Lets understand Monero mining first. What is it exactly?
Mining Monero essentially means running a program on your computer, which will use your processor (CPU) and graphics card (GPU) in order to undergo lots of mathematical calculations. These calculations are necessary in order to validate groups of transactions - blocks - on the network. For each successful validation, you'll be rewarded with XMR coins. While Monero's team aims actively to fight against ASIC-based miners (mostly known for mining Bitcoin), it has generated many different forks in the cryptocurrency, giving birth to Monero 0 (ZMR), Monero Classic (XMC), Monero Original (XMO) etc. I must admit that they have done a pretty amazing job at freeing the network from ASICs with the shift to the new RandomX algorithm!
Different ways of mining Monero:
Before jumping into Monero mining, like all other investment, you should prepare yourself and understand the mining of this currency. Even if you don't plan to invest and just use your old computer to make a few cents, it is always better to acquire some prior knowledge before being let fooled or even scammed. What I like about Monero, is that its team actively combats ASIC-miners, which tend to consume an horrible amount of energy and cost a lot to set up. Thus if you plan to mine with your old computers and don't want to invest a single dollar, Monero mining is definitely a wise choice!
Essentially, there are three distinct ways of mining Monero. Each has its benefits and drawbacks:
- Cloud-based mining - the simplest but most dangerous
I too started with this simple way of mining, using Minergate. It is great for beginners and required little to no prior knowledge. As these cloud-miners have their own GUI (Graphical User Interface) you can set up very fast and with little risk. While there is a ton of 'cloud-based' miners, you have to be very careful about potential abuses and scams which use your calculation power for their own benefit.
- Pool mining - the most popular but singly more complicated
This option makes you use your computer in combination with a group of user, effectively 'pooling' all your resources together in order to resolve calculations faster. The rewards gain for finding a block are split with all miners of the pool, proportionally to the 'effort' they have submitted to solve the block. Thus, the reward of the block (+ the transaction fees of all the transactions in the block) is equally divided between the miners. However, most pools make you pay a small fee for the network maintenance.
- Solo mining - mostly for experienced miners as all profits remain for you
This effectively means that your computer becomes a mining rig and mines blocks on its own. This not only requires a certain knowledge in mining, but also means that your rewards are very uncertain. However this is possible with the main Monero Core wallet which you can find here.
1st Method: Cloud-Mining
MinerGate is the most known cloud-mining platform. While I had a negative experience with them (see post) and don't personally recommend this platform, some Publish0x users have been satisfied, and it is true to be a very interactive platform to start mining. Maybe have a look and play around with before switching to another way or cloud-mining service.
As the wallet, software and settings are already set for you, you'll only have to choose on the MinerGate dashboard between PPLNS (or pay-per-last-N-shares) or PPS (Pay-Per-Share) when mining. As stated on the MinerGate website:
PPLNS is a way of determining how many cryptocoins you get for your shares completed. This method of calculating payouts includes a "luck" factor. Using PPLNS your payout per share will have a large range, but on average, PPLNS earns more than PPS (by 5% or so) in the long run (a month or more).
PPS is also known as Pay Per Share. It is a more direct method where you get a standard payout rate for each share completed.This method eliminates the "luck" in your payout, but can decrease your total income per share by around 5%.Using PPS you get a set number of cryptocoins per share of work you have solved. It has no random involved so the payouts do not fluctuate.
Other popular cloud-miners include Cudominer, MinerGate and Nicehash.
2nd Method: Pool mining
As stated above, pool mining is the most reliable and safest way to mine Monero. While it a bit more tricky to set up, that shouldn't scare you away by any means. You simply need to these 5 steps:
1. Make you own Monero wallet. Preferably on the official web.getmonero.org website in the downloads section.
2. Download a mining software that will have the correct algorithms to mine Monero. The most known are:
- Xmr-Stak-RX - support AMD/Intel CPUs and Nvidia GPUs
- Xmr-Stak - support AMD/Intel CPUs and Nvidia GPUs
- CC Miner
- Monero Spelunker - simple and accessible option for CPU miners
3. Choose a mining pool. MoneroPools.com shows all the pools depending on region, location, fees, hashrate and the number of miners. Pick the most suitable pool depending on your geographical location, and/or depending on the different characteristics of each pool (look for fees, total hashing power, minimum payout threshold and uptime should be 99%). I personally use MoneroOcean.
4. Connect your mining software to the Monero pool. In your mining terminal, you'll be asked for pool address (that will be shown on the pool's website, include which port you need to connect to), the username (that will be your Monero wallet address that you made in 1.), and password (generally you name your worker here, but check for each pool specifically!).
5. Once the miner connects to the pool and receives its first blocks you are set! After some time you should see your hash rate (calculation power) on the dashboard of your pool (if they have one) by simply copying your XMR address in the pool dashboard.
PS: this can be repeated for several computers, using the same Monero address.
3rd Method: Solo mining
As said before, this can be done with the simple Monero wallet available at web.getmonero.org. But you need to be extremely lucky to find a block, but therefore also keep all the reward. Only if you generate the correct hash you will be awarded the reward. This means that the more hashrate you have, you statistically have more chance of finding a block as you find hashes more quickly. But it does not guarantee you any profit, as you could be very unlucky and have to wait a long time before finding a block (or the opposite, really lucky) - Some people have found blocks within minutes with 120H/s... - If that didn't scare you, here are some steps to go solo:
1. Download the web.getmonero.org GUI wallet.
2. You need to sync your wallet with the blockchain. This may take a while as the whole blockchain needs to be downloaded.
3. Under 'Advanced' you'll see Mine.
4. Choose how many CPU threads you want to dedicate to Monero mining and click start.
5. There you are mining solo. You should be able to see you hash power (showing your contribution to the network). GOOD LUCK!
This should be in no case reviewed as a financial incentive to mine Monero. The cost of your electricity, and the CPUs/GPUs you have should be analysed in detail before starting Monero mining. You should make your own judgement about the profitability of this activity.
I hope this little guide was helpful for you and happy mining!
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Donations are welcomed (XMR): 88AEdf4zqz95Gc2cVTvJCMbDkY5QfEt1XRh7zicSX9WpDWsDNrxzdLWTQ4aaD2xyk8ZYsHdThWwZyeXKhmZaDc4CSxrgG5e