In order to participate in the cryptocurrency eco-system you must own a
cryptocurrency such as Bitcoin or any of the other alternative coins
(or ALT Coins) listed in www.coinmarketcap.com.
There are basically four ways you can acquire cryptocurrencies:
1. Buy crypto on an Exchange
2. Accept crypto as payment for goods and services
3. Accept free cryptos from someone
4. Mining new cryptos
You will learn in the preceding paragraphs that Mining is by far the
cheapest way to own cryptos!
Those new to cryptocurrency will most likely use an Exchange to buy their
first crypto coin. As of February 2021, there are 308 Exchanges for you to
buy and sell cryptos. The biggest and most popular is Binance where you
can trade over 330 cryptocurrencies. The widely known site, Coin Market
Cap has put together a comprehensive list of Exchanges.
You can find them on this link https://coinmarketcap.com/rankings/exchanges/ .
You can compare them and make a decision which to sign-up with based on the
ranking of this website or you can evaluate the individual Exchanges based
on its trade Volume, Average Liquidity, Number of Markets, Number of
Coins, and the supported Fiat currency.
The fast-growing trend of cryptocurrencies have sparked the idea of using
cryptos to pay for goods and services. For this to occur the supplier of the
goods and/or services must be willing to accept this form of payment and
have the phone or computer software app to facilitate the transfer and
storage of the cryptocurrency.
The technology of the blockchain or digital ledger has made the
cryptocurrency virtual transactions possible anywhere, any time, and any
place where there is a smart phone and internet connection! People living
remotely and great distances from banks, or those who don’t have a bank
account will naturally gravitate to the use of cryptocurrencies as a form of
payment with a click of a button on their phones.
The blockchain and cryptocurrencies has made it possible for the unbanked to participate in the financial world! It is very possible in the very near future that this digital
form of payment will be widely adopted and fiat currency could be a thing of
You don’t have to buy to own cryptocurrency. Instead, you can mine them.
But of course you need to know that some cryptos can’t be mined like
Ripple (XRP). On the other hand there are many mineable digital assets
out there including Bitcoin, Ethereum, Litecoin, Zcoin, Zcash, and many more.
Why mine cryptos instead of buyer them? There are very good reasons
why mining could be a better option for you. Let’s say you have $5,000
dollars to buy any one of the cryptocurrency listed on coinmarketcap.
Although it is unlikely to happen, let us assume that all the Exchanges and
the entire cryptocurrency ecosystem came crumbling down. Obviously this
event this will leave you with a worthless asset that you purchased online.
On the other hand, if you invested the $5,000 on mining rig hardware and
this unlikely event took place, you can recover all or a major portion of the
investment by simply selling the hardware. In particular, you can easily sell
the highly sought after Graphics Cards that many gamers use to build their
computers. Plus you still get to keep the worthless crypto coins which
someday may come back to life when the world is finally ready to accept them.
The other advantage of mining is that you can own cryptocurrency at a
major discount. After recouping the cost of mining rig hardware, the only
cost going forward is electricity. Let us look at an example.
A typical 12 GPU (grapics cards) mining rig using RX580 8GB Memory GPU cards will
consume about 1750 watts per hour. We will use 11.5 cents per kilowatt
for electricity which is the cost in Las Vegas. This mining rig operating
continuously for 30 days, 24 hours per day will consume about 1,260
kilowatt-hour or $145 dollars per month. With this type rig mining Ethereum
(ETH), you can mine or produce about .75 ETH per month. At the time of
writing February 2021, the price of one ETH got as high as $2,000. Using