Bitcoins work like cash, but you mine them like gold. So how do you start ‘mining’ them? If you are willing to take the risk (upfront investment, like real mining) and if you do it properly, you can actually successfully mine a few Bitcoins. With a single Bitcoin currently trading at $476.56 as of September 17th, 2014, there are rich dividends to be reaped.

We will let you know that there are actually better ways to mine Bitcoins than investing in chunky hardware, especially if you are on a budget. There are also other drawbacks of buying hardware to mine Bitcoins like delayed delivery, internet connectivity issues, massive consumption of electricity, complicated maintenance and more. Moreover, the latest ASIC Bitcoin mining hardware can be used only to mine Bitcoins and not for anything else. The alternative is cloud mining.

What is cloud mining?

There are many companies on the Internet that are offering cloud mining services like CEX.io and /GHASH.io. All Bitcoin mining will be done in the cloud, avoiding the numerous problems associated with mining Bitcoins with hardware. You can begin mining Bitcoins almost instantly (as soon as you purchase the GH/S). So no more waiting for the hardware company to supply the machine.

You will get your share of the mined Bitcoins according to how much GH/S you have contributed. In this concept, you are actually joining a group, for a greater reward. Besides Bitcoin mining, you can also simultaneously mine for other crytocurrencies like Litecoin.

More advantages of cloud mining for Bitcoins

Cloud mining offers a problem free environment for mining Bitcoins. It is more profitable and accessible than hardware mining of Bitcoins. Mining payouts are immediate, you get 24/7 technical support and free notification by SMS.

You do not have to install anything and you are guaranteed a given hash rate along with connectivity, professional maintenance, downtime compensation and high security for your data. In addition, if you do not want to use the GH/S you have bought anymore, you can sell them in the market. There is no depreciation or obsolesce like hardware.

The present lot of hardware miners are already outdated and new hardware with better computing speeds will launch next year. Bigger and faster chips cost more. There is also the issue of leakage and face yield. Keeping all these factors in mind, cloud mining is a good alternative.

Over to you…

So, if you are interested in Bitcoin mining, which route will you take? Are you going to invest in your own hardware or make use of the available cloud mining power? Please share your thoughts…