By - Craig Mullins

Your Ethereum Cloud Mining Guide: What Is Ethereum Mining?

Ethereum mining is a very complex process, but it’s worth engaging in. When done well, it brings lots of rewards. Here’s your Ethereum cloud mining guide.

It’s an exciting time in the life cycle of ethereum. The ethereum blockchain is evolving. As you read this, developers are working on ethereum 2.0.

Bitcoin is still grabbing most of the headlines in the world of cryptocurrency. That makes ethereum feel like a plucky young upstart, even though it is one of the five most popular cryptocurrencies in the world.

Maybe you’re wondering how to get started. Maybe you want to be part of this revolution and start mining the cryptocurrency yourself.

We’ve got you covered. What follows is our guide to the ins and outs of ethereum mining. We’ll talk about what it is, its risks, and whether it’s worth it despite the risks involved.

Let’s dive in!

ethereum cloud mining
ethereum cloud mining

An Introduction to Ethereum Mining

Traditionally, cryptocurrency mining means buying big rigs of machines. These machines solve complex math problems constantly, and in the process, they start to amass coins. In ethereum’s case, those tokens are called ether.

This model of mining is expensive, consumes time and energy, and takes up a lot of space. The miner is constantly surrounded by hot machines and the loud fans it takes to cool them down.

But there’s a different way to do things. It’s called cloud mining. As opposed to on-site crypto mining, cloud mining involves using the cloud to accumulate coins.

How does the cloud do its mining? Well, the cloud doesn’t do any mining itself. Instead, it serves to connect you with the processing power found in remote data centers.

There are still a few resources you’ll need if you want to pursue cloud mining, but they are fewer than a traditional mining rig. You will need a home computer to communicate with the data centers, and it helps to use a local ethereum wallet to store the coins you acquire.

Pros and Cons of Cloud Mining Ethereum

It’s clear that there are very tangible benefits to the cloud mining model. The decentralized nature of ethereum makes it a particularly good fit for this model.

Let’s take a closer look at the pros and cons of using the cloud to mine ethereum.


Many of the benefits of cloud mining ethereum are hardware-related. They include the following:

  • A cooler home thanks to the absence of hot machines running constantly
  • A quieter home thanks to the absence of fans to keep the aforementioned machines cool
  • Lower utilities thanks to not running big fans or powerful mining rigs
  • Not being stuck with equipment that loses value when mining gets so difficult it stops being profitable
  • Not dealing with the variables of reliability that come from working with the manufacturers of your mining equipment


The drawbacks of cloud mining are more nebulous, but they’re worth considering.

Privacy is one of the biggest benefits the blockchain brings, and cloud mining presents some threats to that privacy. Here they are.

  • You risk fraud by the data centers
  • Mining operations remain distant and opaque to you
  • Dealing with contracts that may cease mining operations based on ethereum’s current price
  • Lower profits because of the costs incurred by the data centers
  • Less fun if you enjoy the challenge of building and maintaining rigs

The Types of Cloud Mining

Now that you know a little about how cloud mining works, we’re going to throw a wrench in the works.

Not all cloud mining is created equal. Obviously, there are differences in data centers, but that’s not what we’re talking about.

What we want to say is that there are three categories of cloud mining available based on how physical servers are split up.

Hosted Mining

This is the type of cloud mining that involves the most privacy. Your processing power is still remote. But with hosted mining, you lease a mining machine with its own dedicated server.

Virtual Hosted Mining

This is the next step down in mining privacy. Technically, a virtual private server should offer almost the same protection as a dedicated server, which makes the difference minute. Still, some people prefer the peace of mind that comes with having a dedicated mining server, even if it’s remote.

When you choose virtual hosted mining, you install your own mining software.

Leased Hashing Power

You do not have a physical or virtual machine at your personal disposal when you choose this option. Instead, you lease a specific amount of hashing power on the shared server.

Despite its seeming dip in privacy, this is the most popular cloud mining method. Like all things related to cryptocurrency, it’s still quite private. And leasing just the hashing power of a machine is a lot easier on your wallet than leasing a whole remote machine.

To Mine or Not to Mine

Mining cryptocurrency is part of the fun of the early days in a new currency’s life. You get to take part in establishing the foundation on which the currency stabilizes and grows.

There are downsides to mining ethereum, though, whether you choose cloud mining or traditional mining. These downsides are not just related to the physical inconvenience of an on-site rig or the privacy concerns of cloud mining. They involve the value of the coins.

Once a currency starts to stabilize, it begins to engage with other established currencies. We know the value of mining for bitcoin, for example, by the dollar amounts attached to those coins. Ethereum works the same way.

You don’t have to mine to get ether tokens. You can purchase them directly.

Traditional thinking says that mining is the less expensive way to acquire ether, but as it gets more difficult to mine, that changes. At a certain point, it becomes more sensible simply to purchase ether rather than attempt to mine for it.

To tell when that point is, you can consult an ethereum difficulty chart. One word of advice: you may need a crypto-fluent friend to help you decipher what the numbers on the chart mean for your mining efforts.

Mine, All Mine

Ethereum mining is the most hands-on way to get ahold of the ether that’s the stock-in-trade of this exciting young blockchain. Since so much of ethereum mining takes place via the cloud, it’s a particularly accessible coin for the crypto beginner.

Once you become an experienced ethereum miner and build up your wallet, let us show you how to invest your ethereum wisely.

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