How To Mine Bitcoins

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Luckily for us, however, bitcoins seem to be going up in value and should maintain their value over time, unlike your mint condition Tiny the stuffed Chihuahua. But how do you get bitcoins? You can begin by buying them outright, but the market is currently wild. In short, you should probably mine. But what is bitcoin mining? Think of it as work done by groups of people to find large prime numbers or trying keys to decrypt a file.

In fact, many wager that the DDOS attacks on many bitcoin-related services are direct action by hackers to inject instability in order to reduce the price.

As it stands, mining solo is very nearly deprecated. The process of finding blocks is now so popular and the difficulty of finding a block so high that it could take over three years to generate any coins.

While you could simply set a machine aside and have it run the algorithms endlessly, the energy cost and equipment deprecation will eventually cost more than the actual bitcoins are worth. Pooled mining, however, is far more lucrative.

While this is simplified, it is basically how the system works. You work for shares in a block and when complete you get a percentage of the block based on the number of workers alongside you, less fees. The astute among you will note that I probably used twice that amount of electricity. My buddy Tom explained how to set up a pooled mining account so I thought it would be interesting to share the instructions.

You can either store your wallet locally or store it online. Wallets require you to use or download a fairly large blockchain file — about 6GB — so downloading and updating a local wallet may be a non-starter.

There is no preferred wallet type and there are obvious trade-offs to both. Privacy advocates would probably say a local wallet is best. You can download a local wallet here but make sure you keep a copy of your data backed up. This, without the period, is a direct way to send bitcoins to your wallet. Make a note of your address. In Coinbase, the wallet address found under linked accounts. To mine in a pool you have to work with a group of other miners on available blocks.

You can also try guilds like BTC Guild as well as a number of other options. Pools with fewer users could also have a slower discovery time but pools with many users usually result in smaller payments. However, as one pool owner, Slush, notes:. First, create a pool login.

The workers are sub-accounts with their own passwords and are usually identified by [yourlogin]. I have three workers running, currently — one on my iMac and two on my old PC.

You must create workers to mine. Like any online club, you can dig deeply into the subculture surround bitcoin as you gain experience. Also be sure to enter your wallet address into the pool information. This will ensure you get your bitcoins. There are a number of mining options for multiple platforms although OSX users may find themselves in a bit of a pickle.

Miners, on the other hand, use these cycles to help handle peer-to-peer processes associated with bitcoins. GUIMiner is the simplest solution for Windows users as it allows you to create miners using almost all standard graphics cards.

You can download it here. Linux users can run miners like CGMiner. An excellent guide to installing a miner on Ubuntu is available here. Sadly, it uses deprecated calls to Bitcoin and is quite a bit slower. Note the last two arguments are necessary for Mountain Lion. RPCMiner is far easier to run — you simply click an icon and enter some data — and both have very rudimentary, text-based interfaces. Running Diablo on my iMac has not had much effect on application performance under OS X although it does slow down my Windows 8 machine considerably.

Keep your mind on your money. Bitcoins are baffling in that they are wildly simple to use and mine. Speculators, then, would probably be able to throw hundreds of machines at the problem and gather bitcoins like raindrops, right? As more bitcoins are found, they become more difficult to find. In theory, as the Bitcoin pool operator, I could keep the 25 BTC from a block found by the pool for myself. It is their freedom of choice, and Bitcoin is about freedom.

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Minimum Hardware Specification If you want or will build a computer for mining Bitcoin, you can see this article as a consideration or reference. Computers that are devoted to mining come in all shapes and sizes. And we will focus on the tutorial of building a very basic rig. This guide is meant for those of you who want to start and help in building your first rig. Once you know how to build it, you can grow through super computers as big as you want. We will show you how to build the first rig.

If you do not want to invest money in hardware and just want to use your current computer to start mining, you can simply switch to Part 2: The first thing you need to know about mining is that currently, mining power is processed using your graphics card GPU.

Because, day-to-day process of mining with CPU has long passed. Because, GPU offers a faster way to solve the algorithm needed to make your money. This GPU should be your main focus when designing the rig you want to build. What are the ideal hardware options for Bitcoin mining? Before you take a much more extreme step, there are some things you need to know in assembling. And of course, it also applies to those who have a fairly tight budget because I used to be so: Generally, there are only 3 things you need to see when building a rig for Bitcoin mining: So, do not be cheap for this Power Supply: You will need enough power to run your rig.

If you will get 2 or more for the graphics card, never buy a PSU below W. The only thing you need to look for here is the number of PCI-E slots or a place for your video card. Try to find one with at least 3 slots so you can expand the best graphics card when needed The rest of the hardware is not really that important: Hard drive, again, you just need to run the Operating System. Computer case, less is better.

The less the limitations between your components, the more air will flow through and help in cooling. In fact, most rigs for mining are built with no casing. Software Requirements Software Once you have a computer with minimum specifications to start mining coin, now all you need is getting all the software to get started. This guide will assume you are using the Windows operating system.

If you are using Linux or Mac, the steps to get started are basically the same. However, to get more details on how to complete each step, there are many guides available online with simple web searches. Before starting, there are 4 basic things you need to pay attention to and do, including: Make sure you update the operating system of all the latest updates. Why is that so important? Because this will ensure to minimize the risk of any security breach. Graphics cards are the most important part of getting a mining rig.

So, you should always be ready to update and download the latest software for your graphics card whether it's using an AMD or Nvidia graphics card. Just like Crypto Wallet aka wallet, there are some mining software options that can be recommended. After experimenting with some software, basically Claymore Dual Miner can be a major recommendation.

There are several reasons why this is highly recommended, including:. First, Claymore has a fairly small file size, quickly installed, loads DAG files to RAM rather than disk, and is highly optimized so you might see higher hash on your GPU than you would normally see in other miners. To install it, go to the Claymore GitHub page v9.

Use Archive Manager to open it and extract it into its own folder I created a claymore folder in the home directory. However, this needs to be run from the command line, and uses some input parameters. So the smart thing is to create a shell script that runs everything similar to a batch file in Windows.

Software Mining Just like Crypto Wallet aka wallet, there are some mining software options that can be recommended. There are several reasons why this is highly recommended, including: Authors get paid when people like you upvote their post. Will be contacting you!

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