Understanding Bitcoin and Bitcoin Colocation
Bitcoin has become a very familiar word over the past couple of years, but it is still somewhat difficult to define for those who are not “in the know”. Much of the information on the web seems geared toward those who are already familiar with bitcoin colocation and how it all works. For those who are getting started, much of the terminology and techniques can seem confusing.
Having at least a basic understanding of how bitcoin location works, along with the various types of bitcoin mining, hosting options, data centers, and hardware is very helpful for those who want to get into this field and see what bitcoin colocation and mining is all about.
Bitcoins are a type of digital currency that is dissimilar to the typical currency most people are accustomed to – banknotes and coins. People can buy and sell the currency, make trades and transfers, and use it in many different locations as easily as they would cash. In fact, homes have even been purchased using Bitcoin. However, there is no central governing body that controls making or trading Bitcoins. Many see this as a good feature.
Bitcoin has a range of advantages and disadvantages. In addition to freedom of payment, merchants are not able to charge additional fees without it being noticed. It is possible to backup and encrypt the currency to ensure the safety of the money. The fees are either very low or nonexistent when it comes to making Bitcoin payments, and there also happen to be fewer risks for merchants. For example, since a Bitcoin transaction cannot be reversed, it helps to keep merchants safe from fraud.
Of course, even with all of the advantages, there are still some disadvantages to consider, as well. For example, Many people are still unaware of Bitcoin and how it works. They need to be educated on cryptocurrency, so they can see how it can apply to them. In addition, not all businesses accept this type of currency. Fortunately, things are starting to change, slowly but surely, and more merchants are beginning to come around.
These currencies are still in the early stages, too, so many still see them as risky, even though they are starting to prove themselves. It will still take some time before everyone is on board with what Bitcoin and other alternative currencies can offer.
Now, let’s learn more about Bitcoin colocation, one of the options for getting started in cryptocurrency that is affordable and relatively easy.
Colocation is a type of hosting option that is often used by small businesses who want a lot of features without a lot of cost. With Bitcoin, colocation is similar in this respect. In fact, Bitcoin mining is quickly starting to move from a typical Bitcoin hosting data center to a Bitcoin colocation hosting environment. Bitcoin colocation allows miners to increase the amount of power and resources at their disposal, while keeping the costs down, as they are essentially sharing the space with others.
Bitcoins are “mined” into existence. Of course, you do not use pickaxes and headlamps to find this cryptocurrency, and you don’t have to delve into a dirty, dangerous cave to find the Bitcoin. Instead, Bitcoin mining is a method used that adds transactions to the block chain while releasing new Bitcoin.
The mining process, which is taken care of by minter hardware discussed later in the article, compiles recent transactions into blocks, and tries to solve puzzles. The miner who is able to solve a puzzle and add the next block to the block chain is able to reap the rewards – the Bitcoins that are released.
Because the mining is decentralized, anyone who has an Internet connection and the right hardware can get in on the Bitcoin mining colocation action. The term Block Reward stands for the amount of new Bitcoin that is released when the blocks are mined.
While Bitcoin is the cryptocurrency that has the most name recognition, it is certainly not the only type of cryptocurrency available. Ethereum, Namecoin, Litecoin, Dogecoin, Peercoin, Mastercoin are all types of cryptocurrency, as well.
Ethereum was first proposed in 2013 when a programmer proposed that Bitcoin adopt a scripting language for application development. However, Bitcoin passed on the option and this brought about the creation of the new cryptocurrency platform, which has the potential to offer more innovation. In 2017, Ethereum was the top blockchain platform for ICO, or initial coin offering, a type of crowdfunding with cryptocurrency. Ethereum colocation has gained popularity as this currency has risen to prominence.
Namecoin is another option in cryptocurrency. The goal of this currency is to provide security and resistance from censorship, while maintaining privacy and improving decentralization of currencies. It was one of the first alternative digital coins available, and it remains one of the most innovative.
Some are choosing to invest in Litecoin rather than Bitcoin. Like other cryptocurrencies, Litecoin allows for instant payments around the world at virtually zero cost. It is open source, decentralized, and is a global payment network like other options. One of the elements that sets it apart is that it can provide faster transactions and better storage efficiency than other types of cryptocurrency.
Dogecoin, an open source peer-to-peer digital currency features a Shiba Inu as their mascot and what they boast as the friendliest community in cryptocurrency. Again, it allows for money to be sent online instantly, and it is a decentralized type of currency. They also have a user-friendly site that makes it easy for people to get started.
Peercoin aims to be the “most secure cryptocoin at the lowest cost”. They provide fair distribution with no insider presale or instant mining. They are energy efficient, stable, and are the first proof of stake coin in the world.
Another option is called Mastercoin. Instead of starting up a new blockchain, as many other types of cryptocurrency options do, they are working to create a new network of currencies, along with securities and commodities, on top of Bitcoin. They want to support the ability for users to create their own currencies, to provide a decentralized exchange, provide on-blockchain price feeds and bets, and more.
These are just some of the many alternative cryptocurrencies that are currently available. When you are considering which currencies to start using and mining, be sure to learn as much as possible about the choices available and find those that you feel are going to last. Bitcoin has developed a strong brand name in the field of cryptocurrency, and more and more are considering working with Bitcoin.
Before choosing a cryptocurrency that you find, you will want to check to see the authenticity and the veracity of the currency. Make sure you work with the option that is legitimate and that it is the right choice for you. The amount of time, effort, and money you have to devote to working with cryptocurrency is often one of the deciding factors on just how a person gets involved and starts mining.
If you are going to start working with Bitcoin, you certainly need to have a quality host to ensure you are making the most of the mining. One of the first things to consider when choosing a host, is what type of contract is offered.
You can also see if the company accepts Bitcoin as payment. Using Bitcoin for anonymous hosting is one of the best ways to set up a site without anyone else having your personal or financial details.
It is essential that you choose a hosting location that is highly secure to house the ASIC minder equipment and hardware that you want to use. After all, you need to make sure the equipment is safe and sound, as it tends to be rather costly. In addition to security, consider the cost of the power and the space that you are going to be renting.
ETS private clouds are an option for those who have a larger operation and who need to have dedicated cloud services for their mining and other operations. Everything that occurs on the server via the private cloud will affect only your organization. This provides companies and individuals with more control over the cloud server they are using when compared with shared hosting, discussed next.
You have plenty of other options for hosting rather than trying to pay for a dedicated server. Virtual private server, or VPS Bitcoin shared hosting is another choice to consider. This will help to cut the cost of the server, even though you will not have full control over everything that happens on that server. Those who want to get started, but who do not want to spend a lot of money on Bitcoin mining out of the gate might want to consider VPS bitcoin shared hosting.
The Bitcoin hosting data center and facility you choose should also provide sufficient cooling for all of the machines, remote assistance if needed, a reliable connection so you can always access what you need, and space to expand if needed. Check the contracts, as well to see whether they are flexible enough for you.
Ideally, you will be working with a host that has experience working with other Bitcoin operators. You need to make sure they understand and can provide for the unique needs that you might have. Working with a host that already has experience can make a world of difference.
Bitcoin Mining Data Centers
While it might have been feasible in the past to mine bitcoin from equipment you had in your own home or with a small host, many are finding that it is a far better option for them to work with a full bitcoin mining data center. These data centers provide more power, which means the possibility of mining more of the Bitcoins.
Some of the data centers provide ASIC hosting, which is possible due to the improvements made to the ASIC chips over the years. ASIC stands for application specific integrated circuit. This hardware was created specifically to solve the Bitcoin blocks. Because they are specialized pieces of software, they can do this more quickly and efficiently than other options.
ASIC miner hosting tends to mean a faster speed and better results for the miner, naturally. This is specialized hardware, but it does help to provide miners with quality tools needed to succeed.
CryptoCurrency Mining Hardware
Having quality Bitcoin miner hardware is essential to succeed, as mentioned. However, it is important to remember that technology evolves and advances quickly. Therefore, those who want to start mining and using Bitcoins and who are looking into hardware need to keep abreast of the changes and options out there.
It is no longer enough to find one piece of hardware and to continue using it without ever looking at new options. As hardware improves, miners need to be willing to make investments in that hardware, so they can keep up with the changes.
Some of the popular types of ASIC mining hardware from 2017 that can still provide users with good results include AntMiner S7, AntMiner S9, and Avalon6. Other options and companies making the software include Bitfury, Butterfly Labs, and HashFast.
In addition to the hardware, you may also want to look into getting some quality software to help with the task. A few of the options on the market today include BFGMiner, BTCMiner, Bit Moose, Phoenix Miner, Ufasoft Miner, and Flash Player Bitcoin Miner.
If you have been considering getting started with Bitcoin, there is quite a lot to learn, and this field is changing regularly. Learn the basics and then choose a method to get started with Bitcoins or with other types of cryptocurrency. Learn how to mine, to buy, sell and trade, and be aware that the market can change regularly. Just as there are no guarantees in the stock market or the prices of other types of currency, there will be some inherent risks associate with Bitcoin. Understand the risks, learn the market, learn to mine, and find ways to succeed in this new frontier of cryptocurrency.