Dogecoin was the first meme coin to be released into the market successfully. Dogecoin is a distant Bitcoin fork with a different source code, and it has become one of the top 10 cryptocurrencies by market cap. As a proof-of-work (PoW)-based crypto asset whose digital ledger is maintained by a decentralized network of nodes instead of one single party, the Dogecoin mining process is similar to that of Bitcoin. Mining Dogecoin is the process of earning DOGE, which is contributing to the verification process that helps in the validation of transactions on the Dogecoin protocol in exchange for DOGE tokens. As a miner, you will be compensated with DOGE tokens because you guarantee the safety of the entire Dogecoin network.
But is mining Dogecoin still a profitable venture?
Crypto mining, including that of Dogecoin, has made many millionaires in the recent past. However, it’s not a golden goose ticket to automatically make you enormously wealthy, as has been realized by people who dived into the mining craze due to fear of missing out (FOMO). In other words, Dogecoin mining can be profitable only if the prevailing market price exceeds the cost of mining.
The first challenge emerged when millions of people and organizations joined the mining space when crypto mining became extremely profitable. Most miners took advantage of the advanced technologies and a huge computing power that emerged to support the Dogecoin mining process. But this has made generating a high number of coins from mining Dogecoin increasingly harder.
If you are a beginner crypto miner, you need to understand that several factors are at play when discussing the profitability of Dogecoin. These factors include the cost of electricity, transaction fees, and efficiency of the mining hardware in use.
The challenge comes when you assess the measurement of hashes per second of the Dogecoin validation transaction. This means that computing power with more hashing power or hashrate in the network has higher security and overall profitability. The entry of more Dogecoin miners into the mining space lowers the profitability. This is because Dogecoin was designed to produce a certain number of DOGE tokens as a reward per block.
Lastly, the price of DOGE can also help you determine whether it will be profitable. One thing you must take into consideration is the volatility of the crypto, as the price fluctuates regularly.
Steps for how to mine dogecoin
Step 1: Acquire a DOGE wallet: You can download either the iOS or Android version of the DOGE wallet.
Step 2: Download and install the unMineable app
Step 3: Download the PhoenixMiner app
Step 4: Extract the downloaded file and install the .exe version from the zip. Ensure you remember the location of its installation
Step 5: Select your GPU, and click on “Update mine file location”, which will ask you to locate the file PhoenixMiner.exe in the directory
Step 6: Click on “Next”, and you will be prompted to choose the cryptocurrency you’d like to mine. Select Dogecoin crypto from the options and enter your wallet address and other details.
Step 7: Click “Start” to begin mining DOGE.
Mining Dogecoin can be profitable, depending on the method or procedure you follow. However, mining Dogecoin is not as profitable as it used to be a few years back. Nevertheless, it all depends on the prevailing market price of DOGE and the cost of hardware.