Depending on how long you have been following the crypto agenda, you may have wondered about cryptocurrency mining or tried it for yourself. The rumors of the so-called ‘bitcoin mining gold rush’ drew lots of enthusiasts to mine bitcoin in its early days. Its market price rapidly grew together with the adoption rate. Mining rewards were high while the mining difficulty was moderate. You could mine at home from your PC and many had their own compact farms in a garage or a basement.
Beyond Hardware Mining
Then the industrial giants came in. Mining difficulty increased and individual mining became unprofitable. Energy demands exceeded the maximum rate of consumption that a standard household could provide, unless you had access to use free energy of course.
In some countries crypto mining is illegal and punishable. For a non-techie user, buying cryptos today is way cheaper than mining it. In the midst of it all, cloud mining emerged and became a median between industrial hardware mining on farms and individual mining.
The main advantage of early stage cloud mining for the end-user was, first of all, ease. No need for investments in specialized equipment. No extra costs for electricity because you rent the energy (hashing power) remotely. The core disadvantage though was low profits or none at all if the company turned out to be a fraud. The number of fair players on the market today is still quite low.
How It Works
Cloud mining services are generally hosted by companies that own mining farms – warehouses stacked with mining equipment. They rent out the mining power that the hardware equipment generates to mine crypto. People purchase mining contracts bound by time or amount of hashing power. The more hashing power you have – the more you mine and the greater the ROI. An algorithm automatically defines which coins are most profitable to mine at a given moment in time. From the user’s perspective, the whole setup is pretty simple.
The Next Evolutionary Curve
What’s interesting about cloud mining today is it has established itself as a form of investment with flexibility, profitability and ease for the average person. There are companies in the market that even offer tailored plans. Take MiningFriendly, for instance, run by Swiss veteran trader Jürg Richards, who has 30+ years experience in tech and finance. The company has 12 farms in various locations around the world including Europe, Asia and the Americas. Last year, with a group of co-authors, Jürg published a whitepaper dedicated to an automated trading algorithm. MiningFriendly utilizes a new, groundbreaking evaluation method to mine the “right” coins and to sell the daily mining profits on an exchange for fiat. Profits are calculated independently of cryptocurrency fluctuation.
MiningFriendly appears to be a perfect solution to the conflict between individual miners and the giants who earn most of the profits. With MiningFriendly, the entry level is low and no technical skills are required. You simply create an online account and make a deposit based on the plan selected. The first returns are available in a week’s time. Techies will also appreciate the high profitability with minimum effort. Who wouldn’t, right?
The core strength of the service is the mix of the best practices applied; professionalism and very well-thought out processes of traditional finance and business management on the one hand plus the latest of trading, tech, mining and crypto trends on the other to deliver strong performance and high returns. To mine with MiningFriendly, you don’t even need to understand what a ‘hash rate’ is. It’s that simple.
Jürg’s mining portfolio leans heavily towards the use of the proof-of-stake (POS) method due to energy-efficiency. This is no surprise, especially in view of the Ethereum’s latest Constantinople fork and switch to POS. However, POS is not the only choice of MiningFriendly. Their operation combines proof-of-work (POW), POS and Masternodes (MN) in the company’s so-called ‘portfolio mix’ strategy.
POW Mining In Brief
The proof-of-work mining method has existed since the inception of bitcoin (2009). It consumes immense amounts of energy for computations to solve mathematical puzzles. As a result of this process, more cryptocurrency coins (e.g. bitcoins, litecoins etc.) come into circulation. The computational power first solves the puzzle to receive the reward. Since giant mining farms have flooded the market, they compete for highest profits amongst themselves, offering little chance for an individual miner to mine profitably using this method.
POS Mining In A Nutshell
The main differences between POS and POW mining is a different consensus mechanism and fairer reward distribution. POS takes less time, consumes less energy and solves the problem of trust within the network in a more efficient way. The individual who creates the block is chosen automatically based on his/her wealth (stake) and the security of the network is much higher.
Masternodes Method
Masternodes are servers in a decentralized network. They perform various functions and receive bulk rewards per block. Depending on the particular network, rewards can be distributed one or more times per day. In MiningFriendly’s case, rewards happen daily. What’s more, Masternodes generate additional income through transaction confirmations.
MiningFriendly’s Approach
The company’s R&D and management is located in Switzerland with its headquarters in Norway. The company’s has a strong focus on research and development and screening the market to evaluate new coins and technologies. According to Jürg, the company is not bound by any specific mining method, technology or long-term energy supply contract. Instead, it embraces the most profitable mining solutions available.
As an example of MiningFriendly’s masternode evaluation system, their portfolio is divided into tiers. Tier 1 coins are the ‘must-have’ and over perform the market while also offering stability and high capitalization. Tier 1 coins are accumulated when new money comes from mining rights. Tier 2 coins are held. If a Tier 1 coin slips down to Tier 2 status, it’s no longer accumulated but held until it’s re-evaluated to see if it moves back to tier 1 or sold. Tier 3 coins are the “young and wild ones”. These are bought occasionally to set up masternodes based on their potential. Finally, Tier 4 are the coins are left out, either due to underperformance, lack of liquidity, low market capitalization or a combination of all of the above.
An important aspect of MiningFriendly’s approach is that re-evaluation happens on a daily basis and they do not stick to a single mining method or technology. They constantly adapt to the evolving crypto market while keeping the same evaluation system as a constant throughout the entire mining process.
MiningFriendly offers cryptomining-as-a-service (CaaS) for everybody, requiring no previous technical knowledge whatsoever while also explaining its services in detail, providing customers with the comfort and trust they look for when considering buying services like this.
Disclosure: This is a sponsored article.
Image(s): Shutterstock.com
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