So you’ve heard of Bitcoin, sp20 bitcoin mining you’re ready to get your hands on some digital wealth. You can buy and trade for bitcoins, or you can “mine” for them. Mining for bitcoins is actually the process of verifying other bitcoin transactions, which users are rewarded for. This is the central mechanic behind the bitcoin economy, and mining is used to keep transactions secure and reliable.
This guide will explain how to mine bitcoins and potentially earn a fair amount of money. When Bitcoin first started, it was possible to mine using only your desktop’s CPU and GPU. While this is still possible, the returns make running this method impractical. You will be spending far more on electricity than you will earn mining coins. Instead, custom hardware allows for much better processing for about the same power draw. A dedicated Bitcoin mining machine can cost anywhere from a few hundred dollars to tens of thousands depending on the number of operations it can complete per second. Bitcoins are stored in digital wallets that are encrypted to protect your money.
While online services that host your wallet won’t be able to access it, they are considered less secure as your money could potentially be lost if something catastrophic happens on their end. Most established bitcoin users recommend using a local wallet for security reasons. Local wallets typically require verifying the entire blockchain, which is the history of all bitcoin transactions. Hosting a blockchain is what helps keep Bitcoin running and secure. Syncing this blockchain for the first time can take a day or more.
Popular local wallets include BitcoinQT, Armory, and Multibit. Multibit does not require downloading the entire blockchain. You can also get wallet apps for your mobile device. These do not require downloading the entire blockchain. If you lose your wallet, you lose your money!