The smart ways to mine bitcoin

It has been accepted that bitcoin and in general, cryptocurrencies are here to stay. In fact, this new and exciting technology can be argued to be already mainstream. Now, everyone has the ability to acquire, transact and even trade cryptocurrencies on reputable platforms such as City Index, who also offer Spread Betting, CFD and Forex trading. With regards to bitcoins, there are three main ways to acquire the actual currency; which are to buy on exchanges, accepting them as remuneration for goods and services or mining new ones.

Mining is the manner of discovering new bitcoins which is merely authenticating bitcoin transactions. There are many transactions which must be verified, and these transactions have a virtual padlock which is known as block chains. Those who are miners have the software to find the key that will unlock the padlock.

To get started you first need a Bitcoin wallet which consists of its own Bitcoin address. The wallet is basically an online bank account which keeps your money you received after the mining has occurred. Bitcoin mining is simple and can be attempted by a computer beginner who only requires basic software and specialised hardware. The software needed in order to mine is not only simple it is also free to download and use. The most popular platform for the mining software is known as GUIMiner. This program when running is able to do the mining on its own and finds the right combination to unlock the block of transactions. If one has a faster and better hardware their software is able to produce more bitcoins. Today, people are using Application-Specific Integrated Circuits (ASIC) which means that there are hardware’s which are designed to fulfil one specific task which in this situation would be mining.

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A smart initiative has been the introduction of mining pools which is group of miners from all around the globe who put their computer power together to mine.  The same applies here where the faster your computer mines; the more it contributes to the pool, which then increases the number of Bitcoins you receive. If you belong to a pool it means that you are also able to use a cheaper hardware. Field-Programmable Gate Array (FPGA) is a smart way to go because it allows mining hardware manufactures to buy chips which help miners modify their hardware to mine Bitcoin. Miners who belong to pools have realised that are able to generate blocks quicker and receive block rewards more frequently.

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The Bitcoin mining software helps the hardware to do the difficult work such as giving it transaction blocks to crack. Bitcoin mining software is vital because of its role in helping the hardware mine Bitcoins. Genesis Mining is a cloud mining company which helps miners by mining Bitcoin and other alt coins. They use X11 and SHA-256 algorithms and offer easy ways to start mining, and at the same time they reduce the cost of mining. Their design is set up for those who are new to cryptocurrencies but also for those who are specialists and frequent users.

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CaptainAltcoin's writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of

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