Ethereum mining pros and cons
Cryptocurrencies are rising to prominence throughout the world, due to the anonymous transaction capability, lucrative investment opportunities, and financial gain from mining. It is the latter that we’re going to focus on, as the Ethereum network would struggle to sustain itself without the individuals who mine blocks and consistently produce Ether.
Yes, it is possible to mine independently with success, but cloud mining is quickly becoming the favorable choice for most miners, both beginners and advanced. There are many advantages to using a cloud-based service, instead of trying to run everything yourself. But, like with everything in life, there are some cons to counteract the pros.
So, we’re going to be completely transparent, and highlight both the positives and the negatives, to allow you to make an informed decision on whether Ethereum cloud mining is suitable for you.
Avoid high electricity costs
Running a vast array of equipment at its maximum potential for long periods of time will consume tons of electricity.
No technical skills required
Going down the independent route will require extensive technical experience, and a diversified skill set to know exactly what to do.
No expensive hardware to purchase or maintain:
As you’ll be utilizing a company’s data center to source all the essential elements, you won’t need to build or maintain your own expensive system.
Customer support available
If you ever encounter any difficulties, whether it be with performance or the mining experience, you can seek help from your provider.
No need to upgrade hardware when mining becomes more difficult
Ethereum will constantly increase their difficulty which will lower a miner’s profit margins. But with cloud mining, you won’t need to worry about having to upgrade.
Provider could cease to exist at any moment
You could be mining plenty of blocks, claiming Ether rewards, and enjoying healthy profit margins, then the provider could suddenly go bust with no warning.
Reduced profits in comparison to independent mining
As you’ll be operating under a provider, they’ll obviously take a cut of the profits so that they can continue making money themselves.
Higher risk of fraud
Not all cloud mining service providers can be trusted and inputting your details on a suspicious platform could result in you being a victim of fraudulent activity.
Lack of control over mining rigs
Again, as you’ll be operating under a provider, they’ll have full ownership of the mining rigs, so you’ll have very limited control.
Reliant on provider for performance
You’re purchasing a certain level of performance as part of your contract, but there’s always a risk that the provider’s performance could falter and affect your mining.