Bitcoin mining is one of the most essential activities for the cryptocurrency industry to be well-maintained.
The process involves the validation of information blocks through complex mathematical solutions. After the block is solved, miners get rewards for their efforts through Bitcoin fees.
The reward process is quite simple. Unlike regular users, who learn how to buy Bitcoin on Binance, miners are offered Bitcoins based on the halving system, meaning that every four years, the number of Bitcoins provided for miners is cut in half.
For example, until the next halving in 2024, miners receive 6.25 Bitcoins per block mined, but the amount will decrease to 3.125. This process will continue until the number reaches zero, when miners will be rewarded through other fees.
Halving is necessary to slow down the rate of new coins deployed to lower the supply, making Bitcoin more valuable.
However, this poses numerous challenges to miners, who need to work harder and update their computational power.
So, the question is, can you mine Bitcoin at home?
Common ways to mine Bitcoin
There are numerous ways to mine Bitcoin, so you don’t necessarily have to buy a mining rig. While this is a common practice, the following mining techniques are made for different types of miners:
- A computer with a graphics card is the traditional way of leveraging GPUs to solve mathematical problems to validate transactions;
- An ASIC miner is specifically designed for Bitcoin mining. It’s better than a computer in regard to speed and efficiency, but also more expensive;
- A mining pool is great for beginners because they can join groups to associate their mining resources to win more Bitcoin. Rewards are divided depending on the amount of contribution;
- A cloud mining network allows the opportunity to rent mining resources from a specific service so you won’t have to deal with equipment maintenance;
What does it imply to mine BTC on a PC?
Mining Bitcoin on a PC requires you to specialize in hardware and software solutions that fit your budget, expectations, and goal rewards. However, when it comes to the steps you’d want to take, here’s what you need to acquire:
- A digital wallet. The Bitcoin rewards will have to be stored in a safe space, such as a digital wallet. Luckily, you have more options to choose from, from software wallets to physical ones;
- Mining software is needed to manage the processing of complex mathematical problems that will get you the rewards;
- A mining pool will help you earn Bitcoins faster and without risky commitments compared to mining alone;
- A configuration between your mining software, the wallet address, and the address of the mining pool is needed to balance everything;
What’s the Best Wallet Option?
Cryptocurrency wallets have been specially created for them, so they’re pretty different compared to regular digital wallets.
Such a device stores the passkeys needed for the transactions, but the software within the system makes it all easy without needing to introduce them yourself.
There are two main wallet types: hot and cold ones. Hot wallets work based on an internet connection, while cold wallets don’t. Wallets also fall under the categories of software, hardware, and paper.
Generally speaking, software wallets are easier to use and include more functionalities, but they are not that safe since you may be prone to being hacked and your key being stolen.
On the other hand, hardware wallets are safer since you’re not holding your information connected to the internet, so they’re impossible to reach. Finally, paper wallets are simple pieces of paper where you write your keys.
What about Electricity Costs?
Unfortunately, mining Bitcoin is known as the most energy-draining activity because the system still uses a PoW consensus mechanism.
This is why Bitcoin mining is considered a threat to the environment. Global mining energy has been correlated to requiring more resources than countries like Norway in an entire year.
Indeed, the energy costs depend on a series of factors, from the average electricity in your area to the mining method chosen.
In the US, prices are lower, but other places from Europe might require more computational power for the same results.
What about Mining on a Smartphone?
For those who don’t want to commit to mining on a computer or are simply curious about how it is to mine Bitcoin, choosing a smartphone for this activity can be an option.
Although it’s less lucrative than other mining forms, it can help you earn small amounts of Bitcoins.
The way in which mining works on a mobile device is quite different from the average mining. That’s because you instead use a mobile mining app through which you complete specific tasks or watch advertisements.
Unfortunately, this uses a lot of battery life and the mobile’s processing power, which can eventually damage the device.
Still, if you own a powerful smartphone and want to give it a try, here’s what you need to do:
- Choose to download a mobile mining app from the several ones on your mobile’s store. It would be best to check the app before downloading because most work is based on a third-party business;
- Follow all the steps to make an account, and make sure to check all the guidelines provided regarding how you’ll get your rewards and what are the implications of the method used for mining;
- See what tasks are offered in the app. While most applications provide the possibility to watch ads or complete specific tasks, others might have different approaches, so choose something that fits you best;
- Gather the rewards and wait for the number of Bitcoins to be sufficient for withdrawal. Most apps have their account balance from which you can transfer the funds to your Bitcoin wallet;
Mining Bitcoin at home has become more approachable through the years but also more difficult since there’s the need for more complex computational power to withstand market competition and the increased demand for Bitcoin.
Therefore, you can mine Bitcoin at home through different methods, from entering pools to using a smartphone.