DIY Litecoin Mining – How to Get Started
If you are interested in mining your own LTC, this section will guide you on how to set it all up yourself, exploring the software and hardware requirements and what expenses you will incur.
Best Mining Hardware for Litecoin
Mining Litecoin is not a feasible option unless you are planning to go big, something like a mining farm with arrays of mining rigs connected in tandem, working together towards finalising a block. You can, however, invest in some good mining machines and connect with a mining pool. The game is simple: more mining power (hashes per second) means a greater chance. Following are a few of the most popular miners you might want to consider.
The FutureBit Apollo Pod is a good option as a Litecoin starter pack. Though not as powerful as the big machines, it does a good job due to its lower energy consumption. The miner comes in a small stand-alone pod concept (hence the Pod in the name). The Apollo Pod can give up to 135 Mh/s consuming 1 watt per Mh in economy mode and 1.4 watts in its turbo mode. The device comes with a 64 GB USB drive that is preloaded with the LTC blockchain, helping you spend less time on the first-time synchronisation and jump to mining. The Pod is available to order directly from the FutureBit website, costing $320 (plus $15 if you want the SD card).
The AntMiner L3+ is a good option, with it consuming just a tad more than Apollo at 1.6 W/Mh of energy but performing up to 504 Mh/s of computation. It consumes overall 800 watts and comes with a dual cooling fan system to dissipate the extra heat it generates. It is available on Amazon, costing $700, and comes with its own power supply. Don’t be fooled by the low price, though. The L3+ is out of production, and only models used are available, hence the low price tag.
If you want to go all-in on mining LTC, you should check out the Innosilicon A6+ LTC Master. This beast is one of the most powerful LTC mining ASICs in the industry, churning out 2.2 Gh/s. The high power comes at a cost, though, consuming 2.2kWh of energy. The popularity has led to all units being sold out at the moment, and you will need to get in line for the opportunity to get your hands on it. Priced at $3,000 a unit, it will set you back a whopping $30,000, as a minimum of 10 units can be ordered.
Other Costs to be Considered
Though the machine manufacturers declare the costs of the ASICs, other factors come into play. You will need a computer too that you must hook up with the miner to configure and run.
Your location is also important. Different locations and electricity suppliers have their own rates and that can change the cost of running the machines. If you are located in a temperate or hot climate zone, you will need to additionally invest in cooling apparatus. If you intend to join a mining pool, they will have their charges and the block reward distribution policy.
Now that you are all ready to buy the ASIC you want, you can set it up and mine. But first, there are a couple of other things you need to ensure.
You will need to install the relevant ASIC software, which will communicate with the Litecoin network. Furthermore, a Litecoin wallet will let you store your earned coins.
Easy Miner is the most appreciated mining software available for LTC. It is open source and can be configured for a variety of devices. CGMiner is another good choice but since it is a command-line version, it is not for people who are used to graphics-based user interfaces. Awesome Miner is fine-tuned towards managing multiple rigs and if you are running your own large array, consider this.
Mining pools are the best option if you are on a budget. A mining pool works by combining the hashpower of multiple miners and sharing the block rewards between participants. This gives miners a much more consistent stream of income.
Before committing to a pool, be sure to check out the reputation and their past performances. A larger pool size is bound to get more hits on block rewards, but this also means the payouts are diluted. LTC.top leads the pack with 22% of all hashpower. AntPool from BitMain are other popular choices. Other major pools include F2pool and LitecoinPool.
Mining pools are a logical option for individual miners since the hashpower of Litecoin currently means that it is nearly impossible to be in profit unless you shell out a huge amount of money for a collection of the top of line ASICs. You can buy a cheaper mining machine and join one of the many pools which work as a distributed computing network, combining power and working in unison to find blocks.
Different mining pools have their own method of determining how you are rewarded. The simplest method is Pay Per Share, which guarantees you LTC payouts, even if the block is not successfully mined. Your payout depends on your hashrate contribution to the total pool size. Full Pay Per Share is a variation where pool contributors are also given a share of the transaction fee earned. Pay Per N Shares is the most complex reward system and runs higher risks. You are paid LTC only if the pool manages to mine a block successfully. In order to compensate for the increased risks, users are rewarded much higher than the other options.
Once you have decided on which mining pool you want to join, you can simply set up your ASIC, download and install the necessary software, and connect to the pool.
If you don’t want to go through the hassle of buying and setting up your rig, a cloud mining solution is your best option. Basically, you rent out the ASIC power of another user, sharing the rewards. Though easier, this option has to be carefully considered. Since you are only paying for the rent, the agreements are inclined towards protecting the service provider, even including a clause where they can terminate your account if the cloud mining isn’t feasible due to a drop in Litecoin’s price.
If you still want to use a cloud mining pool for LTC, you can check out Hashflare, which allows instant mining upon payment confirmation, payouts every 24 hours, and unlimited contract lengths. It does have some maintenance fees for Litecoin and will charge you extra if you want your payout in fiat currency. Other good options include NiceHash and Eobot.
The key to selecting a cloud mining platform is to read the fine print in the agreements, along with any mention of guaranteed earnings, contract length, maintenance costs, and the cost point where they can dissolve your account. Scammers are common in the cloud mining space, so always do due diligence when researching platforms, and remember: if it seems too good to be true, it probably is.
A thorough cost-benefit analysis is a good way to find out if it is worth buying your own ASICs or investing in cloud mining. Where owning a machine means a significant startup investment, the main cost comes in running the machines and their cooling requirements. Cloud mining frees you from these, and the rent is low, but can amount to a lot of value if you are not actually earning any rewards.