Cryptocurrency is based on blockchain technology: all transactions in the system are publicly available, and the base itself consists of separate blocks of transactions. Each one is encrypted with a sequence of characters, numbers, and letters – this is called a hash.
The mining farm works with the hash by matching it to the transactions in the cryptosystem. There are millions of combinations, and the process requires high-performance hardware. Hash Rate is the rate at which the problem is solved. It is measured in hashes per second, and the higher the figure, the higher the yield of a particular coin.
The first cryptocurrencies were mined using a computer’s central processor. Then more processing power was needed, and the era of video cards arrived. But since 2013, for bitcoin, only ASIC-boards are profitable – specialized processors with much higher hash rates than video cards. Such equipment is very expensive and virtually unavailable to individuals. By the way, there are licensed online casinos all over the world where you may play for cryptocurrencies, you can find a list of them here — playcryptocasinos.com.
It is not possible to build an ASIC farm “by hand”. This requires special chips, which are not available at retail. It remains to buy ready ASIC solutions, but this is a different budget.
However, there are other promising coins. For example, Etherium is the second most valuable cryptocurrency. Its rate rose from $300 to $1,800 in a few months.
The simplest version looks like this: a video card (the more powerful, the better), a motherboard, a processor, a cooling system, and a power supply. And the most expensive component in the next mining boom will be the video card. Used video cards are not recommended to buy – the prices on the market are far from adequate, and the reliability of the goods is questionable.
Also, you can not save money on the power supply and cooling system. The power supply is especially critical for the mining farm, which is under constant load.
Even a small farm of several video cards will give you a lot of trouble. Firstly, it is quite noisy – the hum from the video gas pedal coolers and cooling system is very noticeable. Secondly, you need an electrical network designed for continuous heavy load, otherwise, there will be problems not only with the wiring but also with the expensive equipment.
How much does mining cost?
The costs of mining are quite high. You can save here only on software – software for “mining” installations is usually publicly available. To earn, say, 500 dollars a month, you will need four or five video cards. The investment will not pay off immediately.
It is noted that bitcoin costs immeasurably more, so the “cloud mining” is developing. Investors often turn to cloud mining by leasing capacity from providers with data centers in countries with cheap electricity.
Prospects for Bitcoin and Etherium
Despite the temptation of mining, there is a likelihood of a repeat of the situation in 2018, when due to the decline in quotations “miners” became fewer, and the equipment had to be sold at a large discount. But it is possible to make some money on the same video cards and at a high rate.
It is worthwhile to enter now, and this can be seen by the actions of the community – equipment is being purchased and sites are being filled. Calling it a bubble is unreasonable, but there are a lot of risks and they need to be taken into account and legally minimized. Selling equipment at the peak is fine, as long as the operation makes a profit and you manage to renew your fleet that way. Of course, it is possible to mine in reserve – if you are ready to take a risk and can cover the costs of the site
The Crypto exchange rate is unpredictable – during last year’s pandemic, no one could imagine that the world’s main digital coin would go, as miners say, “to the moon” in a few months. Etherium cannot yet be called a haven for miners either, as its developers have planned major changes to the system for July, which are expected to result in lower yields.