Among so many crypto alternatives, which one to select to mine, having in mind the risks and capitalization values in the market?
Since the popular and leader until now, Bitcoin, many other virtual currencies have been born.
Part of this great digital range is made up of Monero, Ether, Dash, Litecoin, DeepOnion, Dogecoin, Zcash, Ravencoin, Grin, etc. The list goes on and therefore doubts may arise in this regard, as many are profitable to mine.
And since this profitability will be maintained for the next few years, you must prepare yourself to know everything about mining and its types. In addition, we will show you what aspects to take into account to select the best cryptocurrency.
Cryptocurrency mining and its functions
First of all, what is mining? Simple, a set of processes to validate the transactions of a cryptocurrency within the Blockchain.
As you already know, the way to mine will depend on the system used by the blockchain or algorithm of each cryptocurrency. You should know how each asset works since they all have their characteristics.
Mining cryptocurrencies is a profitable activity that leads to a more secure and stable network. How to choose the most suitable cryptocurrency to mine? CLICK TO TWEET
Crypto mining serves two essential functions. We explain
Confirm or verify transactions in the ledger or blockchain to guarantee their validity. Each verification contributes to the stability, transparency, and security of the network.
Issue or extract new cryptocurrencies, a product of the work of mining.
Learn about the most important features of Minar
Mining cryptocurrencies is a very lucrative activity that is worth knowing. Since it has several very interesting features:
- There are two consensus systems according to the type of virtual currency, the PoW or Proof of Work. The second is called PoS or Proof of Stake.
- The miners or nodes scattered around the world validate the transactions and organize the blocks through complex mathematical processes.
- Mining requires powerful, specialized, high-performance hardware for mining cryptocurrencies.
- Miners are remunerated for validating transactions, encouraging their work, developing a more reliable and secure environment.
- This activity generates a great demand for electricity, which is why some countries have restricted or prohibited mining.
Types of Cryptocurrency Mining
There are many ways to obtain cryptocurrencies, but mining offers 4 types to evaluate according to your needs and objectives. Let’s see.
1. Mining with CPU
This kind of mining was used and very popular from the beginning of the activity. It works through the processor of your computer and software to extract cryptocurrencies.
This system is convenient, although not very fast or sustainable over time. Due to the excessive use of a simple CPU, it is necessary to let it cool down and, in addition to this, there is high electricity consumption.
It is also characterized by yielding lower income. This method is still used for mining, but it has a low return on investment.
2. Mining with ASIC
The way to mine is most used by those who love technology and speed who want cryptocurrency mining.
These are special equipment with a high-power platform, which has a “Specific Applications Integrated Circuit” (ASIC).
There is some suspicion among members of the mining community who demand the prohibition of this machinery. The reason is that those with slower methods don’t have much of a chance against this fast system.
3. GPU mining
The GPU stands for “Graphics Processing Unit” or Graphics Processing Unit, which offers high performance for mining. They have a graphics card, processor, motherboard, and cooling system. This equipment represents a high investment.
Mining with GPU consists of special high-performance equipment, generating high electrical demand. CLICK TO TWEET
They can cost up to more than $ 3,000; they generate great profitability, but also a high energy cost.
4. Cloud mining
Cloud Mining is a friendly process in which you avoid the purchase of expensive mining equipment and excessive electricity consumption. It’s about having a company do the work for you.
An expert ally that, equipped with a platform and through a commercial relationship, provides the operation service. In addition to maximizing your production, there are reliable and profitable options.
How to choose the right cryptocurrency to mine?
Now that you know the ways to mine, you must evaluate what type of cryptocurrency is the most suitable for you.
The most important thing is its profitability since your efforts should not be in vain. Choose wisely, but be guided by these factors to take the right path.
In the crypto world, there is great volatility in every asset. Therefore, it is important to understand that the cost of mining a cryptocurrency may be higher than the current market price.
An indispensable rule is that the cryptocurrency to choose to mine is completely legal in your country. In some regions, mining has restrictions and can create a problem.
Consider the electrical aspect, since the cheaper the energy, the greater the profit.
In addition to taking into account the price of electricity, it is essential to analyze the cost of special equipment for mining cryptocurrencies.
If you decide on a GPU system, you already know that you will have to shell out thousands of dollars in hardware. If you opt for a cloud platform, the expense would be much lower and very efficient.
Cryptocurrency mining is an activity that, in addition to generating profits, entails an objective analysis. You must be clear about your goals to make the right decision as to which method to use.
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Make your transactions person to person, without intermediaries, and in a reliable, safe environment and with multiple tools. We are ready for you, choose your way to grow, and we do the rest.