Mining Bitcoin For Beginners

Bitcoin Tutorial for Beginners. Bitcoin and Blockchain Tutorial

Mining Bitcoin For BeginnersBitcoin Miners today use complex cryptology software and specialized computers to crack the puzzles that encrypt Bitcoin Transactions.  These are then validated and confirmed with other miners, before being written into the Blockchain Public Ledger.  For this the Miners receive a small reward.  But the rewards are not given in full Bitcoins worth thousands of dollars, but fractions of a Bitcoin.  Over a full day’s Mining, this could work out to just a few dollars for some computers.  When Bitcoin was invented ten years ago, it was easy for anyone with a computer to mine up to perhaps fifteen Bitcoin per day.  But today it’s a very different story.

Even with thousands of dollars of mining hardware, a home user might only mine a fraction of a bitcoin, worth less than the electricity needed to mine it.  About seventeen million bitcoins have already been mined, out of the twenty one million that will eventually exist in total.  From that seventeen million almost a third have been lost through hard drive failures or lost private keys.  Mining bitcoin requires that your computer cracks the very difficult encryption that Bitcoin transactions are wrapped inside.  And this encryption becomes exponentially more difficult to crack as fewer Bitcoins remain to be mined.  So day-after-day Bitcoin Mining becomes more difficult.

You must also compete against other Miners on the Internet, including professional Bitcoin mining businesses. Professional Miners connect hundreds of computers in tandem to be the first to unlock Bitcoin transactions, and then write validated transactions to the Blockchain. They can then claim the small Bitcoin fees that are attached.  You really cannot compete today by buying a three hundred dollar GPU for your computer and expect to make a profit.   The cost of electricity used can be extremely high, as cracking Bitcoin transactions takes a great deal of processing power and a lot of time. For an individual with sufficient money and interest, professional ASIC Bitcoin Mining Computers are a possibility, with prices starting from around two thousand dollars. You may be able to mine some Bitcoin successfully with these specialized Mining computers, but you must seriously take account of your electricity costs, as the high cost of this could mean running at a loss.

Mining Bitcoin For BeginnersMining Alternatives to Bitcoin

As an option to mining Bitcoin, some entrepreneurial people mine smaller crypto-currencies, such as Litecoin and other alt-coins.  Alt-coins are based on the same technology as Bitcoin, but are currently easier to mine.  The area of Mining Bitcoin continually changes.  Although Bitcoin algorithms become increasingly more difficult for miners to crack, new hardware for mining is always coming to market.  There are several Bitcoin Mining Calculators available on the Internet, such as this one from 99Bitcoins.com that will help you work out if buying Bitcoin Mining hardware makes sense for the electricity cost in your area.  You also need to be aware that the price of Bitcoin continually rises and falls. So what is profitable one day might not be the next.  If the Bitcoin price does reach extremely high levels in the future, then Mining could return a profit if Mined Bitcoins are retained.  However, the future price of Bitcoin is not guaranteed for many reasons, and the Crypto-currency market offers many competing alt-coins today. Mining is an ever-changing area, but to have any chance of Mining success at the beginning of two thousand eighteen, expect to invest at least two thousand dollars, plus pay for a lot of electricity.

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