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Bitcoin mining has moved on to large-scale operations but there are strategies for individuals to earn money still.
The days of mining Bitcoin in your bedroom on a desktop computer are long gone. It used to be that a small network of staunch Bitcoin supporters would mine the cryptocurrency on individual systems, more as a hobby than anything else. But as time went by, this became more and more of a challenge.
At the end of 2009, the Bitcoin hash rate was 8 million times per second. By the end of 2010, it had grown to 116,000 million times per second. During 2014 the network surpassed 10,000,000,000 million times per second. Needless to say, by this point, it had already become nearly impossible to mine Bitcoin profitably from your personal computer.
Small-scale mining challenging
The hashing power of the network increased exponentially over time as more and more people started to mine. This meant that mining became increasingly difficult, requiring ever more powerful computing capabilities to take on the complicated algorithms. Powerful hardware cost a lot of money, and that is the first challenge when it comes to mining. Even for an entry-level machine that will be able to cope with the complex calculations, you can expect to fork out a few thousand dollars (including cooling systems).
However, the likelihood of successful mining with an entry level machine is slim at best. Most serious miners spend tens of thousands of dollars on strong hardware that can compete with other miners on the network. In fact, Bitcoins are now mostly mined in mining pools, with huge data centers running the latest mining hardware. This state of the art hardware is extremely power-hungry, and electricity bills escalate into the thousands.
Big mining pools take the electricity factor so seriously that they do one of two things: either move to operations where electricity is cheap, like China, or to colder countries, such as Iceland, were running powerful data centers are more energy efficient. It is therefore clear that, without economies of scale, it is impossible for individual miners to compete profitably in the current Bitcoin mining market.
Mining isn’t the only option
If you are absolutely set on mining, a good strategy is to mine altcoins, which have lower barriers to entry but a relatively good value against Bitcoin. Your mining efforts are likely to be more profitable, and once the specific token goes up in value you can trade it for Bitcoins. You can also directly invest in altcoins, without mining, and do the same. Wait for the price to go up and then trade it for Bitcoins. The money you save on mining equipment can be spent on additional tokens.
Another strategy is to hold or stake a token. There are a number of coins on the market that will actually compensate you for holding onto a coin for a period of time. Similar to getting paid dividends, token holders will get paid for helping to preserve the security of the network through Proof of Stake mechanisms. This will increase your holding of a specific coin over a shorter period of time, giving you the opportunity to trade against Bitcoin in the short-term.
The value of Bitcoin is close to its all-time high at the moment and investing directly in the cryptocurrency can be risky and costly. An indirect investment route through altcoins with better growth potential can mitigate both the cost and the risk.
Easy to achieve on one platform
BitConnect is self-regulated, decentralized financial system based on Blockchain technology that provides potentially profitable Bitcoin solutions through multiple investment opportunities.
They offer BitConnect Lending, which allows users to invest or lend Bitcoins through the BitConnect coin (BCC). Investors will profit from the BitConnect Trading Bot and Volatility Software, paying out daily interest earnings.
It also offers a referral bonus program, paying out Bitcoins to members who refer other users to the BitConnect Lending platform.
Other investment opportunities include:
- Staking. BitConnect token holders can earn up to 120% annually by investing in tokens and staking them in a Bitconnect-QT wallet (also known as PoS minting).
- Coin Trading. This option relies on potential fluctuations in the BCC token where it can be bought and sold at different prices in order to maximise profits over the BCC Exchange.
- Coin Mining. BitConnect mining is much easier and less costly than Bitcoin mining and does not require ASIC hardware. Instead, it can be mined with significantly cheaper CPUs or GPUs.
High adoption rate
The platform has one of the largest offline communities compared to other cryptocurrencies, providing education on digital tokens all over the world, including the BitConnect Annual Ceremony Event.
In a first for the crypto community, they released a music video album to raise awareness of the potential benefits and opportunities cryptocurrencies afford investors and users. BitConnect has also seen a high adoption rate among cryptocurrency enthusiasts, with one of the highest mining hash rates for Scrypt cryptocurrencies.
Various unique aspects of the network that contribute to the adoption of the BitConnect coin include:
- BCC has seen an exceptional growth rate, equal or better to that of Ethereum in its first year of launch.
- The Bitconnect Trading Module enables users to trade Bitcoins directly with each other.
- An escrow service team which will act as mediator in case of any disputes and determine an appropriate resolution.
- Quick and easy fiat to Bitcoin trades (and vice versa) through the BCC exchange.
- Trust mechanism guarantees the community stays secure and ensures user protection against fraud.
