Welcome to the DPS Knowledge Database
Here you will find the Know-Hows of the Cryptocurrency space and all the information you need to get you started in the Crypto World. DPS Proudly provides this content absolutely FREE to our customers and new members. Additionally new information is constantly being updated and added to our “Know-How” section. Check back frequently to see whats new!
What are E-Wallets?
In order to receive mining rewards or perform cryptocurrency transactions, one must have a digital wallet or E-Wallet. An E-Wallet is a software program made up of two key components, a private and public key. These keys interact with the Blockchain to allow you to check your reward balances as well as send and receive coins to others.
The public key is your wallet’s digital address and enables you to receive cryptocurrencies. Just like the name indicates, the public key is viewable by the public at large and is recorded in the Blockchain. The private key is your way of identifying yourself as the owner of the public key. It acts as a digital signature to verify that a transaction to your wallet is allowed. Protect the private key and don’t share it with anyone.
There are many different types of wallets with varying degrees of security. Software wallets include Desktop, Online, Mobile, and Paper wallets. Another type of E-Wallet is the hardware wallet. Hardware wallets utilize devices such as USB drives to store the public and private keys. What makes them unique compared to software wallets is that one can store their information offline, adding increased security. Be sure to do your research on the E-Wallet providers and choose the type that best suites your cryptocurrency needs.
Cryptocurrency Miner Selection
With today’s fast changing technology it is imperative to focus on selecting the correct mining equipment. They come in all shapes and sizes. You need to research which tokens you want to mine, find the applicable manufacturer for your miner selection, and their specific models that mine your token of choice. Some of the leading miner manufacturers today include companies like BITMAIN, INNOSILICON, PANDAMINER, WHATSMINER, & TODEK.
You need to be aware of each manufacturer’s policies, shipping and warranty agreements. Miner models are updated frequently and add improved hash value to the pools and can increase rewards. It is important to stay informed on current market offerings, so routine research and evaluation of mining equipment is vital. You want to be ahead of the curve.
As the Blockchain expands so too increases the mining algorithms difficulty. In addition, tokens will split as well as halve intermittently. Being prepared for these changes will allow you to thrive during the ups and downs in the market.
What is the Blockchain? How does it work?
In the context of cryptocurrency the Blockchain is the ledger or spreadsheet on which transactions are recorded. Every transaction adds to completing the spreadsheet (block) and then a new one is started. The new block is coded to refer to the previous one, thus creating a chain of blocks. These transactions are processed by nodes (mining equipment) on a peer to peer network.
In order for a transaction to be recorded in the block it has to be approved by a majority of miner on the network. Each miner records the blocks in the chain and maintains a copy of the whole ledger as more blocks are added into the chain.
Since miner can be located all over the world the Blockchain is decentralized and safeguarded against hackers or attacks. For example many financial institutions have been attacked and compromised due to their centralized banking model, losing individuals money and identities.
With Blockchain technology if someone attempts to fraudulently change a transaction, the miner will identify and reject it instead of adding it to the block. The Blockchain automatically updates itself every 10 minutes on all miner and locks in the ledger. This means it cannot be changed and only allows new transactions to be added to it.
In 2008. Satashi Nakamoto launched an electronic currency that used peer to peer technology to complete electronic cash transactions without the need of a traditional financial institution. Bitcoin was born. For more information we refer to: The Bitcoin White Paper
Since then thousands of cryptocurrency tokens have been created, using the Blockchain Technology to complete their peer to peer transactions and provide security to the system. Traditional currencies require a central authority to print, distribute and maintain them. All too often the organizations overseeing these currencies print and distribute too much causing such currencies to lose their value and fail Electronic currencies have no need for a central authority, instead they distribute new tokens to those who participate in the mining process. This not only incentivizes people to have miner, but also releases new tokens into circulation. As cryptocurrency has grown over the years, so has the number of merchants that accept these currencies.
Today companies like Microsoft, AT &T, NewEgg, Amazon, Ebay and many others already accept Bitcoin as a payment method. For more information we refer to this amazing Documentary on Bitcoin.
What is Cryptocurrency Mining?
Every time a customer uses his credit or debit card a service fee will be charged. This fee will either be paid by the customer or the merchant, and in general it benefits the financial institutions that provide the card services. These transaction fees represent a multi-billion dollar industry. Rather than depending on centralized financial institutions which limit our options, we now have the opportunity to use cryptocurrencies as a peer to peer transaction model.
Individuals participate by providing their own servers (mining equipment) which process cryptocurrency transactions. This service was entirely controlled by financial institutions in the past. The more individuals participate in the cryptocurrency market the more powerful it becomes. For example, acceptance of mobile phones for everyday use has led to the demise of the landline phone services.
Cryptocurrencies too, will replace government based printed money, if enough people accept its usage for everyday transactions. Now the mining equipment becomes equal to an ATM machine. Your miner participates in completing transactions on the Blockchain and it receives compensation for the hash power provided to the network in the form of rewards (coins/tokens). Transactions happen all over the world 24 hours a day 7 days a week, meaning your miner can earn you rewards even while you sleep.
Mining your favorite cryptocurrency is a great way to not only am rewards, but also support the cryptocurrency community at large. It’s your choice how you use the rewards your miner earns. Hold them, trade them, or use them. As long as your miner is connected to the Blockchain network it will continue to generate more and more rewards for you every day.
Power Consumption & Mining Revenue
As you research the miner of your choice, you’ll want to pay close attention to its profitability. Their are three aspects that affect it the most; power costs per kWh, power usage, and miner hash rate. The costs for electrical usage need to be factored into your overall profitability. Where you plug in you miner can have a dramatic impact of your revenue. Even a one cent difference per kWh in electrical cost is significant.
The second aspect is the power consumption which is directly affected by the wattage rating of your miner. A miner that is rated for 500 Watts will use less electricity than one that is rated for 4000 Watts. The third aspect for your selection is the hash rate provided by your miner. Hash rate is the speed at which your miner is able to complete Blockchain algorithms. The faster your miner can complete the ledger, the greater is its ability to receive rewards.
There are many sites available today that will assist you in understanding the profitability of specific miners (ASICMINERVALUE, NICEHASH).
We don’t just want you to be our customer, we want you to be knowledgeable and gain the information necessary to thrive in the world of cryptocurrency. It’s a journey we take together.