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The Three Ways
Ok, now that you know exactly why you would want to mine Bitcoin, let’s get onto the bit I’m sure you all came here for – learning how to mine Bitcoin! There are three ways to start mining Bitcoin:

pool mining mining alone cloud mining
Pool Mining
(Recommended)

Mining alone
(not recommended for novice or hobbyist miners)

Using cloud mining services
(not recommended for anyone!)
I’ll look at these in a bit more detail and then I’ll get onto exactly how to mine Bitcoins!

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Pool Mining
Bitcoin mining as part of a larger pool of miners is the easiest, fastest, and most reliable way to make sure your Bitcoin mining operation is profitable. You join forces with other miners to share the rewards.

By signing up with a pool, you (and everyone else in the pool) are agreeing to split any Bitcoin you are rewarded with the other pool members. This means that you will receive small payments regularly.

However, not all pools are the same. There are plenty of things you need to consider when choosing a pool. They are:

The size of the pool.
The minimum payments.
The fees charged by the pool.
Size of the Pool
The size of the pool is an important thing to think about when you’re mining as part of a pool because as more people mine in the pool, the chances of being rewarded increase. However, since the rewards will be split between more users, they will also be smaller!

How to mine Bitcoin: biggest mining pools.Biggest Mining Pools | Source: blockchain

Joining large cryptocurrency mining pools is usually a comfortable option for beginners how to mine Bitcoin. This is because they will be getting many payments and won’t be spending lots on electricity waiting for the next fraction of a Bitcoin to be rewarded to them.

The Minimum Payment
Another important thing to look at is the minimum payment that the pool will let you withdraw. By minimum payment, I mean the smallest amount of Bitcoin that the pool will let you take out. If you’re very new to cryptocurrency mining, you’ll probably want to join a pool with as low a minimum payment as possible. This will mean that you can be sure that it all works as it should do in a shorter period.

You don’t want to be using lots of expensive electricity amassing a few hundred dollars’ worth of Bitcoin only to find that the pool disappears, or something very bad happens in cryptocurrency news to make Bitcoin’s price suddenly drop!

Pool Fees
Every pool charges a fee for organizing it all for you. The fee is usually a percentage of your profits. It will always be taken from the Bitcoin you mine automatically, so you don’t need to worry about paying it yourself!

Of course, we don’t need to tell you that the lower the fee you pay, the better for your profitability. That’s just obvious!

How to mine Bitcoin: a miner mining Bitcoin.

Typical fees are between 1% and around 3%. Pools with 0% mining fees do exist, too. However, their reliability is yet to be seen. Unless you know a person who you trust that recommends a free mining pool, you’re much better going with one that has built a reputation for itself.

Running a pool is expensive. There are lots of computer systems and data center space that need to be paid for. It’s a full-time job for a few members of staff. Fees of around 1% are fair. However, you should probably avoid pools with fees of above 3%.

Mining Alone
When talking about how to mine Bitcoin, mining alone is possible. It probably seems like the best idea. Surely, you shouldn’t have to share your mining rewards with thousands of other people? Also, paying 1% on everything you make could end up expensive if you plan to mine for a long time.

Well, you’re right. Sort of.

Solo Bitcoin mining does mean that you don’t have to share your profits with a huge group of other people. However, it also means that you don’t get to share the profits of the thousands of other miners, either. You only get paid out if you’re the miner who solves the hash.

This means you’re not only competing with every other solo miner on the planet, but you’re also competing with every pool, too. Even if you have more computing power than every single miner in every pool, do you have more than the entire pool combined? Probably (definitely) not!

That said, if you are a multi-millionaire, you could set up a profitable solo mining operation. You’d need to buy hundreds (if not thousands) of ASICs (application-specific circuit chips). For the very best mining chips, you will be looking at spending around $1,000 to $1,500.

Problems for Solo Bitcoin Miners
To run hundreds of computer chips will take a whole lot of electricity. The best possible way how to mine Bitcoin now is with the help of the DragonMint T1 miner. This runs at 1,600W. Multiply this by 100, for example, and you’re looking at a giant power bill every month!

To make matters worse, running hundreds of computer chips gets hot. Think about using a laptop for a few hours on your knee. They can get pretty warm, right? The average laptop runs at around 60W. That’s about 26 times less power than a single DragonMint unit. Now, imagine 100 of these bad boys running at once in a small room. You’re going to need some serious ventilation! That means more power consumption!

How to mine Bitcoin: DagonMint T1 Miner solo mining.

Source: halongmining

One of the concerns that will occur on your way to learn how to mine Bitcoin is the noise. With the constant buzzing of hundreds of computer components, plus industrial-scale cooling facilities running 24 hours a day, a professional scale solo mining operation is going to be hellishly loud!

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