Mining cryptocurrencies have changed a lot in the past decade, and it has become harder for individual miners to maintain their hardware. Bitcoin broke new records in 2021, and new coins came to the spotlight, but many things are still the same when it comes to the market.
BTC and ETH are still considered the best investment, and even the most trusted coins took a punch in 2022.
Many investors decided to do something else with their money, like spending on the best online casino, and others took a chance with NFTs. But, mining is still one of the best ways to get into the crypto industry.
There are a few ways you can do it, and some are more profitable than others.
Prepare a Wallet
Before you start mining, you need to have a wallet where your cryptocurrency will be stored. There are plenty of wallets online, and there are a few different types you can use. The best for beginners is to use a software wallet that will be placed on your PC instead of exchange platforms.
The most common way to store crypto is to use an exchange platform wallet which can be risky if they get hacked. There were situations in the past where thousands of accounts were targeted because some platforms had poor security.
Your wallet is the most important thing about your crypto portfolio because you’ll be storing everything that you mine. It can also be very beneficial to have multiple wallets so you won’t have everything in one place if something bad happens.
Also Read: How Can You Choose The Best Type of Bitcoin Exchange Without Utilizing Much Hassle?
Use a Mining Calculator
Probably the best tool that you can use before you start mining is a mining calculator, which can be found on multiple websites online. You will need to know how much electricity you are spending when using your own equipment and how much hash power you have.
When you place the hash power and other expenses, you will need to have a certain value in mind for the BTC price, which is a prediction, so try to be realistic. When you place all the factors, they will calculate how much profit you can make if the price hits your predicted number.
Mining has changed a lot in the past five years because many manufacturers decided to increase prices for this type of equipment. GPUs and CPUs prices have increased by almost double in a few years, which resulted in some market issues.
But, people are still buying them because PCs are necessary for any type of business, and there will always be a market for them.
Mining is another market that has suffered from these increases in GPU and CPU value. Many people that wanted to mine have decided to quit because it’s not as profitable as before.
You will need to pay a large electricity bill because the global economy is in a bad state. So, mining on your own is a good idea only if your electricity bill is low and you have the funds to buy ASIC miners.
Also Read: Easy & Safe Way to File Taxes on Cryptocurrency Gains
Cloud Mining for Individuals
Cloud mining is meant for individuals that can’t afford to mine at home because of other expenses or maintenance issues.
There are two options you have when using cloud mining services. The first one is to rent only hash power from the facilities that own large quantities of mining equipment.
Every platform has a calculator where you can place the hash power you want to buy, and you can calculate the profits by the end of the year. There are some small expenses that are included, but in most cases, you will have a profit if the BTC prices go up.
The second option is to buy your own equipment for them and rent out the hash power you will have.
You can also use the ASIC miner for only your purposes, and they will maintain it for a certain price. This is usually very cheap because they have a great maintenance system and they are very experienced.