Over the last few years, Dogecoin has attracted a significant number of miners. But does this mean that the meme coin is easy to mine? Well, keep reading this article to get the answer. We will also show you how to mine DOGE.
The Dogecoin Meme Coin
DOGE has witnessed massive growth since its introduction in 2012. What began as a joke token, having drawn inspiration from the popular internet meme “doge,” is now a leading cryptocurrency with a market capitalization of more than $10 billion. Software engineers Billy Markus and Jackson Palmer are the brains behind Dogecoin.
The meme coin recorded a spectacular rise in 2021 after Tesla boss Elon Musk started supporting it. At the time, interest in Dogecoin mining grew massively, causing mining profitability to hit a new high.
Compared to Bitcoin mining, Dogecoin mining is less difficult. In addition, new blocks are added to the Dogecoin network faster, and mining rewards are higher (10,000 DOGE tokens) than those given to Bitcoin miners (6.25 BTC), although they have less value than BTC.
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How Dogecoin Mining Works
Like Bitcoin and Litecoin, Dogecoin uses the same consensus mechanism to add new blocks to its network. The mechanism, Proof-of-Work, requires Dogecoin miners to compete to be the first to add new blocks of transactions to the blockchain. In order to boost your chance of mining a block, you need to have powerful mining equipment.
While Litecoin and Bitcoin have a fixed token supply, Dogecoin, on the other hand, does not have a cap on its supply, meaning more tokens will continue entering the market through mining forever.
On Dogecoin, new blocks are usually discovered every minute, while on Bitcoin, miners discover new blocks of transactions every ten minutes.
As mentioned earlier, both Bitcoin and Dogecoin use the Proof-of-Work consensus mechanism. However, the two networks employ different hashing algorithms. Bitcoin adopts SHA-256, while Dogecoin uses Scrypt, which makes the mining of the meme coin less complex.
How to Mine Dogecoin
Initially, Dogecoin mining was easy since only a few miners participated in the process. At the time, one could mine DOGE individually. But as the meme coin continued to grow in popularity, the mining process started becoming difficult. This forced miners to form “mining pools,” which allow them to combine their hashing power to increase their chances of getting a block to mine. Still, some people mine Dogecoin individually to date.
Here are the various ways of participating in Dogecoin mining:
If you want to mine Dogecoin for fun or perhaps to understand how the process works, you can do so using a Graphics Processing Unit (GPU) via software such as EasyMiner. However, due to rising electricity costs, solo mining has proven to be difficult in recent years.
Dogecoin Mining Pools
As a solo miner, if you want to boost your chances of making profits from mining Dogecoin, it is advisable to join a mining pool. However, keep in mind that subscribing to a mining pool isn’t free. Be prepared to pay at least a fee of 2%. So, what are the recommended Dogecoin mining pools? You can check out AikaPool and Prohashing.
If you do not have mining equipment, you can opt for cloud mining. But what is it? Cloud mining involves renting hashing power from a reliable data center and then paying an annual or monthly fee. Popular cloud mining providers include Nicehash and Genesis Mining.
As a Dogecoin miner, you need a crypto wallet that supports the storage of DOGE so you can store your mining rewards. Several wallets that have Dogecoin support have been launched over the years. If you want to store your Dogecoin mining rewards in a hot wallet, you can use the Dogecoin Wallet. If you wish to maintain your rewards offline, cold wallets like the Trezor Model T and Ledger Nano S are recommended.
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