The bitcoin craze continues, and it has all the exciting twists and turns of an amusement park roller coaster. Want to join in? You can buy bitcoin at its current price. Then, hope it continues it's upward trajectory, praying it doesn't turn into a death spiral. However, is there any other way to profit from this cryptocurrency? How about learning how to mine it? Here are some things to think about if contemplating bitcoin excavation.
It Takes A Lot Of Power To Mine Bitcoin
It used to be that you could mine bitcoin "with your computer CPU or high-speed video processor card," according to BitcoinMining.com. Not so any longer. The electricity used in the bitcoin mining process has increased over the years, so much so that it is "now using more electricity than 159 individual countries. More than Ireland or Nigeria," as reported by PowerCompare. Keep in mind that there are only 195 countries total. So, be sure you have a super-efficient processor, or you may be spending more on electricity than you are earning in bitcoin mining.
Mining Bitcoin Involves Complex Computations
When mining bitcoin, the computer used is called a "rig." It performs "complex calculations on blocks of data which maintain the bitcoin network," according to a report from TechRadar. The power of the processor is just one of the factors in the payout. The calculations involved in the mining are continually increasing in complexity, meaning that rigs now are often pooled. That way, the power of the group can be used in solving the complicated equations. These solutions result in the reward of bitcoin. And when the mining is successful, each participant gets to reap a share of the rewards. Keeping up with the computation requirements is important, so it may be vital to join a mining pool as part of your excavation process.
Cloud Mining Might Be An Option
Clouding mining for bitcoin is less complicated. It doesn't involve managing as much hardware as conventional bitcoin mining. Cloud mining "only needs a home computer for communications, [and] optional bitcoin wallets," according to a report by Coindesk. So, no large outlays for power and equipment. However, according to an article by 99Bitcoins, "it seems like none of these cloud mining sites are profitable in the long run." Before you opt for clouding mining, you might need to sharpen your pencil. Make sure that this is a viable extraction method for you.
Be On The Look-Out For Cybercriminals
According to the Telegraph, "with a finite supply of 21 million bitcoins, a handful of opportunistic individuals and organizations are making use of powerful computers to hoard as much of the supply as possible." Earlier this week, it was reported that new malware is spreading via Facebook's Messenger. It "is using the many computers it has infected to mine cryptocurrency for its unscrupulous developers at the expense of users." This according to Bitcoin.com.
With the malware, the cybercriminals hijack a victim's computer. They then use its power to assist in the mining process. For the unaware victim, the result can be both a messed-up computer and a large electric bill. So, be on the look-out for cybercriminals who will use your power but not include you in the pool of profits.
Consider Blockchain Instead?
Many experts are now saying to look at blockchain. Its development may be the best thing to come out of bitcoin and other cryptocurrencies. As explained by BlockGeeks, "information held on a blockchain exists as a shared—and continually reconciled—database." This means that the blockchain has many storage locations, which makes it easy to verify and also hard to corrupt, whether by mistake or design. This recorded and shared information can be used for virtually anything of value.
In fact, blockchain technology may totally disrupt banking and accounting. With blockchain, there is no delay in the recording of a transaction and there is no deciding when a transaction would be most advantageous to document. When it happens, it happens. This could make reconciling accounts much quicker and easier, as well as less subject to human intervention and manipulation. So, you may decide that bitcoin mining is not for you, but blockchain investment could be an alternative.