Litecoin Mining – How To Mine Litecoin (LTC)?

Litecoin Mining - How To Mine Litecoin (LTC)?

Litecoin Mining – How To Mine Litecoin (LTC)?

What Is Litecoin?

Just like its older brother Bitcoin, Litecoin is an online network that people can use to send payments from one person to another. Litecoin is peer-to-peer and decentralized, meaning that it is not controlled by any single entity or government. The payment system does not handle physical currencies, like the dollar or the euro; instead, it uses its own unit of account, which is also called litecoin (symbol: Ł or LTC). This is why you will often see Litecoin categorized as a virtual or digital currency. Litecoins can be bought and sold for traditional money at a variety of exchanges available online.

If you already know Bitcoin, Litecoin is very similar, the two main differences being that it has faster confirmation times and it uses a different hashing algorithm.

What Is Mining?

Litecoin Mining – How To Mine Litecoin (LTC)?

Instead of having one central authority that secures and controls the money supply (like most governments do for their national currencies), Litecoin spreads this work across a network of “miners”. Miners assemble all new transactions appearing on the Litecoin network into large bundles called blocks, which collectively constitute an authoritative record of all transactions ever made, the blockchain.

The way Litecoin makes sure there is only one blockchain is by making blocks really hard to produce. So instead of just being able to make blocks at will, miners have to produce a cryptographic hash of the block that meets certain criteria, and the only way to find one is to try computing many of them until you get lucky and find one that works. This process is referred to as hashing. The miner that successfully creates a block is rewarded with 12.5 freshly minted litecoins.

Every few days, the difficulty of the criteria for the hash is adjusted based on how frequently blocks are appearing, so more competition between miners equals more work needed to find a block. This network difficulty, so called because it is the same for all miners, can be quantified by a number; right now, it is 11,074,017.

Should You Mine Litecoins?

Litecoin mining can be profitable, but only under certain conditions. In the early days people could make a profit by mining with their CPUs and GPUs, but that is no more the case today. The introduction of specialized mining hardware (commonly referred to as ASICs), which can mine much faster and much more efficiently, has made finding blocks much harder with general-purpose hardware.

If you compare the profitability analyses for a CPU, a GPU and an ASIC, you will see that the costs of CPU and GPU mining largely exceed the rewards, and even with free electricity the profits are so small that they are hardly worth the effort.

Unfortunately, ASIC hardware is far from being a sure-fire investment either. Potential buyers should be extremely careful, as various elements should be considered:

  • Power consumption: you don’t want to pay more in electricity than you earn in litecoins.
  • Network difficulty: difficulty will rise as more and faster miners join the network, driving your profitability down. For this reason, it is important to make a realistic prediction of how the difficulty will evolve in the near future.
  • Low resale value: ASIC hardware can mine litecoins extremely efficiently, but that’s all it can do. It cannot be refitted for other purposes, so the resale value is very low.
  • Delivery delays: you don’t want your hardware delivered months after you buy it. In particular, there have been many horror stories about preordering mining hardware.

Most importantly: always do your own research, and never trust any single source of information. Good starting points are LitecoinTalk.io and the /r/litecoin and /r/litecoinmining subreddits.

Don’t feel like investing in expensive hardware? That’s fine! Not everyone needs to be a miner. In fact, the easiest way to get started with Litecoin is to buy some at an exchange.

Solo, Or With The Crowd?

Mining can either be a solitary venture or you can join a mining ‘pool’, where a number of people combine their processing resources and all take a share of the rewards.

It can be helpful to think of mining pools as joining a lottery syndicate – the pros and cons are exactly the same. Going solo means you get to keep the full rewards of your efforts, but accepting reduced odds of being successful. Conversely, joining a pool means that the members, as a whole, will have a much larger chance of solving a block, but the reward will be split between all pool members, based on the number of ‘shares’ earned.

If you are thinking of going it alone, it’s worth noting that configuring your software for solo mining can be more complicated than with a pool, and beginners would probably be better off taking the latter route. This option also creates a steadier stream of income, even if each payment is modest compared to the full block reward.

What Are Mining Pools?

As we’ve seen above, finding a block is very hard. Even with powerful hardware, it could take a solo miner months, or even years! This is why mining pools were invented: by sharing their processing power, miners can find blocks much faster. Pool users earn shares by submitting valid proofs of work, and are then rewarded according to the amount of work they contributed to solving a block.

The reward systems used by mining pools can be roughly subdivided into two categories: proportional systems and pay-per-share systems.

  • Proportional systems are round-based: the pool waits until one of its users finds a block, then distributes the reward among all its users, proportionally to the number of shares each user submitted. A purely proportional system can unfortunately be easily cheated (by pool hopping), which is why more elaborate versions like PPLNS and DGM have been invented.
  • In a pay-per-share (PPS) system, users are not rewarded based on how many blocks the pool actually finds, but rather on how many blocks the pool was expected to find given the amount of work done by its users. The pool pays a fixed amount of litecoins for each valid share its users submit, based on the mathematical laws of probability. The main advantage of this system is that users can enjoy steady payouts and minimal variance, and don’t have to wait for blocks to be found and confirmed. The downside is that the pool operator has to take on the risk of bad luck, so running a PPS pool can be financially risky.

Choosing a mining pool can be a very personal decision, and several factors should be taken into consideration, including features, reliability, reputability, and user support.

Installing Your CPU miner

A handy piece of software called cpuminer is the easiest way to start mining, but does require the ability to use the command line on your computer. The program can be downloaded from SourceForge and is available for Windows (32 and 64 bit), OS X and Linux. For the purposes of this guide, though, we are making the assumption that you are using the Windows OS.

First, download the appropriate file for your operating system. The zip file can be extracted to anywhere on your hard drive, as long as you remember where it went. A good idea would be to create a ‘cpuminer’ folder on your desktop.

Writing Your Script

So, how to set up cpuminer with the parameters needed for your mining pool? Well, it’s usually simplest to write a one-line script (known as a ‘batch file’ in Windows) to launch the miner with the correct instructions.

To do this you will need the following:

  • The full path of the directory in which the mining program (“minerd.exe”) is stored (eg: “C:\cpu-miner-pooler”).
  • The ‘stratum’ URL of your mining pool server (eg: “stratum+tcp://pool.d2.cc”).
  • The port number of your mining server (eg: “3333”).
  • Your mining pool username (eg: “username”).
  • Your worker name or number (eg: “1”).
  • Your worker password (eg: “x”).

Now, open Notepad or your preferred text editor. Do not, however, use a word processor such as MS Word. Next, enter the script using the following formula (note that this method assumes you are mining a currency that uses the scrypt algorithm):

start “path” minerd.exe – -url URL:PORT –a scrypt – – userpass USERNAME.WORKER:PASSWORD

So, using the example details above, you would have produced the following text:

start “C:\cpu-miner-pooler” minerd.exe –url stratum+tcp://pool.d2.cc:3333 -a scrypt –userpass username.1:x

Save this file with a “.bat” extension; for example: “my-mining-profile.bat”.

Once the batch file is saved, double click it to activate the miner program. Your mining pool will most likely have a web-based interface and, within a few minutes, the website should show that your mining worker is active.

Now that you know how to mine with the CPU, let’s have a look at using your GPU.

Setting Up Your GPU Miner

Litecoin Mining - How To Mine Litecoin (LTC)?
Litecoin Mining – How To Mine Litecoin (LTC)?

For those that intend to mine with GPUs, or USB mining devices, cgminer is the program to use and can be downloaded from the developer’s website – unless, that is, you’re a Mac user, in which case you will find some unofficial binaries here.

Versions of cgminer following version 3.72 do not support scrypt mining, and support for GPUs was removed in version 3.82. Therefore, the latest version isn’t necessarily the one to download. Instead, seek out the version appropriate for your needs.

Again, in this example, we are making the assumption that you are using the Windows OS. However, if you are using Linux or OS X, the command line arguments (ie: the parameters) are the same. Furthermore, the instructions below once again assume you will be mining a scrypt currency.

Extract the software into a folder that can easily be found, eg: “c:\cgminer\”.

Before going any further, make sure that your graphics drivers are up to date.

Next, press the Windows key together with the “R” key, type in “cmd”, and press “enter”. This will open the command terminal. Use the “cd” command to change the directory to the one housing the cgminer zip file.

Then, type in “cgminer.exe –n”. This will list all recognised devices on your PC. If your graphics card is detected, you should be good to go. If not, you’ll have research the steps required to properly set up your specific graphics card.

You will now need your mining pool details, just as with the CPU mining section above:

  • The full path of the directory in which the mining program (“minerd.exe”) is stored (eg: “C:\cpu-miner-pooler”).
  • The ‘stratum’ URL of your mining pool server (eg: “stratum+tcp://pool.d2.cc”).
  • The port number of your mining server (eg: “3333”).
  • Your mining pool username (eg: “username”).
  • Your worker name or number (eg: “1”).
  • Your worker password (eg: “x”).

Now we’ll make a batch file again, in order to start cgminer up with the correct parameters. In this case, the command structure is:

Start “path” cgminer — scrypt -o URL:PORT -u USERNAME.WORKER -p PASSWORD

For example,

Start “C:\cgminer\” — scrypt –o stratum+tcp://pool.d2.cc:3333 –userpass username.1:x

Watching Your Miner

cpuminer
Litecoin Mining – How To Mine Litecoin (LTC)?

Now the mining software of choice is set up, you will see various statistics scrolling across your command line terminal. If you are using cgminer, you will see more information than you would with cpuminer. In the case of the former, you will see information about the currency and the mining pool, as well as about your mining hardware. If you’re running cpuminer, you will only see references to blocks that your PC has solved; although, it does, at least, show your hashing speed.

Maximising Your Power

Good news for miners who own PCs with dedicated graphics cards: it is possible to run both cpuminer and cgminer at the same time. To make this possible, add a “– threads n” argument to the minerd command. Here, “n” stands for the number of CPU cores that you wish to employ for mining.

Remember to leave one or two cores free to control your GPUs, though. Setting minerd to use all CPU cores will mean that the CPU will be too busy to send data to the GPU for processing. For example, if you have a quad core CPU, try setting the “–threads” argument to “2” or “3”.

Mining with both GPU and CPU concurrently reveals just how much better GPUs are at mining than the CPU. Compare the hash rates shown in the terminal windows for each of your mining programs and you should see at least a five-times difference in hashing speed.

Wallets At The Ready

Litecoin Mining - How To Mine Litecoin (LTC)?
Litecoin Mining – How To Mine Litecoin (LTC)?

Before you start mining, you will need a wallet to keep your hard-earned coins in. A good option is to head to the homepage of the Litecoin and seek out the download link for the default wallet app.

If you find yourself in need of help and advice, most altcoins have community forums, as well as their own subreddit. The majority of wallets are based on the original Bitcoin-Qt client. Be warned, though, that before these wallets are truly usable, you may face a lengthy wait while the coin’s entire block chain downloads.

Litecoin Mining – How To Mine Litecoin (LTC)? – Refer: Litecoinpool.org   &  Coindesk.com
Learn More Mining, Click Here
For Earn $$$/Tokens/Coins free, Click Here 

Good luck,

Latest Articles

0 Comments
Inline Feedbacks
View all comments