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WHAT IS A CRYPTO MINING?
Crypto mining means the process of verifying and adding a crypto coin transactions to the public ledger on blockchain.
The Proof of Work algorithm used in mining a crypto and crypto Bitcoin is a great example of using this process.
Crypto mining such bitcoin and altcoin (crypto token are not generated by mining process) the initial of basic setup is very important as it covers a technical aspect.
You have understood a several terms and phrase about crypto or blockhain from the previous lesson and now lets take a look the method on how crypto mining works.
TYPE OF CRYPTO MINING’s HARDWARE
There are 5 effective ways mining crypto such a bitcoins and altcoin
1. Central Processing Unit (CPU)
uses by the regular processor which all computers have.
Alternate Crypto currencies (Altcoins) such Bytecoin BCN, MemoryCoin MMC, MonetaVerde MCN and Fantomcoin FCN (details as at http://cpucoinlist.com) are the best to mine using a PC or a laptop.
2. Graphic Processing Unit (GPU)
uses the Graphical Processing Units of powerful gaming computers.
E.g AMD Radeon video cards or Nvidia. High-end cards can cost hundreds of dollars, but also give you a significant advantage over CPU hashing.
For example, an ATI 5970 graphics card can give you over 800 MH/sec compared with a CPU, which will generally give you less than 10 MH/sec.
3. CRYPTO FPGA’s MINER
While the FPGAs didn’t enjoy a 50x – 100x increase in crypto mining speed as was seen with the transition from CPUs to GPUs, they provided a benefit through power efficiency and ease of use. A typical 600 MH/s graphics card consumed upwards of 400w of power, where as a typical FPGA crypto mining device would provide a hashrate of 826 MH/s at 80w of power.
With the successful launch of the Butterfly Labs FPGA ‘Single’, the crypto mining hardware landscape gave way to specially manufactured hardware dedicated to mine bitcoins.
That 5x improvement allowed the first larger bitcoin mining farms to be constructed at an operational profit.
4. CRYPTO ASICs MINER
Application Specific Integrated Circuits are specialized machines/hardware built specifically for the mining task (recommended) but the cost price very exspensive.
One unit of Asics “Antminer” around $3000. speeds anywhere from 5-500 Gigahashes/sec.
You may well need a crypto mining software for your ASIC miner, too, although some newer models promise to ship with everything pre-configured, including a bitcoin address, so that all you need to do is plug it in the wall.
5. CLOUD MINING
the process of crypto mining utilizing a remote data center with shared processing power.
This type allows users to mine bitcoins or alternative crypto currencies (Altcoins) without having to manage their own hardware, software or to know which the best pool to mine.
Enables users to purchase mining contract capacity of the hardware in data centres.
EOBOT will mine and hash whatever crypto currency you need.
Get started with as little as $10 with immediate mining results.
Cloud mining enables people to earn Bitcoins and altcoin without crypto mining hardware, software, electricity, bandwidth or other network offline issues.
Notes : Usually CPU mining is the least effective, FPGA mining more power consumption, ASIC mining is the most efficacious, and GPU mining is somewhere in the middle. Your computer has its own electricity draw on top of the mining hardware, and you’ll need to factor that into your calculation for profit.
Once you have chosen your hardware, you’ll need to do several other things:
FIND A CRYPTO MINING SOFTWARE
Depending on which equipment you choose, you will need to run software to make use of it.
Typically when using GPUs and FPGAs, you will need a host computer running two things:
1. The standard bitcoin client, and
2. A crypto mining software.
STANDARD CRYPTO CLIENT.
This software connects your computer to the network and enables it to interact with the bitcoin clients, forwarding transactions and keeping track of the block chain. It will take some time for it to download the entire bitcoin block chain so that it can begin. The bitcoin client effectively relays information between your miner and the bitcoin network.
LIST OF A CRYPTO MINING SOFTWARE
It function to instruct the hardware to do the hard work, passing through transaction blocks for it to solve. There are a variety of these available, depending on Operating System. They are available for Windows, Mac OS X, and others.
Crypto mining software also required for ASIC miner, although some newer models promise to ship with everything pre-configured, including a bitcoin address.
These are the popular crypto mining software (suggestion):
Bitcoin Miner : Windows & Linux
BTC Miner : Windows
BTCMINTER : Windows
CG Miner : Windows & Linux
BFG Miner : Windows & Linux
Easy Miner : Windows & Linux
XRPC Miner : Mac OS
CPU Miner : highly optimized CPU miner for Litecoin, Bitcoin, and other cryptocurrencies are currently supported algorithms are SHA-256d and scrypt(N, 1, 1).
JOIN A CRYPTO MINING POOL
Crypto mining Pools is a group of Crypto Coin miners that combines their computing resources of hashing power over a network, to split the reward equally, according to the amount of work they contributed to solving a block. how to join a mining pool.
There are two basic ways to mine:
1. On your own @Solo : will give you large, infrequent payouts and pooled mining will give you small, frequent payouts, but both add up to the same amount if you’re using a zero fee pool. Remark: the current difficulty level is so high that it’s practically impossible for soloists to make a profit mining
2. As part of a pool : With pool mining, the profit from any block a member generates is divided up among the members of the pool. This gives the pool members a more frequent, steady payout (this is called reducing your variance), but your payout(s) will be less unless you use a zero fee pool.
The reason you shouldn’t go it alone is that Bitcoins are awarded equally according to the amount of share and contributed in solving a blocks, usually 12.5 at a time, and unless you get extremely lucky, you will not be getting any of those coins.Almost all miners choose to mine on a pool because it takes the luck out of the process.
Now, you’re all set up. Good for you. Having decided which currency to mine and which pool you’ll work for, it’s time to get started.
List of available pool for mining crypto:
Create an account on the pool’s website, which is just like signing up for any other web service. Once you have an account, you’ll need to create a ‘worker’. You can create multiple workers for each piece of mining hardware you’ll use. The default settings on most pools are for workers to be assigned a number as their name, and ‘x’ as their password, but you can change these to whatever you like.
CRYPTO COIN ALGORITHM which are the most popular & profitable among them for mining are:
CryptoNight : CryptoNotes are coins mostly based on CryptoNight. can be effectively mined with a CPU only on any computer. In fact, they do not offer any advantage to GPUs whatsoever. Most CryptoNote coins can be mined using the MinerGate GUI Miner (it is free to use) and simple to use, even connecting automatically to its own pool, and even has support for merged-mining: meaning that you can earn two different coins at the same time. The software also has a great option; “Smart mining”, which automatically picks up for you the best coins to mine according to market prices and network difficulties. CryptoNote coins: Bytecoin, Monero, DarkNote, Boolberry.
X11 algorithm : can also be mined with a regular computer. Crpto Coin : DarkCoin, XCurrency.
SHA-256 : Bitcoin uses SHA–256, Bitcoin mining uses cryptography, with a hash function ( hashes are large numbers, and are usually written as hexadecimal).
SCRYPT : many alternative coins (altcoins) was specifically designed to make it costly to perform large-scale custom hardware attacks by requiring large amounts of memory. A free mining software package made up of cgminer and stratum. Crypto Coins : Litecoins, Dogecoins, and Feathercoins are three Scrypt-based.
*there are many more algo available for mining.
COMPARISON OF CRYPTO MINING POOL REWARDS
Reward types & explanation:
CPPSRB – Capped Pay Per Share with Recent Backpay.
1. DGM – Double Geometric Method. A hybrid between PPLNS and Geometric reward types that enables to operator to absorb some of the variance risk. Operator receives portion of payout on short rounds and returns it on longer rounds to normalize payments.
2. ESMPPS – Equalized Shared Maximum Pay Per Share. Like SMPPS, but equalizes payments fairly among all those who are owed.
3. POT – Pay On Target. A high variance PPS variant that pays on the difficulty of work returned to pool rather than the difficulty of work served by pool
4. PPLNS – Pay Per Last N Shares. Similar to proportional, but instead of looking at the number of shares in the round, instead looks at the last N shares, regardless of round boundaries.
PPLNSG – Pay Per Last N Groups (or shifts). Similar to PPLNS, but shares are grouped into “shifts” which are paid as a whole.
PPS – Pay Per Share. Each submitted share is worth certain amoutripnt of BC. Since finding a block requires <current difficulty> shares on average, a PPS method with 0% fee would be 12.5 BTC divided by <current difficulty>. It is risky for pool operators, hence the fee is highest.
Prop. – Proportional. When block is found, the reward is distributed among all workers proportionally to how much shares each of them has found.
RSMPPS – Recent Shared Maximum Pay Per Share. Like SMPPS, but system aims to prioritize the most recent miners first.
5. SCORE – Score based system: a proportional reward, but weighed by time submitted. Each submitted share is worth more in the function of time t since start of current round. For each share score is updated by: score += exp(t/C). This makes later shares worth much more than earlier shares, thus the miner’s score quickly diminishes when they stop mining on the pool. Rewards are calculated proportionally to scores (and not to shares). (at slush’s pool C=300 seconds, and every hour scores are normalized)
SMPPS – Shared Maximum Pay Per Share. Like Pay Per Share, but never pays more than the pool earns.
6. FPPS – Full Pay Per Share. Similar to PPS，but not only divide regular block reward (12.5 BTC for now) but also some of the transaction fees. Calculate a standard transaction fee within a certain period and distribute it to miners according to their hash power contributions in the pool. It will increase the miners’ earnings by sharing some of the transaction fees.
↑Some people claims, Do not use a laptop, gaming console or handheld device to mine. These devices are not effective enough to generate income. Go by the Cloud Mining or With Asic Hardware.
↑Bitcoins @BTC are not a good choice for beginning miners. During the last 3 years an incredible amount of hashrate coming online which made it harder and harder to have enough hashrate personally to solve a block thus getting the payout and does not make it profitable for consumer-level hardware. Better options for beginners on CPU or GPU mining are those Alternative Coins (altcoins) such Litecoins, Dogecoins, and Peercoins, Bytecoin, Monero, DarkNote, Boolberry and later will be paid in BTC upon confirmation of solving block.
↑That pool hashrate is largely irrelevant but can be seen as a popularity measurement. It is a theoretical security issue if one pool gains above 50% of the total computational power of the network, thus consider joining a pool based on other metrics. The pool’s total hash rate is very dynamic on most pools. Over time, as the network grows, so does most pool’s hash rates. The displayed values are the pool’s relative sizes based on the network: Small: less than 2%, Medium: 2%-10% Large: greater than 10% of the network.
↑Merged mining allows miners to mine on multiple block chains at the same time with the same hashing.
↑The difficulty of the shares can be changed by the user.
↑ Merged mining can be done on a “solo mining” basis (payouts in the merged chain are not pooled).
You absolutely need a strong appetite for reading and constant learning, as there are ongoing technology changes and new techniques for optimizing coin mining results. The most successful coin miners spend hours every week studying the best ways to adjust and improve their coin mining performance.(5feb2018)