitcoin Miners are in it for multiple reasons… profit is nice when it happens, but most have other motives, such as fun, supporting the Bitcoin network & security, or simply learning more about how Bitcoin works etc.
There are other options however that avoid some of the risks and save you the technical learning curve (and investment).
Mining Contracts let you purchase a fixed amount of mining power from someone who owns and runs the hardware, and basically rents out space. The advantages are fixed costs and no investment in hardware or software, no learning curve required, and no eletricity or bandwidth costs.
You just pick a package, pay the fees, and collect your earnings for the life of the contract.
You should be aware there are a lot of mining scams out there, so if something sounds too good to be true, it probably is!
Mining is slow and usually operates on a very slim margin. Real profits come from compounding those small returns over time.
Any program that offers you big returns in very short time is probably one to avoid!
In particular there are a lot recently that let you select a desired number of bitcoin to earn… usually 0.1 to 2 or more…
Then they appear to be doing some sort of technical mining operation for a few minutes, then magically offer you your requested bitcoin…. thousands of dollars worth…
Yours as soon as you send them their processing fee.
Of course no Bitcoin could be mined in that time frame, and no one is going to give you $3000 for $70 like that… but the Scam forums are full of people complaining they fell for it.
The sites are that compelling… supposedly live datafeeds, live stats, testimonials and more… so don’t fall for it!
That said, there are mining operators that have been around for quite a while and have a proven track record of delivering results and paying out consistently. There’s a couple of these listed below that I’ve personally used and I feel confident recommending…
Genesis Mining is one of the largest Bitcoin and scrypt cloud mining providers and my preferred option. They offer three Bitcoin cloud mining plans that are reasonably priced plus a number of other crypto currencies so you can build a diversified portfolio over time.
Hashflare offers both Scrypt and SHA-256 mining contracts via a mix of packages. This was one of the first Bitcoin miners I tested successfully and I still keep a couple of package running with them. They are continually upgrading their offerings, so I find it a useful option to maintain a sound mining portfolio…
Hashing24 is one of the longest running contract mining operations, mining Bitcoins since 2012. They have facilities in Iceland and Georgia employing the latest ASIC chips from BitFury deliver the maximum performance and efficiency possible. They also have one of the lowest entry costs around…
MinerGate Desktop Mining Software
This one got a mention in the low entry-cost optionsfor those without the ready-funds to purchase a cloud mining contract. It’s also a pretty good option to run if you have a computer that’s running idle for any length of time each day?
I have a box running 24/5 to monitor my currency trading anyway, so I now run this on that computer and it’s quietly building up a balance in a number of different currencies.
A great feature of MinerGate is that it automatically mines the currency that has been most profitable for the group in the last hour. So you can view the stats when you launch and choose yourself… or just start the software and let it decide.
I have personally used each of these in the past and they performed as promised for me. That said, bitcoin mining does constitute a financial investment so all the standard disclaimers and warnings apply…
Past results are no indication of future performance.
You should review each option carefully and do your own due diligence.
If in doubt seek your own professional advice!
And yes, the links are affiliate links… as a satisfied customer I’m very happy to recommend these services. And as someone who’s trying to build my Bitcoin bank, I’ll happily add ny commission payments to my bank that my efforts here might generate. You can do the same here if you’re interested!