Tech Blog with a focus on personal and consumer technology. The best place for meaningful tech news, analysis, views and reviews. Bitcoin Mining: Can You Really Make bitcoin Money Doing it? Virtual currencies are slowly but surely becoming more popular, as more people start using them.
Mining bitcoins can be easily done and the prospect of getting free money has both increased its popularity and raise some eyebrows. According to Wikipedia, the Bitcoin is the first type of cryptocurrency that was introduced. Existing only in virtual form, the bitcoin is a part of the Internet, and therefore, it is not regulated by a central authority. Also, since their introduction, bitcoins have been continuously created an managed by a open source cryptographic protocol and it will continue to do so for a long time now.
The number of newly generated bitcoins is halved every 4 years, and it has been calculated that this process will reach 0 in the year 2140. 25 bitcoins generated with each of them. A new block is generated ever approximately 10 minutes. When it is generated, a block is created by a very complicated mathematical algorithm, and it needs to be resolved in order to get the bitcoins. These algorithms are increased or decreased in complexity according to the amount of computer power that is used to solve them. Due to the complexity of today’s algorithms, the amount of computational power needed to solve a block is pretty high, and so, one single miner would have a hard time doing it. In these mining pools, multiple users join forces and break down the algorithm to make it easier to solve.
After the block is solved, the 25 bitcoins that it has are divided amongst all the users who helped. Keep in mind that you will need a high-end computer or a specialized rig to mine bitcoins efficiently. Q: How much are bitcoins worth? A: Being a live market, just like any other real world currency, the value of bitcoins will fluctuate. Q: What do I need to start mining bitcoins? A: First off, you will need to set up a bitcoin wallet.
There are two options for wallets: local or online. After you set up a wallet, create an account to a trusted mining pool. You will receive your bitcoin address from your wallet, which is the same as a bank account number. You will enter that address to your pool and you will make and receive payments via this address. Once all of this is done, the last software tool you will need is a bitcoin mining program. There are CPU and GPU clients, but due to relatively slow speed of the CPU, you will most likely use a GPU miner.
There are many out there, so basically all you need is to take your pick and once installed, input your credentials from the pool and start mining. On the hardware side, you will need a very powerful computer. A multi GPU setup is most likely required if you want to have a good hash rate. While regular miners can try out with their computers, those who have made a business out of it rely on ASICs to do the job. If you really plan on doing bitcoin mining, then you might want to invest in a dedicated bitcoin mining computer. These are custom designed computers that can only mine for bitcoins, but seeing that the algorithm gets more complex with each block, you will have to upgrade them from time to time. A: Yes, bitcoin mining is both safe and legal.
However, in some countries, you must declare all income coming from any source, including the Internet, and not declaring will get in trouble with the IRS. Q: Can I make a profit out of bitcoin mining? A: It depends on how committed you are and how much you are willing to invest. Also remember to take into account future upgrades and other possible expenses. Q: Where can I use bitcoins? A: Bitcoins can be used in a number of marketplaces. You can either buy goods and services with them from the websites that support such payments, or you can exchange them for other currencies and transfer them to your bank account.
For more information about bitcoins, you can check out the Bitcoin wiki, where you will find much more information on the economics of bitcoins or o general help. Just keep in mind that you need to do lots of research before you start mining bitcoins. Also, try to seek the best markets and pools so you won’t get scammed. There are a number of trusted websites where you can do bitcoin exchange and transactions. The process is fairly simple, and if you have the hardware to back it up, then from here on it’s smooth sailing.
First off, you will need a Bitcoin Wallet. You can either wallet you please, as they both do the same thing. After you’ve set up your wallet, you will receive a bitcoin address. As mentioned before, with this address you will receive payments and make transfers or exchanges. What you want to do next is join a bitcoin mining pool. Here, you will join a network that works together and combines the hashrates of all the users in order to solve the blocks as quickly as possible.