Cryptocurrency Mining

cryptocurrency mining

The Bitcoin blockchain is running on a Proof-Of-Work (PoW) system (as seen before). In order to validate a new block, computers have to solve a complicated math problem. The machines are called miners. Everyone can be a miner.

Detail About Cryptocurrency Mining:

In more detail, the computers have to find a hash – a product of a cryptographic function – that will connect the new block with its predecessor. Several algorithms are used for the blockchains, and the most famous one is the SHA256, used on Bitcoin blockchain.

The only way to create Bitcoins is to find a solution to the problem. Therefore, the miner with the correct hash can build a block and add it to the Blockchain. The transaction will give him a specific number of Bitcoins, called the transaction fees. Since the difficulty of the problem is increasing, there is only a specific amount of cryptocurrency coins that can be created in a predefined amount of time.

mining

If you are interested in cryptocurrency mining, we have a whole formation about it here.

Here are the 2 different steps you can take if you want to start mining.

The first one is to buy cloud mining contracts.

The second option is to buy your hardware and use it to mine.

In the future, you will discover that some blockchains are running on different consensus.

The second most know, after PoW, is Proof-Of-Stake. With PoS, no need for any hardware, the concept states that a person can mine or validate block transactions according to how many coins he or she holds.