If there had to be a term that described cryptocurrency the best or something that goes hand in hand with it, like bread and butter, it would have to be mining. From the very moment, cryptos entered the scene people started hearing about the (in)famous mining phenomenon. Many understood one thing but failed to grasp the other. How can something be mined in a digital environment? What is there to mine when these new currencies are not ever physically real? Is it all a scam?
Soon, it was much clearer that bitcoin was the leader among cryptos was and why obtaining more of it was referred to as mining. Fast forward more than a decade later and everyone knows what mining of cryptocurrency implies and why it is such a big deal. However, there is still new terminology that needs further explaining as well as new advancements in the industry that manage to introduce additional concepts and approaches to trading and investing in virtual commodities cryptocurrencies qualify as.
For example, have you ever heard of cloud mining? Sure, you are familiar with cloud services and the general premise of storing files off your physical computer and on the internet. And you are already familiar with mining as we established previously. But how do this two mesh together and is it really as simple as these two explanations coming together? Well, let us find out together. In this article, we talk about cloud mining and try to answer the titular question of how legit it is. Keep reading to find out more and be sure to check out www.europeanbusinessreview.com.
It Is Actually a Service
In simplest terms and with as little language as possible, cloud mining is a way of earning cryptocurrency by renting computing power. For those who are using the service, it is a hands-off way of obtaining new crypto assets by using someone else’s hardware power for mining cryptos. Those are third-party sources that come in different types, but all of them have one thing in common. They have the extra computing power to rent out to others in need, earning for this service, as the renters do the same things they would otherwise do on their own mining rigs.
Cloud computing works exactly like this too, and it has for years now. Companies, mostly those from the IT sector, have numerous computers, often basements full of them, which they no longer use on a regular basis. These rooms full of computational power do not have to just sit around and be a nuisance and something dust falls over. On the contrary, they could still be profitable if you rent them as hosts to anyone who needs them. It is basically computational real estate that customers can rent out and use as servers or cloud storage. The same goes on in cloud mining, albeit with more powerful, high-end machines that are made for finding more cryptocurrency. The principle is inherently the same and it is essentially outsourcing of computational work.
Why It Exists
In crypto-mining, there is always the need to run powerful computers around the clock so that they can mine bitcoin, litecoin, and any other coin out there. However, not everyone has the resources or room to have their personal mining rig, let alone a mining farm. Computer components are some of the most expensive pieces of hardware on the market, and the energy bills these computers make by working heavy-duty and non-stop is enough to cause a headache. Instead of going through this hassle, it is now possible to rent the power you need from a specialized mining computer owned by others and still do your mining.
Of course, since it is cloud technology, after all, that computer you rent can be anywhere in the world. It works for you despite being thousands of kilometers away. It is also not a single computer but a pool of computational power provided by many machines working together. This means that you can have better odds of beating the competition who does it the old-fashioned way. Obtaining more crypto is definitely a possibility through cloud mining. The only catch is that it is restricted to proof-of-work cryptosystems, meaning the likes of bitcoin and ethereum, that use nothing but a brute computational force to mine for more. Proof-of-stake systems do not work with cloud mining.
Is It Profitable and Legit?
Just like regular mining, it can be quite profitable if you know what you are doing. Anyone who wants to use this service has to pay to rent a mining rig. Furthermore, the mining pools that are for rent may take a cut of the crypto profits you make, but it can still be worth your while. The profit depends almost solely on the computational power you as the customer choose. It is easy to pick the best between those available and the mining pools will not miss the opportunity to advertise and boost their high-end specs. The more powerful the computers, the higher your returns will be. The state of the market and the prices of the cryptos you mine also matter. It is not always as profitable to mine for cryptos. Mining crazes are usually at their highest whenever there is a sudden rise in value across the board.
In terms of how legit it is, it is as legit as any other cloud-based service. If the computers you are renting are well above average and if the company who is renting them is not a scam, there is nothing to worry about. The opportunity itself is real and it is not a fraud. Of course, like anything else crypto-wise, cloud mining can get risky. But one cannot hope to become a successful trader and investor without taking on some risks in the process. Fraudulent cloud mining services do exist, but then again so does any other internet service. Carefully navigating the web in search for the right manning pool, using common sense, and being internet literate and educated is how you make sure you stay safe. Some of the best cloud mining sites include Shamining, ECOS, ChickenFast, TrustCloudMining, BeMine, and HashShiny.