Cloud mining or Cloud Mining is the most popular trend this period in the world of digital currencies and blockchain, and cloud mining is witnessing a very large growth and popularity.
This type of cryptocurrency mining has been able to overcome all the problems of traditional mining - we will talk about it shortly - and it did not stop there, but it has provided many other advantages.
The reason we are writing on this topic is that it is a huge revolution in the world of mining, and it helps beginners to enter into a very powerful and profitable field, which is the field of cryptocurrency.
In this article, we will provide you with everything you need to know about cloud mining, its advantages and disadvantages, its types, how it works, and many other information.
What is cloud mining?
Cloud mining is a type of cryptocurrency mining, which is based on cloud computing where you perform mining operations, but remotely.
You may think that this type of mining is relatively new, but on the contrary, it dates back to the beginnings of digital currencies, but it flourished more after the spread and popularity of digital currencies, especially Bitcoin .
Before getting to know more about cloud mining, I think it's best to quickly go through the other types of mining:
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1. Solo Mining
This type of mining is the traditional mining that we all know, where an individual mines his cryptocurrency on his own without relying on any other person or company.
The problem with this type of mining is that it needs a lot of technical knowledge because you will be the first responsible for dealing with mining hardware and software.
In addition, you will have to maintain the devices periodically, ensure that they have electricity around the clock, and you are responsible for monitoring them throughout their operation.
It is also expensive because you will have to buy mining hardware, which is usually very expensive, and you will need to prepare your home or room for mining operations and hardware.
There are some side issues as well, such as the constant noise of the devices, the extremely high electricity consumption, and the excessive heat that these devices produce.
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2. Pool Mining
A mining pool is a group of people who mine digital currencies, who decide to combine all their computing power and capabilities through a network, with the aim of increasing the efficiency of their mining process.
After the process of mining and obtaining digital currencies, each of them takes a percentage of what they have mined according to their share of their computing power, or the so-called Hash Rate.
Although some may think that this type of mining is very similar to cloud mining, this is not true at all.
In the mining pool you have to own your own Mining Rigs, with which you will participate in the mining process with other people in the same network.
In cloud mining, you rent this equipment from the company, and you assign the company all the necessary operations and maintenance.
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3. CPU Mining and GPU Mining
The point of difference between these two types is the hardware used for mining cryptocurrency, as it may use CPUs or GPUs.
Of course there are a lot of differences regarding pricing and efficiency between these two types, but this needs a separate whole article to talk about them.
If you want us to write in detail about these two types of mining write us in the comments.
And the last type that we're focusing on today is cloud mining.
You can think of it as Google Drive - or any other cloud storage platform , but for mining, instead of storing your files on your computer and uploading them to the cloud, that's the thing with cloud mining, instead of doing the mining yourself you do it remotely in the cloud.
All mining equipment is located in a company location, and is operated, maintained, and maintained by specialists in order to operate effectively.
This way you won't have to worry about any breakdowns, power outages, or even the extreme noise and heat that these devices produce.
Cloud mining is a very good option for beginners, because you will not need any technical expertise and you will not have to pay huge amounts of money to buy mining hardware.
In cloud mining you are renting mining hardware or you are renting hash power that is mining.
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How does cloud mining work?
Cloud mining works as well as traditional mining, with devices on corporate premises performing the complex mathematical operations of cryptocurrencies.
But there are three basic types of cloud mining that show how cloud mining works:
1. Leased Hashing Power
In this type of cloud mining you are renting computing power or hash power through which the actual mining process takes place.
You will find contracts of this type measured in units of hash strength, such as: giga hash per second GH/S or tera hash per second TH/S, and this unit expresses the ability to perform mining operations, the higher the ability, the more likely you are to find digital currencies.
And you will take your percentage through the digital currencies that are obtained from this computing power, without the need to possess any technical skills or own the hardware.
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2. Hosted Mining
Hosted mining is the type of cloud mining in which you rent or buy a number of mining hardware and equipment, so that the company operates and maintains it for some additional expenses.
This is the most profitable type of cloud mining, but it is also the most expensive among the others, and it remains less expensive than Solo Mining.
The equipment rental option is the most popular among the crypto mining community, which is often referred to as cloud mining or the traditional form of it.
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3. Virtual Hosted Mining
This type of cloud mining is somewhat similar to traditional hosting, but it depends on you installing certain control software and renting virtual servers that do the mining.
The difference in this method is that you need a large technical background in order to manage and control virtual servers and mining tools, and this method may be less profitable than the previous methods.
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Advantages of cloud mining
There are many advantages that cloud mining has over traditional mining, the most important of which are:
1. You will not need to buy expensive mining equipment and will not put it in your home
In cloud mining, you will rent mining equipment or power from the company or the site you are dealing with, so you will not need in any way to buy this expensive equipment and you will not have to prepare and prepare your house in order to suit it.
2. You will start earning right away
You will start mining from the moment you buy a contract, lease computing power or mining, and the profits will start falling on you immediately.
3. No need to worry about operation and maintenance
The cloud mining company that you deal with will prepare all the matters related to the maintenance and operation of the devices, and you will not even need to care about this matter, so you will be able to live your life the way you want, while you are mining cryptocurrencies.
You will also not have to worry about any hardware problem, no crashes, failures, or anything else, as the company will take care of all these technical matters.
4. Don't worry about noise, heat or lack of space in your home
With cloud mining you will in no way have to deal with the annoying loud noise of mining hardware, not even the huge heat generated by it.
Also, you will not have to adjust the arrangement of the house in order to make the right space for these mining rigs, isn't that great?
5. You won't have to worry about electricity consumption
Mining devices consume a lot of electricity, which raises the electricity bills of the people who are mining, and therefore with any increase, even a slight increase in unit prices, it will cost you a lot of extra money, but do not worry with cloud mining companies you will not have to worry about this.
6. A source of passive income
After all we have said about cloud mining, it will become clear to us that cloud mining is a very important source of passive profit that everyone should pay attention to. It is one of the very profitable ways to invest money online .
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Disadvantages of cloud mining
Yes, cloud mining disadvantages, nothing is 100% perfect and there are certainly several disadvantages to this investment:
1. Theoretically the profits are lower than single mining
The cloud mining company that you deal with, takes a certain amount or a percentage of the profits for all the services they provide to you, so in theory mining by yourself will be more profitable for you.
However, this is not true on the ground. For individual mining, you need to purchase expensive mining equipment and devices, in addition to the expenses of electricity, maintenance, cooling and others.
2. Lack of or lack of control when dealing with some cloud mining companies
When dealing with some cloud mining companies and site, you will find that they do not give you the full control you want over the mining capabilities you have purchased, which is a huge disadvantage for some customers.
3. Deception and fraud
This defect is the most important and influential defect regarding cloud mining, as there are a lot of sites and companies that deceive customers and take their money and close the site.
Unfortunately, this is very common in cloud mining companies, according to some experts, more than 90% of these companies are fake companies running Ponzi schemes and cheating their customers.
Therefore, you should take your precautions in order to choose the reliable companies that you deal with, so as not to lose your money. In the next part, we will give you a set of tips to help you choose the right cloud mining company for you.
Important Tips for Choosing a Cloud Mining Company
1. If the sites or companies give exaggerated offers, then they are undoubtedly fake, as they say in English Do your Math.
2. Do not believe what is written on the website of these companies or their social media pages, and instead see reviews in forums, groups and sites interested in mining.
3. Make sure that these companies or websites have real and legitimate headquarters, to ensure that they are genuinely operating and are not fraudulent companies.
4. Do a little research about this company, and do not rush to make the decision to deal with it.
5. Make the initial calculations, and make sure that the numbers they show are realistic, and at the same time not unfair to you.
6. While doing the calculations, do not forget to add maintenance, operating, rent, electricity, cooling, software, and other legitimate matters that may reduce mining returns somewhat.
7. If the company does not adequately disclose itself, its employees, and its owners, then it may not be the best option to deal with it.
8. When purchasing a contract from different companies, make sure that you read and fully understand all parts of the contract before signing it.
In general, if you take these steps, you will find a lot of reliable companies, which you can deal with and you are assured, and we have published a previous article about the 5 best cloud mining sites , and I strongly advise you to look at it.
If you have any question regarding fake cloud mining companies scam or any other point we mentioned in the article, you can easily mention it in the comments, and we will get back to you.
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Cloud mining is a very special type of cryptocurrency mining, with which you can enter this vast world with the lowest possible costs and skills.
It is based on renting you as a client for mining equipment or mining capabilities, which are concerned with all the technical details of the companies that deal with them.
You don't have to monitor appliances, put up with the noise and heat they emit, and you don't even have to worry about regular maintenance or cooling.
That is why many people are starting to invest in cloud mining, especially those who do not have the economic capabilities nor the necessary technical knowledge.
There are a lot of advantages of cloud mining that we talked about, but before making this decision you should also look at the disadvantages and challenges.
Especially the problem of the presence of many fraudulent companies, and in this article we have provided you with some tips and steps that will enable you to choose reliable companies to deal with, in addition to that we wrote a previous article about the top five reliable cloud mining sites.
In the end, I strongly advise you to start investing your money, whether in digital currencies, mining, or other ways of investing and making money from the Internet.