You have probably read about bitcoins in the past months and it is likely that not everything that you read about was praising the digital currency. What you probably read in the past days was that bitcoin dropped from an all time high of about $266 Dollars - that is per bitcoin - to $97 as of today. That's still a lot considering that the value of a single bitcoin was just $13 on January 1, 2013.
The currency is interesting for a number of reasons and while it would take too long to go over all of those, I'd like to mention a few. First, it is a virtual currency that is not managed by a central authority but by an Internet-based network. Currency can be traded just like any other currency, you can exchange Dollar, Euro or any other currency in to bitcoin and vice versa. Bitcoins are created through a process that is called mining. To put it very simple: a mining program runs on your computer that will use your computer's processing power to create new bitcoin.
Single users need to be really lucky to stand a chance in the race to create new bitcoins, which is why many join so called pools that divide chunks of works among their members to stand a chance against server farms, super computers and larger networks. Pooled mining will reward you with smaller but more frequent returns.
I'd like to thank Ghacks reader Alex as he helped me tremendously in this matter.
Setting up your bitcoin mining PC
You need two tools to get started:
There are several wallets out that that you can pick one from. Electrum is a cross-platform wallet for Windows, Linux, OS X and Android that is available as binaries and as source files. Windows users can download a portable version of the application or use the installer to install it on their system. Setup should not pose any troubles to you, just make sure you store the secure phrase in a safe location so that you can recover your wallet at any time should you forget the authentication password.
Guiminer or Gui Mining is a free portable program for the Windows operating system that you can use to mine for bitcoin on your PC. The core benefit of the program is that it ships with everything that you need to get started. It supports joining a mining pool but also solo mining if you prefer to go that way.
Now that you have the tools to start mining bitcoin, you should consider joining one of the mining pools. There is Slush's Pool which I have joined for now for instance. You do need to sign up at the pool's website to receive one or multiple worker logins that you need to enter into your program - in our case Guiminer - to start mining and get credited for your efforts.
You can naturally join any of the other pools linked directly from the application, or use the other option to enter a custom host name and port instead if the pool that you have joined is not listed in the program.
Note that the mining will tax your computer a lot so that it is best done if it is idle and not while you are working on it. While you can continue writing blog posts and doing other light activities, you will notice that more taxing activities will be slower than usual.
The program displays a couple of information about the speed of your system and so on and so forth, but if you are interested to find out how much your mining has earned you, you need to visit the mining pool's website as this is where that is listed.
Here you see estimated, unconfirmed and confirmed rewards displayed to you. Don't expect to gain several bitcoins a day using a single personal computer, but if you are persistent, you will earn money this way. You may also want to enter your Bitcoin address (shown in your wallet) on the mining pool website to receive mined bitcoins there.
You are probably wondering how fast a single personal computer can go. Not that fast actually. My Intel Core i7 860 cpu, 8 Gigabytes of RAM and a Nvidia Geforce GTX 470 graphics adapter has a speed of about 102 Mhash/s. The hall of fame on Slush's pool website shows that some users managed to generated more than 149000 Mhash/s.
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Ghacks is a technology news blog that was founded in 2005 by Martin Brinkmann. It has since then become one of the most popular tech news sites on the Internet with five authors and regular contributions from freelance writers.