Cryptocurrency mining has become largely professionalized, especially after Bitcoin mining difficulty doubled from 2020 through 2022. However, while Bitcoin may be the largest and most known cryptocurrency, others have however to gain planetary popularity.

Monero (XMR) is ane of them. It is similar to Bitcoin in many means but diverges in key areas that make information technology special. More importantly, they make it worthy of mining.

So, how do you mine Monero?

What Is Monero (XMR)?

Put merely, Monero (XMR) is a privacy-oriented cryptocurrency. However, at a glance, Monero and Bitcoin are similar in 2 key ways:

  • They use Proof-of-Work consensus algorithms to secure the network. Pregnant, they use physically-based mechanisms for network operators to verify and execute blockchain transactions. This physical foundation comes in the form of electricity needed to solve cryptographic puzzles. In dissimilarity, Proof-of-Pale consensus algorithms use economically based mechanisms to exercise the aforementioned. Therefore, blockchain networks similar Cardano, Solana, Avalanche use validators instead of miners.
  • They take a supply cap of full coins; Monero at eighteen.4 million XMR, and Bitcoin at 21 million BTC. This makes both cryptocurrencies deflationary, different the USD, which continually loses value over time because the Federal Reserve increases its supply.

However, even in those similarities, they are quite unlike. When zooming in closely, nosotros encounter that Monero diverges from Bitcoin in many ways.

MOnero

Monero (XMR) Supply Cap—Tail Emission Makes All the Difference

Bitcoin has a finite amount of coins that can ever exist—21 1000000 BTC. Presently, this leaves less than 2.i million BTC left to be mined in the side by side 120 years, or less than 10%. However, many BTC coins are permanently lost or destroyed because people have lost admission to unlock them in the form of private keys or destroyed the storage device they were held on. They are contained within non-custodial crypto wallets, which is why it is disquisitional to safeguard your recovery phrase.

On the other hand, Monero takes into account that some XMR coins will be lost in the aforementioned manner. It has an extra mechanism that Bitcoin lacks—tail emission. While Monero will striking the eighteen.four meg supply cap sometime around May 2022, its tail emission ensures that Monero miners can continue to receive rewards.

In other words, Monero miners can count that cake rewards will not autumn under 0.6 XMR per block. In Bitcoin's original design, for the scenario when there are no more block rewards to mine, Bitcoin miners will count on transaction fees instead.

Still, this incentivized concept hasn't been tested (with Bitcoin). For this reason, Monero developers decided there would ever be a block reward through the tail emission. The question then is, does this make Monero equally deflationary as Bitcoin?

The answer is yes. When one accounts for lost XMR, plus the increment in users over fourth dimension, these forces nullify the negligibly inflationary tail emission. Moreover, Monero's inflation is quantified alee of time, different the USD or other fiat currencies. Lastly, tail emission incentivizes Monero holders to apply it as a medium of commutation instead of just a store of value.

Monero'due south Key Characteristic—Privacy

Although Bitcoin is chosen a cryptocurrency, the crypto role is sorely lacking. Crypto implies encryption to safeguard privacy, even so Bitcoin is pseudonymous. This means that its transactions tin can easily be tied to one's identity. In fact, Coinbase has developed a suite of tools to accomplish that and shares it with a host of federal agencies.

Although you lot are non revealing your individual details with a Bitcoin address, you lot reveal it if you buy BTC on a crypto commutation with your banking company account. Likewise, you reveal it when y'all sell BTC on a crypto exchange and withdraw the money into your banking company account. In other words, Bitcoin's blockchain is transparent, equally information technology shows both output and input transactions tied to the address.

While in that location are ways to circumvent that lack of privacy, they are complicated and dubious. In dissimilarity, Monero is non traceable by default, thanks to its band signature feature. It is a cryptocurrency in the truest sense of the word, as was originally intended. In fact, the Internal Revenue Service (IRS) has created a bounty on Monero and other privacy coins of up to $625,000 for their code to be cracked.

This way, Monero is the digital equivalent of physical cash, anonymous and untraceable. Going forward, this gives it an edge over non-privacy coins like Bitcoin. With that said, Monero as digital cash has one drawback—transaction speed. While Lightning Network makes Bitcoin payments nigh instantaneous, XMR transfers still take up to 30 minutes to complete.

Monero Mining Requirements and Profitability

Now that you understand Monero'southward propositional value, information technology is time to come across how yous can go a Monero miner. Thankfully, unlike Bitcoin, which requires specific and expensive ASIC hardware to become a toll-effective miner, Monero doesn't have such a requirement.

Instead, Monero mining tin can utilize both your computer'southward CPU and GPU, whether it is a laptop or a desktop PC. Of class, the more than powerful both components are, the greater the block rewards will be. The measure by which we decide your reckoner's mining potential is the H/s metric—hash per 2nd.

Likewise, 1 KH/southward is one thousand H/s considering 1 Kilo = 1000. This tin can go all the style from Kilo (One thousand) and Mega (M) to Giga (G) and Tera (T) as the highest possible hash power metric (and who knows, in the future, peradventure we volition see Petahashes!). At the fourth dimension of writing, the total number of computers plugged into the Monero blockchain network accounts for a mining ability of ii.9 GH/s.

Monero hashpower
Image credit: minerstat.org

In practice, on a spectrum between low and high PC configuration, here is what you can expect according to the Monero mining calculator.

Mining Monero With Low-End Hardware

On the low end, if nosotros accept the AMD Ryzen 5 Pro 4650G, information technology will have almost 4170 H/due south. The MSRP (manufacturer's suggested retail price) for this CPU with an integrated GPU is effectually $260. Next, when we count the wattage of the CPU at 65W, nosotros arrive at a daily income loss of $0.05 per day.

This loss can turn into profit merely if your electricity toll is lower than $0.ane kWh. In which example, the mining gain with that particular CPU would be at $0.01172 per day. Not much, is information technology?

Mining Monero With Mid- to High-End Hardware

At present, permit'southward take a more formidable PC configuration into account.

The mid-range AMD Ryzen7 5800X has an MSRP of $450. It has no integrated GPU, so this will take to be considered. The CPU itself has a mining power of 9110 H/s with a ability describe of 105W. Furthermore, a discrete GPU, the GTX 1080 Ti, volition have a mining power of about 1000 H/southward with a power depict of 200W.

The issue—an even greater mining loss of $0.4 per mean solar day! The RTX 2080 Ti wouldn't make much difference either, adding simply 500 greater H/s to the Monero mining tabular array. From this, nosotros tin conclude the following:

  • Even the most high-finish GPUs concord merely a fraction of the hash power needed for Monero mining, compared to a CPU, at effectually 10%.
  • Solo mining is not assisting, regardless of the hardware.

The question and so asks itself, is Monero mining worth it?

Joining Monero Mining Pools

As yous tin see, mining Monero depends on the post-obit factors:

  • Electricity cost
  • Your computer'due south hash ability, with CPU being much more than of import than GPU
  • The ability consumption of your computer

Of course, if yous buy a computer exclusively for Monero mining, that too must be taken into account. Otherwise, if you already take a PC ready to be plugged in, the best way to get started is to join one of Monero's mining pools:

  • MineXMR.com: 12,892 active miners with a combined pool hashrate of 1.04 GH/s. Puddle fee—1%
  • SupportXMR.com: 8570 agile miners at a combined 450 MH/southward. Puddle fee—0.half-dozen%
  • xmr.nanopool.org: 4,042 active miners at a combined 566 MH/s. Pool fee—i%

Mining pools work past combining the computational power of individual miners to receive block rewards. In other words, this form of resource networking increases the probability of successful mining. While the XMR payout is distributed to the puddle, miners receive information technology proportionally to the hash ability they contributed to the pool.

Nevertheless, it remains questionable if this volition be profitable in the end. Information technology all depends on your hardware and XMR'southward price moves. If it rises, profitability will increment. You just have to give it a try.

Steps to Start Mining Monero

Aslope the hardware, you need two prerequisites to mining Monero:

  • Monero wallet. Either Monero GUI Wallet or MyMonero. Both are suitable for beginners and advanced users and tin be installed on all major operating systems—Windows, Linux, and macOS.
  • Mining software that connects your PC to Monero'due south blockchain network. Either XMR-Stak or XMRig would suffice.

With both in manus, you lot tin can easily join whatever Monero mining puddle by pasting your accost from the Monero wallet to start receiving your block rewards as XMR. Then, yous can send the mined XMR to your crypto exchange account (Binance, Coinbase, Kraken, etc.) to sell it for fiat currency or swap information technology for a unlike cryptocurrency.

Should You Mine Monero?

In determination, if y'all already have a PC, it bears checking out if the mining venture volition be assisting. By the fourth dimension you read this, the XMR cost might have skyrocketed, making it profitable for fifty-fifty solo mining. However, at the current XMR toll of $211, it likely won't be unless you accept exceedingly inexpensive electricity. In that example, your best bet is to join a Monero mining pool and contribute to a shared effort.

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About The Author

Rahul Nambiampurath (48 Articles Published)

Rahul Nambiampurath started his career as an accountant but has now transitioned into working full-time in the tech space. He is an ardent fan of decentralized and open source technologies. When he'southward not writing, he'south usually busy making wine, tinkering with his android device, or hiking some mountains.

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