Introduction
A decentralized network requires every participant to abide by the transactions orders which are executed by miners by solving cryptographically encrypted puzzles for blocks production and for securing the decentralized network from attacks.
What Is Ethereum?
Ethereum is the 2nd largest cryptocurrency after Bitcoin by market capitalization. It was first established in 2014 and since then Ethereum has gained popularity as the largest altcoin and has been used in various sectors. Ethereum is not only a cryptocurrency but it is an entire blockchain network (open-source blockchain technology) on which its native currency Ether runs. The Ethereum network is one of the robust cryptocurrency networks that supports “Smart Contracts,” responsible for making the crypto transactions 100% secure.
Another competitive advantage of Ethereum on other altcoins is that with Ethereum, scalability is never an issue because, unlike most other cryptocurrencies (including bitcoins), Ether tokens do not have a fixed supply. The Ethereum network, a decentralized open-source application (dApp), supports other cryptocurrencies along with its native currency called Ether. With the increasing demand for decentralized services, the Ethereum network is expected to develop in leaps and bounds owing to the successful development of other altcoins on its network.
Price History of Ethereum Coin
As of 2020, more than $13.5 billion worth of crypto transactions were processed on the Ethereum network. However, in the past seven days, the price of Ethereum has dipped by 6.92%, which again spiked by 0.20% very rapidly.
What Is Ethereum Mining? Different Types of Mining
With the growing demand for cryptocurrencies, investors are showing keen interest in increasing their cryptocurrency portfolio, and the best way to increase the crypto holdings is through crypto mining. Ethereum mining is creating a block of crypto transactions and adding them to the Ethereum blockchain. All crypto mining, be it Ethereum or Bitcoin, involves a PoW (Proof of Work) consensus mechanism which requires miners (computer software) from all over the world to solve cryptographically encrypted puzzles using their computation powers, thereby adding blocks to their network.
Some of the most popular types of mining are discussed in detail below:
CPU Mining
CPA mining is the most convenient process of mining cryptocurrencies, where anyone from anywhere across the world can mine their preferred crypto coins using their computer. Therefore, this mining process is best suited for beginners.
GPU Mining
The GPU or the Graphics Processing Unit Mining is the more robust crypto mining process than the CPU mining. The GPU is a part of the video rendering system that supports the CPU or the Central Processing Unit in creating 3D graphics and other visual effects. Previously, all crypto coins, including Bitcoin or Ethereum, were used to be mined in this process.
FPGA Mining
FPGA mining or Field-Programmable Gate Array Mining is a step ahead of GPU mining. FPGA is a device to calculate inputs from a stream of data via a series of gate arrays to yield desired results. FPGA helps optimize an industry process, conducting DNA sequences or providing machine learning. Any parallel process can be completed using the FPGA mining device, and a mining hash can be converted into a successful hash that would eventually result in creating a successful block.
ASIC mining
ASIS or the Application Specific Integrated Circuit was mainly created for mining popular crypto coins like Bitcoin or Litecoin. It is a powerful mining rig (hardware used in the mining process of cryptocurrencies) launched by KNCMiner for the first time, for which they received $25 million for the pre-orders placed in the first five hours.
Is Ethereum Mining Profitable in 2022?
If the short-term price predictions of the ETH tokens go correct, then Ethereum could be a profitable investment in 2022. According to the recent price predictions, the price of ETH could be anywhere between $3,855 and $14,000 by 2022. The price predictions also suggest that the volatility levels of Ether may rise, and the price will continue to grow following the bullish trend that was established last year.
Growth of Ethereum
According to the ETH prediction, the Ethereum price is expected to reach all-time high in 2022, with the price very likely to spike to $14,000. Ethereum is currently trading at $4,205.79 with a market capitalization of $491.38 billion and no potential signs of slowing down. Ethereum has maintained an all-time high even during the pandemic, which instills much confidence in investors about the price hike of ETH tokens in the future.
Final Thoughts
Thus, according to the price forecasts, the price of Ethereum tokens will rise exponentially, and high-stake investors are counting on these price forecasts to be true. However, the cost of Ethereum is dependent on other factors like the demand for DeFi (decentralized finance) services, the launch of the next phase of the Ethereum network called Ethereum 2.0 that has skyrocketed the price of ETH.
