Ethereum is a decentralized blockchain that is updated and confirmed by users of the Ethereum network, just like Bitcoin. Mining new blocks can only expand the Ethereum blockchain. The term “mining” is an analogy taken from extracting valuable metals from the earth, which requires labor- and energy-intensive mining.
Likewise, computers worldwide compete to solve cryptographic puzzles to mine Ethereum, which costs processing power (labor) and energy. Anyone who completes the problem successfully first gets to add the subsequent block to the blockchain. A miner receives ether in exchange for their labor (ETH). These incentives reimburse miners for maintaining network security, confirming trades, and adding blocks to the blockchain.
The current block mining reward is two ether plus all of the block’s priority fees. On average, the blockchain adds a new block every 15 seconds.
Why mining Ethereum is a good idea
Ether was only worth $1 when the Ethereum network first went live in 2015. The mining of ether wasn’t a quick way to get rich. Many of the first miners were programmers or crypto enthusiasts who supported the project because they believed in it.
With the price of ether gradually rising, mining grew more profitable, luring tech-savvy individuals who saw the network’s potential and had the knowledge necessary to manage their own nodes. Since ether prices are now in the four figures, mining ether is currently a lucrative industry while being extremely competitive. However, additional investments in mining equipment are unlikely to still be viable given that Ethereum will convert to PoS in 2022.
But mining is undoubtedly an intriguing possibility for those looking to earn some additional cash and have access to unused GPU computing power. But since PoS is soon to arrive and ether staking is now available, staking is unquestionably the more convenient, less resource-intensive, and futuristic way to earn ether.
Where to mine Ethereum
Step 1 is to select your mining strategy.
There are three methods that miners might use when mining ether.
The simplest and quickest method to start mining Ethereum is in a pool. You work together with others when pool mining. Each miner who joins a pool understands that prizes will be distributed among them based on the hashpower supplied if one of them solves the cryptographic riddles. The number of blocks the group finds on average depends on the size of the pool, expressed in hashpower.
But not every pool is made equally. Pool size, minimum payout, and pool fee are the three main factors that should be taken into account while selecting a pool. The portion that the pool administrator receives for managing the pool is specified in the pool fee. If a pool charges more than 3% in fees, you might want to look for another pool. The smallest sum from the pool can be withdrawn is the minimum payment. For instance, if the minimum payout is one ether, it can take weeks or months before you accumulate enough reward payments to qualify for a withdrawal.
Since there are no pool fees to pay and benefits need not be divided, mining independently seems to be a more appealing option than pool mining. However, a miner needs hundreds of GPUs to have a realistic chance of finishing one of the cryptographic puzzles in an acceptable amount of time. As a result, professional miners who own their own mining farms tend to use solo mining.
You pay someone else to mine for you in cloud mining. Renting someone else’s computing power allows you to outsource your mining operations rather than purchasing and maintaining your own mining equipment. You receive the mining benefits in exchange. But be mindful that cloud mining, particularly when done through an online service, requires trust in the counterparty. There is no assurance that the upfront payment is used to operate mining equipment or that such equipment even exists. Because of this, it is advised to choose reputable, well-established cloud mining services like HashFlare.
Create an Ethereum wallet in step two
You must make an Ethereum wallet if you don’t already have one. On the market, there are a variety of wallets. MetaMask and Trust Wallet are two well-liked wallets.
Prepare your hardware and software in step three.
It takes a lot of processing power to mine. You want at least one potent GPU unit in order to mine ether effectively. So-called mining “rigs” can also be connected to many GPUs. Installing the most recent updates offered by AMD or Nvidia, the manufacturers of your GPUs is crucial for ensuring that your GPUs operate as efficiently as possible.
Installing Ethereum mining software is step four
Software for mining ether comes in a variety of forms. Visit this page to locate the software you like or to download the most recent version of Claymore Dual Miner. This tutorial’s step-by-step instructions configure Claymore dual mining (point 3.3).
Choose a mining pool in step five
You must choose the mining pool you want to join while configuring your mining software. There are other options, including 2Miners and Ethermine. Check the pool size, the minimum payout, and the pool fee before choosing one.
Collect your rewards in step six
You can start collecting your mining prizes once you’ve been mining for a while. To obtain a summary of your mining rewards, visit the webpage for your pool and paste your public Ethereum wallet address into the search field.
Depending on the pool, after you achieve the minimum payout level, you can either manually claim your winnings or have them automatically sent to your ether wallet. From there, you can use British Bitcoin to have the best experience trading digital coins.