So you are one of those rebels who want to replace the Central Bank of your country, right?
Or maybe you just want to take the stress of printing money off the hands of the government, after all, it was John F. Kennedy who said “ask not what your nation can do for you, ask, what can you do for your nation instead”.
Yeah, whether it’s rebellion or patriotism that brought you to me, I can assure you, you’re at the right place.
Money has gone digital. So, when I say I’m about to share how to print yours using your computer GPU. You can rest assured that I’m talking of the new kind of money; cryptocurrency.
One of my favourite songs says, “Let’s start at the very beginning, a very good place to start”. And that would be the definition of terms.
What exactly is money?
The original definition of money is rendered as a generally acceptable asset, used for value exchange.
Paper currency first developed in Tang dynasty China during the 7th century, although true, paper money did not appear until the 11th century, during the Song dynasty; so the Tang dynasty invented it, but the Song dynasty made it cool, thus, popular (I bet you didn’t know that), and since then, it has been the most stable form of exchange and that’s for over 12 centuries!
To avoid anybody just printing any currency she likes, which would also lead to excessive inflation, and loss of value (since everyone would be printing their own money), the government had to be in charge of printing, verifying and authenticating the monies, for obvious reasons, and the banks were in charge of distributing them.
This form of control is termed Centralized Finance; owing to the fact that, one body or entity would always be in control.
Now, there are a few problems with this form of financial regulation. First off, your money wasn’t really your money once it gets to the bank; the government body in charge of the regulation of banks in the country was the real owner; it reserved the power and authority to do whatever with your funds. Next, there is sluggishness in transactions. Since they authenticate every single transaction, whatever money transaction they don’t, forget or won’t authenticate, will not go through.
But then, 2001 witnessed the merger of X.com and PayPal to birth PayPal; a platform that digitized money transactions and thus, made it faster than ever. The banks would still be in control, but at least the problem of sluggish transactions was getting solved.
Then someone came up with an idea; maybe the problem wasn’t the process of transacting, maybe we need a better currency.
The year was 2008 and his/her alias was Satoshi Nakomoto (no one knows the guy/girl/ people/alien/Autobot/ Decepticon/Eternal). (S)He invented another kind of money. This money wouldn’t be controlled by any single body or organization, it was going to be completely running on an open-source program, and it would initiate the fastest and most secure transactions ever known to man, by man, so far. It’s called; a cryptocurrency and (S) he named it Bitcoin. It would be used mainly for online transactions, seeing that there was now more buying and selling activity going on via the internet than there were trading via physical cash.
According to a survey published in The Guardian in 2016, only about 2% of the value transacted in Sweden was by cash, and only about 20% of retail transactions were in cash. Fewer than half of bank branches in the country conducted cash transactions.
In 17 out of 24 studied countries, cash represents more than 50% of all payment transactions, with Austria at 85%, Germany at 80%, France at 68%. The United Kingdom at 42%, Australia at 37%, the United States at 32%, Sweden at 20%, and South Korea at 14% are among the countries with lower cash usage.
By the 2010s, cash was no longer the preferred method of payment in the United States according to USA Today;
In a “2016 U.S. Consumer Payment Study”, released by TSYS; the largest third-party processor for issuing banks in North America, with a 40% market share, and one of the largest in Europe and the subsidiary of Global Payments, the United States User Consumer Survey Study reported that three out of four of the participants preferred a debit or credit card payment instead of cash. Some nations have contributed to this trend, by regulating what type of transactions can be conducted with cash and set limits on the amount of cash that can be used in a single transaction
El Salvador recently just became the first country to adopt Bitcoin (the first cryptocurrency) as their official currency. Nigeria is about to roll out her own digital currency in less than a month, and that will make her the 5th country to do so if no other country does so before October.
My point is, money has gone completely digital and mining it, will only get easier as time goes on.
So now that we know what cryptocurrency is, what’s mining and how does it work?
Mining is the process of solving complex computational calculations to discover a cryptocurrency (or part of it); it is how the cryptocurrencies are discovered, not particularly created. The inventors of the crypto coins decide how much worth of cryptocurrencies they would create and make available from the beginning and then the miners, start mining to get it all out; think of it like physical mining.
Different Ways to Mine Cryptocurrency
The calculations are too complex to be carried out manually by a human, (even if you were Batman); instead, it is carried out by 3 major devices:
- An ASIC machine
- A GPU
- A CPU
An ASIC is a machine dedicated to the sole purpose of mining 1 particular kind of cryptocurrency. It is highly expensive, overheats, consumes a lot of power, but is faster in mining than anything else made so far. Thing is, as earlier mentioned, it can’t mine any other cryptocurrency than the one it was programmed to mine.
A GPU is a unit composed of a computer used for the computational analysis of high-speed calculations to display graphics on a computer monitor. In simpler terms, it is why the games on your PC are fast, slow, sharp or blur and why your videos also express either of the aforementioned characteristics.
Based on its ability to perform complex computational analysis with speed, it is alternatively used for mining cryptocurrencies. The good thing is it can mine more than one coin.
A CPU is the most important component of a computer, it also solves computational problems, and so, it was used in the early days of mining. In the initial years of Bitcoin’s launch, mining could be easily done via any computer component that had the right amount of processing power and memory. But as mining evolved, the need, speed and technology changed, resulting in a competitive race that ousted incompetent mining hardware.
Initially, home desktops were more than enough for cryptocurrency mining. Over the years, miners switched to GPUs for more hash rates and CPUs just became obsolete. You can still mine using older methods, but there will be insignificant profitability and hence useless effort, meaning your electricity bills will rise, your CPU may spoil due to overheating, and profits will be minimal at best; GPUs were just better.
So how exactly does one set up a GPU to start mining cryptocurrency?
First off, you have to be sure you’re buying the right kind. The ones displayed here are my personal recommendations for starters.
Next is, when thinking about how to start mining cryptocurrencies, software shouldn’t be excluded from the picture, in fact, it is 80% of the picture; good software is often what makes it or destroys it, I wrote about one here and my colleague, David wrote on another here.
After installing the software, configure the options to your liking and proceed with the setup. Your device will have to reboot a few times before it’s fully operational, don’t be scared, just be patient, and in a few minutes, you’re all set up.
If you’ve got low electricity costs within your vicinity, and you could raise $5,000, I do not see why you shouldn’t become your own Central Bank or Federal Treasury. Next time, I want to show you how to set up your own mining rig or maybe mine with your phone, but let me let you put this one into practice, and depending on your comments, I may publish that article. After all, everyone should be able to control their money.