What is Filecoin & Cloud Mining?
Mining
In the course of recent years, cryptocurrencies like Bitcoin have been discreetly developing in popularity, with an ever-bigger number of people purchasing and selling them. Presently that Bitcoin has hit the mainstream and become a worldwide phenomenon, more individuals than ever are hoping to get into the digital currency game.
Mining is a process of adding transaction records to Bitcoin’s public ledger called the Blockchain. It exists so that every transaction can be confirmed, and every single user of the network can access this ledger. It is also used to distinguish legitimate Bitcoin transactions from attempts of re-spending money that has already been spent somewhere else.
However, the creation of cryptocurrency is nothing similar to that of regular money. There's no focal authority that issues new notes; rather, bitcoins ( or any of the other alleged 'alt-coins') are generated through a procedure known as 'mining'. So what is cryptocurrency mining, and how does it work?
Mining new blocks
As there is no central bank or central authority, there has to be a way of collecting every transaction carried out with crypto in order to generate a new block. Network nodes that carry out this process called “miners”. Every time a lot of transactions are amassed into a block, this is added to the blockchain. Whoever adds the block gets rewarded with some of that cryptocurrency.
In order to avoid the devaluation of the currency by miners generating lots of blocks, the task is made harder to conduct. This is done by forming miners to solve complicated mathematical problems called proof of work.
Hashes Calculation
To successfully create a block, it must be followed by a cryptographic hash that fulfills certain requirements. The only best way to arrive at a hash matching the right criteria is to simple calculation and wait until you get a matching hash. When the correct hash is accessible, a new block is formed and the miner that found it is awarded units of cryptocurrency.
Just consider it as a competition where you have to guess the weight of the box- only you get unlimited guesses, and the first one to submit a right answer wins. Whoever can make guesses at the fastest rate has the highest chance of winning.
What is Filecoin & Cloud Mining?
Filecoin mining pool is a method of bitcoin mining using a remote datacenter with shared processing power. This type of cloud mining allows users to mine bitcoins or alternative cryptocurrencies without managing the hardware. All these mining rings are maintained and housed in a facility owned by a mining company and the customer simply needs to register and purchase mining contracts.
Filecoin is a decentralized storage network that turns cloud storage into an algorithmic market. Miners earn the native protocol token (also called “filecoin”) by providing data storage and/or retrieval. Conversely, clients pay miners to store or distribute data and to retrieve it. “Filecoin” can refer to a) the network, b) the protocol, c) the token powering the network, and d) the project.
Advantages of Cloud Mining
No need for space
Less cost of electricity
No requirements for hardware/software/technical experience
Instant connection
24/7 uptime
No Pre-ordered mining hardware that may not be delivered on time
Disadvantages of Cloud Mining
No fun! If you like building your own mining systems.
Cloud mining services cost high expenses