You have probably read about bitcoin in the last few months and it is likely that not everything you read praised the digital currency. What you probably read in the last few days was that bitcoin fell from an all-time high of around $266 dollars, that is, per bitcoin, to $97 as of today. That’s still a lot considering the value of a single bitcoin was just $13 on January 1, 2013.
Currency is interesting for several reasons and while it would take too long to go through all of them, I would like to mention a few. First, it is a virtual currency that is not managed by a central authority but by an Internet-based network. The currency can be exchanged like any other currency, you can exchange dollars, euros or any other currency to bitcoins and vice versa. Bitcoins are created through a process called mining. In a nutshell: a mining program is running on your computer that will use your computer’s processing power to create new bitcoins.
Individual users must be very lucky to stand a chance in the race to create new bitcoins, which is why many join so-called groups that divide parts of the works among their members to stand a chance against server farms, supercomputers, and larger networks. Merge mining will reward you with smaller but more frequent returns.
I would like to thank Ghacks reader Alex for helping me tremendously on this matter.
Setting up your bitcoin mining PC
You need two tools to get started:
- A secure wallet that stores all the bitcoins you own.
- A mining program that allows you to use your computer’s resources for mining.
There are several wallets from which you can choose one. Electrum is a cross-platform wallet for Windows, Linux, OS X, and Android that is available as binary and source files. Windows users can download a portable version of the app or use the installer to install it on their system. Setting it up shouldn’t be a problem for you, just make sure you store the passphrase in a safe place so you can retrieve your wallet at any time if you forget the authentication password.
Guiminer or Gui mining is a free portable program for Windows operating system that you can use to mine bitcoins on your PC. The main benefit of the program is that it includes everything you need to get started. It supports joining a mining pool, but also solo mining if you prefer to go that route.
Now that you have the tools to start mining bitcoins, you should consider joining one of the mining pools. There’s Sleet Pool which I’ve joined by now, for example. You must register on the pool’s website to receive one or more worker logins that you must enter into your program, in our case Guiminer, in order to start mining and get credit for your efforts.
Naturally, you can join any of the other linked groups directly from the app, or use the other option to enter a custom hostname and port instead if the group you’ve joined doesn’t appear in the program.
Keep in mind that mining will tax your computer a lot, so it’s best to do it if it’s idle and not while you’re working on it. While you can continue to write blog posts and do other light activities, you’ll notice that more demanding activities will be slower than usual.
The program displays a couple of pieces of information about your system speed and so on, but if you’re interested in knowing how much your mining has earned you, you should visit the mining pool’s website, as this is where it’s at. listed.
Here you can see the estimated, unconfirmed and confirmed rewards shown to you. Don’t expect to earn several bitcoins a day using a single personal computer, but if you are persistent, you will earn money this way. You can also enter your Bitcoin address (shown on your wallet) on the mining pool website to receive bitcoins mined there.
You are probably wondering how fast a single personal computer can go. Actually, not so fast. My Intel Core i7 860 cpu, 8 Gigabytes of RAM and an Nvidia Geforce GTX 470 graphics adapter is clocked at about 102 Mhash/s. The hall of fame on the Slush pool website shows that some users managed to generate more than 149000 Mhash/s.