If you’re here reading this article, then you’ve probably gained some interest in mining cryptocurrencies. However, setting up your own mining rig and finding the right GPUs ( Graphic Cards ) can be a daunting task, especially if you have no technical background or knowledge. Luckily, there are services out there which help you get started with mining without any hardware.
How Does Cloud Mining Work?
Traditionally, mining cryptocurrencies such as Bitcoin, requires you to have extensive technical knowledge and mining rigs set up. With Cloud Mining programs, one simply has to just register an account, purchase one of their mining contracts ( think of it as purchasing shares ) and let the cloud mining company do the rest. So how does it work? Basically, the company houses a bunch of mining rigs which already mine Bitcoin or Ethereum or other alternative cryptocurrencies and “rents” part of the rigs to whoever purchases the mining contracts. However, there are risks to using cloud mining services.
What are the Pros & Cons of using Cloud Mining Services?
As with most investments, even as a beginner, one needs to understand the risks and benefits of using a Cloud mining service. I’ve put together a small list of pros and cons surrounding these types of services.
- No Expensive Hardware to Maintain
- No Technical Experience or Knowledge Required
- No Increase in Electricity Costs
- Your home or office wont be super hot from all those GPUs running.
- No need to get new equipment every time mining is no longer profitable.
- You don’t have ownership of the mining rigs
- High risk of fraudulent companies
- Lower profits than mining for yourself
- Not very transparent in terms of actually seeing the mining facilities and rigs.
- Dependent on the service provider
Always do your research first before signing up with a cloud mining service provider. Search for reviews, forum threads, warnings, or even try to speak with them through social media channels ( Twitter, Facebook, etc. ). Cloud mining can be an easy entry into the mining world, but as you progress and learn more, you will want to start with your own machines. After all, mining for yourself can be much more profitable than using a cloud mining service.
Watch this video by Genesis-Mining, which shows the size and complexity of these cloud mining facilities
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