Now that we established what is mining, it is important to look at different coins to determine what to mine and how to mine. First of all, there are two types of coins, those that can be mined and those that cannot be mined. For the purpose of mining, we can ignore coins that cannot be mined. Please note that this is just a quick introduction. Future articles might go in more depth.
Example of coins that can be mined:
Example of coins that can’t be mined:
In order to start mining, you will need hardware that can allow you to mine. There are 4 major types of hardware that you can use to mine different coins. The barrier to enter mining will differ for each of these, so will the profitability.
One of the easiest ways to get into mining is by using your available hard drive storage. Essentially everyone has some unused space on their drive that they can lend out to get some coin as a reward. There is barely any barrier to entry and usually doesn’t use a lot of power. Please look at the different coins to see how to mine them.
Here is a list of coins that can be mined with HDD:
CPU mining also provides a low entry barrier to start mining, since all you need is a PC that is running 24/7 without any other extra hardware. The gains are not the highest but some mining profit can still be made.
List of CPU mineable coins:
Wast majority of coins are mineable with a GPU or multiple GPU’s. Connect a bunch of GPU’s to a computer, select a coin to mine, or use some automated mining app to decide what is best to mine and let the computer do the work. If you have a modern GPU in your computer, chances are, that there is a profitable coin to mine just with your gaming PC when you are not playing games. Some people build mining rigs with up to 14 GPUs on one motherboard to maximize profits.
You can either mine individual crypto currencies, or use a service like nicehash to take care of the finances for you and just give you pay outs. If you wish to figure out the most profitable currency to mine, you can check the whattomine website, which has amazing statistics on different GPUs and coins.
GPU mineable coins:
ASIC mining provides the largest barrier to entry as it requires a specialised hardware, which is generally quite expensive and has no resale value. Once ASIC miner loses effectivity, it is a very expensive paperweight. They do however provide the highest hash rates and therefore the largest gains.
ASIC mineable coins:
Things to consider
There are a lot of things to consider when mining crypto currencies. Profitability is the most important aspect to consider but the calculation of profitability is actually quite complex as it consists of many aspects and will change a few times per day.
Here is a list of things to keep in mind:
- Cost of hardware – often neglected but when purchasing dedicated hardware for mining, it needs to pay for itself.
- Cost of electricity – you will be running the hardware 24/7, you need to make sure that it doesn’t consume more electricity than it produces.
- Pool fees – Chances are you are not on your own but you joined a pool and need to consider pool fees.
- Coin price – You are mining a coin that is profitable but if the price drops, is it still profitable? With GPU, it is easy to switch to a different crypto but with an ASIC, it might be more difficult.
- Change in difficulty – Will you still be profitable when difficulty increases?