Mining for Bitcoin Explained

BitCoin mining is a fascinating new practice that provides the backbone for the entire crypto-currency’s existence. By slowly and meticulously calculating out complicated algorithmic equations, a computer processing unit can be used to generate a certain string of code that, according to some, is worth a certain value. While there is a potentially large supply of this code available, the rate at which this code can be generated is very tightly restricted so that the complete volume will take over a century to completely generate. Furthermore, due to the constantly rising levels of mainstream technology, the difficulty challenge of creating this code, known as BitCoin, increases constantly.

When BitCoin mining first began, it was plausible to mine the block using a primary CPU. However, as it became more difficult, a high end graphics processing unit is mandatory to see any results. Still, even those will soon become obsolete due to the advent of ASIC rigs that are specially built to achieve the maximum BitCoin output per energy input possible. As these types of mining rigs become more popular, it will become more and more difficult for a new miner to enter the game and see profitable returns.

To start mining, a primitive computer with any PCI slot is required. Next, acquire an ATi GPU with OpenCL and connect it to the motherboard. As long as everything works properly, using a client such as GUIMiner to join a mining pool is quite simple. Of course, some miners like to make things much more complicated by linking several, if not dozens, of graphics cards together with outrageous yet super effective cooling methods to reach higher hashing rates and observe greater profits.

Joining a pool is practically a requisite for any miner. Working as a team with multiple other miners to churn out more BitCoins at a faster rate provides numerous advantages. Some pools collect a fee to cover expenses but others work pro bono. By joining a pool, it is possible to get many more coins than it would be by working alone. Additionally, some pools even put a portion of their resources into alternative crypto-currencies to diversify the pool’s interests. Finding a pool that meets your needs isn’t difficult.

Currently, it is still possible for a light hobbyist to get into BitCoin mining with a simple rig and see some encouraging results. Hopefully, despite the power and efficiency of ASIC rigs, they will be obtainable by entry-level miners on a realistic budget. If this is the case, we can hope to see the rate of BitCoin mining increase exponentially due to mainstream demand and availability. Putting commercial mining power in the hands of individuals will only help the BitCoin community grow and prosper.

An interesting and novel approach to entry-level mining that has recently emerged is the use of tiny USB powered rigs that, while not being able to achieve the raw power of true ASIC rigs, can reach impressive hashing levels and offer a cheap method of mining a respectable level of BitCoin. One of their key advantages is a minimal use of additional power over what the host computer is already using. A problem that often occurs with cheap mining rigs is a waste of power that outweighs any profits from mining but these USB units run smooth and efficiently.