No Gear, No Problem! 3 Ways to Earn Bitcoin Through Cloud Mining

Bitcoin-Mining

Most people think of crypto mining simply as a way of creating new coins.

Introduction

In addition to lining the pockets of miners and supporting the Bitcoin ecosystem, cloud mining serves another grander and vital purpose: it is the only way to release new cryptocurrency into circulation. By releasing new coins in circulation, by extension, also releases more money.  In other words, miners are basically “minting” currency.

Crypto mining is known as the process of validating cryptocurrency transactions on a blockchain network and adding them to a distributed ledger. The challenge lies in that digital currency is a digital platform that can easily be manipulated. Bitcoin’s distributed ledger, therefore, only allows verified miners to update transactions on the digital ledger.

The process of crypto mining is often very long, painstaking, costly and only sporadically rewarding if and when you get it right. Still, the prospect is appealing to a lot of traders simply for the fact that miners get to be rewarded for their work with crypto tokens. It’s without doubt that one of the few methods buyers should purchase BTC without shopping for it straight from the market, and it’s quick turning into a trade dominated by huge money advantages.

While there are a variety of crypto investments that you could choose from, most are ‘high risk, high reward’ in nature and you could as well make a massive profit as you could hit rock bottom. But fear not, because there are still ways to guarantee you see a return of investment when it comes to bitcoin. Here are some of them: 

1. Cloud mining contracts

It’s widely known around the trading circles that one of the best ways you can passively earn cryptocurrency is through cloud mining. While pool and individual mining methods require some form of technical expertise and a physical mining setup, cloud mining does not. 

It’s simply the process of generating cryptocurrencies by using computing power from a third party – or a cloud mining operator. To do so, you would simply just need to place some funds into a cloud mining service provider, and in turn, the firm will invest those funds into a physical mining operation. 

It also means that miners are getting paid for their work as auditors. They are doing the work of verifying the legitimacy of Bitcoin transactions. This convention is meant to keep Bitcoin users honest and was conceived by Bitcoin’s founder, Satoshi Nakamoto. By verifying transactions, miners are helping to prevent the “double-spending problem” prevalent in bitcoin trading.

2. Cryptocurrency loan services

Many cryptocurrency loans work as a form of peer-to-peer lending. The borrower uses their cryptocurrency as collateral to take out a loan, while the lender puts up their own cryptocurrency to serve as a loan and earns some of the interest that the borrower pays.

Most platforms screen borrowers and issue the loans themselves, then simply share the profits with the lenders. This creates an experience similar to the way banks offer loans and pay interest to savings account holders. Others act as marketplaces where borrowers and lenders can come together and browse each other’s offers.

While a little more traditional, availing of cryptocurrency loan services is also another option for holders to get more bitcoin using their current holdings. This doesn’t require any additional investment such as mining, and can be done through simple loan services that offer a return on deposits. 

3. Centralized exchanges

It’s also worth keeping in mind the many different centralized exchanges that offer bitcoin holders a return on their BTC deposits, albeit at slightly lower rates. Binance, one of the largest CEX in the crypto ecosystem, offers users an estimated APY of 0.5%, while third-ranked exchange Huobi offers 1.32%.

There are actually multiple ways to increase a Bitcoin stack as opposed to simply buying on the open market, but they are becoming scarcer as time progresses. With large institutions, energy companies and governments beginning to develop Bitcoin mining infrastructures, smaller market participants are increasingly being squeezed out as cloud mining facilities are unable to keep pace with demand.

Bitcoin lending is increasingly looking like the main way BTC holders will be able to earn a yield paid in BTC in the future, while Bitcoin-backed loans offer a way for holders to access the value of their tokens without the need to sell and create a taxable event.

Conclusion

It goes without saying the operational costs of bitcoin trading is high, but miners are willing to put in the work in order to make money hand over fist. 

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