How to Mine Ethereum with NiceHash | Quora Users Speak Out
If you are looking to mine Ethereum, most internet searches will recommend that you use NiceHash. Before you decide to enlist the service of this mining software, let’s go through some information about NiceHash and what other miners say.
What Is NiceHash?
NiceHash is a platform created by Slovenian-based developers, designed to serve as a marketplace for crypto mining. Here miners of hashing power are connected with those that are interested in buying their processing power.
Since they started their activities, NiceHas has become the biggest marketplace of its kind in the world. The site’s stats are very impressive, the platform having over 110,000 active miners, 4,107,000 orders served, and over 193,000 BTC payouts.
NiceHash supports 34 different algorithms, including SHA-256, Blake, Equihash, Scrypt, X11, X13, X15, meaning that you can mine in addition to Ethereum, Bitcoin, Zcash, Litecoin, and many other cryptocurrencies. The user can select the mining algorithm which makes the most profit at that moment.
The service applies a fee of 3% on orders and the mining payouts are made in Bitcoin. But of in spite of the fee, it is usually more profitable to sell your hash power with NiceHash than mining the cryptocurrency.
Is NiceHash an Effective Solution for ETH mining?
A majority of miners state that NiceHash mines Ethereum blocks in a quick and easy manner. The miners also have the option of automatizing the process of choosing the most beneficial algorithm to hash.
Basically, the software gets rid of a lot of the speculation and strategy which is invested on the user’s behalf before deciding which coin and algorithm he wants to mine.
NiceHash provides more versatility by having more algorithms and hash rates available. However, there are some users that have reported that NiceHash features lower hash rates in comparison to other mining services available.
Ethereum Mining Algorithm
Ethereum 1.0 initially used Dagger-Hashimoto as its algorithm for generating blocks. But after a while, Ethereum switched to Ethash. However, NiceHash’s still uses Dagger-Hashimoto to mine its Ethereum.
On the plus side, NiceHash features on its website instructions for setting up your ethminer software. The site provides instructions for GPUs from both AMD and NVIDIA, Linux builds, as well as directives on how to link two server connections from different continents.
Should you Mine Ethereum with NiceHash? Quora Users React
Miners and crypto enthusiast have taken to Quora, the question and answer site, to express their opinions regarding NiceHash’s efficiency as an ETH miner.
One user, Frederick Briggs noted that NiceHash’s use of the Dagger algorithm paired with a GPU is less effective that directly mining Ethereum with that GPU instead.
He stated that he prefers using ethermine.org because “they provide a very consistent platform and my effective hashrate seems to average out very close to reported hashrate of Claymore Miner (which is the same miner that nicehash uses anyway for Ether)”.
Briggs concludes that Nicehash is convenient to use for GPUs that can mine other coins better than Ether, but there are pools that can fare better in terms of hash rate.
As other users in the forum, he believes that mining Ethereum on your own is the best option, considering that getting your Ether wallet directly is much faster and convenient than converting and transferring Bitcoin (as we mentioned payouts are made in BTC).
Other Quora users recommend alternative mining services such as Hashflare, Minergate, Genesis Mining, and Ether miner. But those that defend individual mining argue that cloud mining is unsafe, as most platforms are scams that pay out only as long as they have new customers coming.
Hashflare has been accused of being a Ponzi scheme, as it has a referral program, reportedly fake positive reviews and what’s weird is that all its contracts aside from ETH are out of stock on their site. These accusations have not been proven to be true or false yet.
Another user, Min Park, believes that the profit made using NiceHash depends on the amount of hashing power the user buys, the hardware they use, and electricity costs, which are factors that vary from user to user.
Profitability should also be analyzed from a short-term and long-term perspective. NiceHash is more profitable short-term but “considering the fact that many people acquired millions of Ethereum for essentially zero dollars, they are going to cash it out soon.” Taking this aspect into consideration, Park believes that Ethereum is “a probably better investment than NiceHash in the long term”.
Because NiceHash is a market for hash rates, the prices for the available hashrate can vary, thus making the miner’s profitability also fluctuate.
It has been noticed however that NiceHash is slightly more profitable with altcoins, as it mines the coin with the least difficulty which has the most potential to increase in the future.
It seems that the opinions regarding NiceHash and its use in ETH mining are divided, with some recommending to mine Ethereum solo or use other mining options.