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Published:
July 13, 2022

Cryptocurrency Mining For Dummies

Overview

Untangle the steps to mine crypto, including new coins and services

The cryptocurrency market moves quickly and miners and investors need the latest information to stay ahead of the game. This edition of Cryptocurrency Mining For Dummies has the insight you need to get started with mining. You'll learn what goes into building a mining rig that can complete cryptocurrency transactions and reap the rewards in the form of new coin. You also discover how to join existing mining programs. Whatever your crypto goals, Dummies will make it easy for you to understand, engage in, and invest in mining. You'll even get an up-to-date primer on the evolving legal situation and an idea of what to expect in the future of crypto.

  • Understand the basics of mining cryptocurrency and get started with your own mining operation
  • Explore the latest cryptocurrencies and mining services so you can mine your own or invest wisely
  • Get involved in crypto mining with the hardware you already have, or build a new, powerful mining machine
  • Become an expert on the latest mining trends so you can identify new ways to profit in the crypto space

With this book, you've got insider advice on choosing which cryptos to mine, riding out market fluctuations, creating pool accounts, and more. There's no time like the present to get started with crypto mining.

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About The Author

Peter Kent and Tyler Bain are coauthors of Bitcoin For Dummies, 2nd Edition. Peter created the Crypto Clear video course to assist would-be investors in understanding cryptocurrency. He is also the author of SEO For Dummies. Tyler is a professional electrical engineer and an active crypto miner.

Sample Chapters

cryptocurrency mining for dummies

CHEAT SHEET

Cryptocurrency mining is a relatively new concept that started slowly and has, over about a decade, developed into an entire industry with a wild-west-gold-rush reputation.The mining of “digital gold” in the form of cryptocurrencies is often painted as a get-rich-quick scam, with comparisons to tulip mania and the gold rushes of years past.

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A ton of helpful resources are online for aspiring cryptocurrency miners or those interested in learning more on the topic. These cryptocurrency mining resources are split into ten different categories, from resources that can help you track the price of cryptocurrencies to cryptocurrency whitepapers. Reviewing these resources can keep any aspiring crypto miner busy for many happy hours!
Cryptocurrency miners need to keep an eye on the latest mining info to be successful. The best method of checking the pulse of the burgeoning cryptocurrency mining industry is to stay up to date using online resources, such as social media and specific online forums covering the topic. ©Shutterstock/LuckyStepDue to the infancy of the cryptocurrency mining space, many news sources in the space can be misleading, downright inaccurate, or even propagate bought-and-paid-for content without a sponsored label.
Cryptocurrency mining is a relatively new concept that started slowly and has, over about a decade, developed into an entire industry with a wild-west-gold-rush reputation.The mining of “digital gold” in the form of cryptocurrencies is often painted as a get-rich-quick scam, with comparisons to tulip mania and the gold rushes of years past.
Cryptocurrency mining has changed significantly since its inception. Newer cryptocurrencies are breaking from the old ways of PoW (proof of work) algorithms and using Proof of Stake instead.In the early days of cryptocurrency, PoW was the only game in town, and new cryptocurrencies primarily copied Bitcoin as the model and a starting point for their slightly different ideas and implementations.
There is a lot to consider when you first begin mining cryptocurrency. A big part of mining involves consensus. Consensus is the process of ensuring everyone’s copy of the transaction data matches — that every copy of the blockchain contains the same data. Different consensus methods can be used for cryptocurrency mining, but currently the primary method is known as Proof of Work (PoW).
Decentralization of cryptocurrency is actually what makes it trustworthy. In general, more decentralized cryptocurrencies are likely to be more stable and likelier to survive (long enough for you to profit from mining) than more centralized and less distributed cryptocurrencies.In the cryptocurrency arena, the term decentralization is thrown around as an absolute: The system is either decentralized or it is not.
In the cryptocurrency mining space, revenue is important, and profit is critical. You do not want to spin your computational hash cycles for zero gain, and you want your investment of time, mining hardware, electricity, and other expenses to pay off. These ten tips will help you become profitable and receive a return on investment (ROI) in your cryptocurrency mining adventure.
After you have your hardware running, you’ll need to install the appropriate software to mine cryptocurrency. The software you’ll use depends on whether you’re pool mining or solo mining, your hardware setup (ASIC, GPU, or CPU), and the particular cryptocurrency you plan to mine.In some cases, the mining software replaces the entire operating system (ethOS and Braiins OS, for example), but in other cases, the software is application software that runs within another operating system, typically Microsoft Windows, Linux, or Apple’s macOS (such as Multiminer, niceHash, and Honeyminer).
When it comes to Bitcoin and other cryptocurrency, mining is not about tunneling into the ground and hauling out ore. It's actually a computerized method for verifying the legitimacy of cryptocurrency transactions and entering new cryptocurrency into circulation.Cloud mining operations are mining farms — data centers dedicated to mining — that sell or lease hashing power to cryptocurrency miners.
Cryptocurrency mining involves the addition of transactions to a blockchain by a crypto miner. But, it’s a bit more complicated than that. Take a look at decentralization and discover the role of the crypto miner. Understanding decentralized currencies Cryptocurrencies are decentralized — that is, no central bank, no central database, and no single, central authority manages the currency network.
Pool mining is a group of miners acting as a team to find blocks. The block rewards are proportionally split across all miners who contributed to the pool’s hashed Proof of Work; that is, the more hashing power you provided to the operation during a particular time period (the pool mining duration or mining round), the higher the share you receive for block rewards won by the pool during that time period.
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