How to mine bitcoins the alternative way

First of all, why mine alternate coins ?

Because Bitcoin comes with a number of issues:

1. Algorithm

Bitcoin uses SHA-256, which is a hash algorithms that almost entirely requires CPU cycles to calculate. This means that it is easy to create custom hardware to perform this calculations. That's the main reason why altcoins use Scrypt cryptographic function. Scrypt was specifically designed to make it as expensive as possible to create hardware that is specifically good at doing that hash function. Scrypt is more memory-intensive and therefore harder to implement in custom hardware. The first altcoin to implement Scrypt is Litecoin. 

2. Amount of coins that can be mined

Bitcoin has a limit of 21 million coins. Some altcoins raise this limit, such as Dogecoin, others lower it, such as 42.

3. The rate at which new blocks are created

Bitcoin blocks are mined at an average rate of one block every 10 minutes. Many merchants require that a transaction has been confirmed by several blocks before they accept it. With a confirmation time of 10 minutes (in fact, the recommended amount of confirmations to wait for is 6) can be quite cumbersome in certain use cases. Litecoin has a confirmation time of 2.5 minutes.

4. The time it takes before the maximum amount of coins is created

Block rewards usually have a halving time. Every halving time the block reward halves until it is too low to represent using the maximum precision and it becomes zero. With Bitcoin it will take until 2140 until the block reward becomes zero. Some coins shorten this period. Sometimes they shorten it so much that the creator (who mines first, of course) is accused of pre-mining because he can mine very fast and easy in the beginning of the existence of the coin. Be aware of scam coins like this.

5. Expensive mining

Unless you have a lot of money to invest in special equipment, mining just Bitcoins is way too expensive. In previous post I've explained a lot about Bitcoin mining and why you shouldn't support nor trust companies behind ASIC miners. 

With alternate coins you have a lot of choices especially when it comes to hardware. I noticed there aren’t a lot of good beginner tutorials for coin mining so I decided to make my own. Inside you will find info about optimal hardware configuration, what software is required and most important how to make money, how to brake even.

I decided to go with survey downloads but not because I like them that much. It's more a test to see how will it go. I know there are people who don't like surveys so I'll give you a hint: get this addon for Chrome first.

Filed Under: mining on Saturday, February 1, 2014