How to mine bitcoin

You've heard of Bitcoin and you're ready to get your hands on some digital wealth. However, this may be easier said than done. When you "mine" Bitcoin, you actually verify Bitcoin transactions in the public, decentralized ledger of Bitcoin transactions (called the blockchain). Every time you find a new block to add to the chain, the system gives you some Bitcoin as a reward. Back in the early days of Bitcoin, it was easy to mine Bitcoin using your own computer. However, as the cryptocurrency has become more popular, it has become all but impossible for individuals to make a profit mining Bitcoin. That doesn't stop a lot of people from trying, though. If you want to mine Bitcoin, you can either sign up with a cloud-mining company or build your own mining rig to mine for yourself.^[1]

Method One of Three:
Setting Up a Bitcoin Wallet

1. 1
   Download a software or mobile wallet if you're just getting started. Software wallets are kept on your computer, while mobile wallets are apps that you install on your smartphone. Software and mobile wallets are reasonably secure, can be downloaded for free, and are suitable for smaller amounts of Bitcoin.^[2]
   

   • You can find a list of secure wallets approved for use with Bitcoin at https://bitcoin.org/en/choose-your-wallet.
   • Some wallets are hybrid, meaning that you can access them through software on your computer and through an app on your mobile phone.
2. 2
   Invest in a hardware wallet if you're serious about Bitcoin. Hardware wallets may set you back a couple of hundred dollars but are considered more secure. Since they aren't connected to the internet, they aren't vulnerable to hackers. If you intend to keep your Bitcoin long-term, a hardware wallet is likely a worthwhile investment.^[3]
   

   • Trezor and Ledger are two of the more popular hardware wallets available. You can buy them online or at brick-and-mortar stores that sell computer supplies and accessories.
3. 3
   Enable all security features on your wallet. Once you've chosen a Bitcoin wallet, set it up for maximum security to protect your Bitcoin. Use two-factor authentication to secure your account. When you log in, a code will be sent to you in a text message or email. You have to enter the code to access your account. This makes your account less vulnerable to hacking.^[4]
   

   • Make sure the password you choose is secure and would be difficult for anyone to guess. If you have a password manager on your computer or smartphone, you can use that to create a secure, encrypted password

   
   
4. Decide which cloud-mining service provider to use. There are a number of different cloud-mining service providers available, some of which are better established than others. Each service charges different fees and has different contract packages available.[5]
5. Genesis, Hashflare, and Minex are some of the more popular cloud-mining services. However, the most popular services with the best reputations also are frequently sold out of contracts.
6. Research services carefully. There have been numerous cloud-mining scams. Make sure the company is legitimate and has a good reputation. You can search the name of the service and see what people are saying online about it. Websites such as CryptoCompare can also help you analyze company reputations. Visit https://www.cryptocompare.com/mining/#/companies to get started.
7. Be careful of a cloud-mining service that makes guarantees or claims that sound too good to be true. It is likely a scam. No cloud-mining service can guarantee you a particular rate of return, or guarantee that you'll break even or start turning a profit in a short amount of time.
8. 2
9. Pick a cloud mining contract package. With cloud-mining, you essentially lease mining power from a miner farm for a period of time. While your contract is active, you get all the Bitcoin that is mined using that amount of mining power, minus fees paid to the cloud-mining service for maintenance of the mining hardware.[6]
10. Contracts typically last from 1 to 3 years, although some last longer. While shorter contracts may carry a lower price tag, it's unlikely that you'll make any money in a shorter period of time. You usually need at least 2 years to break even.
11. Prices vary anywhere from under $100 for smaller contracts to several thousand dollars for larger contracts with more mining power – expressed as the hash rate. For example, as of 2019, Genesis offers a 2-year Bitcoin mining contract for $50, which gets you 1 TH/s (1 Tera hash per second, or 1,000,000,000,000 hashes per second). This sounds like a lot, but it's unlikely that you'd do much more than break even in 2 years on such a small plan. At the other end of the spectrum, you could get a 5-year contract for $6,125 with 25 TH/s.
12. 3
13. Withdraw your earnings to your secure wallet. When you purchase your contract, your mining power goes to work for you immediately. As you earn Bitcoin, it will show up on your account at the cloud-mining service. When you've accumulated enough, you can send it to your wallet.[7]
14. Some cloud-mining services may do regular payouts on an established schedule, such as once a month or once a quarter. Others may allow you to withdraw your earnings any time you want, as long as you have a minimum amount. The minimum can range anywhere from 0.05 BTC to 0.00002 BTC.
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