Author Archives: CryptoRigs

Bitcoin Price Falls Below $500 USD

As you probably know, the price of BTC hasn’t exactly been breaking 1K recently. In fact, as of right now, the sell price at coinbase is just below $500, at $494. Why? Well, for a variety of reasons. Probably mainly because a person is trying to mine 10% of all Bitcoins, and the IRS recently named Bitcoin as a property, not a currency. It certainly is surprising a lot of people, especially when the price was expected to be at around $2000 by mid-2014.

Regardless, this goal is still feasible. Hopefully, however, the price will go up soon.

Meanwhile, what does all of this mean? Well, it certainly is a good time to go invest in some! Head over to coinbase to get the best deal.

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How to Benefit From Alternate Currencies

Introduction

As I have mentioned many other times before, there have been many different cryptocurrencies that have spun off the initial Bitcoin/Litecoin idea. A single coin from pretty much all of these “minor” currencies is’t worth anywhere near the price of a Bitcoin. For example, 700 Dogecoin is the equivalent of one USD (at the time of this writing). You can view a list of most of these currencies here (and here, and here). If you look at these sites, you will notice that they each go about listing the profitability of the coin compared to Bitcoin. What does this mean? Well, even though the price of most of these coins is no where near a decent amount of money, there are much less people mining than compared to say, Litecoin. This means that you can get large quantities very quickly, and that you would be making more money that you would be if you were mining a more stable currency.

That’s Great and All, But How Can I Benefit From It?

Great question! The most obvious answer would be to check the list periodically, pick whatever is the highest, and then find a pool that mines that particular coin, cashing out as quickly and possible before the price drops. But unfortunately, the price of these coins are very volatile, and you might be essentially losing money until you check back in and switch coins. This not only defeats the purpose, it is also very tedious finding and switching to a new pool and then selling quickly enough.

A bit more logical option would be to use cryptoswitcher. It works by taking the data from one of the said lists above, and then automatically switching to the most profitable coin. It is the ideal setup once everything is running, but setting up is a major hassle. Not only do you have to optimize cgminer settings for each type of coin, you have to find a pool that actually mines at least one of the twenty-plus coins that it supports.

As far as I can see, the most logical option is to use a auto-switching pool. The only thing you have to do for your rig is point it towards the pool sever, and all of the switching is taken care of.  Work mining the most profitable coin is automatically sent to the miner. The only real disadvantage is that the pool fee tends to run a bit higher, at ~1.5%.

Sounds Great! How do I Get Started?

The first thing that you need to do is decide what pool to join. Personally I use multipool. There are other options as well, such as the premium one run by coinwarz, I only have experience with multipool.

Setting up is fairly straightforward. After you point your miner towards the pool server, you have to setup payout addresses. Multipool automatically pays out whatever balance of whatever coin you have in order for you to sell at the most profitable price. There isn’t really a site that converts all of these altcoins into USD, but sites like Cryptsy and Vircurex allow you to trade them all for BTC, which can be sold into a bunch of physical currencies. I personally use and recommend Cryptsy. After registering an account at once of these sites, you have to generate payment addresses to receive all of these altcoins. The work itself is easy, but there are a lot to do, but you can probably get them all entered into the multipool site in about ten minutes.

After you have done this, turn on autosell, and start mining! After a certain amount of time, your multi-pool will payout to either Cryptsy or Vircurey which automatically converts them into Bitcoin. You can then withdraw this and sell it at your preferred trading site.

Conclusion

If you choose to follow this guide, congratulations! From my testings, I have gotten 1.5-2x the profit than what I would have gotten from purely Litecoin mining.

Getting Started, Part 3: Selling Your Coins

Introduction

Now that you know about getting a wallet and keeping it safe, eventually you are going to want to sell your coins. In this guide, we part we will go over how you can get actual money for your coins.

Pricing

The price of cryptocurrencies can be very volatile. Bitcoins and Litecoins tend to be a bit less extreme, but this is not always the case. In the past Bitcoins went from $75 to $1000 and then back to $800 all in one day! Different trading sites offer different prices for their coins. Be sure to hunt around before you decide what trading site to use.

Selling Your Coins on a Trading Site

Selling your coins can be a lot like selling stocks. You add funds to your account and sell them when you think the price is right. There are a few main trading sites. MtGox, BTC-E, and coinbase are usually considered the main ones. Each has different advantages and disadvantages. For example, MtGox has the highest prices, but requires a lot of verification. EDIT: MtGox has been shut down, and has yet to refund any balances of either USD or BTC. Your best bet right now is probably Coinbase. BTC-E trades a lot of different types of currencies, but is a pain to withdraw money from (7% fee if you use paypal!). Coinbase (my personal favorite) has prices that are a bit lower (but still very good), but makes withdrawing money quick and painless.

Regardless of the ones you choose, always make sure your account is secure and has a long password.

Selling Your Coins Via Private Merchant

There also many people willing to buy coins directly from you. If you use this method you can sometimes get a better price than what major trading sites are offering. Be wary though, there are always people that are out to scam you. Always use an escrow service.

A good place to find private merchants is on the Bitcoin forum.

Trading Your Coins for Actual Items

If you want to skip a few steps and trade your coins for items directly, there are many retail sites that accept coins directly! The largest of which is overstock.com

Conclusion

There are many different places where you can sell/trade your coins. Obviously, the most widely adopted is the Bitcoin. As always though, whatever you do, be careful that you are not getting scammed. Hopefully if you went through this guide, you have now gotten started with cryptocurrencies!

Getting Started, Part 2: Wallet Security

Introduction

Unfortunately, there are always people trying to steal your money. This is also the case in the cryptocurrency world. However, if you take certain precautions, you can greatly reduce the chance of a hacker stealing your hard-earned coins.

Step 1: Make Sure Your Computer Hasn’t Already Been Compromised

This is a very important step. There is no point in making sure your wallet is secure if there is already a virus/malware on your computer. Microsoft Security Essentials is generally good for Windows users. Mac users probably don’t have to worry as much, but I still recommend using a program like AVAST.

Step 2: Download the Liteaddress.org Wallet Generator

Download the offline liteaddress.org wallet generator here. This program allows you to generate wallets offline, securely. Note that this obviously only works for storing Litecoins. A bunch of other cryptocurrencies have a version of liteaddress such as bitaddress (BTC) and Unknownfeatheraddress (FTC). Regardless, the procedure is the same. If you can’t find one for your cryptocurrency, your options are to either convert your into a more popular currency, or find something equivalent via either forums or Google (make sure to verify the source’s reliability!).

A Note About Using an Offline Generator: Liteaddress.org and similar all of course function both online and offline (provided you download it), but I highly recommend using the offline version. As always, use at your own risk.

Step 3: Generate a New Wallet

Before you do anything, disconnect your computer from the internet completely. This means turning off the wi-fi and disconnecting any ethernet cables. DO NOT SKIP THIS STEP. Open the .html file included with the download. It should look identical to what the online sight looks like. Click “Generate New Address” and then print it (make multiple copies). Store the papers in a safe, secure place where you know you won’t lose it or where it could get stolen. DO NOT put it in a place like your (physical money) wallet. After this is done, clear your browser history (cache, etc).

Step 4: Transfer Funds to Your New Wallet

After taking your computer back online, fire up Litecoin-QT (or similar) and go to the “Send” tab. Transfer your funds to the public key of your freshly generated wallet. Your coins are now secure and you can breathe easily. Now, like a normal wallet, just give people the public key of your paper wallet and funds will be sent to it.

Step 5: Check Your Wallet Funds

Since there is no client on your computer to check the wallet balance, you may be wondering if you have to import the keys every time you want to check the balance. This is not the case. Since all of the transactions are on the publicly available blockchain, you can use a explorer like Abe. To check the transactions to/from that wallet (or any wallet). Simply enter the wallet public key and click “Search”. Wallets that currently have no funds on them probably won’t show up.

Step 6: Spending Coins

When you decide that you want to spend some/all of the funds on the secure wallet, open up Litecoin-QT, go to the help menu, and click “Debug window”. Then click on the “Console” tab. You should see something like this:

Screen Shot 2014-01-11 at 11.20.41 AM

In the box, type in “importprivkey privatekeygoeshere “yourdesiredlabel”” (No quotes around the entire thing, but quotes around the label).

Screen Shot 2014-01-11 at 11.24.35 AMAfter it is confirmed, the funds will have been added to your wallet, which you can now easily spend using the “Send” tab. Note that imported wallet is now useless security-wise and that you now have to go back to step 1 if you want to re-secure the funds.

Notes

  • Although following these steps greatly reduce the chance of your coins being stolen, nothing can prevent it completely. I do not take responsibility for any lost funds.
  • If you get an error when importing your wallet, it is most likely your -QT wallet is encrypted and you need to unlock it by typing “walletpassphrase “PassPhrase” 1000″ where 1000 is the amount in seconds that you want the wallet to be unlocked.

Conclusion

Your wallet is now secure! Next up in this guide is cashing out your coins.

 

Getting Started, Part 1: Grabbing a Wallet

Introduction

The first thing that you will need is a wallet. A wallet is where you store all of your coins. This applies to all different cryptocurrencies. There are several types of wallets:

  • Software Wallets-Software wallets are stored on your computer’s hard disk. These are Screen Shot 2014-01-06 at 8.15.27 PMgenerally the most secure types of wallets and are used by the majority of the mining community.
  • Mobile Wallets-Mobile wallets, like the name suggests, are installed onto your mobile smartphone. They follow the same principal as software wallets, but usually are a little bit less secure since mobile phones are much easier to steal/get lost.
  • Internet (cloud) Wallets-Internet wallets are stored up in the cloud on a server. If you decide to choose a internet wallet, be cautious about who the provider is. It is very easy for a fraudulent provider to steal whatever coins are in the wallet. For this reason, I strongly recommend against using one.

In this guide, we will be going over setting up Litecoin-Qt. Litecoin-Qt obviously is for storing Litecoins. Pretty much every cryptocurrency has a -qt wallet, and they are pretty much recognized as the standard for wallets. You can grab Litecoin-Qt here. Download the appropriate copy for your OS and install it.

Note: In this tutorial we are going to be using the Mac version as an example. Keep in mind that it varies very little from the Windows version except for a few different ways that you access controls.

Step 1: Downloading the Blockchain

When you first open up Litecoin-QT, you will see something like this (Make there are no firewalls blocking the program):

Screen Shot 2014-01-06 at 6.02.03 PM Before you can perform or view any transactions, Litecoin-QT has to download the Litecoin blockchain. This file is several gigabytes, so be patient. Note that if you have sent or received Litecoins recently, it won’t show up until the entire block chain is updated. So don’t panic when you wonder where that big Litecoin payment is.

Step 2: Receive Litecoin Payments 

Once the blockchain is down downloading, your wallet should look something like this:

Screen Shot 2014-01-06 at 7.53.16 PMClick the “Receive” button.

Screen Shot 2014-01-06 at 7.55.29 PMIn the top-right corner, you can see you public wallet address. If you ever want to receive Litecoins from someone, tell them to send it to that address. If you want a small amount of Litecoin for free, click here.

You may have also noticed that on our second image, under the “Wallet” section, there is a label that says “Unconfirmed”.

Screen Shot 2014-01-06 at 7.53.16 PMThe amount next to that label is LTC transactions that have been requested but not confirmed. In our previous guide, we talked about how transactions need to be confirmed before they go through. This is the case here.

Step 3: Sending Litecoins

If you ever want to send some Litecoins to an address, click the “Send” button.Screen Shot 2014-01-06 at 8.03.54 PM

Enter the public address of the person you want to send it to, enter an amount, and hit send! Again, keep in mind that because of the verification process, transactions are delayed. Expect most to take a few days to be cleared.

Conclusion

And that’s it! You now know the basics of getting around your wallet. Next up in this tutorial is wallet security, and how to keep you coins safe.

What are Cryptocurrencies?, Part 2: Introduction to Mining

What is Mining?

As stated in the previous part of this guide, when someone sends someone a Bitcoin (or other currency) the transaction is verified many times over. The entire list of past transactions is called the block chain, which is made up of a string of blocks. The act of verifying transactions is called mining. Mining is performed by both CPUs and GPUs. Most CPUs are very fast and have two to four cores. GPUs on the other hand, since they are designed to render lots of 3D images very quickly are build with thousands of cores, thus being faster. The mining community measures how fast a CPU or GPU is at mining in hashes per second. A typical decent CPU will probably get around fifty kilohashes per second (50,000 hashes in one second). A decent GPU for around the same price will get around five hundred kilohashes per second (500,000 hashes in one second).

More About Blocks

Each block contains a mathematical puzzle that needs to be solved for the block to be completed. There are more than one answer to each block “puzzle”. A block is never almost solved; it is like an on-off switch: it is either solved or it isn’t. It is impossible to “make progress” on solving a block. When computers mine, they submit “shares” which is what they think the answer to the puzzle might be. Whenever a computer solves a block, their is a “reward” consisting of Bitcoins. Right now the reward for solving a block is twenty-five Bitcoins. A few years ago the reward was fifty. In a few more years the reward will be twelve and a half. This is because Bitcoins are designed so that about every ten minutes, one block is solved. If you do the math, you can figure out that the reward for solving a block is halved ever 210,000 blocks, or every four years. Since the number of computers mining Bitcoins fluctuates, you might wonder how the system keeps maintains having one block solved every ten minutes. The difficulty is how hard it is to solve a block. The more people mining means the difficulty rises. This same idea applies to all other cryptocurrencies. Since cryptocurrencies are becoming a lot more difficult in general, the difficulty is now continually rising.

So Why Mine Litecoins Instead of Bitcoins?

Good question! Although Litecoins and Bitcoins both are based on the same idea, they have a few differences. Litecoins are designed so that one block is solved every two and a half minutes. But the big difference is the way they are designed. Bitcoins have a “flaw” where an “ASIC” (Application-specific integrated circuit), something specially built to mine Bitcoins, can be built to ming many, many times faster at a fraction of the cost of a GPU. Since the introduction of these, the Bitcoin network has been flooded with ASIC, defeating the efficiency of mining with a GPU or CPU. Litecoins however are designed so that they have to be mined with either GPUs or CPUs.

How Can I Mine Litecoins?

To start off with, you need a computer with a decent AMD graphics card. The build featured here is great to start off with. The “standard” mining program for AMD GPUs is called cgminer. A great way to learn about this is simply looking at the configuration file:

cgminer –scrypt -o stratum+tcp://ltc.give-me-coins.com:3333 -u xxxx -p xxxxx –lookup-gap 2 –thread-concurrency 11200 -g 2 -I 13 -w 256 –auto-fan –gpu-fan 30-75,30-75 –temp-cutoff 90,90 –temp-overheat 85.85 –temp-target 72,72 –gpu-memclock 1500,1500 –gpu-engine 1080,1080 –gpu-powertune -20,-20

You can probably get an idea just by reading it. Let’s like at the first part: “cgminer –scrypt”. Cgminer of course the name of the program. “Scrypt” is the name of the algorithm used for mining. Moving on:

o stratum+tcp://ltc.give-me-coins.com:3333 -u xxxx -p xxxxx

Here it appears that cgminer is connecting to something. Specifically, it is connecting to the LTC give-me-coins server. Give-me-coins is a mining pool. Mining Pools are groups of people mining together. Since someone with one computer has a very small chance of solving a block (thus getting a reward), people team up and split the reward whenever someone solves the block, which ends up being much more profitable. -u xxxx and -p xxxxx is where you enter the worker username and password for a mining pool account. The purpose of individual accounts being divided up into workers allows people to track their separate miners easier. A list of Litecoin mining pools can be found here. The rest of the config file is:

–lookup-gap 2 –thread-concurrency 11200 -g 2 -I 13 -w 256 –auto-fan –gpu-fan 30-75,30-75 –temp-cutoff 90,90 –temp-overheat 85.85 –temp-target 72,72 –gpu-memclock 1500,1500 –gpu-engine 1080,1080 –gpu-powertune -20,-20

This is simply the settings that tell cgminer how much work to give the GPU. Each GPU mines faster at different settings. Part of the trick to mining is figuring out what settings work best for your card. If you can find the optimal settings, all you have to do is sit back and watch the $$ to come in.

Conclusion

Hopefully this guide has explained to you the basic concept of cryptocurrencies and what “mining” them is. If mining sounds like something you want to get into and experiment with (and even make some money!), check out our next guide, which explains how you can build one for fairly cheap.

How to Build a Cheap Litecoin/Cryptocurrency Mining Rig, Part 4: FAQ, Tips, and Tricks

FAQ

1. How many Kilohashes a second do one of these rigs get?

It varies a lot on the model and who manufactured it, but pretty much all of the cards can be configured to get at least 650Kh/s. Most are around the 725Kh/s range. The highest I’ve seen is 800Kh/s.

2. How many Litecoins can I expect to get from one of these?

In my tests, using the give-me-coins pool, I get one Litecoin about ever four days. Its not huge, but you do make money and it is a fun experiment. A more accurate calculator can be found here.

3. How can I store my rig?

Store your rig in a dry, relatively clean area. At the same time make sure that the area isn’t too hot to avoid overheating. Make sure that there is a clear path for air to come into your GPU and power supply fans, and leave the exhaust unobstructed. 

4. Are these things noisy?

Somewhat, yes. You can definitely hear it if you are in the same room. I would’t want to try to sleep in the same room as one of these things. You should be fine if you store it anywhere else though.

5. Can I use wi-fi as opposed to ethernet on my mining rig?

Yes! You will, however have to buy a separate ethernet adapter. You also want to make sure that it is reliable and doesn’t glitch often.

6. Can these rigs mine currencies besides Litecoins?

Yes! However they will probably only be efficient with scrypt currencies because of ASICs.

Tips and Tricks

  • Most of our parts are available on Amazon. You can get free two-day shipping on all items for 30 days by signing up for the Amazon Prime Free Trial (Be sure to cancel before it is over so you don’t have to pay for it!)
  • You can some free LTC (fractions) here (not one of those ad sites).