Best 5 Cloud Mining Services
Just a few years ago, from 2009 to around 2013, everyone was able to mine several Bitcoins a day with their own computer. Mining is the manufacturing process of crypto currencies such as Bitcoin. With the current value it is almost unthinkable that in the past you could simply boot up your own computer to generate virtual money out of nothing. Meanwhile the degree of difficulty is much too high, so that the technical equipment of the own home computer is no longer sufficient. Special Bitcoin Mining hardware is necessary, which is specialized in performing millions of calculations per second to “crack the code” and generate Bitcoins. But this hardware not only costs a small fortune to buy, it also consumes a lot of electricity. The birth of cloud mining providers. These are companies that do mining on a grand scale.
How does cloud mining work?
Every 10 minutes, Bitcoin creates a new block with all the transactions that have been carried out within this time. This block is then attached to the blockchain. During each process, the algorithm generates a fixed number of new bitcoins (currently 12.5 bitcoins every 10 minutes). In order for this process to be stable, however, miners are required to validate the whole thing with their computing power (proof-of-work procedure). As a reward for their computing power, the new 12.5 Bitcoins are distributed to the miners. However, these are not distributed arbitrarily, but the one who calculates the solution fastest receives the reward. At the latest now it should be clear that a conventional computer has no more chance.
In order to benefit from mining as a private individual, cloud mining providers offer their computing power for money. This creates a win-win situation. Anyone can simply register on a provider’s website and select their computing power, which can then be rented for an (un)defined period of time. In addition to Bitcoin, other coins are usually offered that can be used as mines.
While private individuals provide the providers with fresh capital for the purchase of new hardware, they can then order large quantities at much more favorable conditions. The companies are also based in countries with very low electricity costs, such as China, Iceland or Eastern Europe. The private individual has the advantage of not having to worry about technical installations and maintenance.
In addition, people who live in countries with expensive electricity, such as Germany, can also participate. Another advantage is that you can buy very flexible computing power and increase it further, while you have to buy whole devices for your own mining.
But there are not only advantages, but also some disadvantages. In the following we want to compare you the advantages and disadvantages
Cloud Mining Advantages
- Uncomplicated: No technical know-how required, as the purchase of the mining equipment, installation and maintenance is carried out by the cloud mining provider.
- Cheaper Hardware Deals: Since suppliers order much larger quantities directly from the manufacturer, they usually get much better conditions than a private person.
- No waste of space: Since the mining devices are not at home, they do not need any space, do not need to be cooled and do not disturb anyone (volume).
- Low electricity costs: Cloud mining providers usually have their mining facilities in countries such as China, Eastern Europe or Iceland, where the costs per kilowatt-hour are much lower.
- Flexibility: The purchase of computing power can be individually adapted, while entire hardware parts have to be purchased for your own mining.
Cloud Mining Disadvantages
There are some dubious providers on the market. Therefore, it is important to inform yourself thoroughly beforehand.
- Little control: You have to rely on the offers of the cloud mining providers.
- Less revenue: This only applies if you can buy electricity yourself at a low price. If you have an affinity for technology, you can mine yourself and have all the profit for yourself.
From our point of view, cloud mining services clearly have more advantages than disadvantages if you have informed yourself well in advance in order not to fall for dubious offers.
Above all, the flexibility and uncomplicated application make cloud mining very exciting in our opinion. Now all that remains is the question: Is cloud mining profitable at all?
Cloud Mining – Is it profitable?
Assuming you have chosen a reputable provider, the question is: How profitable is best cloud mining? After all, the providers put a piece of the profit into their own pockets. In addition, you first have to pay in advance, because you usually rent the computing power for a longer period of time. The bill stands and falls with the price of Bitcoin. If the value increases, your profits also increase in the long run. If the price remains relatively the same, it takes a while until you have recovered your investment. Afterwards, however, you make your profits daily. In order to illustrate the whole we make a small calculation example with the offerer Hashflare once:
Currently 10 GigaHash costs $2.20 for a rental period of 1 year. For 1100$ you get 5TH, 5000 GigaHash. According to the calculator of Hashflare one earns between 300$ and 380$ per month with the current degree of difficulty. This however fluctuates like also the price of Bitcoin. The incomes can thus likewise fall or rise. The maintenance fees have to be deducted from the income. These are with 5Th around approx. 53$. Thus remain between 250$ and 330$. So in order to get your initial costs out again you need in the calculation example about 4-5 months, from then on you are profitable. Since the contract is valid for one year, you could even earn more than 100% profit with the same mining statistics. Cloud mining can really be very profitable, considering the risk that the value of Bitcoin can fall.
To give you a better picture of the different cloud mining providers we have started a self-test.
Our Cloud Mining Self Test
In order to provide you with an honest experience report about Cloud Mining we have registered with various providers and rented Hashpower. We will keep you up to date about costs, revenues and payouts, so that you can benefit the most from cloud mining.
Cloud Mining Provider – You should pay attention to that!
There are many black sheep among the cloud mining services. That’s why it’s important to inform yourself thoroughly about the individual providers beforehand and to take a closer look at the experiences of other members. Often dubious cloud miners lure with incredible earning opportunities or very cheap Hashrates. In reality, however, these are pyramid schemes in which no Bitcoin Mining hardware exists. So that you don’t fall for such providers, we have created a small checklist for you here:
Cloud Mining Checklist
- How long has the provider been on the market? The longer the better!
- What are the experiences of the members? Are there many negative reports? If there are payment difficulties, you should avoid the offer.
- Is there any evidence about the mining facilities and the company? It would be best if the company is already established.
- Do the cloud mining contracts reflect current market conditions? If the contracts seem too good to be true, they usually are. So check carefully. Of course there are very good offers from established providers every now and then.
- Are there hidden fees? As a rule, in addition to the actual rental costs, which are usually paid upon conclusion of the contract, there are also daily maintenance costs that reduce the profit. Otherwise, however, no further fees are usual.
- Comparison: Once you have identified the reputable providers, it is time to compare the providers and choose the one with the best conditions. The top priority is to get your investment back as quickly as possible to minimize the risk of loss. These criteria should flow in:
- Price per GH (less maintenance costs)
- Contract duration (the longer the better, but it must be assumed that the yield will decrease over time, as the mining difficulty will usually continue to increase in the future. Therefore, it is more important to choose a shorter contract, which however now achieves a better performance in mining than mining contracts, which are lifetime contracts, but the yield is so small that it takes much longer to get your investment out again.
- Mining start (immediately or does the vendor have to buy the hardware first?) – This is important because the course and the degree of mining difficulty can change considerably over time.
Is Cloud Mining Worthwhile? Our conclusion
Cloud mining has both advantages and disadvantages. The best thing is that it is very easy to use and very flexible. Generating a passive income definitely has its appeal and is certainly more fun than buying and keeping crypto currencies. Furthermore, you have the possibility to buy further hash power from the generated profits and thus constantly increase your profits comparable to compound interest. Moreover, you probably sleep more relaxed if you simply generate your income every day than if you simply buy a currency and are hopelessly at the mercy of fluctuations. This point is always ignored by many. Because once your money is tied up for a certain period of time, you won’t be tempted to panic and sell everything. On the other hand, this is of course also a risk, because you do not have the possibility to sell your investment quickly again. So our conclusion is: Cloud Mining is a great thing in our opinion. Since there are a lot of black sheep here, caution is advised. The best thing to do here is to use established cloud mining providers. And best of all always spread your risk: Buy crypto currencies directly with one part and put a part into mining in order to generate monthly income.
However, it is very important to say at this point that crypto currencies are generally subject to high fluctuations and thus a high risk. Therefore you should proceed with caution and only pay in so much that in the worst case you can easily put up with, should suddenly a total loss occur.
Cloud Mining – How to start?
- If you haven’t been involved with crypto currencies before, you should first inform yourself about the topic
- If you don’t have a wallet yet, you should get one. At blockchain.info or Bitwala, for example, this is very fast and free.
- Check the cloud mining providers for seriousness using our checklist and then examine the best for profitability.
FAQ about Cloud Mining
- How does cloud mining work?
- Can I mine Bitcoin for free?
- Can I mine Bitcoin on my phone?
- How long will it take to mine 1 Bitcoin?
- How many Bitcoins are left?
- Is Bitcoin mining illegal?
- Can I mine Bitcoin on my PC?
- How can I mine Bitcoin?
- Is mining Bitcoin illegal?
- Is mining bitcoin profitable?
- Which Cloud Mining is best?
- Is cloud mining legal?
- Can you make money cloud mining?