Ethereum Mining is a computationally in-depth work that requires a lot of time and processing power. A miner gets rewarded for providing solutions to challenging math problems via blockchain technology, just like bitcoin mining. Ethereum is the first ‘world computer’. It is a decentralized network that can be used by anyone and is capable of running applications with no possibility of downtime, censorship or fraud.
Ethereum Mining is open file, public, blockchain-based distributed computing platform, and software that includes good contract (scripting) practicality. It supports a changed version of Nakamoto accord via transaction-based state transitions. Ether could be a token whose blockchain is generated by the Ethereum platform. Ether may be transferred between accounts and accustomed to compensate participant mining nodes for computations performed. Like all cryptocurrencies, the future of Ethereum remains uncertain, but the tone of the conversation surrounding Ethereum is different than almost any other cryptocurrency.
Ethereum is one of the fastest growing cryptocurrencies next to Bitcoin, the native digital currency which has been taking the world by storm. Just a year and a half ago, the price of Ethereum was $1, now it is well over $300 with an all-time high of over $400. The rapid growth of Ethereum mining excited users who were eager not to miss out on another hyper-growth opportunity. The price of mining Ethereum is $29 per MH/s, reduced from the past rate of $44 per MH/s.
Ethereum provides a decentralized virtual machine, the Ethereum Virtual Machine (EVM), which may execute scripts using a global network of public nodes. The virtual machine’s instruction set, in distinction to others like Bitcoin Script, is believed to be Turing-complete. “Gas”, an internal transaction rating mechanism, is employed to mitigate spam and allot resources on the network.
History of Ethereum Mining:
Ethereum was proposed in late 2013 by Vitalik Buterin, a cryptocurrency researcher and programmer. Development was funded by an online crowd sale that took place between July and August 2014.
Ethereum was literally described in a white book by Vitalik Buterin, a programmer involved with Bitcoin Magazine, at the end of 2013 with a goal of building decentralized applications. Buterin had argued that Bitcoin required a scripting language for application development. Failing to realize agreement, he proposed the development of a new platform with a more general scripting language.
Ethereum was declared at the North America Bitcoin Conference in Miami, in January 2014. During the same time as the conference, a group of people rented a house in Miami Gavin Wood, Charles Hoskinson, and Anthony Di Iorio, a Torontonian who financed the project. Di Iorio invited friend Joseph Lubin, who invited reporter Morgen Peck, in reality, witness. Six months later the founders met once more in a house in Zug Switzerland, where Buterin told the founders that the project would proceed as a non-profit. Hoskinson left the project at that point.
How to Start Ethereum Mining?
- Choosing mining hardware:
Before getting started, you will need special computer hardware to dedicate full-time to mining.
There are two types of mining hardware:
GPUs boast a higher hash rate, meaning they can guess puzzle answers more quickly. At the time of writing, GPUs are now the only option for ether miners.
First things you need to do is to select the current best card for Ethereum mining and have it installed on your computer, especially the graphics card has a good cooling solution as the temperatures of your hardware will rise significantly while mining Ethereum. Once you are set up and booted into your operating system then it begins.
- Get Ethereum Mining Software:
First of all, find the best Ethereum mining software and install. For example – Claymore, CGMiner, Minergate, Ethminer, and Geth.
- Get an Ethereum Wallet :
Now get an Ethereum wallet. You can use any Ethereum wallet you like but some of them are Mist for desktop and TrustWallet for mobile.
- Join an Ethereum Mining Pool:
Now get an Ethereum mining pool. Some of the best are Mining pool hub, Nanopool, F2pool, Dwarfpool, and MaxHash.
- Transfer your Ethereum:
Transfer your mined Ethereum to the Ethereum wallet most mining pools will ask you for your Ethereum address when you set up your account but if not, you are required to manually send your Ethereum address.
How Ethereum Mining Works?
Ethereum uses the proof-of-work algorithm called “ethash” which is harder to mine when using an ASIC due to the algorithm requiring more memory.
When mining Ethereum the goal of the miners is to find a hash that matches the current target if they find a hash that does they are then awarded some Ether which is then broadcast across the network and copied to the ledger once it is validated by each node. The miners randomly earn these ether, and their profitability depends on luck and the amount of computing power they devote to it.
Approximately every 12–15 seconds, a miner finds a block. If miners start to solve the puzzles more quickly or slowly than this, the algorithm automatically readjusts the difficulty of the problem so that miners spring back to roughly the 12-second solution time.
As soon as the matching hash is found, then other miners stop mining on the current block and begin to mine the next block with the same process. On the other hand, it takes almost no time for others to verify that the hash value is correct, which is exactly what each node does.
The method of mining Ether is called “proof-of-work” as it is required to prove you have done the work of mining the block.
For each block of transactions, miners use computers to repeatedly and very quickly guess answers to a puzzle until one of them wins.
More specifically, the miners run the block’s unique header metadata (including timestamp and software version) through a hash function (which will return a fixed-length, scrambled string of numbers and letters that looks random), only changing the ‘nonce value’, which impacts the resulting hash value.
How to Build an Ethereum Mining Rig?
There are many ways of going about building the best Ethereum mining rig, the most import aspect being the graphics card, so begin there and find the best card that fit’s your budget. You can save money on the rest of the parts as you won’t be needing a lot of RAM or a Super CPU, the baseline is a Celeron dual-core CPU and about 4GB of RAM, you can also get away with as small of a hard drive as you can find as long as you can install the operating system and have some space for the miner software and the wallet that you will be using for your mining rig.
The following is a list of GPU’s to consider when mining Ethereum:
- AMD Radeon RX Vega series
- Nvidia GTX 1070
- Radeon R9 295X2
- Radeon R9 HD 7990
- AMD Radeon RX580
- Nvidia GTX 1080 Ti
Note: Don’t even attempt to try with the latest GPU’s, even though they produce better hash rates, they are just simply too expensive right now and are not profitable.