No doubt, all of us have own account in a cloud service. It can be Google Drive, Dropbox or, all in all, iCloud. Cloud storages have different shaped and forms, depending on their providers. Now, it is a competitive field, so each provider tries to offer new features for its customers. So, Dropbox created Paper for working in a team, Google Drive offers integration with all Google’s service, MEGA provides chat, email, calling and video conferencing. However, nowadays these functions are becoming common and an ordinary client stopped be surprised by them.
Have you ever thought what function beyond the capacity of a cloud service? Now, we are going to speak about cloud mining.
Bitcoin is the most popular form of digital currency of our time. It is a cryptocurrency, and what sets it apart or adds popularity is that it is decentralized. So, large banks can’t control or regulate it.
Bitcoin produced by the process of spending computer power to process transactions, secure the network, and keep everyone in the system synchronized together.
In theory, you could use your personal computer as a node, however, it would be ineffective. People, who make money in this way, use specially equipment (like graphics accelerators). The demand for graphics cards for mining is growing rapidly every day (NVIDIA made a fortune, selling video cards, adapted for the mining of cryptocurrencies). So, you must spend a lot of money on deficit equipment and electricity.
When power was not enough, the miners began to create improvised servers. But each block is the only one for the whole network, so who has more power to hit the block, gets new bitcoin. The cost of buying equipment and paying for electricity has stopped paying off.
In the 21st century, almost everything can be done online, can’t it?
Cloud mining allows you to mine cryptocurrency without additional cost, using processing power of data centers. A user can purchase capacity of a special equipment, installed in remote data centers.
Types of cloud mining:
Nowadays, there are three ways to remote mining:
1. Renting the equipment from the supplier.
2. Renting computing power without access to server
3. Renting virtual private server and installing own software for mining.
How it works:
1. Provider buys an equipment (ASIC is heavy duty processor, created for searching for new blocks) and sets up hardware.
2. The service offers a contract for mining.
3. A user purchases a certain amount of allocated capacity
4. The service makes a profit from the transaction, a user from mining on the advanced equipment.
The structure of the cloud mining hasn’t changed comparing with ordinary mining. The total capacity became more. The operation should become a part of the block together with the mathematical structure of the performed action to become confirmed. For proving it is necessary to connect the large computational power.
Taking the evidence of the transaction depends on previous blocks, that are necessary for the formation of the structure and creating a chronological order of operations. When a pair of blocks occurs in the same time, the power treats the first received unit, but switches to the longest chain after finding the next block.
It must be noticed, that if the whole company involved in mining process, it means no need for fraud — income is divided by all participants.
Advantages of cloud mining:
1. As a rule, data centers are located in areas with low cost of electricity.
2. No need to purchase deficit equipment.
3. Cloud mining is suitable for those, who has no knowledge in this sphere. Provider assumes the responsibilities for installing and configuring the hardware.
4. No control.
5. High yield. Also, you can mine bitcoins without investing in a test mode.
6. Using of this service in any case brings you money. A fixed amount of remuneration for provider and indicators of the complexity of calculations make prediction of yield easily.
7. It is possible to purchase contracts for various cryptocurrency, what helps to insure against occasional drops one of them.
Disadvantages of cloud mining:
1. Cloud services are interested in income generation, so your final income would be lower.
2. If the BTC’s exchange rate depreciate sharply, then a cloud company can stop its work. This investment is for long-term use.
3. The probability that a provider of the contracts may be a fraud (you should be looking for reliable company)
4. The service isn’t fully secure — it is vulnerable to hackers’ attacks. So, if you want to protect yourself, try to find a service with a small period of the provision of funds.
Show a list of popular cloud mining services below:
· instant connection
· instant withdrawal
· detailed statistics
· fixed cost
· power distribution
· mine alternative cryptocurrencies
· get daily payouts
· official reseller of industry
· the newest ASIC chips
· 100% uptime guarantee
· payout is based on overall network hashrate
· daily payout
· 24×7 Customer Support
· affiliate Program
Let’s talk about Amazon’s experience in mining.
Amazon’s Elastic Cloud Computing (EC2) was popular for the mining of cryptocurrencies based on scrypt algorithm. Amazon offers prepaid rates for the year or postpaid use, but it became more profitable to use Amazon EC2 spot instance lately. It means, if Amazon has free processing power, it can offer it to someone, who is ready to pay the highest bid. In general, this way of mining is cheaper than standard rates, but less predictable: if today you were given the power, it doesn’t mean that tomorrow the situation would be the same.
Cloud mining is specially for those, who doesn’t want to build the farm and purchase noisy equipment. Investment in such services can be compared with purchasing stocks, but analyzing its positive trend cloud mining has a low risk. However, cloud mining expects the crisis. When remuneration level decrease to 12 BTC per block, the work of such companies may become unprofitable.
p.s. during the gold rush manufacturers of shovels earned more money than someone else…..