Crypto Mining

Litecoin Mining Guide – How to Mine Litecoin

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Mining cryptocurrency can be a great way to put more money in your pocket, as long as you know what you are doing. Those who are just starting out might find it to be very confusing but the process is more straightforward than many people would expect.

Our ultimate guide to mining the Litecoin cryptocurrency tells you everything you need to know.

Litecoin – A Brief Introduction

Litecoin was first released in 2011 by a Google employee, Charlie Lee, and has become one of the most popular cryptocurrencies to mine.

It has since grown into one of the largest cryptocurrencies by market cap, with Litecoin having some key differences when compared to the market leader, Bitcoin, often considered its brother. Litecoin is quicker to use than Bitcoin due to the fact that transactions using this cryptocurrency typically take 2.5 minutes or so to be completed, compared to around 10 minutes for Bitcoin. In addition, Litecoin has adopted a more common scrypt hash algorithm compared to Bitcoin’s SHA-256.

There are similarities too, however. Litecoin is both peer-to-peer and decentralized, just like Bitcoin, though it uses a different hashing algorithm. Litecoin, also in the same way as Bitcoin, uses a distributed ledger that is known as a blockchain.

How Are Litecoin Cryptocurrencies Mined?

When cryptocurrencies first began to grow in popularity, they could be mined through a computer and a lot of people got very rich, very quickly, as a result. The process is a bit more complicated when Litecoin is involved, though, due to the fact that specialized mining hardware needs to be used. People can still make a profit out of mining Litecoin but they might find it more challenging to do so than it was a few years ago when there was less interest in this cryptocurrency.

There are three main ways to go about mining Litecoin nowadays and the first of them is solo mining. ASIC (application-specific integrated circuit) miners can be a good way to go about mining Litecoin as they are a lot powerful than the computers people used to originally use to mine cryptocurrencies.

Second up as an option for mining Litecoin is joining a mining pool, which allows those interested in mining cryptocurrencies to team up in a group or ‘pool’ to produce more LTC.

Using a cloud mining service is the third way to mine Litecoin and this works by using a company that allows Litecoin mining equipment to be leased on a temporary basis.

Getting Started With Mining Litecoin

The first thing people who want to mine Litecoin need to do is to set up a Litecoin wallet. This does exactly what it says on the tin; provides a safe and secure place to store Litecoin. Various Litecoin wallets are available so you can check them out online and decide which is right for you.

Deciding on the hardware you are going to use to mine Litecoin is next. You might be able to use computer equipment you already possess, but in all likelihood, you will have to invest. Any cryptocurrency mining hardware you buy to mine Litecoin will likely come with all of the software you are going to need, so installing this is the next thing to do on your list.

Then, you are just about ready to go – there is not that much to it. Realistically, you could be ready to mine Litecoin in a few minutes Remember you should keep an eye on your Litecoin mining to make sure it is running as smoothly as you expect it to – and is making you cash.

Things To Consider When Mining Litecoin

While it is still possible to be profitable as a Litecoin miner nowadays, there are a few things that you should consider first before getting into this cryptocurrency.

The first of them is deciding whether to go it alone or to join a mining pool. The main benefit of solo mining is obvious – you get to keep all of the proceeds – but mining pools can be a safer way to get started for those who are still learning the ropes when it comes to mining cryptocurrency. In addition, it will be a lot cheaper to join a mining pool.

Power consumption is going to be a key factor in how much money you can make from mining Litecoin. For obvious reasons, you do not want to be spending more on the electricity you need to mine cryptocurrency than you are making from the production of Litecoin itself. It is worth ensuring you are on the best possible deal for your electricity supply as well, for this reason. Most people will find that switching suppliers can save them money on their bill so take the time to research this.

Litecoin Mining Pools – How Do They Work?

Pay Per Share System

Litecoin mining pools work in a couple of different ways – the proportional system and the pay-per-share system. The pay-per-share system means a fixed number of Litecoin is paid to the group, so this provides a more reliable income stream for people mining cryptocurrency.

Proportional System

On the other hand, the proportional system means that mined Litecoin are shared between everyone who worked towards mining it. Some believe this system is too easy to be cheated, however.

Mining pools increase your chances of hitting a block you can unlock, whereas if you go solo, you might be running your hardware for hours and hours at a time without getting lucky. Pool fees might have to be paid, though, which can eat into profits you would normally be able to keep when solo mining. Check these fees before joining a mining pool.

Checking the Profitability of Your Litecoin Mining

Once you are up and running with your Litecoin mining, you need to make sure your output is profitable – that you are making more money from mining than you are spending.

To do this, you need to be able to find out the exact cost of your electricity. You can do this by checking your power bill for the kW/h price. With that figure, you can then check out profitability reports that are updated very regularly on the internet to see what you are making from your Litecoin mining.

If you chose to invest in powerful hardware for your Litecoin mining and started in a pool, this might be the time to consider going it alone. The risks are greater for solo mining but the rewards on offer are far greater, so it is up to you whether you want to take the gamble or not. Again, you can use a profit calculator to see whether solo mining would be the right move to make.

By now you should have all the information you need to get started – happy Litecoin mining and here is to your success!

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    froleprotrem

    January 22, 2020 at 2:17 am

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