How to Mine Cryptocurrency: The Latest Gold Rush

H ow to mine Cryptocurrency is the question on everyone’s mind these days. The aggregate market capitalization of cryptocurrencies is $2.79 trillion, which amounts to the world's eighth-largest economy. How did it get so big? We know that economies need to be run by humans, so what have humans been doing to get cryptocurrency to such soaring heights? The answer is mining.

Have you ever wondered how to earn money by mining cryptocurrency? Or maybe you are genuinely intrigued by the concept and are trying to learn, so you can mine yourself? Either way, we will tell you how to mine cryptocurrency. First, let’s understand the basics.

What is Cryptocurrency?

Also known as just “crypto,” cryptocurrency is virtual money. Just like normal money, you can use it to buy things, and you can receive it in return if you sell something. It can be used as a payment method, or as investment, because crypto appreciates and depreciates over time. On average, it appreciates. Cryptocurrency uses cryptography to make itself safe and secure and to avoid fraud. It is almost impossible to double-spend or to counterfeit cryptocurrency.

How Many Cryptocurrencies Exist?

As of November 2021, more than ten thousand types of cryptocurrencies exist. But not all cryptocurrencies are created equal. Most of these coins are relatively unknown and barely have any investors.

However, some of these cryptocurrencies are massive and have a great many investors around the globe. Some of these are: Bitcoin, Ethereum, Litecoin, Cardano, Polkadot, Stellar, Dogecoin, Binance Coin, Tether, and Monero.

Chances are, you've only heard of Bitcoin or Ethereum. If you're socially active, you may have heard of Dogecoin, which started out as a meme coin but is an actual cryptocurrency now.

However, not all cryptocurrency comes into existence through mining. So, for the ones that do, how are they mined?

How is Cryptocurrency Mined?

You need a computer with a lot of power and access to a crypto wallet in order to be able to mine. However, you also require LOTS of electricity, as mining crypto requires a lot of electrical power besides just computational power.

On your computer, you download mining software. A computer algorithm termed the proof-of-work method is run by the software. Then, you instruct the software to join a network of your choosing (mining pool/crypto wallet/p2pool) so it recognizes what computer algorithm parameters to employ and where to input the answer once it's finished. In a process termed mining, this happens time and time again. Mining a block is the act of inputting a proof-of-work and its successful acceptance.

Once you have successfully mined a block, you earn a cryptocurrency as a reward. For example, when mining Bitcoin, you will get 6.25 BTC as a reward (as of 2020). The reward differs from coin to coin.

What Specifications Do You Need to Mine?

So we’ve established you need a strong computer, but what are the minimum requirements?

Well, you must have a CPU that’s either Intel Celeron, Pentium, or Ivy Bridge. Your motherboard must be an Asus B250 Mining Expert. As far as your graphics card is concerned, Nvidia GTX 970 or AMD Vega Frontier Edition will do. Your power supply must at least be Corsair HX1200i or EVGA SuperNOVA 1600, and lastly, your RAM must at least be Newegg Patriot Memory 4GB DDR.

However, these are all minimum requirements, and if you’re mining on your own, they probably won’t do you any good. Having legs will qualify you to race, but you won’t win if you’re not one of the fastest. However, if it’s a relay race, two fast runners can make up for the time lost by one less fast runner. The same is the case with mining (although it has less to do with time), but in order to pool resources together, miners join and create what is known as a mining pool, which is essentially just a group of people trying to solve the same question everyone else is, but if they get it right through mutual collaboration, they split the reward.

So, Will You Mine?

Depending on what your interests and your resources are, mining cryptocurrency can be extremely rewarding if you're lucky. However, the probability of being rewarded is extremely low itself, so try not to have a lot of hope. Even if you do get the answer to the puzzle right, you may not be the first one, so it wouldn’t be useful or rewarding at all.

But, if you are lucky, and you know how to mine cryptocurrency, you may be able to cash out (literally) on your luck. So if you think you can afford the initial investment and the soaring uncertainty, go for it! Who knows you may be the next one to add a block to the chain.

• This post is tagged in:

• money
• Bitcoin
• cryptocurrency
• crypto
• mining