In the busy crypto mining sector, optimization is critical. With slim profit margins and demand for optimal computing power, all tools for increased results are welcome. As miners try to scrape reasonable profits, they usually turn to traditional mining pools. These pools let miners combine their hashing power and, as a result, provide more frequent rewards compared to solo mining. However, there are more options out there.
Another option miners have is selling their hashing power. Hashing power is the computing power of hardware (ASICs) used to solve different hashing algorithms that some cryptocurrencies are based on. Selling hashing power is possible by selling the hashrate through a marketplace. In this case, the miner’s profits are driven by the buyer's demand instead of the difficulty and coin price.
What is a hashrate marketplace?
Hashing power sellers and buyers can meet at a hashrate marketplace to sell or buy hashing power. A buyer buys the hashrate and directs it to a chosen pool. A buyer then receives the cryptocurrency rewards through the chosen pool without owning mining hardware. The owner of the ASICs (miner) selling the hashing power, in turn, gets paid by the buyers for providing this hashing power. The seller is paid in real-time for each and every share sent towards the buyer.
Selling hashrate can be alluring for mining hardware owners, as the buyer pays in Bitcoin (BTC). Hence, the buyer takes the risk of mining or not mining the block. If the buyer manages to solve a block alone, they receive the entire block reward of 6.25 BTC when mining Bitcoin. On the other end, the owner of the mining hardware gets paid the average price of all the orders regardless of whether a block is mined or not. This eliminates the luck factor of mining pools.
The volume of orders results in steady income for the hardware owner, as the seller’s pay is a combined average of the marketplace orders. These are among the reasons miners may find selling their hashing power an interesting option instead of joining mining pools.
Latest hashrate market innovations
When it comes to established hashrate marketplaces, NiceHash helps retail buyers of hashrate to buy hashrate and try solo mining with it. On its platform, NiceHash enables buyers to select the cryptocurrency they would like to mine. Then, the NiceHash Miners will fulfill the order, lending their resources to the buyer. This way, the buyers don’t have to worry about the complex mining operations, giving them the most straightforward access to the end product: the possibility to mine crypto.
As mentioned earlier, miners have several options to earn crypto with their mining hardware. Selling hashrate instead of deploying it directly belongs among the most profitable options. According to data from NiceHash, a miner selling hashrate through their marketplace would have earned 5.1% more in the past 6 months compared to directly mining bitcoin.
The platform can create a stable revenue stream as it pools together orders from buyers. The average of all these orders is then used to determine miners’ pay rates based on the pay-per-share (PPS) reward system.
Nevertheless, this way of deploying hashrate could be an easy and profitable solution for many miners. NiceHash is compatible with most ASIC mining rigs, like the Antminer, WhatsMiner, and Avalon models. This makes it possible for most miners, big and small, to easily connect to the marketplace and offer their hashrate on the open market.
The platform is also an attractive option when it comes to anonymity. With the changing crypto regulations worldwide, staying anonymous becomes harder. However, on NiceHash, miners don’t need to go through a KYC process. No personal information needs to be shared by miners to be able to mine on NiceHash. Miners are able to receive rewards within their account but can also choose to have the rewards paid out directly to their Bitcoin wallet.
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