Cloud mining involves accessing the processing power of a data center and buying the right hardware, software, electricity, maintenance, etc. allows you to get cryptocoins without having to spend money. The essence of cloud mining is that it allows users to purchase the processing power of remote data centers.
The entire cryptocoin production process is done in the cloud, which makes cloud mining very useful for those who don’t understand all the technical aspects of the process and don’t want to manage their own software or hardware. If electricity is expensive where you live – for example in Germany – then outsource the mining process to a country where electricity is cheaper, such as the US.
Types of Bitcoin cloud mining:
There are currently three ways to do cloud mining:
1. Leased mining. Rental of a mining machine operated by the supplier.
2. Virtually Hosted Mining. Creating a virtual private server and installing your mining software.
3. Lease of hash power. Renting a certain amount of hash power without special physical or virtual hardware. (This is the most popular method of cloud mining).
What are the advantages of Bitcoin cloud mining?
– Not dealing with excess heat generated by machines.
– Avoiding the constant buzz of fans.
– No need to pay electricity bill.
– Not selling your mining equipment when it is no longer profitable.
– There is no ventilation problem in the equipment, it usually overheats.
– Prevention of possible delays in the delivery of devices.
What are the disadvantages of Bitcoin cloud mining?
– The possibility of fraud,
– Bitcoin transactions cannot be verified
– This can be boring if you don’t want to build your own Bitcoin hash systems.
– Low profit – Bitcoin cloud mining services bear costs.
– Bitcoin mining contracts may allow transactions or payments to be suspended if the Bitcoin price is too low.
– Not being able to change the mining program.
Risk of cloud mining:
The risk of fraud and mismanagement is prevalent in the world of cloud mining. Investors should only invest if they are comfortable with these risks – as the saying goes, “never invest more than you’re willing to lose.” Explore social networks, talk to old customers and ask all the questions you think are appropriate before investing.
Is cloud mining profitable?
The answer to this question depends on some factors that affect the profitability of investments. Cost is the most obvious factor. The service fee covers electricity, accommodation and equipment costs. On the other hand, due to the prevalence of frauds and bankruptcies, the reputation and credibility of the company is a determining factor.
Ultimately, profitability depends on factors that no company can predict or control: just remember the high volatility of bitcoin over the past three years. When buying a mining contract, it is better to take a fixed price for Bitcoin, because your other alternative is to buy bitcoins and wait for the price to rise. Another important factor is the capacity of the entire network, which depends on the number of transactions per second. The power has grown exponentially in the last few years. Its growth will continue to rely on the value of Bitcoin and innovation in the development of integrated circuits for specific applications.