New mining software promises to let almost anyone earn small amounts of bitcoin with a Windows laptop, giving users a taste of the cryptocurrency’s early days.
Revealed exclusively to CoinDesk, the New Jersey-based crypto mining startup Honeyminer quietly launched a free beta in June and has already garnered 10,000 downloads across the globe. Honeyminer allows users to participate in a dynamic mining pool by running the app when the computer’s graphics processing unit (GPU) isn’t in use processing images or videos.
The pool focuses on mining cryptos like ethereum, ethereum classic, zcash, monero and other GPU-friendly currencies. Then, at the end of the session, Honeyminer sends the participant’s earnings, converted into bitcoin, directly to the user’s wallet.
“The miner doesn’t have to do the math or manage all the configurations and settings, or manually check the prices,” Honeyminer advisor Noah Jessop, a venture capitalist at Founder Collective in San Francisco, told CoinDesk.
“We make it so that any surplus compute, so any laptop you aren’t using all the way up to a rig that you run is automatically doing the most profitable computation.”
This type of service offers new opportunities for people who want to acquire bitcoin but have little money to invest or limited access to cryptocurrency exchanges. It could also broaden the range of participants in cryptocurrency mining, which over the years has had its barriers to entry rise as expensive, specialized hardware gave large, professional operations an edge over hobbyists.
Honeyminer’s algorithm automatically switches between cryptocurrencies every 10 minutes or so, depending on block size, if there’s a sudden change in the currency’s mining profitability.
“We are pooling people together to find those block rewards faster. Together, we have a larger hashrate,” Honeyminer co-founder Larry Kom told CoinDesk. “Not only do we connect you to the blockchain and anonymize you through us, but you also are contributing to what is, in essence, a pool.”
To be sure, this isn’t the most profitable way to mine cryptocurrency, given broader market volatility compared to bitcoin and Honeyminer’s cut, ranging from 2.5 percent to 8 percent depending on the quality of the user’s hardware. Someone with a few high-end GPUs could expect to earn bitcoin worth a dollar or two from running the software almost all day.
However, it may be one of the easiest methods to date. Although the company declined to specify how many users are in nations where cryptocurrency access is restricted, such as Jordan or Venezuela, it said more than 18 percent of users hail from developing nations.
“If you hear about crypto and you want to learn, you can either go out and pay real cash money,” Jessop said. “Or you can download a program in 30 seconds and start earning your own crypto, for free.”
Honeyminer’s software was, in part, inspired by the controversies that surround bitcoin mining. Namely, the way many users of the software feel the China-based hardware provider Bitmain has achieved a near-monopoly on mining equipment and how a similar small number of firms control the majority of mining pools.
“As we’ve watched in bitcoin proper, the arms race escalates to this custom hardware and then people who have access to the best silicon tabs are the people who control mining,” Jessop said. “For us, it’s all about increasing the number of people who have access to the best-in-class.”
But according to David Vorick, CEO of Nebulous, which operates Siacoin and the mining equipment manufacturer Obelisk, this may not change the broader ecosystem beyond attracting more curious newcomers. Especially because the software is closed source, albeit with plans to extend open APIs in the future.
“That actually increases centralization, because all you’ve done is moved the power from the mining pools or users who have to be advanced, to software toolkits,” he told CoinDesk. “Basically all the power lies with the devs of the software.”
Elaborating on this point, Vorick said he believes GPU mining will almost entirely disappear over the next two years regardless. He added:
“We’re going to see general purpose ASICs [mining hardware] come out that is capable of targeting lots of algorithms. As soon as that happens, the role that GPUs play is going to disappear.”
For better or worse, the Honeyminer team recognizes it will need to offer additional features for different types of users.
For newbie retail investors, Honeyminer will soon allow them to send their bitcoin to wallets on third-party platforms like Coinbase. Plus, the app’s algorithm can also help miners with professional mining rigs as well.
Whether they’re cheap laptops or pro rigs, “each computer will get a different [task], based on its particular performance or capabilities, you’ll get assigned what is most profitable for it,” Kom said.
A specialized version called Honeyminer Pro is in the works for professional miners who need help with power consumption management and options for manually choosing which cryptos to mine, so they’re not restricted to whatever’s most profitable, or which coins to cash out in, in case they don’t want bitcoin.
Speaking to the lack of user-friendly tools for both novice and experienced miners, Kom said:
“I would say there’s not a clear competitor for us, which is why we built what we built.”
Honeycomb image via Shutterstock
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.
Let’s block ads! (Why?)