Cloud Mining Explained
Cloud Mining contrary to the literal meaning the name suggests, cloud mining is a system of mining in which miners subscribe to the services of a mining company by way of mining contracts or shares. The main idea behind cloud mining is that different miners from several locations are able to mine cryptocurrencies whilst sharing the same datacenter. This data center is usually located in a remote area and serves the processing need of the miners using that cloud. Just like the general concept of cloud storage which involves storing data online with an already built hardware, cloud mining provides the same hardware facility for a miner who doesn’t have sufficient mining processors and hardware to fully see through the process.
Benefits of Cloud Mining
Cloud mining has a lot of benefits. Firstly, the miner isn’t saddled with the responsibility of maintaining the mining rigs. By this, what is meant is that the company offering cloud mining services takes care and is fully responsible for the proper functioning of the facility. Secondly, cloud mining offers miners access to better processors and hardware which increases the likelihood of a productive mining exercise. Also, cloud mining provides a level playing ground for miners to meet each other and interact.
Shortcomings of Cloud Mining
Cloud Mining is not with its shortcomings. Despite the great benefits, cloud mining isn’t so rosy in all terms of its use. The miner is expected to pay for the services of the company hosting the cloud. In addition to the subscription payment, some companies charge a certain percentage of the cryptocurrencies mined; that is if the mining is successful. As a result of this, miners who use cloud mining do not make as much as other miners.