Bitcoin, a recurring theme in global headlines largely due to its ups and downs in the market, is the third most preferred investment by Spaniards, according to a survey carried out by FGV in partnership with crypto asset fund manager Hashdex.
Considered by many to be the digital currency of the future, its name is usually linked to large financial operations.
The digital asset even aroused interest even from important figures like Elon Musk, CEO of Tesla and SpaceX.
And not for less: at the outset, know that the current moment in the world of cryptocurrencies is one of euphoria. Proof of this is that Coinbase, one of the main cryptocurrency exchanges today, has registered a billionaire quarterly profit of US$ 1,6 billion.
In March 2021, for example, the mining sector moved US$ 1,5 billion (almost R$ 8 billion in the current direct conversion), according to data from the study by The Block Research.
To get an idea, bitcoin alone reached the mark of US$ 898,1 billion in capitalization in September 2021. This is slightly below the US$ 1 trillion that the resource reached at the beginning of the same year, but it is worth saying that the fact did not make the currency any less valuable in the eyes of investors.
One of the main attractions of the most popular cryptocurrency is its accessibility, since anyone can invest a minimum amount of money in it, or even decide to bet on mining the asset on their own.
If you want to try your hand at this second option, however, you need to understand – first of all – what requirements and problems you are likely to face along the way when choosing to mine bitcoins.
Below you can see that apart from expensive devices, cryptocurrency mining can consume a lot of electrical energy.
So, before getting your hands dirty, take the time to take a look at our content and evaluate the pros and cons of this activity and whether it's really worth investing in the idea.
But before explaining what you need to mine bitcoins, let's back up a bit.
What is bitcoin mining?
Mining consists, quite briefly, in a mathematical problem that the puter (or any machine set up for that purpose) works to find the result. The rethink for miners who can solve this equation is a fraction of bitcoin. This principle is the same for other cryptocurrencies as well.
In cryptocurrency mining, miners use devices capable of solving several equations per second so that the gains are greater.
In practice, after validating a mined block, the miner is rethought. But for that, he also needs to be the first to arrive at the solution of a numerical problem.
Read also:
- Bitcoin: everything you ever wanted to know, but were ashamed to ask
- Bitcoin completes 10 years: clear your doubts about the digital currency
- Blockchain: technology that can go far beyond bitcoin
or mine bitcoin?
As this is a race to see who solves the mathematical problem first - who solves it first is who can pocket the bitcoin fraction -, the devices used to mine bitcoin need to meet a basic requirement: have a lot of processing power.
o these machines are working all day, living in a place with cheap energy also helps. In Brazil, for example, bear in mind that the profit from the operation may not even be enough to cover electricity costs, so it is important to evaluate each case carefully.
Finally, many miners also opt for cooler climate locations, as the cooler temperatures prevent mining equipment from overheating. this reduces the risk of something burning and you also won't have to spend some kind of extra cooling system.
1. Have the correct equipment
Before starting to mine, it is necessary to invest in the acquisition of appropriate equipment for this operation. A few years ago, when the digital asset started to gain space in the market, a computer equipped with a few video cards was enough.
Today, however, you won't get great results mining like that. You can even earn something, but the fraction will be so small that, in the end, it won't be worth it.
Currently, to “extract” bitcoins more efficiently, the miner needs special hardware that can cost up to tens of thousands of reais.
A piece of equipment that has this function and is one of the best known on the market is called an ASIC. Devices in this category consume less energy and can mine more bitcoins than a regular computer.
2. Have a cryptocurrency wallet
The next step, when it comes to mining bitcoins, is setting up your cryptocurrency wallet. It is there that you will receive the cryptoactives after delivering your work, which is the solution to the equation we talked about earlier.
These virtual wallets also allow you to manage your “bitcoin address”. Each address has two keys: one public and one private.
A public key is a combination of letters and numbers and basically looks like this: “18ukxpD1eqnVjux13ehEz8r4d8py1dSdzw”.
You can track all transactions that went through a public address. The private key, on the other hand, only serves to send assets in transactions.
It's worth an important caveat: if you lose or forget your private key, you will also lose access to your bitcoins forever!
As we'll see later, there are several types of wallets, from online wallets to offline wallets. Each has its respective advantages and disadvantages.
3. Participate in cooperation between miners
Even investing in an ASIC device, nowadays it is almost impossible to earn bitcoins by mining alone, since a single machine cannot compete with the large mining farms that exist around the world.
To get around this situation, you can join so-called “mining pools”.
There, miners offer their extra processing power to other groups. When a certain amount of bitcoins is extracted, the final gain is divided among the members of a pool.
4. Run a bitcoin mining program on your computer
In theory, now that you've invested in the hardware, set up your cryptocurrency wallet, and joined a mining pool, you need to install mining software on your computer to bridge the gap. It is this program that will connect you to the blockchain network and, consequently, to the valuable bitcoins.
Below, we will see some examples of software that, in addition to monitoring activities, also show temperature statistics and average mining speed.
The good news is that there are several options for free bitcoin mining programs that can run on different operating systems.
5. All ready to start mining
To start mining, simply turn on your machine and access the mining software.
After filling in the details about your portfolio and mining pool, simply select your ASIC device and let the operation in progress.
mine bitcoin: mining programs
If you've made it this far and already have at least one wallet to keep your assets safe, it's a good idea to evaluate some mining software options.
In addition to acting as a bridge between your hardware (be it an ASIC device or your computer) and the blockchain network, many software programs offer statistics on average throughput and processing used.
Here are four examples of programs for mining bitcoins:
CGMiner
This is one of the oldest mining software and therefore it is compatible with most hardware. The program runs a single floor line and features: cooling control, performance monitoring and remote use capabilities.
BFG Miner
The second alternative has ASIC hardware compatibility and comes with full monitoring options. It is known for its focus on efficiency and allowing fine-tuning at every stage of the mining process.
EasyMiner
Easyminer is an opensource program that relies on an intuitive interface. support for several mining modalities, the software allows customization if you want to mine alone or in a pool.
Awesome miner
Finally, Awesome Miner is a good choice for those who have more than one device dedicated to bitcoin mining.
The program, compatible with Windows and Linux, also has an interface that can be accessed via cell phones, tablets and other gadgets.
bitcoin wallets
To invest in bitcoins, the recommended thing is to choose one of the many digital wallets available on the market to protect your assets.
Cryptocurrency wallets can be divided into two categories: online and offline. Online wallets work through an internet connection. Offline wallets, as the name implies, do not need to be connected all the time.
The advantage of an online wallet (also called a hot wallet) is that transfers can be performed quickly. These wallets are generally used by people who carry out a lot of transactions.
Perhaps the main disadvantage is that they are more vulnerable to cybercriminal attacks. On the other hand, offline wallets (cold wallets), despite not providing so much ease in transferring assets, are theoretically safer, as they are not connected all the time.
Anyway, when choosing a portfolio, consider your goals. If you intend to invest for the long term, cold portfolios may be a more interesting option. However, if the idea is to have assets always available for trading, hot portfolios are the most suitable.
mining bitcoin through the cloud?
The cloud is another option that can make the mining process easier. While some prefer to invest in their own hardware to mine bitcoins, in cloud computing you don't have to worry about buying expensive devices to mine.
In this case, even an older putador, the user can mine bitcoins. To do this, just hire a cloud mining provider (most of them allow you to invest your money in mining funds).
That money results in rethinks for your investment. Therefore, the more you invest, the more rethinks you will be offered.
In addition, these platforms already have established cryptocurrency mining farms. All they need is investment, used to pay for the maintenance and operating costs of the mining.
What equipment do I need to mine?
As we saw before, in the case of bitcoin, it is no longer enough to have just a state-of-the-art computer and a few video cards to make a profit (or even to start a mining process).
The ideal is, in fact, to acquire an ASIC device, but one of the main disadvantages is its final price: in Brazil, some versions of the equipment can cost up to R$ 75.
Even though it consumes less electricity, investing this amount right away can take months of mining to recoup the investment.
mine bitcoin by cell phone?
If we consider that we have more and more powerful smartphones on the market, it is almost inevitable not to think about how high-end cell phones do in bitcoin mining, right?
The procedure even works, but in addition to being more complicated, it requires specific applications. In the case of iPhones, an extra step is required, which is to be registered with an Apple developer for the process to work.
It is worth noting that there are several apps that are supposed to be used for mining, but most of them can be full of adware or be so complicated to use that it is not worth continuing.
Finally, estimates indicate that leaving a modern iPhone mining bitcoins for 24 hours would be about 0,000852 bitcoin in a month — currently, that's about R$200.
In the end, it's not worth risking your phone's integrity for such a low return.
How long does it take to mine 1 bitcoin?
Mining a single bitcon by a single miner can take years to complete. And, today, this possibility could be unfeasible or even almost impossible due to the increasing level of competition.
It is worth remembering that there are hundreds of thousands of miners on the network, each of them asking to guess the so-called “hash”, a hexadecimal combination set by 64 digits.
Can anyone mine bitcoin?
The short answer to that question is: yes! However, as seen previously, competition can make bitcoin mining unprofitable, since to gain efficiency it will be necessary to invest heavily in devices with high processing power.
Keep in mind that mining is a petition. In the end, whoever has the most powerful hardware will get the best results.
And considering the current scenario of energy crisis in Brazil, this activity is even more costly due to the high cost of energy at the end of the month – not to mention unethical.
Attention to energy consumption
Speaking of large energy costs, according to the Cambridge Bitcoin Electricity Consumption Index, the entire bitcoin mining network in the world consumes more electricity per year than all of Argentina.
This is one of the vital problems of cryptocurrencies: to keep the process running, you inevitably have to waste electricity. the increase in mining, this activity can still become one of the great villains in another aspect: the impact on the environment.
Another study, this time from the journal Nature, concluded that bitcoin mining in China will generate 130,5 million metric tons of carbon in the atmosphere by 2024.
To try to mitigate the high energy consumption, some people even resort to renting generators to make the mining process viable.
How much does a bitcoin miner earn?
The miner is also rethought the so-called “transaction fee” in exchange for transaction validation services. This fee, which varies from block to block, can reach up to 6,25 bitcoins — which is equivalent to almost R$ 1,6 million at the current exchange rate.
However, validating transactions does not mean winning that jackpot automatically, to receive the amount you need luck and speed. He still needs to be the most agile – after all, as we said at the beginning of the text, being a miner requires agility.
It is worth noting that this rethink on bitcoin is halved every four years. The last change, including, was made in May 2020.
Curiosity: in 2009, the year that bitcoin mining started, this review was 50 bitcoins (more than R$ 12,5 million).
mine bitcoin for free
Some websites and apps distribute small fractions of the cryptocurrency for free. We have already seen that one bitcoin is equivalent to a large amount, however, the asset can be divided into satoshis (a bitcoin is worth 100 million satoshis). They are the ones that are distributed around for free.
Freebtico.in, a kind of virtual lottery, offers hourly bitcoin bonuses. On the site, there is the possibility to multiply the coins acquired in a casino game or by buying tickets. Another similar service is 777Bitco.in, a platform that distributes up to 11 million satoshis in a similar scheme.
There are also services like Paidbooks, where the user receives 150 satoshi every 10 minutes for reading books. Bitvisitor, in turn, offers bitcoin bonuses every five minutes if the user visits a certain number of sites.
There are several games and services that offer rethinks in this way, however, the small amount is not worth it when the idea is to invest in the bitcoin market for profit.
Read more:
- After all, what can stop bitcoins?
- On this 7th of September, El Salvador goes down in history and the price of bitcoin goes up; understand
- Cryptocurrencies: what they are and where they go
How do I know if my PC is mining bitcoin?
It is also important to find out if someone is using your computer's resources to secretly mine cryptocurrencies. The Pirate Bay website, for example, has already been caught using visitors' processors to mine cryptocurrencies.
Know that there are a few ways to identify these cases. One is to open the task manager on your computer and check the processor (CPU) usage graph. If you notice something out of the ordinary, it may be that something is “sucking” the power of your machine.
A processing spike when visiting a particular website is also a warning sign that the page may be performing a task that uses its processor in the background.
Also, if you close all windows and the CPU usage is still high, then you might have a mining related malware issue. There have also been cases on record where infected ads resulted in the same behavior.
A solution to solve the problem is to open the Task Manager, identify the process that is consuming these resources and close it.
Difficulty mining bitcoin: hashrate
As we observed in the previous topics, the probability of a miner being the first to discover a solution to a problem is measured by its mining power in relation to the blockchain network.
First of all, you need to understand two concepts: what is putational power and hashrate? The processing power of a computer refers to the number of problems it can solve per second. This division by time is called hashrate (mining rate).
Processors used for mining have a hashrate in the terabytes per second (T/s) range, which equates to trillions of hashes per second — trillions of tries per second to find the blockchain solution.
To be competitive, you need to have a high hashrate, as the higher the hashrate of a network, the more difficult the mining process becomes.
Is it worth it to mine on your own?
As mentioned earlier, although mining cryptocurrencies at home is not impossible, you will face competition that makes the activity practically unfeasible financially speaking.
Is mining bitcoin a crime?
No. The truth is that bitcoin has created a new situation in the market: the first digital and decentralized currency in the world.
As the asset becomes more popular, tax authorities and regulators around the world are wrestling with exactly where it might fit into existing regulations.
Conclusion
Now that you've come this far and know what it takes to mine bitcoins, it's time to assess the advantages and disadvantages of the process before investing your money.
Even if you have the necessary resources, it's not worth moving forward if mining will ultimately result in loss.
Finally, it is still necessary to take into account that currently bitcoin is not profitable for beginner miners. Cryptocurrency mining has become a business of gigantic proportions, in which companies alone can exceed 400 hashrate points (speed at which devices can process data).
In this way, other alternatives may be more interesting for those who want to enter the crypto market or, for example, invest in specialized companies that carry out this entire process.
It is also worth taking a look at other cryptocurrencies, Ether, ZCash, Monero, which allow you to use more modest hardware in mining and may represent a more attractive investment, depending on your profile.
