What is Cloud Mining?
Cloud MiningMining is the process by which cryptocurrencies such as Bitcoin and Ethereum are mined. Mathematical tasks, so-called hashes, have to be solved, which require computing power.
This computing power is provided by miners who specially configure powerful mining devices such as GPUs or CPUs and leave them permanently online. In return, miners receive cryptocurrency, such as bitcoin in bitcoin mining.
Unfortunately, modern mining devices are expensive, complex and costly to configure and require frequent updates. That is why their own cloud mining providers have developed who operate their own data centers with numerous mining devices.
This mostly in countries where electricity costs are low. This is how mining can become as profitable as possible. Users can access pre-configured mining hardware over the internet (the “cloud”) instead of operating the equipment themselves at home.
How does cloud mining work?
With cloud mining, you pay a cloud mining provider so that you can mine a desired cryptocurrency (or several) with a specific mining performance. The mining performance, also known as the hash rate, is given in hashes-per-second (HPS).
There is usually a monthly fee for this, the coins earned, e.g. BTC with Bitcoin mining, go directly into a wallet specified by you.
To do this, you register an account, then choose a tariff plan with a certain amount of hashrate and determine which cryptocurrency(s) you want to mine.
Monthly plans offer more flexibility, but you can get out even cheaper with longer subscriptions. Usually you can also upgrade or adjust the mining settings during runtime.
Ethereum (ETH) cloud mining
Ethereum MiningEthereum Cloud Mining is also very popular. Please note that Ethereum is gradually switching from Proof-of-Work to the more efficient Proof-of-Stake mechanism.
With Proof-of-Stake, each participating miner is rewarded in proportion to their deposited ETH coins - so you can earn more regularly here than with Bitcoins Proof-of-Work.
Nevertheless, the same applies here: modern and powerful mining devices are the be-all and end-all! The higher the hashrate, the better the earnings.
How do you recognize reputable cloud mining providers?
When choosing a reputable cloud mining provider, one must pay particular attention to their legal compliance, convenient locations, powerful mining devices, online reviews by other users and the transparency of their information.
Cloud mining advantages & disadvantages
The main advantages of Bitcoin Mining in the cloud are the convenience and the time and cost savings. You can earn money with the mining of cryptocurrencies for low monthly costs, expensive investments and high configuration effort are no longer necessary.
In this respect, it is also acceptable that the cloud mining provider has control over the mining devices and records the mining earnings.
Advantages
- • Start mining easily and inexpensively
- • No mining hardware purchase required
- • No mining hardware configuration required
- • Mining of one or more cryptocurrencies possible
- • Earnings calculable (excluding currency fluctuations)
- • Bitcoin cloud mining increased as part of a mining pool
- • Earning opportunities
Disadvantages
- • Cloud mining provider collects margin
- • Dubious providers on the market (please note our comparison)
- • Less control over configuration and device choice
Conclusion on cloud mining
Cloud mining is the perfect option for anyone interested in crypto who wants to get into Bitcoin mining or Ethereum mining without investing a lot of time and money in purchasing and configuring mining hardware.
In advance, the expected earnings can be calculated with a cloud mining calculator and a suitable price package can be selected.