How does cloud mining work?

28 Sep 2017

Bitcoin cloud miningCloud mining is really useful for those who aren’t technically minded and don’t want to run their own software or hardware.

If you have very high cost electricity too – for example in Germany – then it’s a good idea to outsource your mining to somewhere where electricity costs are much lower as they are in America.

First you determine which provider you want to go with – have a look at our list of providers here and reviews.

Then you determine which deal you want to go for – whether it’s a 500GH contract or a 1000GH contract and for what term. Most Bitcoin contracts are for a year, however some can be infinite (although this might sound too good to be true as most machines will be obsolete 18 months if Moore’s law continues to be followed – which would mean the Bitcoin or litecoin mining company would be operating at a loss in the not too distant future assuming the rate of network hashing power continued to increase). There are some providers who offer shorter and intermediate length Bitcoin or litecoin contracts of between 6 Months and 24 months.

You can rank the cost per GH and the length of contracts here on our Bitcoin and Litecoin mining Comparison pages.

You buy your first a cloud mining contract with Hashflare or Genesis Mining.

All you need to do is pay the upfront cost, either in BTC as it is for PBmining, or you can pay in dollars at PB mining. They take care of everything, and all going well – you will receive a regular flow of BTC into your personal wallet.

Some mining contract providers are charge you fees throughout the contract on top of the initial payment, which can distort the return metrics, and sometimes the mining contract provider can go bust or be a complete and utter scam. This is why we are here to provide a concise database on who is reputable and can be trusted to run a Bitcoin mining hardware machine on your behalf.

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