In the highly competitive cryptocurrency market, Monero (XMR) has managed to creep in. Created in April 2014, it is now the world’s tenth-largest cryptocurrency with a total market value of $3.26 billion which.
Monero is a favorite of investors and miners because of its terrible performance last year.
Monero rose from $10 in January 2017 to $494 in January 2018. It offers investors around 4800% returns. So astonishing!
So, if you are thinking of starting Monero mining now, you are not alone. Monero’s growth in the past year has drawn a lot of attention to the price of Monero and the Monero mining process itself.
Starting to practice Monero mining is indeed confusing, and you must have many questions such as: How does the Monero mining work principle? What software and hardware do I need? How to start? How long does it take to mine one XMR?
But there’s good news — today I’m going to answer all of the questions above and a lot more about Monero mining and the Monero calculator.
So, at the end of this tutorial, you really understand what Monero mining is and you can decide whether to mine Monero or not.
Before going directly to the main part of Monero mining, it is very important that you understand the price of Monero and the value of XMR to help you make a decision. You will also understand better what makes Monero so special.
What is Monero (XMR)
Monero, like Bitcoin, is a digital currency that can be used to send and receive payments. Imagine if Carl wanted to pay $100 to Ava, and they agreed to transact via cryptocurrency. Carl can pay using Bitcoin, Litecoin, Monero or other similar cryptocurrencies.
Where is the difference between Monero and Bitcoin?
If Carl and Ava want their transactions to be untraceable, then Monero could be the best choice for them.
Let me explain further:
If Carl sends money to Ava using Bitcoin, the transaction will be visible to everyone on the network. Everyone can know who sent and received it. This means transactions sent via Bitcoin are public and visible to everyone.
Even though Bitcoin is decentralized, it offers no privacy. Monero, on the other hand, is not only decentralized, it is also private. Monero technology makes all transactions 100% private and untraceable.
If the transaction is done using Monero, then only Carl and Ava will know about this transaction.
No one else on the Monero network can know that this transaction ever took place.
The privacy that Monero offers has made it very popular. Because some people feel uncomfortable telling other people what their money is being spent on.
Apart from total privacy, here are some unique features of Monero.
Monero is Fungiable
Sound complicated? Actually no. In fact, the concept is very simple.
Functionality means that currency units (or assets) can be swapped or disassembled.
For example, a $100 bill can be replaced with another $100 bill, or even two $50 bills. This is what makes all fiat currencies (USD, EUR, JPY, etc.) fungible.
While Bitcoin is not fungible. This is because someone may refuse to accept Bitcoin that has previously been used for illegal transactions.
This is possible because everyone can see the transactions that occur in the Bitcoin network.
So, one Bitcoin unit cannot be replaced with another Bitcoin, but Monero is different. Because no one knows anything about the previous transactions of Monero coins.
Everything is considered the same and can be replaced with one another.
Monero Mining Doesn’t Require ASIC
ASIC (Application Specific Integrated Circuit) is a special type of hardware used to mine Bitcoin. One ASIC unit can be worth between $600 to $1000, which makes Bitcoin mining not attractive to many people except professionals.
Fortunately, the Monero mining process doesn’t require you to buy an ASIC. In fact, mining Monero can be done using your computer’s CPU/GPU. This is what makes Monero a great choice for beginners who don’t want to invest a lot of money just to start mining.
So, now you have a better understanding of Monero and how it differs from Bitcoin. Now it’s time for us to address your next question – what is Monero mining?
What is Monero Mining
As of the writing of this article, there are a total of 15,829,795 XMR in circulation. This figure will continue to increase until there are 18.4 million Monero coins in circulation.
So, how are new Monero coins created?
The answer is very simple Monero mining!
Monero miners perform two important tasks:
In the previous example, suppose Carl sent $100 to Ava via bank transfer. In this scenario, it is the bank’s job to ensure that Carl has sufficient balance to pay $100 to Ava.
After the bank confirms the transaction, they record it so that it can be used as a reference in the future.
Now, if Carl sends $100 to Ava via Monero, so who will validate and record the transaction? The answer is Monero miners! This eliminates the need for a bank to confirm transactions.
The answer that often comes up is:
What are the benefits for miners? Yes, they are rewarded in the form of XMR coins every time they verify a transaction within the Monero network.
Whenever they use the resources at their disposal to validate a group of transactions (called blocks), they are rewarded with the latest Monero coins.
Rewards from Mining Monero
The reward you will get after verifying (mining) 1 transaction block is around 4.99 XMR, plus a transaction fee of 0.06573 XMR.
So how do the miner’s reward after all 18.4 million Monero coins have been mined?
Here’s the good news: After reaching 18.4 million XMR coins, new coins will be added to the system at an average rate of 0.3 XMR/minute.
These new coins are used to reward miners and continue to incentivize mining.
Do you know how long it takes to mine one Monero coin?
One Monero block is mined every 2 minutes, and we already know the reward amount for mining transactions is 4.99 XMR.
So, by simple calculations, we know 1 XMR is mined every 24 seconds.
Now you understand what it means and why we need Monero mining. Everything will be much easier when you understand how Monero mining works.
How to Mining Monero
As mentioned earlier, you don’t need to buy special hardware to mine Monero. Anyone with a computer can mine Monero. Even so, using more powerful hardware would be better.
Following are some ways to mine Monero. But, before we get into it, you need to know what a Monero mining pool is.
Monero Mining Pool
Before you start mining, you need to decide whether you want to mine Monero yourself or join a Monero mining pool.
In a Monero mining pool, a group of Monero miners work together and combine the power of their hardware. This gives them a greater chance of verifying transactions (the competition is fierce!).
The rewards they get from mining are also divided equally among all pool members. Most pools also charge an operating fee, which is usually around 0-2%.
Imagine if you contribute 5% of the total hardware mining pool where you work. This means you also receive 5% of the total rewards earned by the pool.
Solo mining (mining independently) is not recommended for beginners. Solo mining will yield nothing unless you are prepared to invest a large amount of money in the hardware.
You can choose from the many Monero mining pools on the market. You can see a list of the pools below.
Pool fee: 1%
Pool fee: 0.6%
Pool fee: 1%
Pool fee: 2%
Various Ways of Mining Monero
The most important thing is to have the right hardware to mine Monero. Apart from hardware, you also need software that helps you connect to the mining pool.
As I said, you don’t need a special ASIC to mine Monero. This can be done using the CPU or GPU.
But before starting, you need to know that the two most important factors in choosing hardware.
You should pay attention to:
- High hash rate – You can think of the hash rate as the processing power of the hardware.
- Low power consumption – Electricity is the biggest cost for mining.
- I will now describe the three most popular software and hardware options
Central Processing Unit (CPU) Mining
You can choose to use your current CPU or you can buy a new CPU. If you are buying a new CPU, then AMD Opteron and Intel Xeon CPU are the two that I recommend
AMD Opteron 627
- Price – $50
- Hash Rate- 415 H/s
- Price – $150
- Hash Rate- 130 H/s
Once you have the CPU you want, you will then need to download the Monero mining software. You can use XMR-STAK-CPU because it is the most popular software — you can download it here.
If you are using Windows, then we recommend that you download xmr-stak-cpu-win64.zip (shown in the screenshot below). XMR Stak charges a 2% development fee unless you can compile the source code yourself.
If you already have a CPU, you can start mining right away! Just install the software, join a pool, and you’re ready to compete.
Mining with AMD’s Graphic Processing Unit (GPU)
If you want to be serious about mining Monero, then using a GPU is a better option. Although it costs more, the GPU offers a much higher hash rate.
AMD graphics cards are a great option to use when mining using GPUs. Try buying an AMD R9 280x or buying a newer GPU like the AMD Radeon Rx 580.
AMD R9 280x
- Price – $140
- Hash Rate- 500 H/s
AMD Radeon Rx 580
- Price – $300 – 400
- Hash Rate- 575 H/s
After you install the graphics card into your PC or Laptop, follow the same steps as you did with Monero mining using the CPU.
The best Monero mining software when using AMD GPU hardware as well as XMR-STAK-AMD. You can download the latest release here: https://github.com/fireice-uk/xmr-stak-amd/releases/download/v1.1.0-1.4.0/xmr-stak-amd-notls-win64.zip.
After you have installed the software on your computer, you will need to change the pool settings so you can join the pool of your choice.
Mining with Nvidia GPU
Using an Nvidia graphics card is another popular way to mine Monero. There are several models that you can choose from. Everything depends on your budget. You can choose one of the following options:
Nvidia GTX 1070
- Price – $400 – 500
- Hash Rate- 505 H/s
Nvidia GTX 1080
- Price – $550 – 650
- Hash Rate- 600 H/s
Regarding the use of software, XMR-STAK-NVIDIA can be used but CCMiner is a better option.
You can download the latest release of CCMiner here. Make sure you select ccminer-x64-2.2.4-cuda9.7z if you are using a Windows operating system.
These are some of the best methods for mining Monero using a combination of Monero mining hardware and software. However, one more nest before you start mining — create your two Monero wallets.
There are not many choices when it comes to choosing a Monero wallet. Hardware wallets (which are the safest option) are not yet available for Monero coins.
The two most popular wallets, which are also featured on the official Monero website are:
- MyMonero web wallet: Just go to their website and create an account to use it right away.
- Monerujo: This is a mobile wallet only available for Android devices.
On the official website, they state that the Monero community has funded the development of a Dedicated Hardware Wallet which is now underway. Ledger Nano S is also working on integrating Moner into their hardware wallet.
Hope these things happen soon!!
You should already have a good understanding of the various aspects of Monero mining. However, you may still hesitate to start Monero mining or not?
Should You Mine Monero?
You want to mine Monero for profit, right?
Well, while mining Monero can be profitable, it depends on a variety of factors, the most important of which are the following:
- Hash Rate: How powerful is your hardware
- Power Consumption: How much electricity your hardware uses
- Price Per KWh: How much electricity do you spend per unit
- Pool fee: The cost of the mining pool you join
- Initial cost to buy your hardware
- You can try using the online Monero calculator to calculate your mining profit! We recommend CryptoCompare’s Calculator for Monero.
Mining profits also depend on the price of XMR. Cryptocurrency prices can rise and fall very quickly, and these prices will have an impact on your mining profitability.
It’s all up to you on the actual start. Consider the above factors before you make a decision. So remember, the more you invest, the more rewards you will get.
So, you already understand how to mine Monero, how it differs from Bitcoin, and calculate profits using the Monero calculator. You also know the definition of Monero mining and the various ways to do it.
Monero mining can be profitable or not, it all depends on these factors: hash rate, electricity costs, hardware costs, etc.
If you think mining Monero is for you, then you can use the information in this tutorial to start mining!