For part 10 in my Bitcoin 101 Series, I want to go deeper into explaining what it means to mine Bitcoin.
To start, I think it would be good if you watched a short video. It is less than 2 minutes and really worth the time.
Credit for the video goes completely to the site https://www.bitcoinmining.com/
The site isn’t just great because it made a cool video that explains mining really well, but there is a lot more information on that site – including how to get started mining bitcoin for yourself.
I used to mine bitcoin. I installed the software and followed a youtube video. It was fun. The problem was that it wasn’t very profitable. I would encourage anyone who is thinking about doing mining to understand what is all involved with taking this on.
- Understand what is all needed for a good mining rig. It might seem silly that you would need to spend a lot of time on this, but there are a lot of options out there that you can use for hardware. The bigger the better and if you don’t have the latest technology and hardware, then you will not be the one collecting the bitcoin reward.
- Use a calculator. No I don’t mean a standard math calculator. I’m talking about an online mining calculator. There are a lot of sites out there that do it, but you want one that takes as many factors into consideration as possible. It is important to factor in what your hardware will cost (including the GPU or graphics card that you need) and also how much your electricity will cost. You will be using a LOT of electricity.
- Talk to other people who have done mining. Yeah they might have not had a good experience, so take what they say lightly. They may tell you to stay away from mining – but ultimately it is your choice. There is a risk in everything you do.
- Consider joining a Mining Pool. There are groups of people that have joined up to form pools. The reason is because it isn’t really that profitable to start mining bitcoin if you are only going to use your own computer at home. There are huge data centers that organizations now use to mine bitcoin. (Including John McAfee who – at the time of this writing – was making $55,000 / mo) If you are going to compete, you may as well join a good team.
- To stress how far people have gone to set up a bitcoin mining system, take a look at this video that Motherboard did when they visited a Chinese Bitcoin Mine. The mine generates about $1.5 million per month. At one point they were making over $365,000 per day at the six mines they have.
- Do your research. A simple Google search can go a long way.
I will keep this post short. I just wanted to give you a little bit of information about Bitcoin Mining. I will save the deeper explanation about how it all works for a later post.
Thanks for stopping by. I hope that this helps you further understand bitcoin mining in the new bitcoin world. Be sure to check out the other posts in the Bitcoin 101 Series and stay tuned next time when we dive even deeper into the world of bitcoin!
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