Cloud mining allows you to access data center processing capacity and obtain cryptocurrencies without having to buy the right hardware, software, spend money on electricity, maintenance, and more. The essence of cloud mining is that it allows users to buy the processing power of remote data centers.
The whole cryptocoin production process is done in the cloud, which makes cloud mining very useful for those who do not understand all the technical aspects of the process and do not want to run their own software or hardware. If electricity is expensive where you live (for example, in Germany), 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. Leasing of a mining machine hosted by the supplier.
2. Virtually hosted mining. Creating a virtual private server and installing your mining software.
3. Hash power rental. Rent a certain amount of hash power, without having a dedicated physical or virtual computer. (This is by far the most popular method of cloud mining).
What are the advantages of Bitcoin cloud mining?
– Do not treat the excess heat generated by the machines.
– Avoiding the constant hum of the fans.
– Not having to pay for electricity.
– Do not sell your mining equipment when it is no longer profitable.
– There are no ventilation problems with the equipment, which is usually very hot.
– Avoid possible delays in the delivery of hardware.
What are the disadvantages of Bitcoin cloud mining?
– The possibility of fraud,
– Transactions with bitcoins cannot be verified
– Unless you want to create your own Bitcoin hash systems, it may be boring.
– Lower profits: Bitcoin cloud mining services come at a cost.
– Bitcoin mining contracts may allow for the cessation of transactions or payments if the price of Bitcoin is too low.
– Unable to change mining software.
Risk of cloud mining:
The risk of fraud and mismanagement is common in the world of cloud mining. Investors should only invest if they were comfortable with these risks; as they say, “never invest more than you are willing to lose.” Research social media, talk to old clients, and ask any questions you deem appropriate before investing.
Is cloud mining profitable?
The answer to this question depends on some factors that affect the return on investment. Cost is the most obvious factor. The cost of the service covers the cost of electricity, accommodation and hardware. On the other hand, the reputation and reliability of the company is a determining factor due to the prevalence of scams and bankruptcies.
Finally, profitability depends on factors that no company can predict or control: remember the high volatility of Bitcoin in the last three years. When buying a mining contract, it is best to assume a constant price for Bitcoin, as the other alternative is to buy bitcoins and wait for the price to go up. Another important factor is the capacity of the entire network, which depends on the number of operations per second. In recent years, power has increased exponentially. Its growth will continue to be based on the value of Bitcoin and innovation in the development of integrated circuits for particular applications.