✔️ Information reviewed and updated in December 2023 by Eduardo López
One of the options available to obtain cryptocurrencies is mining. This complex and resource-demanding process has gradually become accessible to users. An example is cloud mining, the arrival of cloud technology.
That is, The cloud has made it possible to modify the concept of mining as we know it so that today, it is possible to carry out Cloud Mining. If you don't know what that is, don't worry, here we tell you what this innovative way of obtaining cryptocurrencies is about by validating blocks.
What is cryptocurrency mining?
Cryptocurrency mining is a process in which a series of algorithms and mathematical problems are solved in order to validate blockchains. In this way, each valid block is added to the Blockchain and you receive your reward, a cryptocurrency.
Although it seems simple, in reality this is very complex, since it requires a great capacity for data processing. As usual, RIGs are used, which are a kind of computer made up of a motherboard, graphics cards, a processor and a power source to be able to solve these problems mathematicians.
✨So what is cloud mining?
Cloud Mining is considered the most recent and surprising innovation in the field of cryptocurrency mining. This is because the use of the cloud to mine virtual currencies completely changes the map.
It will no longer be necessary to have a large number of graphics cards to mine since now it will only be enough to have access to the cloud to be able to take advantage of this process. Thus, In addition, mining becomes much more accessible because now you can do it without having to invest in your infrastructure.
✨How does cloud mining work?
Cloud mining has a major change in the way it relates directly to the user. And here you have to connect to an internet platform instead of having to do it to your hardware.
Although the mining process is basically the same, what changes is the infrastructure because you will not be using your infrastructure but that of a provider. Thus, It seeks to offer an alternative solution to traditional mining, thus guaranteeing that more users can perform these tasks.
✨Advantages of Cloud Mining
- Multi mined: One of the great advantages of Cloud Mining is the fact that this system allows you to use several clouds at the same time. That's how it is, You can simultaneously mine several cryptocurrencies so that you can generate more profits in less time.
- You do not have to invest in infrastructure: Another great advantage of cloud mining is the fact that it does not require an initial investment. That's how it is, no need to invest in expensive computer hardware and equipment, since Cloud Mining puts its own infrastructure for you to work on it.
- Accessible rental costs: Although the cost of the rental depends a lot on the mining potential and the cryptocurrency itself, the costs are usually much lower compared to investing in graphics cards and paying for electricity. In this way, the returns are usually higher.
- Easy connection: Finally, you should know that the connection process is very simple, since you only have to enter the platform and that's it. This makes everything much easier, as you can mine from your own computer just by accessing the internet.
✨Disadvantages of Cloud Mining
- Time: Cloud Mining may take a little longer to run than conventional mining. This can be risky if we add it to volatility, since at any moment the price can go down causing the mining operation to result in losses.
- Cloud shutdown: In addition, you should know that your mining depends on a third party, who is responsible for renting the cloud to you. If the platform closes overnight, you will not only lose your cryptocurrencies but also the possibility of continuing to mine. Added to this is the risk that there are still no regulations for these platforms.
✨ Is it profitable to operate in Cloud Mining?
The profitability of cloud mining depends on multiple factors that must be independently analyzed to determine whether or not it is worth using this system. Next, we will tell you more about each of these factors.
- Power: The first thing to assess is power, since the more powerful the cloud and its infrastructure, the greater speed and mining capacity it will have. In other words, The more powerful it is, the more cryptocurrencies we can generate in much less time and with fewer resources.
- The cryptocurrency: Another point to consider is the type of cryptocurrency to be mined, since this will greatly influence profitability. Virtual currencies with more value and less volatility tend to be more profitable than those that have little value or that change rapidly in prices. We must also consider the volume of coins generated.
- Cost of operation: Finally, another factor to consider in determining whether it is worth operating or not is the rental cost. And is that Each platform has its own operation or rental cost which we must contrast with the cryptocurrencies that we are going to generate.
✨ Is it advisable to operate in Cloud Mining?
Although it may be attractive, in reality we must take into account that here, we are not directly miners. Rather, We pay a certain amount and after a certain time, we recover the investment and the cryptocurrency, but with the risks that this entails.
The best way to invest in cryptocurrencies is, without a doubt, to invest in them directly by buying or exchanging them. For it The ideal is to open an account in a platform or cryptocurrency broker, so you will be the owner of these currencies and not only try to mine them to obtain benefits.