Bitcoin cloud mining
With the advent of blockchain technology, cryptocurrencies (primarily Bitcoin) have entered our lives and become pretty much a part of mainstream news these days. Most people buy them in the hope that their value will skyrocket, which it certainly did in 2017, so that they can sell them later down the road. Others see this as somewhat of a job opportunity and take up mining coins, thus keeping the network alive and safe. But if you want to mine, a lot of preparation is in order: you have to have the right tools for the job, and that requires some investment. However, if you don’t want to go through the hassle of setting everything up, Bitcoin cloud mining is a perfect solution. How does that work? Well, you’re about to find out. Read on!
What is Bitcoin cloud mining?
So, what’s the big deal with cloud mining? How does it solve all our problems? Well, it’s pretty simple – you just hire someone to do Bitcoin mining for you. Companies in the Bitcoin cloud mining business have huge farms of servers in areas with low electricity costs, so they charge you a percentage of what they mine to cover the costs and make a profit, while the rest is passed on to you. The thing they charge you with is sometimes called Maintenance and electricity fees, which are usually fixed, although if you decide to mine some coins this way they may be gone altogether. So, sure, you don’t get as much as you would if you went ahead and set everything up, but this is a much more convenient method.
Like we said in the introduction, if you want to do Bitcoin mining yourself, you have to invest in some equipment. The more computing power your rig has, the more profit you can achieve. However, more computing power also requires more electricity and produces more heat, so you need parts which will keep the whole thing cool and your bills will therefore go up. Not to mention that all that hardware takes up some space, too. Bitcoin cloud mining is in essence a pretty good idea and an elegant way to avoid all these problems. But let’s get down to some more nitty-gritty stuff and explain some important details. Stay with us!
Genesis Mining Home Page
How does Bitcoin cloud mining work?
The way Bitcoin cloud mining works is that you enter a contract with a provider of the mining services. You buy hashing power from them, usually expressed in several thousand GH/s, while they promise that they will transfer the revenue back to you. These contracts can last from just a couple of hours to a couple of years, the choice is up to you, plus you can even choose which coin to mine – we already said that it doesn’t necessarily have to be Bitcoin you go for with this model. Things like Ethereum, Litecoin, Dash and other altcoins can be chosen, too. However, keep in mind that all of these deals are often open-ended. What this means is that the company you sign up with has the possibility of terminating the contract before it ends if the conditions on the market drop the mining profitability below the level which benefits you and the company. A good partner will notify you when these conditions are met and will usually allow a couple of months for the market to bounce back before things are terminated for good.
The main parameters that Bitcoin cloud mining profitability depends on are the same as everywhere else – the Bitcoin to USD price and the mining difficulty. These are difficult to predict, though, so try to avoid market volatility if you don’t want to endanger your contract. In addition, there are some other potential problems you can encounter. Keep reading to learn all about them.
Bitcoin ASIC Miner
Bitcoin cloud mining pros and cons
You know the old saying – if it’s too good to be true, it usually is. Therefore, there are some drawbacks in this type of mining, as well. Like we said, you will have smaller returns than if you do the mining yourself, but that is to be expected. You have to pay the people doing the work for you, after all.
However, the problems with Bitcoin cloud mining are potentially much deeper than that. By this, we primarily mean the security issues you can encounter this way. You see, by signing a contract of this kind, you are willing to put all the control in your chosen company’s hands. All you can do is wait for the revenue to reach the amount needed for you to be able to make a withdrawal.
The open-ended contracts don’t help a lot, either. Be very careful when signing them and pay special attention to the conditions that make the contract void. Bitcoin price is famous for its volatility, which means market conditions change often. All of this means that the act of signing a contract doesn’t have the usual significance and that you can’t always rely on the deal lasting as long as it was supposed to.
Because of all that, what was essentially a great idea has now become corrupt and a there is a fair degree of scams out there. However, not all Bitcoin cloud mining sites are run by frauds. If you really want to give this a go, we strongly recommend that you turn to NuVoo Mining. They have years of experience and a loyal base of customers behind them, so you can count on them to deliver top-tier service. With the potential problems out of the way, let’s go a bit deeper into the options a company of this kind can offer you.
NuVoo Home Page
What else can you find?
We said earlier that Bitcoin cloud mining does not necessarily have to be the only type of mining on offer (although there are companies that offer only that). Other cryptocurrencies can be accessible, too. However, what you get for your money can be vastly different depending on which model you choose.
For example, a company can offer you to share the equipment that is used for your cloud mining with another person who is also that company’s client. That way your expenses are halved, and you are less worried about Bitcoin price fluctuations. Furthermore, you can sometimes also compose your own mining rig from your company’s offer, so if you think you can do better than what the people you’re signing up with offer, go right ahead. As a matter of fact, in some cases, you can even buy the Bitcoin mining equipment and then let the company simply set everything up. That way, you’re essentially just renting out space where your rig can operate in good conditions and pay for the maintenance and installation service. Once your contract expires, you get the equipment back. You should also keep in mind the payment methods, but more on that in the next paragraph.
Bitcoin cloud mining transactions
In most cases, when you want to start cloud mining, you will need to make a Bitcoin transaction in order to buy a contract. Of course, other cryptocurrencies can come into play, but in any case, virtual coins are usually the way to go. Some companies also accept bank wire transfers and more usual stuff like that, but you can almost always count on some sort of coin having the main role. So, Bitcoin price has a role to play not just in your mining profitability, but also in the price of the contract. However, the price of contract you are charged with will very rarely be affected by this.
To be able to execute this kind of transaction, you will, of course, need a wallet, but you should be able to create one with your company very quickly (or even automatically when you create your account). The bottom line is that you should examine the offer thoroughly before you sign up since there are many details that can play a significant role in your overall experience. As for us, we will give you a short recap of everything this article was supposed to teach you.
Conclusion
Bitcoin cloud mining is a process in which you pay somebody else to do the work for you in exchange for a certain fee. This allows you to avoid the expenses of setting up a mining rig in your own home and removes pretty much all inconveniences regular miners have to deal with. The way things are done is that you sign a contract with a company of your choice and then leave everything to them. However, mining profitability can drop, which can lead to running costs being greater than what the company earns from you. In these cases, the contract can be terminated, so you should always make sure you are well aware of everything you’re signing. But apart from that, this type of Bitcoin mining offers some pretty elegant solutions. In some cases, you can split the monthly running costs with someone else or you can even set the equipment up the way you think it should work. Therefore, if you want to be a miner but don’t want to do it at your own home, this may be the solution. Just make sure you’re signing up with a reliable company, but for that you have us. Check out our articles and then make your choice.