Monday, 16 March 2015

Bitcoin Mining!

Hey guys!

Lately, I have been researching Bitcoin. Bitcoin is a cyber currency, which is  currency with no physical form. One Bitcoin is worth about £170 ($250). There are two ways that you can acquire Bitcoins, either a) buying them from a trader or b) mining them yourself. I went down the route of mining and here's how i did it:


Mining is how bitcoins are found - you set a computer or ASIC (Application Specific Integrated Circuit) up to constantly do the same set of sums, just with different numbers, and occasionally it will find a block (a group of 25 bitcoins). It is possible to mine either on your own, or in a bitcoin "pool". A pool is a group of people working together to mine bitcoins, and when a block is found, they divide the winnings up, dependent on their hashrate (The speed at which your device can do sums).

So first, i needed to set up a wallet. a wallet is the program that you can connect to, stored on your computer in the web, or other outside sources. I chose Coinbase, as it is very popular, but also is web-based, so even if your computer gets hacked or stolen, your money is still safe. I was a bit worried, as it asked for ID, but it is because, technically, your'e opening a bank account, so they need to make sure your'e you. 

I then had to decide, solo or pool mining? I decided pool, as solo mining is a) very hard to set up and b) extremely unlikely that you'll find any bitcoins. I chose to go with Bitcoin Affiliate Network, as they have 0%PPS (For every block found, they take none of the bitcoins, giving them all away) They also have a very high hashrate (~4Ph/S) So they pay out frequently, but you only get a small percentage of the money.

I found out, after creating an account with BAN, that they only accepted ASIC miners. I was a bit stuck, but then received one from a friend to borrow. It is only a USB Block erupter, providing only 1 Gh/S, but it is something to try. I st it up, the drivers were fairly quick to install, and then had to get my mining software. I used bfgMiner on my computer, as it was fairly simple to install, and then created a quick batch file to start up the miner. This is the bfgminer console:

I have been getting a strange "saw-tooth" pattern in my hashing power>>>

I calculated that with this miner, it would take 100 days to even make enough bitcoins for it to even PAY OUT! (0.0002 btc - approx. 4p (6 cents) )
This miner showed an average of about 1Gh/S, but i still had to have my computer on, that drew a lot of power, being very inefficient. That's that for this post, but I will be posting another post about the workings of Bitcoin, such as the block chain and how transactions work.

Make sure to keep checking here to see the latest tech news!


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