Ethereum, since its founding in 2013, continues to be the most valued cryptocurrency after the most powerful Bitcoin.
The value of the coin is upgraded with the founding of each new block through the method of mining. Mining is not an easy process and can be achieved only through solving complex mathematical problems and puzzles. It is a Proof-of-Work (PoW) task.
On the successful completion of mining, the block will be added to the Ethereum network and the miner will be rewarded with ETH tokens for finding and validating the block.
Steps to be Followed for Ethereum Mining
Ethereum mining is a capital-intensive project due to the large-scale effort needed to accomplish the task. It is important to know the steps involved in Ethereum mining to ensure the success of the mission.
1. The primary prerequisite for starting the Ethereum mining process is that you set up an Ethereum-compatible crypto wallet. You can choose from Trezor One, MetaMask, Ledger S Nano, Exodus, or Mist.
2. The second most important requirement for Ethereum mining is powerful hardware support. Mining requires advanced, high-power systems to complete the process. You may be required to invest a high amount in equipment costs.
Graphics Processing Unit (GPU) based computer systems are more viable than Central Processing Unit (CPU) based systems. The hardware should also have an efficient cooling system as it tends to heat up due to the continuous process.
You also need to ensure a high-speed internet connection and electricity supply throughout the process.
3. The third important prerequisite to ensure smooth mining of Ethereum is the selection of a mining strategy. The three most popular mining strategies are explained below.
- Cloud Mining: In cloud mining, you seek the help of a mining company that provides you assistance in the whole process for a fixed fee. You can choose this method if you don’t have the means to afford the equipment costs.
- Pool Mining: Pool mining involves pooling the resources that different miners have in hand. The rewards are distributed according to the hash power provided by each miner.
- Solo Mining: As the name suggests, in solo mining you mine blocks by yourself, using your resources, without having to share the reward with anyone else.
4. The next important requirement is mining software. A few of the most preferred mining software are:
- Go Ethereum
- Minedollars
- MineGate
- Cudo Miner
- Easy Miner
- Ethermine
- Phoenix Miner
- Kryptex
- NBMiner
- GMiner
5. After all the requirements are set up start mining. Once the mining process is completed and a new block is added to the blockchain, you will receive rewards.
If you are a solo miner then you are the sole authority entitled to receive all the rewards. If you have used pool mining resources, the pool will pay you relevant rewards periodically.
In the case of Cloud mining, you will given rewards after the platform retains a certain fee for its services.
What are the New Developments in the Realm of Ethereum Mining?
Ethereum mining was initially done through the Proof-of-Work consensus mechanism, but of late, the process has been shifted to the Proof-of-Stake model.
Mining of ETH tokens in the sense it used to be done is not in use now. The miners on the traditional Ethereum platform are now gaining profit by staking ETH and validating the nodes.
Ethereum has branched to many forks in the past years, some of which still support the traditional way of mining. Some of the forks that can be mined using the Ethereum equipment are:
- Ethereum Classic (ETH)
- EthereumPOW (ETHW)
- Zilliqa (ZIL)
- Canxium (CAU)
- MaxxChain (PWR)
The altcoins that can be mined using the Ethereum mining equipment are a profitable way for ex-miners or owners of the equipment to make use of them.
If you still want to mine the original ETH coins, it is only possible through staking the coins on the ETH platform.
The Bottom Line
Ethereum mining is a solid way of maintaining the competence of the platform in the market.
In the changed scenario, the same level of profit can be made by staking ETH tokens. The veteran miners can also use their equipment to mine other profitable fork coins of Ethereum.
As long as the relevance of cryptocurrency prevails, Ethereum mining and staking and other innovative technologies to keep the platform alive will thrive strongly.
