How Does Mining Work?
Crypto mining in Canada is the work of solving a highly difficult cryptographic algorithm. With each new coin mined the next algorithm becomes more and more difficult, making it harder and harder to mine a new coin with each coin that has been previously mined. Crypto mining in Canada is, therefore, a difficult process.
Bitcoin mining in Canada is probably the hardest of all because it has been around the longest. People need to keep buying increasingly more expensive computers to solve the algorithms. The chips that mine the currency are currently priced at $3,000 or more, and the price will keep rising as the chips have to become better and better to solve the more difficult algorithms.
This is why, generally, large companies with a lot of cash on hand do crypto mining in Canada. Individuals interested in Bitcoin mining in Canada would have to compete against people with a lot of high-end computing and a lot of electrical usage. Yes, you can use the cloud to mine crypto and not pay any money for electricity, but that process is slower. Bitcoin mining in Canada is difficult and expensive, but it can be worth it for fans and crypto geeks.
Pros And Cons
Successfully mining a block of crypto will end up with you being awarded with cryptocurrency. That’s a pro. The con is that you are going to have to invest time and money into mining that reward.
Of course, there is nothing wrong with crypto mining in Canada as a hobby. Lots of people are happy to do it! You can use the crypto you get through mining to buy stuff on the Internet or play at Bitcoin casinos in Canada. Just be prepared to not become a billionaire overnight, and you may have to pay a huge electric bill along the way.
Crypto Pricing in Canada
The best way to get into crypto in Canada is to simply buy some crypto. Crypto exchange in Canada is easy to do. Yes, you can still do crypto mining in Canada, and in fact, many people try Bitcoin mining in Canada. But you can also save time and money and simply go to a crypto exchange and purchase it. There are a lot of cryptocurrencies out there, and all of them can be a part of crypto mining in Canada.
The most valuable one is Bitcoin. It is the standard of cryptocurrency. An offshoot of Bitcoin – Bitcoin Cash – has come about in the last couple of years. Its advantage is that it is easier to spend online. But Bitcoin itself will always have more value than Bitcoin Cash. The cryptocurrency market doesn’t get involved directly with setting up how much their cryptocurrency is worth. That’s done by the market itself.
However, they make sure that the currency retains value by making each additional crypto coin that much harder to produce. That means people have to expend a lot more computer time and a lot more electricity to solve the various algorithms to make new cryptocurrency. This is why, for many people, simply buying crypto on a cryptocurrency exchange makes more sense. You don’t want to have to compete against other people mining crypto when each time one is mined it becomes harder to mine the next one.
If you want to invest in crypto mining in Canada, it’s a much better deal to just buy your crypto and see if it increases in value. As mining crypto becomes more difficult, it’s going to take more expensive computers to perform the mining. You could probably get away with crypto mining in Canada today with a $5,000 computer. Your best bet may be to try Bitcoin trading in Canada, which is easy to do.
Cryptocurrencies & Technology
There are various technologies used to crypto mining in Canada:
When fewer people were trying to mine crypto and the algorithms were easier you could use your own computer’s CPU. That is not practical anymore, but people still do it.
A graphics processing unit (GPU) is a powerful processor whose sole purpose is to assist your computer’s graphics card in rendering 3D graphics. GPUs can execute over 800 times more instructions in the same amount of time as a CPU. Mining is a repetitive process that does not require complex computing power which leads to GPUs replacing CPUs in the mining world for most people.
FPGAs are processors that can be programmed to execute specific instructions and only those instructions. This meant they didn’t need to be reprogrammed the way GPUs were.
ASICs were introduced in 2013 and, as of November 2017, they are the best processors available for mining crypto and they outperform FPGAs in power consumption. They are chips designed with one specific purpose in mind, in this case, mining crypto
Crypto miners eventually started organizing in cloud mining networks. Whenever a miner in one of these pools solves a block, the reward is shared with everyone in the pool in a ratio representative of how much work you did to help solve the algorithm.
Clouds offer prospective miners the ability to purchase mining rigs in a remote data center location. This eliminates the need to pay for electricity. It also means you don’t have to sell your expensive computer when you give up crypto mining in Canada because you realize it takes forever to mine crypto.
As you can see, as solving the algorithm becomes progressively harder, new solutions are constantly arriving. This is how crypto mining in Canada works. The people who come up with the new ways to solve them can mine more crypto for a while and make a bit of money off of it.
What’s going to make it difficult from a technology standpoint for a new person to enter the game is going to either be the electrical costs or if you decide to go to cloud computing the sheer amount of time it takes to mine crypto versus how much money you will spend on renting your time on the cloud. This is why we advise people not to try to crypto mine on their own, but if you just want to do it as a hobby and are happy with breaking even, go for it. This is amusing for some people.
The way the Canadian electrical grid is set up, you are going to be spending a great deal of your investment on your electric bill. Typically, the only people in Canada who make the big money from mining crypto are large companies with huge banks of computers working at it night and day. And even in those cases, their profit margin is small – but if you are mining enough cryptocurrency, a small percentage profit can pull in big gains.
Bitcoin cloud mining in Canada also requires an investment in cloud rental fees. A Bitcoin mining machine in Canada may eat into your profits – as will having to update your computer every three months or so. Crypto mining in Canada on the individual level is more for people who are into crypto and just want the price of their machine solving the algorithm.
If that sounds like you, then you can go for it. Be aware in advance though that it is an expensive hobby to have and you’ll be laying out money on computers and electricity months before you will mine your first cryptocurrency. For some people that’s fine. Just don’t look at cryptocurrency as a get rich quick scheme. It is not. If you want to go that route you can simply buy crypto on a cryptocurrency exchange and become a day trader. Otherwise, just let the crypto mining companies do the job because they have the technology in place to get it done efficiently to make huge profits.
Security & Support
Crypto companies take security seriously. Even Bitcoin wallets in Canada are secure. They don’t want to get hacked and have the value of their currency evaporate overnight. That’s why they make each new crypto coin that much harder to mine than the one before it. By making the algorithms so difficult they make them much harder to hack. This benefits themselves and their users. It also makes it that much more difficult for the average person to start mining crypto. It gets progressively harder and harder to do as time goes on. And what happens if you are trying to solve a particular algorithm and someone beats you to it? They get all the rewards and you get nothing.
The crypto money itself is always becoming more and more secure. This leads to people developing new ways to mine cryptocurrency in Canada, which works for a bit until the crypto becomes more difficult to mine. That’s great for the overall security of cryptocurrencies but bad for the average person who just wants to mine it. With each coin made the next coin becomes that much harder to unlock. So, you have to approach it with more computing power and pay more electricity and more for the hardware you are going to use to mine it.
From a security standpoint that’s a true benefit. From the standpoint of the average person who is trying to mine cryptocurrency, it’s bad. Bitcoin and other cryptocurrencies put all of this security into place for a reason. It keeps the value of their currency high. It also makes it hard for the average person to get in and start making money off of it.
Crypto mining in Canada may require a significant investment for the average person. We are at a point in the crypto cycle where only large companies in Canada can access enough hardware to make mining crypto profitable. With each day that goes by crypto mining by design becomes more difficult. The amount of money you’d spend on hardware and electricity is likely to wipe out any profit you might make. The same can be said for mining crypto on the cloud – it can be difficult to break even, but if you’re interested in giving it a go, there’s nothing to stop you.