Cryptocurrencies have attracted the attention of investors. Some digital coins can yield enormous gains to early investors. However, investing is not the only way to make money with cryptocurrencies. There are different ways to generate extra income with these digital assets. For example, mining a cryptocurrency can be profitable if you do it properly.
You can mine cryptocurrencies that utilize the proof-of-work (PoW) consensus mechanism. But what is mining in the first place? This activity consists of verifying data blocks before they are added to the blockchain. It helps to maintain a secure network. In exchange for this service, a miner gets a reward in cryptocurrency.
Bitcoin (BTC) is the most popular digital coin that uses PoW, and it is even used as an alternate payment method in Bitcoin Casino. Mining this cryptocurrency, on the other hand, necessitates the use of extremely powerful hardware miners in order to gain profit. Nonetheless, because of its stability, mining Bitcoin is recommended if you have sufficient funds to invest in specialized hardware.
However, mining Monero (XMR) is also viable. The most effective Monero miner can be a regular personal computer.
Are you interested in mining Monero? We invite you to read this article and learn what you need to know to mine this privacy-oriented coin profitably.
Basics of Monero (XMR) Mining
Monero is a cryptocurrency that aims at enabling private and anonymous transactions between users. Unlike Bitcoin, this digital coin utilizes advanced cryptographic techniques to obscure the addresses of the parties involved in a transaction. Because of the PoW consensus algorithm, mining Monero requires finding the solution to a cryptographic problem. The miner that finds the solution first gets a reward from the network.
So, to mine Monero profitably, you need these things:
- A computer with average or above-average computational capability
- A fast and stable Internet connection
- Monero mining software
- A Monero wallet.
As seen, you do not need anything special to mine Monero. However, solving the cryptographic problems in less time requires adequate hardware. Unlike Bitcoin, you cannot use ASIC miners to mine Monero. Instead, a regular central processing unit (CPU) is the best hardware to mine this cryptocurrency. Alternatively, you can use a graphic processing unit (GPU). However, mining with a CPU is much more effective.
You can join a mining pool if you do not have access to high-end hardware for mining Monero. In most cases, joining a mining pool is the only way to successfully mine Monero (for more information on mining Monero, you can refer to this crypto blog). A mining pool combines the computational capabilities of different users to find solutions to cryptographic problems faster. The rewards are then shared among users proportionally to the provided computational resources.
Investing in Cryptocurrencies: Bitcoin or Ethereum?
If you don’t want to deal with all the technicalities of Monero mining, you can invest in cryptocurrencies instead. Check websites like checkitsreal for reviews and detailed guidance on crypto investment. If you are a beginner, do make sure that you understand how the digital coin works, where you can buy them and how to store the currency. You can buy Bitcoin only and then swap Bitcoin to Ethereum on an exchange platform.
Novice investors usually ask which of these two cryptocurrencies is better. Is Ethereum better than Bitcoin? From a technological point of view, Ethereum has features that outperform Bitcoin. In fact, the new NFTs (Non- Fungible Token) are secured by the Ethereum blockchain. You might have heard how many are taking interest in the new digital ledger by using a nft drop to get the right non-fungible token project. When it comes to value of Ethereum and Bitcoin, the former can handle ten transactions per second, whereas the latter can handle only four. Ethereum also supports smart contracts and the development of other cryptocurrencies.
When looking at the investment point of view, Bitcoin is more stable. It is also a better hedge against inflation.