Essay Example on TO MINE OR NOT TO MINE THAT IS THE QUESTION

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When we talk about cryptocurrency you probably remember about mining don t you This is not surprising It is undoubtedly the most known and effective way to earn in crypto world What is more the cryptocurrency cannot exist without miners Distributed decentralized structure is one of the key advantages of any cryptocurrency There is no person organization or government behind it The entry and exit from the project are absolutely voluntary Real computing resources are needed for the functioning of a virtual system of calculations as well as people who provide them For the work done they receive a reward in the same digital coins As you probably have already guessed we are talking about miners These people are really indispensable Nowadays they serve as the issuing authority as well as verify and confirm transactions From the technical point of view several types of mining are distinguished depending on the configuration and equipment cost Using the CPU CPU Using graphics cards GPU With the help of integrated circuits of special purpose ASIC In the first type of mining a central PC processor is involved Now it is obsolete due to the low efficiency if comparing to more modern approaches The extraction with the help of the CPU does not bring profit from 2010 when it was replaced by mining using video cards 



Mining with GPU is based on the calculations performed by video cards It gives high speed due to their ability to perform parallel calculations and solve several tasks simultaneously Remember that this property is very valuable for mining The transition to mining using the GPU was a real breakthrough if comparing to CPU mining What is the profit The video card is able to calculate much more hashes than the CPU In addition it became possible to place four cards on one motherboard Actually later their number increased to six and the theoretical limit is eight That allows users to create relatively cheap mining farms from video cards Another type of production is based on integrated circuits for special purposes ASIC They are made to perform only one task That means ASICs are focused on the extraction of only one currency most often bitcoins and are not suitable for an amateur use However ASIC is much more efficient than the CPU the difference in the performance of devices of the same price level can reach thousands of percent Despite all pros there are some cons about this type of mining This system cannot switch to the currency analogues in addition not all digital currencies are suitable for ASIC mining What is more in case of a collapse of the course of the cryptocurrency the ASIC system will be much more difficult to sell than the GPU In the secondary market it is very hard to find somebody willing to buy them while graphics cards can be sold to gamers Considering the number of participants mining is divided into three categories Independent Cooperative Cloud Let us start from the first one This type is suitable only for new cryptocurrencies where no large computing power is required for calculations Block searches are made by the miners independently on their equipment 



The main advantage is that the miner leaves all the mined coins for himself But there is also a significant disadvantage Block search may take quite a while It all depends on the complexity of the calculations and of course the good luck The miner just has to hope that his equipment will be able to solve the task faster than the competitors computer If talking about cooperative mining I can say that this is the most popular type A large number of independent miners are combined into pools for the calculation of blocks and the profit is distributed between each participant depending on its contribution I mean the computing power The main advantage is that this extraction is more reliable than independent because all participants are guaranteed a part of the profit despite who of them generated the block At the same time the crypto community refers to large pools with distrust because there is a risk of accumulating more than half of the processing power in one pool In this case he will have the opportunity to commit fraudulent manipulations and confirm fictitious transactions completely putting the corresponding cryptocurrency under control The cloud mining still remains the most controversial way On the one hand the miner does not need to spend money on buying setting up and servicing the equipment and electricity

This is especially true in regions with high costs that is why most mining centers are located in countries with cheap electricity for example in Thailand In the first two types the equipment is monitored by the miner himself With cloud mining computers can be located on the other side of the world and the only thing left is to believe the promises of the service provider Just remember that there are no guarantees that suppliers will knowingly fulfill their obligations and the miner will receive a reward for the calculated units Anyways the crypto world continues to grow inevitably as well as new cryptocurrencies appear Mining is a great way to earn on the digital money To mine or not is your choice Just choose the cryptocurrency deliberately calculate the production strategy and join only reliable pools with a proven track record Do not trust money to strange service providers if their activities are not supported by years of experience and positive feedback Participate in thematic forums and follow the discussions of real mining methods and industry issues affecting the course You need to become a realist to succeed But remember he who doesn't risk never gets to drink champagne


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