This was the year that I finally jumped down the rabbit hole known as “cryptocurrency” — decentralized, blockchain-based digital money — and a big part of what sparked my interest was the concept of “mining,” or using my computer’s processing power to mint new units of these “coins.”
And man, was I in for a rude awakening. Almost ten years after its creation, the demand for Bitcoin (BTC) has pushed its difficulty way above the capabilities of my little gaming desktop. Now, it’s only possible to mine any appreciable amount of Bitcoin with a specialized device called an application-specific integrated circuit (ASIC) — which can cost thousands of dollars, take forever to ship, and become obsolete relatively quickly.
Many of the top digital currencies are ASIC-resistant — which means you can still mine them profitably with powerful graphics cards (GPUs) — typically requiring ones with at least 4GB of memory. However, most established miners have created massive mining rigs that utilize half a dozen GPUs, pushing the difficulty sky high on popular proof-of-work (PoW) currencies. And with the transaction volumes they’re handling, most mining pools set their minimum threshold for payouts pretty high, which can mean waiting weeks or even months to actually receive the coins you’ve earned. And, as we just saw in the hack of NiceHash, being forced to store your earnings online means you can lose the fruit of all your work.
So if you’re looking to dabble in small-time mining, here are a few digital currencies that have been a lot easier to get off someone else’s website and into my wallet. You can play around with them to get a sense of how mining works, then decide if you want to spring for more expensive equipment to do it as more than just a hobby.
Before we proceed, consider these warnings: Having mined these coins, anything I write about them can be interpreted as an attempt to pump their prices and enrich myself by increasing the demand for and therefore the value of what I own. Do not consider my opinions and personal anecdotes to be financial advice or a recommendation to buy or sell any assets. The cryptocurrency market is extremely speculative, so prepare yourself for the possibility that you could lose any investment — whether it is your time and cost of electricity or money spent at a currency exchange.
Zcash
If you want to own one of the top 25 digital currencies, Zcash (ZEC) is the one that has given me the smoothest mining experience. Ethereum (ETH), my very first foray into GPU mining, took me about two weeks to hit a payout threshold of .05 ETH (at the current price, that much is worth around $36). More recently, I’ve used the same graphics card (an Nvidia Geforce GTX 1070) for Zcash mining and hit a payout threshold of .01 ZEC (about $5) every 24 hours. So over the same two weeks, I’m earning double the value from Zcash that I would from Ethereum — and that’s even after Zcash’s developers take a cut of the mining payout.
Sumokoin
You may have heard about this coin lately because of a sudden and dramatic market rally. When I started mining it about a month ago, it cost about $0.41 per full unit; then it hit a steady norm of about $1, then this week it surged above $2 and hit an all-time high of $5 Thursday morning. But what is it, exactly?
Sumokoin (SUMO) is a privacy coin forked off of Monero (XMR), using its same technique of including multiple dummy transactions in every block of the public ledger to mask how much you own and where each coin came from. This design provides privacy and fungibility that Bitcoin does not yet have.
Sumokoin is best understood as the Litecoin to Monero — set up as a smaller-scale, more nimble testing ground for coding improvements that are then freely shared with XMR’s developers. The project has only existed for about eight months but is integrating new features at a regular pace.
Since SUMO uses the Cryptonote mining algorithm, you can use a CPU to earn it at a slower (but not excruciating) rate or run both CPU and GPU mining programs at the same time.
If you’re just starting out with one beefy desktop for mining, it can take over a month to reach a payout threshold for Monero — and the fees will take a big bite out of what you just earned. Not a good feeling. If you want a faster reward that you keep more of, Sumokoin might be a better place to start.
Pirl
Pirl (PIRL) uses the same mining algorithm as Ethereum but is not built on the Ethereum platform. It boasts of being the first Ethash coin to have a Masternode system and is working towards developing a decentralized peer-to-peer marketplace a la OpenBazaar.
For people with mid-range hardware, the mining rewards come fast and small, as each block only takes 30 seconds to unlock. I won’t get anywhere close to the 10,000 Pirl required for a Masternode anytime soon, but I’m pretty happy getting a full unit of a coin with some modest growth potential every 15 hours or so.
Komodo
Komodo (KMD) is a growing Dapp (decentralized app) platform that’s mined with the same algorithm as Zcash (Equihash). It has recently surged into the top 50 cryptocurrencies thanks to BarterDEX, its live decentralized currency exchange, which has integrated a functionality called “atomic swaps” — allowing peer-to-peer trades between two blockchains without relying on a middleman like ShapeShift to convert them via a centralized exchange.
Your earnings with Komodo, dollar-for-dollar, won’t come as quickly as Zcash, but you will hit a payout threshold (often .1 KMD) faster with the same equipment — just a few hours, in my case.
ASIC Coins… with My CPU
This one is a neat little crypto earnings hack. At a site called CoinPot (that’s not an affiliate link to benefit me, if you’re wondering) you can set up wallets for a network of “faucet” sites allowing you to receive small amounts of Bitcoin, Litecoin, Dogecoin, and Dash for completing captchas and creating ad impressions. One feature of the CoinPot dashboard is web mining — I’m not certain if it’s the same service as CoinHive or not, but the same principles apply: you receive a balance based on how many hashes your CPU contributes, regardless of whether the pool of browser miners finds a block. And the balance is automatically added to my currency of choice, even if I’m most likely contributing to a Monero pool.
So, right now, with an old, obsolete desktop pushing at most 40 hashes per second, I’m earning about .000000035 Dash every five minutes, which adds up to about .0001 every 24 hours, or 11 cents at the current price. That’s about 1/70 of how much I would earn using a common ASIC miner, the Antminer D3, at its advertised speed of 19.3 giga-hashes per second — but without costing me at least $1,500 up front.
All of CoinPot’s supported currencies can otherwise only be mined with ASICs, so if you’re just dipping your toe in the pool (yes, even for BCash), you can get yourself a small balance without the wait times or fees you’d encounter while exchanging fiat for digital currencies.
Ezra Dulis is Deputy Managing Editor of Breitbart News. Follow him on Twitter and Steemit.
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