Cloud mining allows you to access the capacity of the data processing center and get cryptocurrencies without the need to buy the right hardware, software, spend money on electricity, maintenance, etc. The essence of cloud mining is that it allows users to purchase the processing power of remote data centers.
The entire process of producing cryptocoins 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 manage their own software or hardware. If electricity is expensive where you live – for example in Germany – then 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 mine the cloud:
1. Lease Mining. Provider hosted miner rental.
2. Virtually hosted mining. Creating a virtual private server and installing your mining software.
3. Renting out hash power. Renting a certain amount of hash power without having any dedicated physical or virtual equipment. (This is the most popular cloud mining method).
What are the advantages of Bitcoin cloud mining?
– Does not handle excess heat generated by machines.
– Avoiding the constant hum of fans.
– You don’t have to pay electricity.
– Not to sell your mining equipment when it is no longer profitable.
– There are no problems with the ventilation of the equipment, which usually heats up a lot.
– Avoiding possible delays in hardware delivery.
What are the disadvantages of Bitcoin cloud mining?
– Possibility of fraud,
– Bitcoin transactions cannot be verified
– Unless you want to build your own bitcoin hash systems, it can be boring.
– Lower Profits – Bitcoin cloud mining services incur costs.
– Bitcoin mining contracts may allow operations or payments to be suspended if the price of Bitcoin is too low.
– You cannot change the mining software.
Cloud Mining Risk:
The risk of fraud and mismanagement is prevalent in the world of cloud mining. Investors should only invest if they are comfortable with these risks – as the saying goes, “never invest more than you’re willing to lose.” Research social networks, talk to old customers and ask all the questions you think are appropriate before investing.
Is cloud mining profitable?
The answer to this question depends on some factors that affect the return on investment. Price is the most obvious factor. The service charge covers electricity, accommodation and equipment costs. On the other hand, the reputation and reliability of the company is a determining factor due to the prevalence of fraud and bankruptcies.
Finally, returns depend on factors that no company can predict or control: just remember the high volatility of Bitcoin over the past three years. When buying a mining contract, it is better to accept a constant price for Bitcoin, because your other alternative is to buy Bitcoins and wait for the price to rise. Another important factor is the capacity of the entire network, which depends on the number of operations per second. Power has increased exponentially in the last few years. Its growth will continue to rely on the value of Bitcoin and innovation in the development of integrated circuits for certain applications.