What Is Crypto Currency Mining And Is It A Good Way To Make Money?

In an earlier post I explained what crypto currency is, how it worked, and basically described what you can do with it. Now also within that same post, I briefly talked about mining and how it fit into the whole process.

Now if you’re new to the whole crypto thing, you might be wondering what is crypto currency mining?

Well to give a short answer, it’s where people compete against one another by verifying transactions — and whoever wins earn a small amount of money.

The questions I want to answer today though is how does mining work, what do you need in order to do it, and most importantly if it’s even profitable enough to pursue.

So without further ado, let me jump right into things here.

What Is Crypto Currency Mining?

Crypto currency mining is the process where people (or what we like to call miners) verify transactions into a public ledger. Now each time someone does this, new crypto coins are created and given to the person as an award for verifying the transaction they just did.

Much like how the government will print new money and put it into circulation.

The main difference however is crypto mining is controlled by very complex computer algorithms, which keeps inflation in check by allowing a steady flow of coins to be brought in about every 10 minutes.

How Does It Work?

When someone sends crypto currency to another person, this transaction is made into a block which will then be collected by a “miner”. The miner (or more precisely the software + hardware a person is using) must then solve a very complicated math puzzle to make sure the transaction that just took place is valid.

complicated math puzzle

For example someone trying to send crypto currency without actually owning any would be fraudulent, or someone sending the wrong kind of coin would also be considered invalid.

Now when these blocks are created they aren’t just sent to a random miner to be deciphered, but instead are basically thrown at there as a free for all allowing anyone to try and solve it. And the more miners there are the harder the equation becomes, and the fewer there are the easier it gets.

But as I previously mentioned, whoever is the first person to solve the equation will then receive a small amount of crypto coins as payment for their work.

What Do You Need In order To Mine Crypto Currency?

Now while essentially anyone can become a miner to try and earn some extra money, before you can do anything you must first have a few things in order to decipher these complicated equations.

Here’s a list of 7 things I recommend you have in order to mine crypto currency effectively:

1. A mining software – First you’ll need to get a mining software program that will be installed onto your computer.

2. A crypto coin wallet – This is basically a password protected database that will keep all your money safe and secure.

3. A mining pool you can join – This is where a community of miners join together to make earning money much easier.

4. Becoming a member of an online currency exchange – This is where you can exchange your crypto coins for real money and vice versa. One of the most popular ones right now is called Coinbase.

5. A separate desktop – Due to the high demand mining puts on your computer, it’s necessary to use a separate desktop from the one you normally use. Also it’s advised you custom build this desktop to generate the most amount of money you can from mining.

6. An ASIC chip – this is a specialized processing device that basically does all the mining work for you.

7 – A fan or cool location for your desktop – Then last but not least, you’ll want to find a cool place for your desktop and perhaps buy a fan to blow air across your computer to prevent it from overheating.

Then once you have all of this in place, you’ll simply turn on your computer, activate your mining software, join a mining pool, and start collecting money.

Is Crypto Currency Mining Profitable?

If all you’re looking for is to generate a few dollars a day, then sure you could try mining if you want — however if your expecting this to be basically a second source of income then you’re going to be sadly disappointed.

You have to remember after you buy all the hardware, software, and other accessories that come with mining in the first place, it’s going to take a while to break even and even longer to start earning a profit.

However if you’re willing to invest say around $5,000 dollars for a serious computer and you don’t mind consuming a lot of electricity — then you could have the chance of earning about $30-$50 dollars a day.

But due to all sorts of factors like the price of the virtual coins, how many miners there are, and how much energy you’re using — you could still end up making very little even after buying some top-notch hardware.

So you’re welcome to try and earn some money with crypto currency if you want to, but you’d have a much better chance of buying and trading these coins rather than actually mining them.

Final Thoughts

Even though mining is an essential part to make crypto currency work, as you can tell within this post it’s not necessarily a good thing to do if your in it for the money.

Now a few years back it might’ve been a lot easier to make money with mining since it wasn’t so popular, but due to the sudden interest in bitcoin it’s brought a lot of competition to the mining world and as a result made it to where it’s basically not worth doing anymore.

Here’s How I Prefer To Make Money Online

Now if you’your still wanting to find a way to earn some extra cash online, I would recommend you forget about crypto currency and look into building a business online.

And yes it will take time and work to actually create money this way, but you can essentially make however much you want depending on how hard you work — unlike crypto mining which is all based by chance.

And best of all you can create your business around anything you want, and you can do it all for about $30 bucks a day! Not too bad right?

So if this sounds like something you may be interested in, check out my favorite program online that will teach you step by step how to do this by clicking the image below.

learn how to create a profitable business online

I hope you found this post helpful. However if you still have questions in regard to mining, leave a comment below and I’ll be happy to help you out. 🙂

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6 thoughts on “What Is Crypto Currency Mining And Is It A Good Way To Make Money?”

  1. Many people make crypto currency sound attractive and lucrative, and I even see many adverts saying you should get involved with crypto currency. But judging from your article the market seems very saturated now.

    Is crypto currency the same as bitcoin, or they to separate online currencies?

    I’ve also heard people say that if you join mining pools you’ll have a good chance of making a lot of money. However like you said I don’t think they take into account the software, hardware, and electricity you’ll be consuming when they are calculating how much money you’ll make.

    Great review and thanks for this information.  

    Reply
    • Ya even though many people will say cryto currency is a great way to make money, it’s really no different than the stock market. 

      You can essentially make a lot of money or lose it — and really how much money you can make really depends on luck as no one knows what the market will do from a day to day basis. 

      Also to answer your question, crypto currency is just the term people call every single digital coin out there whether it be bitcoin, litecoin, ripple, etc. Kinda of like how you have a dollars in the U.S — you can have a 1 dollars bill, 5 dollars, 20 dollars — but they all are dollars. 

      Reply
  2. Michael,

    This sounds like a very expensive way to try and earn just a few dollars a day. I mean once you invest all that time and money then the return is only $30 to $50 per day?  I do not think that is a very profitable business to be in just my thoughts. 

    The way I understand it people are spending the crypto currency but in order to find out who is to get paid your doing all the work in figuring this out for pennies; sounds like a minimum wage job would probably pay you more. 

    I would prefer to learn more about your other business opportunity that you have listed on your site at the bottom :).  Thanks for the heads up on crypto mining, but I don’t think it’s  something I will ever be interested in.

    Susan

    Reply
    • Hey Susan thanks for your comment.

      Ya only making about $50 bucks a day at most doesn’t seem all that great especially after you’ve invested in thousands of dollars in high end equipment — and not to mention the amount of energy you’ll be consuming every day just to keep your computer running.

      I think you would indeed though find my other opportunity much more satisfying in terms of what you would be doing and how much money you’d be making. At least I think it’s way more enjoyable helping people out, then staring at a screen of numbers all day.

      Again you can find out more on how I and thousands of other people are making money online with the help of Wealthy Affiliate, and best of all is you can join it for free. 🙂

      Reply
  3. Michael this is a very interesting article. 

    I have always wondered exactly how these internet currencies worked, and you made it a little easier to understand in this article. But I think I shall check some of your other blogs relating to it.  

    It seems that the mining is more for people who are expert in the field. From the way you described it, it would take quite a while to make any money considering the investments in hardware, software and education in the field.

    Thank you for this article. I believe I am growing in understanding in this area.

    Reply
    • Hey Thomas I’m glad I could help clarify what crypto mining was for you.

      However you don’t really have to be an expert to mine crypto currency — all you have to do is spend a lot of money on a high tech computer, but the necessary software, then simply sit back and hope you’ll make money. 

      However as I mentioned in this post, the amount of money you make can change on a day to day basis — and almost every you ask now says your better off buying and selling crypto currency than actually mining it. 

      Reply

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