Right now the digital currency market is going through a period of upheaval, but that has not diminished the lucrativeness and competitiveness of cryptocurrency mining. Nothing but substantial growth is expected from it in the coming years, offering real profit opportunities to real people.
The recent drop in the value of cryptocurrency was expected to affect the hash rate. There has, however, been no negative impact. Instead of declining, the hash rate for Bitcoin has increased. Bloomberg reported the increasing hash rate indicated that, “mining is still profitable for many players to stay put.”
Cryptocurrency mining is a process that creates new digital coins, validates transactions, and protects the system. The process involves computers competing to solve complex math puzzles to find cryptocurrencies, the demand for which is expected to grow in the years ahead.
Transparency Market Research’s (TMR) report predicted the global cryptocurrency market would surge to US$6,702.1 million by the end of 2025. Once the adoption of cryptocurrencies rises again, it is likely the mining will also see explosive growth.
In 2017, Ethereum and Bitcoin were almost unstoppable, with their values hitting record highs. Flash forward to 2018, both the cryptocurrencies have been on a wild roller coaster ride, and their values continue to hit a new low. Are they still profitable to mine? The short answer is yes, but surprisingly, there are more profitable coins out there.
Let’s take a look at a few.
- Launched: 2011
- Available/Total Supply: 58.2 million / 84 million
Litecoin is almost a clone of Bitcoin. Founder Charlie Lee says his alt-coin “complements” and “not competes” with Bitcoin. Although Litecoin is based on Bitcoin, some striking features set it apart. One of them is its faster transaction time.
In Bitcoin, the time taken to generate a block is 10 minutes. In comparison, Litecoin is much faster, as it takes 2.5 minutes to generate a block, making confirmations and transactions quicker. The two also use different algorithms. Litecoin uses Scrypt algorithm, while Bitcoin uses SHA-25. First-time miners will find Litecoin more accessible and less complicated.
As of September 11, 2018, Litecoin has a market cap of $2.98 billion.
- Launched: 2014
- Available/Total Supply: 16.4 million / 18.4 million
Monero is a popular alt-coin in the privacy coin space. It is a secure and untraceable digital currency, as your transaction details never appear in the public record of transactions. Whether you send or receive, the system will not disclose your identity.
Ring signature technique is used for “transaction mixing,” which guarantees no one can guess the actual source of the transactions. When someone sends funds, several other users’ funds also appear in the transaction as sources that might have sent the funds. Features like stealth addresses and ring confidential transactions (RingCT) also help keep the information secure. Monero’s mining process is egalitarian, which means everyone is equal and therefore, deserves equal opportunities.
As of September 11, 2018, Monero has a market cap of $1.70 billion.
- Launched: 2016
- Available/Total Supply: 4.78 million / 21 million
Zcash, a fork of Bitcoin protocol, supports nearly all the transactions Bitcoin supports. However, when it comes to privacy, it is more like Monero, which keeps the identities of its users and their transactions private. Zcash provides anonymity to its users by leveraging a form of zero-knowledge cryptography.
The zero-knowledge proof is called zk-SNARKs, an acronym for “zero-knowledge succinct non-interactive arguments of knowledge.” It allows two parties involved in a transaction to verify the kind of specific information they have without revealing what that information is.
As of September 11, 2018, Zcash has a market cap of $532.28 million.
- Launched: 2014
- Available/Total Supply: 8.32 million / 22 million
Dash, forked from Bitcoin protocol, today is one of the most adopted alt-coins in the market. As it uses the hashing algorithm X11, it is much easier to mine this cryptocurrency. Also, it is an ASIC-friendly digital currency. Dash mining has a high hash rate, but low electricity consumption.
As of September 11, 2018, Dash has a market cap of $1.53 billion.
The Future of Cryptocurrency Mining
Cryptocurrency miners need to be prepared for the new era of digital currency. Hobbyists mining from their basements and small entities might have to bow out, as cryptocurrency mining is no longer feasible without a proper and competitive set-up and a reliable supply of electricity.
Canada has emerged as a great destination for crypto miners. Not only does the country offer them cheap and regular supply of electricity, but companies like JV Driver help them establish an ideal mobile data center for efficient cryptocurrency mining operations.
Companies ready to expand move to places that provide them with a cost-effective proposition, and adapt quickly to the changes in the lucrative cryptocurrency market.