To mine or not mine is the question of most modern crypto enthusiasts. The fall in the cost of bitcoin and its altcoins has significantly reduced the possibility of extracting profits from the extraction of coins. However, in the field of sales, too, things are not so smooth - due to the desire to comply with the requirements of the regulatory authorities, most of the marketplaces introduced ruthless demands of KYC. About which way is preferable to go, about the pros and cons of each approach - further in the material.
To the question of mining, as a way to become the owner of cryptocurrency
In 2018, mining became one of the most discussed topics in the crypto community. In the wake of a prolonged downtrend, cryptocurrency prices continued to plummet. As a result, the profitability of mining has decreased significantly, and many users have chosen to turn off the equipment. The crisis was the reason for changing the network in the direction of reducing the level of complexity, due to which a long process of forming a certain balance began, the result of which will be the installation of an adequate reward for the expenditure of computing power.
Mining efficiency directly depends on the power level of the user's equipment. As a result, in the field of PoW crypto-production there was a race for manufacturers of equipment: buyers do not have time to buy another asyk, as another model is replacing it. As a result, most of the computing power began to move into the field of companies engaged in the extraction of cryptocurrency on an industrial scale (private miners are simply unable to constantly invest in the purchase of expensive devices).
The combination of mining nuances, as well as the complexity of its technical component, seem to be extremely repulsive for beginner enthusiasts. In order to see the realities of modern crypto-production, it is necessary to consider its positive and negative sides, in relation to the current day.
Pros of mining
The main advantage of mining is getting cryptocurrency (for example, Bitcoin), at a price below the market. Accordingly, the earnings in this case will be the difference between the cost of production and the profit received from the sale. It is important to take into account that for the profitable realization of the extracted cryptocurrencies, it is necessary to choose the appropriate time to enter the market. The general advantages of mining include the following points:
- Working with the equipment directly, the user gets the opportunity to explore the whole world of cryptocurrency from the inside. Understanding the capabilities of digital assets: the facets of their use and the nuances of the technical component allows us to dive deeper into the subject, and as a result, to find ways to increase the level of profit. In particular, it is possible to control the market, and if necessary, switch equipment to the extraction of other coins that are more relevant at a particular moment.
- Getting started in the mining area today can turn out great prospects in the future. The fact is that in the wake of the fall in the cost of cryptocurrency, many crypto producers began to actively sell their equipment. As a result, in the secondary market, there was a mass of proposals for the acquisition of everything necessary for the technical start of work. Manufacturers, seeing their losses, are also trying to attract buyers with loyal prices.
Taking into account the duration of the downtrend and the peculiarities of the current position of the cryptocurrency market, in the near future, the beginning of a new phase of growth is quite likely. It was during this period that miners who bought equipment from their desperate colleagues, will be able to get the maximum profit.
- Mining today is rather an investment in the future. Many network-connected cryptograders work on the verge of loss, but they are also driven by their belief in a bright future of cryptocurrencies and the possibility of a more rational use of equipment during the period of market growth. It is quite probable that bitcoins earned today and withered for a year or two (at least until the next halving) may well turn into a decent state.
- The market is extremely mobile. This means that it contains promising points for the implementation of earned coins, for example, pampas. Accordingly, obtained by bitcoins, the initial value of which is lower than the market, can bring more profit than in the case of their purchase.
It is also important to note that mining is network support. Without users who carry out transaction processing, there will be no development. Accordingly, crypto-production is a kind of contribution to the bright future of the world of cryptocurrencies.
Unfortunately, in the realities of the modern market, the disadvantages of mining can significantly outweigh the possible positive aspects of this trend. The main disadvantages of crypto production include the following points:
- To get started, you need serious investments: the purchase of equipment and its placement. The exception is cloud mining, however, as practice shows, this area of crypto-production today does not feel very good.
- Independent mining implies a long payback period. If the user previously could close the cost of equipment for 6-12 months, then during periods of cost of Bitcoin in the region of $ 3400-3500 and below, this can take years.
- For efficient crypto production, the search for cheap electricity is needed. Many ideological enthusiasts, in pursuit of cheap mining, decide to move to regions with cheaper "rosettes". Accordingly, effective crypto-production today implies a nomadic lifestyle, an alternative to which can only be cunning (illegal connection to the communications of other people and other illegal actions). Another option for work in this case could be a mining hotel search.
- In order to earn on the resale of received cryptocurrencies, it is necessary to have a good understanding of cryptotrading. This “science” requires a great deal of practical experience, and is comprehended over the years.
In addition, the cryptocurrency market is unpredictable. The problems are added by the precariousness of its position - in the absence of clear rules of regulation by the government, users do not see any real prospects. No one can guarantee that in a couple of months the government of the Russian Federation will not pass a bill obliging the miners of the country to pay a huge tax. And maybe a catastrophe may happen at all - for example, the beginning of the persecution of crypto producers and users of cryptocurrencies as citizens working with an illegal financial instrument. In this case, the digital asset market will expect another drop.
Buying as a way to become a cryptocurrency owner
Direct acquisition of cryptocurrency without mining has always been considered the easiest way to become the owner of digital assets. As of the beginning of February 2019, the decline in mining profitability attracted more users to this path.
Pros of purchase
Next, you need to consider the benefits that a crypto-enthusiast can receive by preferring the acquisition of digital assets, against their mining:
- No need to purchase expensive equipment, the subsequent implementation of which in this case is extremely unprofitable and time-consuming process.
- There is no need to know the technical component of mining and maintain equipment for the mining of coins.
- The transaction on the acquisition of cryptocurrency does not take much time.
- With free time and the desire to save money, you can explore the market and choose profitable moments for the purchase of cryptocurrencies. In this case, the result of profit may be significantly higher than in the case of mining.
Cons of shopping
In addition to the advantages presented, for completeness, it is also important to consider the possible disadvantages of a simple purchase of cryptocurrency. Speaking about the shortcomings of work in this direction, we can note the following:
- The user needs professional knowledge in the field of cryptotrading. Otherwise, the transaction may be unprofitable.
- A purchase can be more expensive than independent mining (subject to availability of equipment).
Another problem is the notorious KYC. To purchase cryptocurrencies in the open spaces of popular digital asset exchanges, the user may be required to fully disclose his identity.
The results of the fight
In general, the truth of the current choice between mining and buying cryptocurrency can be expressed by the following message from the user Lynwod, which he left on the bitcointalk forum: “If the socket is free, then you can begin to mine at any time, and if paid, then it is better to buy crypts.” However, it is worth remembering that in most cases the purchase will destroy the user's anonymity.
Alternative ways to get cryptocurrency
It so happened that for most users, mining and buying are the only ways to become the owner of cryptocurrency. In fact, with a careful study of the proposals of cryptospace, you can see a number of alternative proposals. These include the following:
- cryptocurrency earnings through participation in the bounty and airdrop;
- cryptocurrency winnings;
- earnings on "cranes";
- earnings for the work.
In this detailed review, each of the methods represents the following essence:
- Bounty and airdrop are traditional ways of attracting attention to projects and cryptocurrencies developed for them by their teams. In fact, they represent the distribution of coins, in order to start the turnover of an asset and increase its popularity.
Bounty implies the need to perform a number of tasks (reposts, user engagement, and so on). Airdrop can be issued just like that.
It is important to note that in the wake of the popularity of cryptocurrency (in the period of high prices), many users viewed the bounty and airdrop sector as the main source of income. Unfortunately, in the realities of the modern market, it will not be possible to receive a lot of money in this area, but this does not mean that participation in a couple of programs cannot bring a certain amount of digital assets.
- The network often hosts contests, the main prize of which is cryptocurrency. Of course, participation is not a guarantee of victory, but if we are talking about an area in which a particular crypto enthusiast is a professional, winning can become a reality.
- “Cranes” means sites on which any person can earn a cryptocurrency for performing any simple tasks. The most common example is filling a captcha for sites. It will not be possible to make a fortune on “cranes”, but getting a small amount of cryptocurrency is quite realistic.
- Cryptocurrencies come out of the shadows, and gradually become a real financial tool that can be interesting not only to speculators, but also to ordinary people. Thus, there is a trend in the network to increase the number of proposals on the part of employers to hire employees with the payment of wages in digital assets (most often this uses Bitcoins and Litecoin).
Thus, in a period of low prices in the cryptocurrency market, the easiest way to become the owner of digital assets is to buy or participate in the distribution of tokens. However, the field of mining should not be underestimated either - the downtrend cannot continue indefinitely. Accordingly, sooner or later, patient cryptograders will be able to enjoy the rays of glory.
Dear readers, do you mine the cryptocurrency, or prefer to buy it?