Cloud Mining is the process of bitcoin mining utilizing a remote datacenter with shared processing power. This type of cloud mining enables users to mine bitcoins or alternative cryptocurrencies without managing the hardware. The mining rigs are housed and maintained in a facility owned by a mining company and the customer simply needs to register and purchase mining contracts or shares.
Since Bitcoin Cloud Mining is provided as a service there is generally some cost and this can result in lower returns for the miner.
Types of Hosting for Bitcoin Mining Cloud Computing
A mining farm located in Iceland.
Users of hosted Mining equipment can either lease a physical mining server or a Virtual private server and install mining software on the machine. Instead of leasing a dedicated server, some services offer hashing power hosted in data centers for sale denominated in Gigahash/seconds (GH/s); Users either select a desired amount of hashing power and a period for the contract or in some cases can trade their hashing power.
For Genesis Mining,
the process of bitcoin mining could be described as a meeting of fire and ice.
Mining — the method by which new bitcoins are made by a computer solving an extremely complex math puzzle — requires big, energy-intensive computing power to operate. Thus the “fire.”
When cryptocurrencies were less popular, a miner with a computer at home could solve the puzzle quickly. But now bitcoin mining requires ever more and faster computing. A few companies, including Genesis, are starting to provide the cloud services needed to supply that capacity.
“We provide everyone access to mining through our cloud-based infrastructure,” said Marco Streng, the CEO, and co-founder of Genesis.
Started in 2013, Genesis Mining has grown into the world’s largest cloud-based blockchain and cryptocurrency mining company, used by bitcoin miners the world over.
The company’s cloud-based hardware provides miners access to as much computing power as they’re willing to pay for.
As the price of cryptocurrencies skyrockets, so does the demand for mining services, Streng said.
The launch of bitcoin futures institutionalizes the digital currency further, adding to the growing demand for mining and validating transactions, Steng said.
“Futures contracts are a big milestone for the cryptocurrency market because professionally managed money will begin greater sophistication to the marketplace,” said Streng.
So where does the “ice” part come in? All that computing power needed for bitcoin mining requires both low-cost energy and cool temperatures to keep the computers running. Genesis found the right mix in Iceland — low temperatures and low electricity costs.