If you want to invest in Bitcoin mining but you’re not ready to buy the hardware yet, you don’t need to worry. There is another way to mine Bitcoin without the hardware. This is referred to as cloud mining. It has to do with using shared processing power from remote data centers to mine. All you need to cloud mine is a home computer and a Bitcoin wallet.
Starting Cloud Mining
Just like mining with the hardware, there are risks associated with cloud mining. Before you start, make sure you understand the risks, and you’re willing to take them.
Risks Associated With Cloud Mining
- High risk of fraud
- Lower profit than hardware mining
- Opaque mining operations
- Lack of flexibility
Advantages of Cloud Mining
- Peace in your home
- No extra electricity costs
- You’ll not need to start looking for how to sell hardware when it’s not longer effective
- Lower possibility of downtime than with hardware mining
- No ventilation problems
Types of Cloud Mining
Currently, there are three types of cloud mining available, and they are:
1 Hosted Mining
In this case, you’ll lease the mining machine, but the service provider will host it.
2. Virtual Hosted Mining
With virtual hosted mining, you’ll create a virtual private server for general purpose and install your mining software on it.
3. Leased Hashing Power
Here, you’ll only need to lease some hashing power from the service provider. It doesn’t require a virtual or physical computer. It is the most popular type of cloud mining.
With cloud mining, you can try Bitcoin mining without having to commit long term to buying hardware. Cloud mining has its advantages and its disadvantages. Depending on what you want, you can start mining on the cloud. If you are not sure about it yet, then go ahead and buy the mining hardware and set it up in your home.