bitcoin mining

How To Become A Bitcoin Miner: The Ultimate Guide

Pranav Hooda
By Pranav Hooda 6 Min Read

Bitcoin mining is a lot like a giant lottery where you compete with your mining “rig” (a computer specifically designed for mining) with everyone on the network to earn bitcoins. It is the process by which transactions are verified and added to the public ledger, known as the blockchain, and also the means through which new bitcoins are released. Anyone with access to the internet and suitable hardware can participate in mining.

The Basics of Bitcoin Mining

Bitcoin mining requires the user to solve a mathematical puzzle. To do this, they have to make as many calculations as possible and the computer has to solve those calculations within a time limit. Once the puzzle is solved, the miner is rewarded with a predetermined amount of bitcoins. On average, a Bitcoin miner earns about .00035 per hour. At the time this article was published, the Bitcoin value was $13.02 and the minimum daily reward for solving a puzzle was 25 Bitcoins ($250). This will decrease as the number of miners grows because fewer people will be able to solve the puzzles. 

What is a Bitcoin Mining Rig?

In 2013, the first ever bitcoin miner was produced with a “bitcoin rig” costing $1,000. However, to access the bitcoin network one is required to have a bitcoin wallet, which basically acts like a virtual wallet used to send and receive bitcoins. One needs to set up an account at a bitcoin exchange, either the San Francisco-based Coinbase or the Toronto-based Bitstamp, which acts as a merchant processor for the digital currency and allows consumers to exchange dollars for bitcoins. Once an account has been created, the user would send a transaction to the network. The protocol is set up such that a transaction can either succeed or fail.

How Does Bitcoin Mining Work?

Bitcoin mining is the process by which transactions are verified and added to the public ledger, known as the blockchain, and also the means through which new bitcoins are released. Anyone with access to the internet and suitable hardware can participate in mining. But several components, like a graphics card, motherboard, and a fan-cooled water-cooled processor, are required to participate in mining. However, for the purposes of this article, we will be focusing on the use of a graphics card to mine bitcoin, since it is much easier to figure out than the other components. Mining is also a 24-7 gigahertz type of process, so it is necessary to buy the equipment that you need when you want it. 

Bitcoin Mining Software

Depending on the skill of the miner, the computer, and the hardware you own, it can take anywhere from minutes to hours to mine a single bitcoin. And the rate at which new bitcoins are released determines the difficulty of the work. Hard work is required when mining bitcoin. Many people have looked into creating Bitcoin-mining software to make it easier for others to participate. Some of them have proven to be more efficient than others. You can find a list of the most common types of mining software by visiting this page, or you can visit this webpage dedicated to self-mining guides and instructions for the most popular types of mining software.

How Do I Join Bitcoin Mining?

Since bitcoin mining is so automated, it is possible to work part time and earn bitcoins. To understand how to become a bitcoin miner, you first need to understand how bitcoin works. Here is an easy-to-understand explanation: Bitcoin is digital money, a “digital cash” with no physical form. Bitcoin can be exchanged for goods and services, but it can also be used to pay for transactions in any currency. The most widely accepted way to convert bitcoins to cash is through “Bitcoin exchanges.” These are online exchanges that convert bitcoins to other forms of digital money, typically government-backed currencies such as dollars or euros. The simplest way to do this is by buying and selling bitcoins on an exchange.

Conclusion

As it stands now, there is a total of 21 million bitcoins that will ever be released (Source: Bitcoin Wiki) If each bitcoin is currently valued at $230 each, and they are only expected to increase in value (thanks to their underlying technology), that would mean the total value of the entire network would be $57.2 million. That is assuming there are an equal number of bitcoins mined as there exist as in the supply. So if you want to secure your right to be one of the lucky 21 million bitcoin owners, you’re going to have to stake some serious money at some point!

Share this Article
Posted by Pranav Hooda
Pranav is a serial explorer of new ideas and internal thought, a visionary and a transformational thinker. He launched his first business at the age of 21, while still learning about it in college. He hustled from the bottom and worked hard to build his company Orento Group. He has been on the forefront of transforming innovation in various industries such as marketing, finance, education and social entrepreneurship. Today he’s an investor, mentor, and speaker who has helped many entrepreneurs to find their vision and start their journey.
3 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *