For people new to the cryptocurrency world getting started mining can seem like a daunting task. The first thing a newbie will notice is the large variety of software and hardware used in cryptocurrency mining. There are four kinds of cryptocurrency mining hardware ASIC, FPGA, GPU, and CPU. Since the scope of this article is limited to introducing a beginner to mining cryptocurrency with a graphical processing unit (GPU) we won’t discuss ASICs or FPGAs.
So what is the quickest way to start generating cryptocurrency with a GPU? The answer is NiceHash.com.
NiceHash has been around for several years and functions as an open market for hash-rate. NiceHash now offers their own ready-made software solution to jump into CPU or GPU mining.
You will not make a ton of money mining for NiceHash with a single GPU but you can start collecting a small amount of Bitcoin while your computer is not in use.
How to Get Started GPU Mining with NiceHash
- Go to miner.nicehash.com (the link will open in new tab)
- Determine which brand of GPU you have (AMD or NVIDIA)
- Download the NiceHash software relevant for your GPU
- Install the NiceHash software
- Add a Bitcoin address for payment in the software program (you are not mining Bitcoin directly but the payment is done in Bitcoin for universal compatibility)
- Set the NiceHash mining software to start mining
- Allow the software to mine continuously – a real-time view of your accumulating profits is provided onscreen.
The software is great for beginners because there are no settings to configure and the entire process of algorithm/coin switching based on profitability is handled by NiceHash. With the NiceHash software program you will be mining a variety of cryptocurrencies that use several different algorithms. Mining algorithms the NiceHash software supports include X11, Keccak, CryptoNight, NeoScrypt and more. This is by far the fastest and easiest way to get started mining cryptocurrency.
How does NiceHash.com work? It connects people bidding for hash-rate with people providing hash-rate.
Hash-rate buyers will put in orders on the NiceHash website and the supply/demand for each type of hash-rate sets the price they are willing to pay. The NiceHash software will connect you automatically to the pool the buyer specifies and mine for as long as the order has remaining Bitcoin. As a miner you will be running hash computations on your hardware for the buyer. You will be on the supply side of this NiceHash market. In simpler terms you are renting your computing power out in exchange for Bitcoin. NiceHash functions as a middleman and takes a small cut.
Why do people want to rent hash rate? The simple answer is to mine altcoins.
Buyers who bid to utilize the hash rate you provide desire to point it to the coin and pool of their choice. Buyers mostly use the hash rate you are renting in a speculative manner mining coins which they believe will increase in value. The buyers may also be scalping small profits generated by fluctuating altcoin prices. A third use of rented hash-rate is to essentially gamble by renting a huge amount of hash-rate in attempts to solo mine an entire block – this use-case is more like gambling. Nicehash’s software is unique in that you will be automatically switching between many algorithms and pools depending on which kind is bringing the highest price in the marketplace at the time.