How to Mine Bitcoin and What Equipment You Need
Bitcoin is one of the most sought-after digital assets today, and you can potentially earn thousands of dollars and sometimes even millions depending on its value.
Nowadays there are many ways on how you can profit from Bitcoin. As for how to mine bitcoin and what equipment you need, here’s the lowdown- you can use a computer or machine, as well as electricity and access to the internet to get fractions of the cryptocurrency.
Bitcoin, Mining and Profit
You may have heard about Bitcoin in the news, or maybe on YouTube or a friend who has invested in it. However, you will want to know, what is Bitcoin and how do I make a profit from it?
Bitcoin is a digital asset and perhaps the most popular in the world of cryptocurrency. You can wn’ it just like you would a traditional asset, such as gold or stocks.
There are several ways on how to collect Bitcoin- you can buy it using real money in a crypto exchange, or mine it using equipment. The term ining’ is used here and is self-explanatory to an extent.
Miners are rewarded a small amount of Bitcoin by participating in the Blockchain network and solving complex mathematical equations using hardware. They generate new locks’ that add to Bitcoin’s public ledger.
The process of mining Bitcoin seems simple enough- you just have to get the right equipment and have it work through the Blockchain network. As time passes you get more and more Bitcoin, which you can store in a digital wallet.
Turning in a profit is a bit more complex, though. You will have to factor in the value of Bitcoin and determine if it’s the right time to exchange it for fiat currency, the costs associated with mining, e.g., the hardware, electricity, and more. You can turn in a tidy profit as long as you get more money than you initially invested in.
The good thing about mining is that the cost of entry is relatively lower compared to just buying Bitcoin. Furthermore, you control the operation and how much time and effort you’re willing to put in. It’s a legitimate side hustle and has the potential to give you more money than a regular 9 to 5 job.
What Hardware Do You Need to Mine Bitcoin?
As far as hardware is concerned, you can dive into the world of Bitcoin mining by looking for and buying specialized equipment known as an ASIC.
ASIC, or an Application Specific Integrated Circuit is a device that has only one task, and that is to mine Bitcoin. It’s highly efficient, comes in a neat package or bundle and offers a quick entry into the Bitcoin mining industry.
There’s another way to mine Bitcoin, and that is through a computer. It has to have a powerful enough GPU and CPU, or graphics card and processor respectively to be competitive. Although it’s more versatile, it’s significantly less efficient compared to ASICs.
That said, you will need to consider two major factors when buying a Bitcoin mining device- unit cost and electricity consumption. Unit cost is the cost of obtaining hardware that can mine Bitcoin. The beauty of it is that you can choose from several products depending on your need and budget. You can either get an expensive ASIC that can mine Bitcoin faster (and thus allow you to recoup your initial investment sooner), or you can get a cheaper ASIC that can mine the cryptocurrency, albeit at a slower pace.
Then, there’s the matter of electricity consumption. A device may be more capable of mining Bitcoin, but it might tend to consume more watts which cuts from your profitability. As long as the hash rate is somewhat the same, a device that uses less electricity is deemed the more profitable one.
Before buying a Bitcoin miner it’s best to check the hardware profitability first so you can get an estimate of your returns. You can check using an online calculator, as well as ASIC profitability comparison charts to get the most value for your money.
How to Set Up Bitcoin Mining Hardware
The first order of business is to purchase an ASIC device. You can look for and shop online in reputable websites and e-retail stores. Keep in mind that when buying equipment from a foreign country you might need to pay for additional import costs.
You will want to check and see if the hardware comes with a power supply. Also, it’s worthy to note that the machines will require a connection to the internet, which means you may need to upgrade your router or purchase an ethernet cable for a wired setup.
Depending on your ASIC device, you will need to create an account via the manufacturer’s web panel. There will be a detailed instruction on how to pick your mining pool, as well as enter your account information and endpoints. It’s recommended that you choose an established pool for constant returns. This means joining forces with other miners to achieve optimal hash rate.
As with any hardware you will need proper care and maintenance. ASICs tend to generate lots of heat- you will want to set up a ventilation system to keep things cool. A fan or two may not be enough, especially if you have several of them.
You will also need to know the maximum power level your home socket can accept and see if it meets the ASIC’s requirement. This is considered important as ignorance can lead to an electrical fire or frequent power outage.
Your hardware will last longer and perform better if it’s free from dust and relatively cool. You can invest in accessories that wick heat out and keep away dust that accumulate over time.
Hardware can become obsolete, with newer models having greater efficiency or consuming less power. If you plan on mining Bitcoin long term, you’ll want to get the latest and best ASICs available, then regularly see if there are better machines available and upgrade as soon as you’ve turned in a profit.