Cloud (or remote) mining – is the process of using hardware power to mine cryptocurrency (such as Bitcoin or Litecoin) remotely. This mining model came to existence due to the fact that the increasing difficulty of mining has made it unprofitable for mining enthusiasts to mine Bitcoins at home.
Cloud mining gives people a unique opportunity to begin mining cryptocurrency without the need for a large initial investment in hardware or technical knowledge. Despite the simplicity of the cloud mining model, it is worth elaborating on a few details, specifically it’s important to highlight that remote mining comes in two forms: hosted or cloud based mining.
REMOTE HOSTED MINING
The first form of remote mining is remote hosting. This model suits users with a high level mining experience and know-how and who require a high degree of control over their mining hardware. Under this model, the mining hardware is hosted in a remote datacentre and the user assumes full control over the setup and configuration of the mining hardware. Under this model, the miner pays a fee to the hosting company that would cover maintenance and electricity costs. This helps the miner handle the risks associated with maintenance of the kit as well as any risks with the shipment of the hardware. On the other hand, it presents the miner with risk on the initial hardware investment and requires much more time and technical knowledge to implement successfully.
It can therefore be summarised that the benefits of remote hosted mining are tight control over the mining process, maintenance support and subsequent ownership of the hardware. The big drawbacks are risks associated with the procurement of expensive hardware and the very high cost of entry, both in terms of investment and technical experience.
The second, and more accessible model of remote mining is Cloud Mining, whereby a miner purchases a part of the mining power of hardware hosted and owned by a Cloud Mining services provider. The service provider takes on configuring the hardware, maintaining uptime and selecting the most efficient and reliable pools.
This option provides a range of benefits: instant connection (meaning no hardware shipment wait times and delivery risks), fixed maintenance and electricity fees and no nuisances associated with mining at home such as noise, heat or space. Another key point is that this model of cloud mining requires no technical experience. Obviously, it’s very important that miners understand the mining process, however this model doesn’t require hardware expertise or significant configuration / implementation cost. Since customers can purchase any amount of mining power they wish, this means that the level of investment will depend only on the miners’ ambition. This means that the cost of entry and subsequent risk is far lower than in comparison with the remotely hosted model.
Cloud mining is greatly suited for novice miners who would like to try out mining and earning cryptocurrency as well as seasoned miners who don’t want the hassle or risks of hosted or home-based mining.
If you are a beginner, you should know all about the pricing and processes. If you are a newbie, you can start with a 100 GH/s lifetime BTC mining contract that may cost you approx $25-35. This is somehow, you might understand how the cloud mining would work and what are the benefits of using it.
You can look for different coins and different contracts. You can mine BTC, LTC, Dash, Dogecoin, Startcoin, Peercoin and Namecoin for X11 contracts. You can mine BTC, LTC, Darkcoin, Zetacoin and Dash for SHA-256 contracts.
You should also be aware about the factors that make a contract profitable. You should be aware of the changing factors including hash rate, network difficulty and price of a coin. These factors change every day.
Most Bitcoin Cloud Mining Companies are Scams
Like the heading says, most cloud mining contracts are scams. Why?
Because it’s easy for companies to take peoples’ money, and then not pay out. A company can claim to be a cloud mining company without any proof of actually owning any hardware.
So remember: 99% of cloud mining companies are scams.
Which Companies Are Not Scams?
There are only three cloud mining companies we are willing to recommend on this site: HashFlare, Genesis Mining and Hashing24.
Just because they are not scams, however, does not mean that you will make a profit by buying contracts.
Hashflare.io offers a unique option for mining with a low cost of entry as well as minimal risk and expense, which is opposite to traditional models of bitcoin mining that involve procurement, maintenance and configuration of highly specialized hardware.
The answer is simple: HashFlare is a division of HashCoins – a company founded in 2013, known for manufacturing and sale of cryptocurrency mining equipment. Extensive experience and good feedback from customers build trust and guarantee safety of investments.