How to increase mining income with hashrate marketplaces

In the busy crypto mining sector, optimization is essential. With slim profit margins and demand for optimal computing power, all tools for increased results are welcome. As miners try to scrape reasonable profits, they usually turn to traditional mining pools. These pools allow miners to combine their hash power and as a result provide more frequent rewards compared to solo mining. However, there are several options out there.

Another option miners have is to sell their hashing power. Hashing power is the computing power of hardware (ASIC) used to solve various hashing algorithms that some cryptocurrencies are based on. Selling hash power is possible by selling the hash rate through a marketplace. In this case, the miner’s profit is driven by the buyer’s demand rather than the difficulty and coin price.

What is a hashrate marketplace?

Hashpower sellers and buyers can meet on a hashrate marketplace to sell or buy hashpower. A buyer buys the hashrate and sends it to a selected pool. A buyer then receives the cryptocurrency rewards through the chosen pool without owning any mining hardware. The owner of the ASICs (the miner) who sells the hashing power is in turn paid by the buyers to provide this hashing power. The seller is paid in real time for each share sent to the buyer.

Selling hashrate can be enticing for owners of mining hardware, as the buyer pays in Bitcoin (BTC). Therefore, the buyer takes the risk of mining or not mining the block. If the buyer manages to solve a block on their own, they receive the entire block reward of 6.25 BTC by mining Bitcoin. On the other end, the owner of the mining hardware gets paid the average price for all the orders regardless of whether a block is mined or not. This eliminates the luck factor of mining pools.

The order volume provides stable income for the hardware owner, as the seller’s salary is a combined average of the orders in the marketplace. This is among the reasons why miners may find selling their hashing power an interesting alternative to joining mining pools.

Latest hashrate market innovations

As for established hashrate marketplaces, NiceHash helps retail hashrate buyers to buy hashrate and try solo mining with it. On its platform, NiceHash allows buyers to choose the cryptocurrency they want to mine. Then the NiceHash miners will fulfill the order and lend their resources to the buyer. In this way, the buyers do not have to worry about the complex mining operations, giving them the easiest access to the end product: the ability to mine crypto.

Source: NiceHash

As mentioned earlier, miners have several options to earn crypto with the mining hardware. Selling hashrate instead of distributing it directly is among the most profitable options. According to data from NiceHash, a miner selling hashrate through their marketplace would have earned 5.1% more in the last 6 months compared to directly mining bitcoin.

The platform can create a stable revenue stream when it collects orders from buyers. The average of all these orders is then used to determine the miners’ pay rates based on the pay-per-share (PPS) reward system.

Nevertheless, this way of distributing hashrate can be a simple and profitable solution for many miners. NiceHash is compatible with most ASIC mining rigs, such as the Antminer, WhatsMiner and Avalon models. This allows most miners, large and small, to easily connect to the marketplace and offer their hashrate on the open market.

The platform is also an attractive option when it comes to anonymity. With the changing crypto regulations around the world, it’s getting harder to stay anonymous. However, at NiceHash, miners do not need to go through a KYC process. No personal information needs to be shared by miners in order to mine on NiceHash. Miners can receive rewards in their account, but can also choose to have the rewards paid out directly to their Bitcoin wallet.