Crypto mining refers to the process of validating and recording transactions on the blockchain, for which miners are rewarded in digital currency.
This article provides what crypto mining is, its profitability, and the best cryptocurrencies to mine in 2024.
What is Crypto Mining?
Crypto mining requires solving complex computational puzzles to verify and record transactions on the blockchain. In return, miners are rewarded with cryptocurrency for their computational effort.
Mining cryptocurrencies requires significant resources and may involve using expensive rigs. Users can utilize specialized integrated circuits or rent cloud space for crypto mining computations. Cryptocurrency mining is measured by how many hashes a system can generate per second.
Mining is crucial in securing cryptocurrencies by adding new coins to circulation and ensuring their safety. This process allows cryptocurrencies to operate as a decentralized peer-to-peer system without relying on third-party regulation, as it verifies and protects the blockchain. Miners are also incentivized to contribute their computing power to the network, enhancing the system’s overall security.
Top Cryptocurrencies to Mine in 2024
1. Bitcoin
Bitcoin mining involves participants, known as miners, who validate transactions to ensure network security and earn rewards in the form of Bitcoins. This process creates new Bitcoins and keeps the network secure by validating transaction blocks. New coins are created due to mining, and miners receive this reward for keeping the network secure. In technical terms, bitcoin mining uses hardware processing power and software to solve complex algorithms, earning bitcoins as a reward. An ASIC, a crucial component for practical mining, can cost from $5,000 to $10,000.
As of 2024, Bitcoin miners can earn 3.125 BTC per successfully validated block. The earnings depend on their hash rate, which measures the computational power dedicated to solving Bitcoin's mining algorithm. A value reduction of half will take place every four years, or every 210,000 blocks, for the reward. As the Cambridge Bitcoin Electricity Consumption Index estimates, Bitcoin mining uses 176 TWh of electricity per annum, similar to the Netherlands or the Philippines.
2. Litecoin
Litecoin was developed in 2011 due to a fork in the Bitcoin network. It was initially conceived to address the developer's worries that Bitcoin was becoming too regulated by a central authority and to make it more challenging for large-scale mining companies to obtain an advantage in mining. The cryptocurrency has been remade into a minable coin and a peer-to-peer payment system, even though it was ultimately unsuccessful in stopping commercial miners from taking over most of the mining for Litecoin.
While Litecoin was initially designed to resist ASIC miners by using the Scrypt algorithm, ASICs eventually became capable of mining Litecoin efficiently. By 2024, the most effective way to mine Litecoin is by using ASICs that support the Scrypt algorithm, often within a mining pool for better profitability.
By 2024, the best approach to mining Litecoin will be to use one or more ASIC miners that support the Scrypt algorithm. However, joining a mining pool is still necessary, as you are against more efficient hashing pools.
3. ZCash
ZCash is an open-source cryptocurrency that operates on a decentralized blockchain. It uses advanced applied cryptography to increase security and privacy through shielded addresses. In the beginning, it was built using open-source code comparable to Bitcoin.
Z-addresses and t-addresses are the two varieties of wallet addresses available in Zcash. A private address is referred to as a z-address, while a transparent address is referred to as a t-address. The addresses are compatible, and users can select the type of address they wish to use for each transaction.
Zcash depends on cryptocurrency mining to add transactions to the blockchain and mint new tokens. ZCash employs a proof-of-work mining algorithm that requires miners to solve complex cryptographic equations to validate transactions. The first miner to solve these equations is rewarded with newly minted ZCash.
4. Dogecoin
Bitcoin and other cryptocurrencies entering the market led to the creation of Dogecoin (DOGE). Initially conceived as a meme, Dogecoin has since become one of the significant cryptocurrencies.
However, Dogecoin has added enhancements, such as low transaction fees. It is also backed by a community known as the ‘Doge Army. ’ In 2021, Dogecoin ranked as the ninth most popular cryptocurrency. Its proof-of-work method allows it to be compatible with networks not relying on Scrypt. This makes it capable of functioning. When mining Bitcoin, Dogecoin requires much less power as it uses the Scrypt algorithm.
Graphics cards are used since the Scrypt mining method is used for Dogecoin mining. Mining Dogecoin requires downloading software such as CGMiner or EasyMiner, which should be installed on a computer with graphics cards like Nvidia GeForce.
5. Filecoin
Filecoin is a decentralized storage network that operates using a cryptographic protocol. This protocol guarantees that any file saved on the network is safe despite being easily accessible to users.
Like any other cryptocurrency, Filecoin storage costs are not unusual and change based on the cryptocurrency's supply and demand. Because Filecoin provides an open data storage market, storage costs are lower than those of centralized systems.
When users want to store files, they must pay storage providers, often called storage miners. Storage providers are responsible for storing files and ensuring they are accessible and properly stored. In addition to providing storage and retrieval services for consumers, storage providers also help secure the Filecoin network and get paid in block rewards. The more storage providers add to the Filecoin network, the more FIL they earn.
To mine Filecoin, you must participate in a consensus technique known as Proof of Space-Time, made possible by specialized hardware known as Filecoin Miners. Filecoin miners must be ready with fast storage devices. Mining operations are managed using the Lotus software, which coordinates the storage and retrieval tasks that Filecoin miners perform.
6. Ethereum Classic
In the wake of a contentious hard split, Ethereum Classic prioritizes immutability and decentralization, representing the preservation of the values present in the original Ethereum network. As a result of its GPU-friendly architecture, Ethereum mining continues to be freely available to a diverse group of participants.
Mining tools such as Claymore's Dual Miner and PhoenixMiner facilitate efficient mining operations on AMD and Nvidia platforms. This makes Ethereum Classic a versatile choice for miners with various hardware configurations. Users will need a GPU rig with AMD or Nvidia graphics cards and popular software for mining ETC, such as PhoenixMiner and GMiner.
7. Monero
Monero (XMR) was one of the first to implement encryption, offering significant improvements in privacy and fungibility compared to other potential alternatives.
The primary factor that set it apart from similar systems was that it enabled users to send and receive transactions without making this information accessible to anyone investigating its blockchain.
In addition, this alternative cryptocurrency network was developed to prevent the creation of ASICs exclusive to Monero. As a result, it is an excellent choice for mining using a personal computer at home.
To get started, you must first download a wallet to store your coins. Using the official Monero graphical user interface client is strongly suggested. Downloading mining software compatible with Monero, such as MultiMiner, is the next step after completing this step. Many more options are available online, but MultiMiner is one of the most user-friendly mining solutions. After mining Monero, you can use a cryptocurrency exchange to trade it for other currencies like Bitcoin or Ethereum.
8. Ravencoin
Ravencoin is software that encourages a network of computers to operate a platform for creating and managing a new category of crypto assets. This protocol simplifies creating and transferring tokens representing real-world assets such as equities, collectibles, gold, event tickets, or airline miles.
Ravencoin originated as an open-source fork of Bitcoin's software. Its team utilized Bitcoin's code and updated it to incorporate extra features to accomplish other objectives.
One notable advantage of Ravencoin is that its mining algorithm does not require costly application-specific integrated circuits (ASICs). While Artificially intelligent computers (ASICs) have gained popularity for mining cryptocurrencies like Bitcoin, their high cost makes specific coin mining inaccessible to those with limited initial capital.
Mining Ravencoin provides an alternative that is more accessible in terms of cost than other options. You can mine using a central processing unit (CPU) or a graphics processing unit (GPU), which are much more affordable than ASIC miners. Early on, the central processing unit (CPU) was sufficient for mining due to lower computational demands. However, a GPU is necessary for modern mining because it excels at quickly performing complex calculations.
Is Crypto Mining Still Profitable in 2024?
Crypto mining can be profitable if the eligible conditions are in place. Nevertheless, no accurate method can determine how much money you will make from mining.
Mining in 2024 requires significant upfront investment, particularly in ASIC hardware and electricity costs. Profitability is highly dependent on factors such as cryptocurrency prices, mining difficulty, and local energy prices. For miners with access to low-cost electricity, mining can still be lucrative, especially when the price of mined coins increases. Additionally, alternatives like cloud mining may offer a less capital-intensive entry point, though they come with lower control and potentially lower profitability.
When prices are low, however, your profit margins will be smaller than they would otherwise be. Additionally, you must take into consideration the difficulties of mining. As a result, you will want additional hashing power to compete correctly when there is a higher level of competition. Conversely, when mining is lower, there is less competition, which improves your chances of success.
The only costs to consider are those that will be minus your mining profits, and only if you successfully mine a Bitcoin block will you receive 6.25 BTC, and the transaction cost paid by senders for the appropriate block will be sent to you.
Additionally, it is feasible to mine without purchasing any equipment. As an illustration, cloud mining is gaining more and more popularity. In the end, although mining can be rewarding, you should still consider the risks. You can incur financial losses if you do not have the appropriate mining setup or your devices are not operating efficiently.
How to Trade These Tokens on CoinEx
CoinEx is a global cryptocurrency exchange trusted by 5+ million users worldwide and has 100% reserve. Users can now trade quickly and seamlessly with its 900+ supported tokens, including the mentioned meme coins.
To purchase any token on CoinEx, follow the steps below.
- Sign up for an account: Create a CoinEx account first.
- Log in to your account. Now, fund it using deposit methods or cryptocurrencies. With funds in your account, you can quickly complete deals.
- Go to the Trading Page for the Token: Once your account is funded, proceed to the specialized token's trading page on CoinEx. Use the search box to find your preferred token.
- Choose a Trading Pair: Select the desired trading pair that matches another cryptocurrency. For instance, you may choose to trade XMR/USDT.
- Specify the Purchase Amount: Determine the quantity of the tokens you want to purchase. Input the amount in the trading interface, which will calculate the corresponding cost based on the current market price.
- Execute the Trade: Execute the trade with the specified amount. Confirm the details, and if you are satisfied, submit the order.
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