Cloud mining - Definition from the Hotspot Shield Encyclopedia

Cloud Mining is involved with the process of mining digital currencies.

All digital currencies are created and distributed using some form of mining process. Mining involves adding information to a Bitcoin Blockchain to gain a reward in the form of Bitcoins. There are many different rigs and pieces of hardware that have been created to improve the mining process which is extremely energy inefficient and time consuming. Cloud mining involves using a dedicated data center to perform mining on your behalf. This reduces the need for buying expensive hardware and using up a great deal of your own energy. The only downside is that there will be some form of cost for using a cloud mining service, so your returns will be reduced.