Mining Explained: A Detailed Guide on How Cryptocurrency Mining Works.

Posted on May 18, 2022by Gordon Neil

During the peak of cryptocurrency mining, war ensued that boosted demand for GPUs. GPU manufacturer Advanced Micro Devices reported impressive results in its latest earnings report as demand for its shares rose and shares were at a record high for the past ten years. Although demand for graphics processors has increased dramatically crypto mining gold rushes have quickly ended as difficulty in mining top cryptos including Bitcoin increased rapidly too. cryptocurrencies are still lucrative. What does cryptomining mean? The following article focuses on this subject further.

Understanding Bitcoin

Bitcoins are a very popular type of cryptocurrency that are digital currencies. Bitcoin is distributed in the form of distributed ledgers, which monitor the transactional data in cryptocurrency and track the transaction. When computer systems verify and process transactions, new bitcoins may be created. These networked computers process this transaction by accepting bitcoins and then paying them. Bitcoins are based on blockchain technology, enabling some cryptocurrency systems and applications. A blockchain is essentially a centralized ledger that records every transaction within a network.

Is Bitcoin mining profitable?

That’s a question. Even if the Bitcoin mining business succeeds, the mining companies are unsure about their potential profits because of the high initial equipment prices and the ongoing electric expenses. The ASIC’s electricity will consume about twice what is used to power the PlayStation three in the US, according to the report released in April 2019. Since the complexity of mining bitcoin increased, it was necessary for a higher computing capacity. Bitcoin mining consumes 14.5 terawatt-hours of electricity a day, according to Cambridge Bitcoin electricity consumption.

How Bitcoin mining works?

Bitcoin miners compete for the best chance to create and maintain a large amount of blocks using expensive computer software and massive electricity. To complete the extraction the miner must find a correct answer. A method to guess a correct amount is called proof of a work. Miners guess targets’ hashed data using random guessing as quickly as possible — a method that requires massive computational power. The difficulties are increased with increasing numbers of miners joining the network. ASICs are computer hardware that are typically referred to as ASICs and can be up to $10,000 to build.

How can I start mining Cryptocurrencies?

Mining cryptocurrencies uses computer programming software geared toward solving cryptographic mathematical calculations. Until recently, cryptocurrencies like Bitcoin were mined using just the CPU chips of home computers and were easy to use. In recent decades, CPU-chip technology has largely become unsuitable for mining cryptocurrencies because of increased challenges. Nowadays mining for cryptocurrency requires a GPU mining device or ASIC mining software for applications. In addition, every GPU in mine must have reliable internet connectivity.

Tell me the best way to mine Bitcoin?

Initially individuals could compete to buy Bitcoins using a computer that was connected to their computers, but it is no longer so. It’s because of how complicated Bitcoin mining can be with time. In the hope that it will be possible to run the blockchain in a smooth way and be processed and verified by a Bitcoin blockchain, the network will generate one block each hour. Nevertheless the mining industry is likely to be able to solve the problem in less than two hours with fewer hacked computers than 10 hacked computers compared to 100.

Different methods of mining Cryptocurrencies

Different methods to mine a cryptocurrency take different times to do so. In the early days of computer mining, CPUs were the preferred solution for all of the mining jobs. Despite the huge electricity costs and increased difficulties across the country, CPU mining remains slow. GPU mining is a way to explore cryptocurrency. It increases computation power when combining GPUs with one machine. In the GPU mining rig the motherboard must have cooled systems installed in order. ASIC mining also provides another way of mining cryptos.

What are mining pools?

If the solver has a puzzle then he receives a bonus from mining, and the probability that a participant finds a solution equals the percentage of the mining power. Participants with relatively small proportions of mining power can’t really discover the next Block alone. A mining card a user might have for tens of thousands would not be enough to supply 0.09% of the mining power of an entire system. It may take the miner quite some time for him to locate the block, and the difficulty is going to increase it.

What is Hashrate?

GitHub hashrate represents the computation power used by mining companies. The more people mining Bitcoin and hoping to earn money, the more difficult it gets to solve it. This is a computational battle where individuals or groups have more computing power. More computers have the more opportunities the mine is going to get and thus the more blocks it can get. In 2009 Hash rates were initially measured in Hash Per Seconds (H/s – H/s was quickly used to indicate that mining grew exponentially in the future.

Is Bitcoin mining legal?

Bitcoin mining has a legal status depending purely on where you are. Bitcoin’s concept threatens fiat currencies and government controls on financial markets. Bitcoin is illegal in some locations. Bitcoin owners can legally use their Bitcoin to mine Bitcoins and other cryptocurrency. The country has been found to be illegal for several reasons. 8. Currently the ban includes China, Bangladesh, Dominica, North Macedonia, Qatar and Vietnam. In most countries bitcoin use remains a legal practice.

Downsides of mining

Generally, mining risks can be financial or regulatory. Mining of the Bitcoins is a serious and expensive risk since it is impossible to earn enough profit by buying and selling mining equipment for a single investment. However, these risks can easily be reduced through mining. When mining is considered a risk and living near a place where the mine is illegal then reconsider it. You should also consider the country regulation and general sentiments regarding cryptocurrency before investing.

FAQ

How much can you profit from Bitcoin mining?

If an Ethereum miner can create an Ethereum block, he will get 625 bitcoins. The prize is halved every 4 years or a quarter of the 200,000 block. Bitcoin was valued between $40,000 and $750 million and is worth approximately $150,000.

What is block mining in bitcoin?

Bitcoin mining is used to store current bitcoin transactions in blocks that can be added to blockchains. Bitcoin miners are used to analyze transactions by analyzing data from bitcoin transactions. The miners receive bitcoins for each block.

How long does it take to mine a bitcoin block?

Bitcoin blocks are mined every 10 minutes. This means that the theory will take about 10 minutes to mine a BTC reward.

How many bitcoin blocks is a mining?

How many coins can be minted per block is varied. Each block produced 6.25 BTC.

What is the return on Bitcoin mining?

Miners will receive a reward of 625 bitcoins. The price will decrease by 1.325 Bitcoins from 2023 to 2027. The prize is paid to the miners first solving this puzzle. Typically the same procedure repeats for ten seconds for all of the mining machines in networked systems.

Bitcoin Guide

What would happen if I invested $1000 in bitcoin in 2010?

Posted on April 21, 2022by Gordon Neil

The story of the most popular digital asset created by Satoshi Nakamoto began years ago, back in 2010, and since then the asset has shown a crazy increase in value. In the past decade, this digital currency grew in price at a frantic pace, although in 2010 it was used to buy several pizzas, and has since inspired the creation of many other cryptocurrencies.

On May 22, the cryptocurrency world celebrates the anniversary of Bitcoin Pizza Day. On this day in 2010, Czech enthusiast Lazlo Hanesh made the first financial operation using crypto called bitcoin. Hanesh transferred 10,000 bitcoins to his developer friend, who ordered him two pizzas from Papa John’s restaurant. Then one bitcoin cost about $0.003 (thus, pizzas cost the Czech $30).

However, if you had clicked the bitcoin payment button in 2010 and purchased $1,000 worth of crypto assets, you would have received at least 927,693% growth in 2022! In other words, a thousand US dollars in 2010 invested in bitcoin in 2022 would turn into $927 million. Those who invested 1000 in Bitcoin are certainly happy they’ve done so. But when did Bitcoin start and what was Bitcoin’s starting price?

BTC mining began in 2009. However, Bitcoin was not sold anywhere. Back then, there were no cryptocurrency exchanges at all. Technically, the price of bitcoin in 2009 was $0. Throughout 2010, bitcoin did not manage to reach the $1 mark, but the price had already begun to rise.

The lucky ones who bought bitcoins in 2010 could not fully realize the potential of the crypto coins. Until 2017, the growth rate of bitcoin did not give reason to assume that Bitcoin’s rise would lead to cosmic growth. The process of global adoption of crypto began after 2017 and was triggered by a sharp rise in bitcoin.

Between May 1, 2017 and April 1, 2018, the main cryptocurrency has risen in price by almost 5000%. This happened against the backdrop of an increase in the popularity of a new way to raise funds – ICO. IPO projects have raised millions of dollars, often without even a minimum viable product. During the same period, CME launched Bitcoin futures trading.
Every year, the number of Americans hearing about bitcoin has grown exponentially, including the many people who’ve actually bought bitcoin. According to explodingtopics.com, in 2022 most people in the US (more than 89% of the population) have heard of bitcoin. At the same time, the number of blockchain wallets as of the beginning of 2022 has increased to 80 million

The value of the Bitcoin

The main digital asset burst into the global economic and financial arena thanks in large part to individual traders. Large companies and hedge funds helped to reach a new level of BTC, which saw their benefits and potential in cryptocurrencies. What was this value?

It is important to remember that when bitcoin appeared, blockchain technology also appeared. These two technologies are inextricably linked and help each other get better. Blockchain algorithms and protocols work best in the first cryptocurrency. Given the value of digital assets and the technologies on which it is based, six core values can be identified:

Decentralization – Bitcoin technology has allowed us to avoid tight control over the use of cryptocurrency and put more power in the hands of the user community. In 2022, this is a key advantage of the new generation of digital assets, but for the first time this was implemented as part of the Bitcoin project.

Security – The Bitcoin network remains virtually immune to hacker attacks. Blockchain technology plays a significant role here, due to which, in order to access the information of the BTC network, it is necessary to control at least 50% of mining, which is an almost impossible task.
Mining or extraction of BTC is distributed among numerous companies that are geographically located in different parts of the world. Therefore, the Bitcoin network is a much more secure place than any physical storage. Wild west of crypto mining explained how exactly mining caused on BTC/USD price.

Scarcity – according to the original algorithms, the total supply of BTC is limited to 21 million coins. Computing processes are designed in such a way that the last coin will be mined no earlier than 2140. Crypto has more value than fiat means of payment. Eventually, the digital asset will become completely deflationary, causing its value to rise significantly. Due to this property of the coin, the term HODL appeared, which means long-term storage with the aim of making a profit by increasing the fundamental value of the asset.

What will happen with bitcoin in 2022?

In 2021, Bitcoin became the most profitable financial instrument, surpassing the S&P 500 trading index, which showed the best result in three years. Also, the digital coins bypassed real estate and oil in terms of profitability. Gold finished 2021 in the red by 2%, in which BTC played an important role. Therefore, a fashionable topic for discussion is “what better protects against inflation Bitcoin or gold?” may be considered closed.

Despite the yield in the region of 60%, the cryptocurrency did not justify all the advances that it received in the fall of 2021. Leading experts like Bloomberg analyst M. McGlone and S2F model developer have said that bitcoin will end 2021 at around $120k. Leading banking conglomerates JPMorgan and Goldman Sachs were also confident that Bitcoin price would cross the $100k mark. But in reality, the digital asset hit a painful correction that the market is still feeling.

Although this should not be taken as definitive investment advice for your personal finance ventures, among the global forecasts for Bitcoin, it is worth highlighting the statement of Bloomberg expert McGlone. The analyst believes that the main cryptocurrency will reach $100k in 2022 due to a gradual change in the role in the financial system and a significant decrease in volatility.

The CEO of cryptobank SEBA is less optimistic in his forecasts, and believes that the asset is capable of reaching $75k by the end of 2022.

Is it too late to invest in Bitcoin?

If I didn’t invest 1000 in Bitcoin in 2010, is it too late now? Yes and no. On the one hand, Bitcoin is already worth too much (not counting the transaction costs), so it is no longer possible to get a million percent of the net worth profit.

On the other hand, despite finding great success over the last decade, the main crypto assets is only at the initial stage of its formation. Bitcoin is now at the adoption level of the Internet in 1996.

In other words, cryptos have a great future and there is no doubt that if in 2022 you invest a thousand dollars in this cryptocurrency during the bear market, then after 2-3 years you will be able to get at least 100% profit.

Bitcoin has not yet found itself as a full-fledged means of payment. Large hedge funds continue to be interested in the asset, and the emergence of state regulation will increase investment flows in BTC. Therefore, there is no doubt that the digital assets has room to grow and develop, so buying BTC/USD is still a good deal in the long run.

Cryptocurrency

The Good, the Bad and the Ugly: Wild West of Crypto Mining

Posted on March 4, 2022by Gordon Neil

“Bitcoin mining” is a phrase that has been tossed around for over a decade now and even people with no knowledge of crypto have encountered it at least once. The crypto market has evolved a great deal since 2009, however, the regulations of crypto trading and mining are still considerably lagging behind. This gray area is leaving plenty of room for trading manipulations and causing a Wild West of crypto mining.

Wild West Crypto Mining – no Pickaxe required

When a typical person hears “crypto mining” the thought that comes to mind is a gamer using his rigged PC to mine Bitcoin while offline. In actuality, according to a new study, half of all Bitcoin mining capacity is controlled by 0.1% of miners.

A typical Bitcoin miner is a corporation operating “mining farms” – numerous warehouses full of ASIC (Application-Specific Integrated Circuits) mining computers. These organizations make it impossible to compete against them for lucrative Bitcoin hashrate, practically pushing an individual miner out to the curb.

However, Bitcoin, even though the most recognized, is not the only proof-of-work (PoW) crypto. Despite some arguing that proof-of-stake (PoS) is the new norm among the blockchains, there are still quite a few cryptos that can be mined.

Deciding Whether to enter the Wild West of Crypto Mining

Despite numerous arguments against it, PoW seems to be here to stay, at least for the time being. For those who are interested in making some easy passive income on the side, once they dismiss the idea of mining Bitcoin, the next stop is Ethereum.

Ether’s price has lately made its mining an extremely lucrative endeavor. It attracted many first time miners, so it is no wonder Ethereum’s hashrate is at its all time high. Miners’ only concern is Ethereum’s eminent transition to PoS, which is expected to take place by 2023.

Ethereum Network Hash Rate Chart by etherscan.io

Honorable mentions of PoW chains include, though are not limited to:

Ethereum Classic
Monero
Ravencoin
Dodgecoin

Mining each of them comes with different equipment requirements and fluctuating hashrate difficulty. Anyone looking to get into crypto mining needs to weigh out the current hardware availability and prices against the potential gains.

Miners versus Gamers

Lately, hardware scarcity has been one of the burning topics among the miner community. Various weather incidents, trade war of the US and China and the consequences of the pandemic as well as the increasing hardware demand by miners resulted in a worldwide semiconductor chip deficit.

The surge in demand and prolonged chip shortage culminated into a market of online purchasing bots, scalpers, hardware company lotteries, skyrocketing prices and overall equipment unavailability. At one point, the consumers were forced to either pay double and triple the MSRP, or settle for the equipment they already own.

This affair primarily affected the gamers and the miners as they were the pool competing for the severely limited supply of the medium and high performance GPUs. Since the miners were using the hardware to acquire generous income, they were ready to pay high prices to the scalpers thus further deepening the issue.

This trend prompted manufacturers to put a lid on the GPUs’ hashrates making them less appealing to miners. However, the short term solution was just an implemented driver on the existing GPUs. Consequently, as soon as they hit the market, crypto miners’ forums were overflowing with advice on how to go around the restrictions. It was back to square one for the manufacturers and just another day in the Wild West of crypto mining.

The Big Miner Migration

Besides the chip shortage, 2021 was significant as the year of the big miner migration. With the release date of digital yuan approaching, the Chinese government saw crypto as direct competition to their CBDC. This triggered one of the world’s biggest government crackdowns on crypto, effectively shutting off power to all Bitcoin mining farms on Chinese grounds overnight.

Bitcoin mining hashrate contribution of China up to that point had been steadily declining in the anticipation of such an event. It went from 75% in 2019 to 44% in May of 2021, however, the ban has suddenly brought all Bitcoin mining in the Republic of China to a screeching halt.

All of the miners had to quickly find an alternative combination of crypto friendly grounds and affordable power. Russia and Kazakhstan were appealing and initially quite popular options because of their proximity. However, over time, they have shown to be risky choices due to governments’ inconsistent policies and electricity shortages.

Evolution of country hashrate share by Cambridge Bitcoin electricity consumption index

Transporting the equipment to the US and Canada was logistically challenging due to the pandemic imposed shipping strain. Nevertheless, Texas has become the fastest growing destination for crypto mining in the world.

Green is the New Black of the Crypto Wild West

The narrative constantly finding its way back to the headlines of the crypto news section is that of Bitcoin’s “poor effect on the environment”.

Total Bitcoin electricity consumption data by Cambridge Bitcoin electricity consumption index

It is a fact that Bitcoin mining is a highly energy intensive process. According to Cambridge Bitcoin electricity consumption index, monthly Bitcoin electricity consumption has increased from 0.09 to 310 TWh, or close to 350,000% over the past decade. This trend has brought about numerous critics of mining impact on the environment and just about every major news post on the topic resulted in a price hit to Bitcoin.

One of those price hits was in May of 2020 when Elon Musk announced that Tesla would no longer be accepting Bitcoin as payments due to its environmental impact. The news caused a Bitcoin price drop of 15%. The epilogue of this episode was only a month later when Tesla’s CEO tweeted that the company would likely reinstate the bitcoin payment button once miners shift to more eco-friendly energy sources.

Probably unrelated to Mr. Musk’s actions though, Bitcon’s mining industry is showing an overall trend of moving towards more sustainable energy consumption. During June quarter, the share of green energy reached 56%, making Bitcoin mining one of the most sustainable industries in the world according to Bitcoin Mining Council (BMC).

This shift perfectly correlated with the big miner migration into the US. Not coincidentally so, since in Texas, miners shut the rigs upon power use surges and buy electricity when the demand is low. This way, they are efficiently acting as a new green energy shock absorber. Some even anticipate that recent mining activity will catalyze wind and solar energy production in the area to alleviate the power strain.

The demand for green Bitcoin is so high that even hardware manufacturing companies are jumping on the bandwagon, one of which being Intel. There has been a great deal of marketing and fan-fare surrounding Intel’s new “Bonanza Mine” chip and the community expected the new miner to deliver on speed as well as energy efficient performance. However, this turned out to be a letdown, as this chip only has about 40% of the hashrate power of the typical antminer, leaving the consumers to choose between hashrate and sustainability.

Crypto is here to stay and, despite its drawbacks, PoW is not going anywhere any time soon. However, anyone looking to get into mining has to be aware of the kind of cut-throat business they are entering. Until some serious regulations are in place, this market, as a whole, will be referred to as crypto Wild West among serious investors.

Bitcoin Guide

Bitcoin and Bitcoin payment button

Posted on February 2, 2022by Gordon Neil

Integrating a Bitcoin payment button into your website enables you to accept Bitcoin payments, and improves your transaction experience while simultaneously growing your customer base.

Proceeding text will try to provide answers to the following questions:

What is Bitcoin, and why do merchants nowadays opt for bitcoin transactions?
What is a Bitcoin payment button?
What are the benefits of the Bitcoin payment button?

Bitcoin (BTC) is a form of alternative payment digital currency. BTC is a decentralized exchange medium, meaning that it operates in real-time independently of any third-party authority -just like a virtual cash payment. As a result, the settlement between merchant and customer is secure, direct, instant, and effortless.

Since there are no financial intermediaries, there aren’t any extra fees or chargebacks like credit card use. Bitcoin is also not affected by foreign currency exchange rates either. In addition, bitcoin transactions do not require verification of your identity or an address, thus ensuring anonymity. The only thing you will need to send and receive Bitcoin is a digital wallet.

A digital wallet is a program that stores cryptogenic information about your digital currencies addresses and all of your transactions while allowing you to accept, hold, or sell them without limit.

The bitcoin button is a simple custom-built checkout link, designed similarly to conventional online payment buttons, except it allows receiving payment in Bitcoin digital currency. After each successful transaction, your bitcoin payment will be safely stored inside your digital wallet. Besides, providing the BTC payment option benefits your business in many ways. For example, it can expand your client base and increase your customer satisfaction. Furthermore, integrating the BTC as part of your company’s payment system benefits your exposure and makes your products or services cutting edge among the industry’s competition. Finally, having multiple payments and currency options expands your own experience range and boosts your confidence as a business owner.

The Bitcoin payment button setting doesn’t require integration of the payment gateway. It lets you skip lengthy payment processing time and offers a personalized checkout experience, regardless of whether you are selling a product, service, or receiving a

donation. In addition, the setup process is safe, quick, and easy, and it doesn’t require any complex technical coding skills besides copying and pasting.

For example, you may design your unique payment button’s features, such as adding a slider, changing the color palette, or you can simply set the upper and lower payment thresholds. Furthermore, it is effortless to share your BTC payment button URL address and choose which pieces of information you want a customer to disclose before finalizing the bitcoin transaction, allowing you to collect only the relevant data that matters to you most.

Finally, it ensures contactless and secure transactions from any location as long as you have an internet connection. The only thing you need to do is choose between the multiple website creators and make an account so that you can easily generate a bitcoin payment in no time.

How to make the BTC payment button in ten easy steps?

Nowadays, many website creators are available, but the basic BTC payment button creation and setup process essentially remains the same and minimally differs regardless of the website.

Step 1. First, create an account by following the instructions on a Sign-Up page.

Step 2. Activate your account.

Step 3. Log into your account on a dashboard.

Step 4. Choose and click on the ‘Payment Button.’

Step 5. Wait until you are redirected to your bitcoin wallet address.

Step 6. Once inside your bitcoin ‘Wallet’ section, enter your private key.

Step 7. Click on the ‘Product’ page and enter your product’s name and description.

Step 8. Choose the ‘Customer Field’ menu and fill out the details

Step 9. Click the ‘Save’ button option.

Step 10. Finally, click the ‘Generate Button.’

How to add the Bitcoin payment button to a website in 10 steps?

Once you have generated a Bitcoin payment button, an HTML code should appear.

Step 1. Under the ‘Step 1’section, select and click the ‘Copy code’ button to save the source code to your clipboard.

Step 2. Open your website and log into your admin panel.

Step 3. Open the page exactly where you wish to add your ‘Bitcoin payment button.’

Step 4. Paste the code.

Step 5. Go back to the ‘Step 2’ section

Step 6. Highlight and then click the ‘Copy code’ button to save the piece of code to the clipboard

Step 7. Go back to your website page where the ‘Bitcoin payment button’ is

Step 8. Scroll all the way to the bottom of the page

Step 9. Paste the script code.

Step 10. Finally, check if your new payment button appears on the page.

Congratulations! You did an amazing job, and now you can safely accept your Bitcoin payments. You may also turn on notifications to easily track your orders as well as gather additional information about your customers’ shopping cart conversion rate. Also, do not forget to set up an alert button while waiting on the payment. In this way, you will receive a notification via email each time your BTC transaction goes through!