A Beginner’s Guide to Mining Ethereum
Latest posts by Dean (see all)
- Here’s How to File Cryptocurrency Loss Deductions at Tax Time - December 28, 2018
- Kepler Technologies Launches LUKRUM Portfolio Tracker Application with Advanced Tools for Streamlined Crypto Asset Management - December 20, 2018
- Kepler Technologies Crypto Trading Terminal Kattana Simplifies Trading with an Access to Multiple Crypto Exchanges and Covering All Crypto Traders’ Flow in One App - December 16, 2018
The launch of the Ethereum network and its explosive growth has been one of the most exciting new developments in blockchain technology over the last couple of years. It has also produced some great opportunities for ordinary users and even complete beginners to get involved in ‘mining’ – the process of helping to secure the blockchain and earning rewards for your work – in a way which has not been possible with Bitcoin for some years now.
The Ethereum mining process uses an ‘ASIC-resistant’ algorithm, which means that its not so easy to create specialist hardware to get a big advantage over everyone else. That doesn’t mean that you can’t increase your mining rewards if you have high quality equipment of course, because everybody should earn a fair amount according to their contribution, but it does mean that big mining farms aren’t getting access to microchips that aren’t available to the public and which give them a huge advantage over everyone else.
You can mine Ether using an ordinary CPU processor which every computer has, or using a graphical processing unit or GPU. You will get much better returns using a GPU, so you should use one of these if possible and anyone choosing to stick with a CPU should probably consider their involvement to be an interesting way to get a few coins rather than a way to make a profit. Many higher-end computers and laptops, especially those marketing to video game players, will have a GPU already installed. If you have some money to invest then you can also buy a new GPU from any electronics shop which sells computer equipment. So setting up a good quality ‘mining rig’ for Ethereum is within the reach of ordinary users.
Thanks to strong value growth and the relatively small size of the professional mining industry compared to Bitcoin, Ethereum mining has offered very strong returns since the network launched in 2015.
How to Start Mining Ethereum
Once you have a computer ready to use, all you need to do is to install some software and choose a ‘pool’.
Mining pools are essential for most ordinary miners. They work by grouping together lots of people, who all put their rewards into a big pot and then divide them up according to the contribution each person has made. This means that instead of, for example, getting a large reward every year or two (or perhaps never if you are unlucky), you get constant smaller rewards every day or week depending on the size of the pool.
The most beginner-friendly method to get started is probably using something like MinerGate. These guys are a pool operator, but they also provide their own mining software with a super easy one-click start – just download the software, start it up, and the rewards will start to trickle in!
The MinerGate software can be used for both CPU and GPU mining, and allows you to easily select how many cores should be used to mine with. This is really handy if you just want to do a little bit of ether mining in the background on a computer which you also use for other stuff, as it means you can lower the number of cores used so that your machine doesn’t grind to a halt when you try to use it as it might if it was trying to mine on full power.
More advanced users who want to tinker with their set up can also use the official EthMiner client or the popular Genoil miner which includes native CUDA support and other additions to the standard mining software. These users will still be able to join the MinerGate pool and make use of other features they offer, such as the integrated Changelly service which allows for instant conversion into other cryptocurrencies like Bitcoin.
For more information about supported hardware and other technical details check out this Ethereum mining guide from the MinerGate blog.
Looking to put a bit of time and money into increasing the amount of ether coins that you can mine? Here are some other great resources I’ve found which may help you to mine more ether.
Ethereum Mining Calculator: get an estimate on how much you can expect to earn from a particular set up.
Choosing a GPU: This is a great guide from Crypto Compare that is ideal for a beginner looking to buy their first GPU for Ethereum mining.
To get started head on over to the MinerGate download page to get the software you need to start mining right away.