Want to mine Bitcoins at home? Here's a step-by-step guide
Over the years, cryptocurrency mining has evolved as a hot topic in the world of digital currencies. It allows people to get hold of cryptocurrencies like Bitcoin without actually buying them. However, even today, mining is one of the most volatile aspects of the crypto-world; it comes with its own caveats and might not prove profitable every time. Here's how you can mine Bitcoins.
First up, what happens in cryptocurrency mining?
Cryptocurrency mining is the process of verifying crypto transactions and adding them into blockchain ledger. In order to successfully mine/authorize a cryptocurrency transaction, you'd have to compete with others and perform complex calculations on blocks containing transaction data - which requires huge processing power. However, once the work is done, you'll be rewarded with a certain amount of Bitcoin or the currency in question.
Mining Bitcoins at home: Things to remember
If you want to earn rewards by mining Bitcoins, you should know that the process would take a toll on your machine. Basically, the processing power of a computer defines hash rate or mining speed and directly impacts profits. So, if your computer is not well-equipped with a powerful processor and GPU, the mining would be slow and you will not make enough Bitcoins.
Some people attach dedicated crypto-miners to their machines
To tackle hardware problems, you may also attach an application-specific integrated circuit (ASIC) to your computer and upgrade its processing power for the job of mining. However, it will add to the cost of running your own personal Bitcoin miner.
Also, the running costs will impact revenue
Along with hardware requirements, you'd also have to bear the operational cost of running a home-based Bitcoin miner. This would include electricity charges, which are likely to increase when you'll mine Bitcoins, and the cost of keeping an always-active internet connection. Also, you'd need a fan or dedicated cooling device for the PC as it might overheat during the mining process.
Pick a digital wallet
Once you've arranged appropriate hardware (either through GPU or ASIC), you'd have to setup a digital wallet to store Bitcoin rewards. If you want to keep the Bitcoins as an investment, create a 'paper' wallet using a website like Bitcoin Paper Wallet Generator otherwise go to Electrum wallet for regular payouts Electrum has to be installed and it works on all platforms, including Android.
Pick a mining pool
Next, head over Bitcoin wiki and find a mining pool to join. As the name suggests, a mining pool is a group of machines connected together for mining bitcoins. It will bolster your profit-making chances, but do note that the rewards earned through pooling would be shared with every member who contributed in the joint effort.
Create account, provide payout details
Once you've found a mining pool (Slush Pool is a popular choice), create an account on its website using your email and password. Then, verify the account and enter payout details or the public wallet address on which you'll be receiving the money made through Bitcoin mining. Make sure to check if the pool has any minimum Bitcoin restrictions for cashing out rewards.
Now, download a mining software
After prepping the wallet and joining the mining pool, install a legit Bitcoin mining software on your PC, like GUIMiner. Launch the program, select the pool that you've joined from the server option, and enter the username and password for it. Now, select your GPU from the device menu and click the 'start mining' button to begin the crypto-mining process.
After this, the software will start mining Bitcoins
Once you start the process, the mining software will communicate with servers of the pool to collaborate your machine's mining effort with that of others on the pool. You'll be able to see the hash rate at the bottom of the page and use it calculate how many Bitcoins your machine may mine on a single day.