While Bitcoin miners perform complex calculations in pursuit of “digital gold,” Ether mining becomes more accessible and in demand. Unlike BTC, the issue of the second coin by capitalization - Ethereum - is not limited.
Add to this the future prospects of cryptocurrency, smart contracts and solid rewards for participants - Ethereum mining will remain popular for a long time.
We'll tell you what it is and how to mine Ether in 2021.
General information
- International designation: ETH .
- Ether Icon:
- Dynamics of changes over the past year on the screen:
What is Ethereum
- Dynamics of changes over the entire time on the screen:
- Appearance: August 2015.
- Official website: https://www. ethereum.org/
- As of today (02/18/2018), Ethereum capitalization is RUB 5,091,679,449,682. ($90,262,160,537).
- Ethereum rate today (02/18/2018): 52,111 rubles ($923.97).
- Source code: https://github.com/ethereum/
Equipment for mining using the Ethash algorithm
There is no consensus on what specific hardware is best for Ethereum mining . It all depends on the specific tasks, as well as on the user’s preferences.
Recommended operating parameters of the video card:
- 4 gigabytes of RAM or higher;
- frequency from 1200 MHz;
- number of hash operations performed per second - 22–26 million (Mh/s);
- Availability of the most current versions of installed drivers.
A video card with such performance can be purchased for 15–20 thousand rubles, but recently there has been a trend towards a constant increase in prices on the market for these products.
In the future, this trend will decline, as ordinary video cards are gradually being replaced by professional ASIC farms optimized for cryptocurrency mining, the integrated circuit of which is developed exclusively for the tasks of miners. Despite this, ASIC farms still have difficulty with Ethash due to its inherent complexity for them, so they are still not suitable for full-fledged Ether mining.
The opinion is becoming popular that in the future the mechanisms for allocating resources will undergo changes, and the mining process as such will be somewhat transformed. According to Buterin’s assumption, put forward in his article published on his personal website, over time the role of mining in Ethereum production will gradually decrease. Therefore, it is worth paying attention to alternative methods of producing Ether.
The difference between Ethereum and Bitcoin
At the heart of Ethereum is the next generation of blockchain technology, which is different from the technological foundation of Bitcoin.
The essence of Blockchain technology is the creation of block chains, where each block is a network node that executes and records one mathematical proof that this block is a consequence of the previous block. As a result of the creation of such blockchains, a distribution database is formed that is maintained throughout the entire network. Importantly, all user interactions with block creation transactions are protected by strong cryptography.
In the Bitcoin network, the network is created from ledger blocks. A transaction in Bitcoin is the transfer of coins (tokens) for funding between users. Bitcoin caching algorithm SHA-256, volume of one chain 1 MB, 3 transactions per minute.
The development and popularity of Bitcoin gave rise to the creation of altcoins that improved the Bitcoin code and used and are using other caching algorithms.
It is important to note that Bitcoin and Altcoin technology does NOT imply program changes within one block. In other words, you can create blockchains, but you cannot change their purposes.
In 2013, Vitalik Buterin suggested, and in 2014, in a team with Gavin Wood and Jeffrey Wilk, he began to create Ethereum, which uses new generation blockchain technologies.
Course and principle of operation of Etherium
As you can see in the graph, throughout 2018 Ethereum showed a clear decline:
Ethereum rate in 2018
At the beginning of 2022, the cost of the crypto coin in question was $8-12, and in June the price maximum reached almost $400 per coin. However, after such a rise, the price went down, and in November 2018 it became less than $200. But Bitcoin has already taught users who make money on cryptocurrency that steep falls sooner or later end in a complete recovery and reaching new price highs.
Launched in 2015, the new virtual coin, which many experts consider an advanced version of cryptocurrency, already has quite a rich track record.
Despite the fact that making money on Ethereum today is considered a very promising and profitable direction, Bitcoin remains the most popular cryptocurrency with the largest capitalization and the highest price. However, no expert can say for sure how Ethereum will behave in 2022 or next year. The majority still question such statements, but at the same time do not refute the rapid development of this currency. At the moment, the cost of the coin in question does not exceed $295-300.
At the moment, the rapid increase in the price of ETH is explained by the following factors:
- Many giant companies have entered the community to develop this virtual coin, incl. Microsoft, Intel, Santander, BP, ING;
- Cool information campaign;
- Soaring demand for production in 2022.
As for the principle of operation, unlike the first cryptocurrency, Ethereum has the following advantages:
- Transactions are much faster since there is no need for large services to participate in the operation. In addition, the history takes up minimal space on the disk (4 times less than during operations with Bitcoin).
- Smart contract technology . You can specify the conditions for executing a transaction in arbitrary code. This principle of operation is reminiscent of a transaction guarantor, only it is carried out free of charge. Many large American companies have already become interested in this opportunity and intend to integrate currency into their business.
- The new blockchain technology has long-term potential , so it can be used in various industries.
After analyzing the price spikes and understanding what Ethereum is and how it works, it is not surprising that many users are looking for ways to earn it.
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Ethereum Virtual Machine
Ethereum continues to be a programmable blockchain. However, now the user does NOT have a set of predefined operations, but the ability to create his own operations of any complexity. That is, Ethereum has become a platform for many different types of NOT centralized “blockchain” applications, and the ETH cryptocurrency is only a part of “ether”.
The basis of Ethereum is the Ethereum Virtual Machine (“EVM”), which, by changing protocols, can execute code of any algorithmic complexity.
You can think of Ethereum as a global computing computer, where one calculation is created and recorded in a flowchart. Each block diagram has a peer-to-peer network protocol, the block database is maintained and updated from many nodes connected to the network.
But the Ethereum “notional computer” does not serve to speed up calculations; on the contrary, it makes calculations slower and much more expensive.
Like programming languages, the Ethereum platform is faceless. Ether allows users to decide what they should be used for.
How to earn Ethereum without investment
Earning Ethereum without investment
Cryptocurrencies, in particular Ethereum, are following the path of global transformation of the financial sector, so it is not surprising that interest in the coin continues to grow. But what to do if you don’t have funds to buy ETH?
Don’t be upset, as you can get altcoin for free. The most popular ways to earn Ethereum without investments are faucets, airdrops, bounties and freelancing.
Ethereum faucets
Ethereum faucets are sites that pay users for visiting their platforms and completing simple tasks. A faucet is like a lottery that releases a certain amount of ETH at fixed intervals.
There are a sufficient number of similar services on the Internet, and the mechanism of their operation is identical to each other.
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The only thing that distinguishes the faucets is the size of ETH accruals, their frequency and the minimum threshold for withdrawal of funds.
Today, the most popular faucets that pay their users are: Ethfaucet, Allcoins.pw, ClaimFreeCoins, AutoFaucet.
To earn Ethereum, the user does not have to complete complex tasks. It is only necessary to enter the captcha at certain intervals, thereby confirming the absence of bots in the system for the purpose of fraud.
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Read the full article: Cryptocurrency faucets: earning coins for free
The most convenient way to work with Ethereum faucets is from your phone. The review below presents the best Ethereum faucets in 2022:
Ethereum faucets 2021
So, let’s look at the mechanism of how an Ethereum faucet works using the example of the popular EthereumFree service.
First, enter the request EthereumFree in the search bar of your browser or follow the link to the service’s website. After logging in, a window will appear with various advertisements, for viewing which, in fact, money is paid.
Ethereum faucet interface EthereumFree // Source: Ethereumfree.info
In the “Sign Up” tab, enter the email and password that will be needed in the future to log into the service, then click “Create Account”. That's it, registration is completed!
Ethereum faucet registration window // Source: Ethereumfree.info
Now you can start directly earning Ethereum. Every five minutes, the faucet awards 1610 Gwei, which are transferred to your account balance upon clicking the “Claim Now” button.
Accrual of Gwei in the EthereumFree service // Source: Ethereumfree.info
The service also supports other options for coin accrual rates depending on the time frame, so the user can independently choose the most acceptable one:
- 5 minutes - 1610 Gwei;
- 10 minutes - 2890 Gwei;
- 15 minutes - 3860 Gwei;
- 30 minutes - 6430 Gwei;
- 1 hour - 12860 Gwei;
- 4 hours - 32140 Gwei;
- 24 hours - 48220 Gwei.
Features of the EthereumFree service // Source: Ethereumfree.info
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Help: Gwei is a microparticle of ETH, the equivalent of which can be calculated using a special calculator, for example cryps.info.
If you log into the service once a day, your earnings will be 48220 Gwei or 0.00004822 ETH. If you receive payments every 5 minutes, you can reach a level of about 400,000 Gwei or 0.0004 ETH. Therefore, to reach the withdrawal limit (0.01 ETH + transaction fee), which is issued in the “Account” tab, it will take more than 7 months if you receive a reward once a day and about a month with constant activity, taking into account 4 hours of sleep.
Withdrawal window in the EthereumFree service // Source: Ethereumfree.info
But what is 0.01 ETH? At today's current exchange rate, this is a little over $19. The best solution is to use several Ethereum faucets at the same time. But, unfortunately, most of the earnings will go to cover electricity costs, and not to mention the time and effort spent.
Bounties and airdrops for earning Ethereum
Earning Ethereum from bounties
Many blockchain startups distribute free cryptocurrencies through bounties and airdrops. The main goal of such campaigns is to increase awareness of the project and its products, as well as attract the attention of a wider audience.
In turn, the user is given a number of tasks (usually activity on social networks), for which payment is intended.
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In total, you can make good money on such tasks (up to several $10 from one campaign). Everything depends only on the activity of the participant.
In order not to waste time searching for organizing projects, it is recommended to use specialized services, for example, airdrops.io, COINAIDROPS, BountyHub.
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Read the full article: What is an airdrop of cryptocurrencies - is the game worth the candle?
Freelancing services for Ethereum
Earning money from freelancing
To search for vacancies in freelancing, we recommend using foreign platforms, the most popular of which are UpWork, XBTFreelancer, CryptoGrind, BitGigs, Coinality. As for the Russian freelance segment, it is underdeveloped. Yukon.To is one of the Russian-language freelance exchanges where you can find work for cryptocurrency.
Of course, the more popular payment method in cryptocurrency is Bitcoin, but you can always agree with customers to pay in ETH.
Note that due to the high volatility of cryptocurrencies, many are simply afraid to enter into transactions in digital coins.
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However, in order to protect yourself from situations such as withdrawal, you can fix the exchange rate in rubles, dollars or euros, and recalculate into ETH upon completion of the task.
How does Ethereum work?
Ethereum includes many of the features and technologies of Bitcoin, as well as many modifications and innovations.
For example, if Bitcoin is a list of transactions, then Ethereum is a collection of accounts. The Ethereum blockchain keeps track of the state of all accounts, and state transitions in Ethereum blockchains are the transfer of value and/or information between accounts.
There are 2 types of accounts in Ethereum:
- EOAs are external owners. They are controlled by private keys.
- Contract accounts. They are controlled by their contract code and are only activated by EOA.
An EOA user can create new contact accounts (contacts) that are governed by their internal code. Each such contact is created by embedding a code into the blockchain.
Contract accounts can perform a transaction when notified by the EOA. That is, it is not possible for a contact to perform its own operation, such as generating random numbers or calling an API. The contact can do this if there is an EOA call.
What is Ethereum Mining
Ethereum is a technologically advanced version of Bitcoin. Its blockchain is unique in itself.
Before diving into the intricacies of Ethereum mining methods, it is important to have a basic understanding of coin mining.
- Ethereum mining is based on a special algorithm – ethash. It hashes (transforms) the metadata of the last block in the blockchain using a special key (nonce).
- The Ethereum network sets a target hash value for each block. The miner who managed to find the correct code (nonce) receives a reward in his wallet. The solved block is added to the end of the blockchain chain.
Since Ethereum is a very popular crypto network, Ethereum miners need to compete with thousands of other participants to be the first to confirm a new block.
Guessing the nonce code on your own is almost impossible. The only way to find a key is to try different options until the desired value is found. Special programs help the miner with this: they sort through private keys.
Where is the income?
A complex blockchain scheme, NOT created for fun. Like the Bitcoin network, users pay a light fee for transactions in Ether. This protects the Ethereum blockchain from frivolous or malicious computing tasks such as DDoS attacks or infinite loops. The sender of the transaction must pay for each step of the "program" they have activated, including computation and memory. These fees are paid in Ethereum cryptocurrency.
Transaction fees are charged by nodes that verify the network. These “miners” are nodes on the Ethereum network that accept, distribute, verify, and execute transactions.
Following the "miners", miners group transactions, which involve many updates to the "state" of accounts on the Ethereum blockchain, into so-called "blocks", and then the "miners" compete with each other to ensure their block is next, in addition to the blockchain.
Miners are rewarded with Ether for each successful block they mine. This provides an economic incentive for people to contribute equipment and electricity to the Ethereum network.
Just like in the Bitcoin network, miners solve a complex mathematical problem to successfully “break” a block. This is called "Proof of Work".
Any computational problem that requires an order of magnitude more resources to solve algorithmic problems than is required to verify the solution is a good candidate for a proof of work.
To prevent centralization due to the use of specialized hardware (such as ASICs), as happened in the Bitcoin network, Ethereum chose a complex computing task.
A complex problem requires more CPU memory and makes it impossible to solve on a single device. This allows Ethereum to be ASIC resistant and allow for a more decentralized distribution of security. An excellent alternative to blocking devices used in specialized hardware such as Bitcoin.
Step-by-step instructions for mining Ethereum: where to start for a beginner
What you need to get started:
- Register an Ethereum wallet.
- Select suitable equipment.
- Decide on a mining pool.
- Select and configure suitable software.
Let's talk about everything in order.
Creating an Ethereum wallet
How to start mining Ethereum? From creating a wallet.
Storing Ethereum on an exchange is risky. The most reliable (and safe) way is to store crypto in your own wallet. The mined Ethereum will go to it.
Any Ethereum wallet has two keys – private and public. Both are required to complete transactions.
- The public key is associated with the wallet address. Knowing it, other users will be able to send you crypto coins. The public key can be shared with anyone without worrying about the security of your funds.
- Private (private) key – password for your wallet. You cannot give it to anyone - you risk being left without coins. Otherwise, anyone can steal the coins.
- Every time you want to send cryptocurrency to another user’s account, the system will ask you to specify the recipient wallet address. And then confirm the transaction using the private key.
Creating an Ethereum wallet is done in a couple of clicks: just install the software and generate the address to which the coins will be sent.
About
How to buy and sell ETH
You can easily buy or sell ETH coins for other digital currencies or for fiat using a bank card on crypto exchanges or online exchangers. ✅
Through the exchange
You can buy or sell Ethereum for fiat money or cryptocurrency on all the most popular trading platforms.
For example, the top exchange Binance provides several options for purchasing Ethereum:
- Instant exchange;
- Trading on the classic spot market (market, limit and stop limit orders);
- P2P transactions with token holders directly without intermediaries.
The buying/selling process is standard: we select the currency and payment method, as well as the amount and other payment details.
