With mining, cryptocurrency users can obtain as much digital currency as they can based on the power of their computers. So what is mining?
Mining is a process that corresponds to the English word 'mining' and involves performing as much high-level digital work as possible to obtain high opportunities from a new emission. Those who engage in this work are called miners.
Thus, mining is considered a new era for the industry, and those who engage in this work have the opportunity to earn sufficiently. To do this, you just need to turn on your computer. You can learn some technical details from here.
About mining
During mining, the miner's computer is used for cryptocurrency transfers, data storage, and coordinating all participants in the network. Thus, computers monitor the network, manage it, and store all movements on the blockchain. This work can also be understood as a computer center consisting of miners.
During mining, all successful transfers are collected in blocks in the form of a list over a certain period. The miner checks, verifies, and stores each block they find.
All of this work is transparent and can be monitored by everyone. However, the person executing the transfer remains anonymous. To ensure data security, the information related to the newly created block is encoded in hash format. This should be understood as a code consisting of letters and numbers.
At this time, each hash is unique, and if any marker in the block changes, then the entire hash also changes. Each block's hash uses the previous hash as well. This sequence is a system that ensures the correctness of all movements. Thus, a person attempting to manipulate transfers has a chance equal to zero. In the end, the hash is verified by the miner and confirmed before being added to the blockchain.
How much do I earn while mining?
In return for all the above work, the miner is rewarded with a certain fee. Based on today's indicators in the bitcoin market, they are rewarded with 12.5 bitcoins. However, considering that bitcoin is limited in number, all existing blocks will soon be converted, and all bitcoins will be fully emitted. This is why it becomes more difficult for participants to create new hashes. It should also be noted that as the number of miners increases, the difficulty and load of the work done also increases.
What do I need for mining?
In fact, a simple computer is sufficient to join 'mining'. However, the efficient organization of the process increases the demand for stronger specialized equipment (i.e., 'Hardware'). While normal computer processors were used in the past, applications using graphics processors have emerged. Equipment based on 'FPGA' (i.e., 'Field Programmable Gate Array') and 'ASIC' (i.e., 'Application Specific Integrated Circuit') systems have been created specifically for these purposes. All of this leads to a rapid increase in digital power. For example, it should be noted that the digital power consumed in 'Bitcoin' increased 660 times from January 2013 to January 2014. Thus, it has become impossible for an ordinary computer user to receive a share in new emissions and transaction fees in attractive cryptocurrencies in the digital work competition (i.e., 'Proof of Work').
Another important point here is that there are selectable difficulty levels to meet the increasing number of participants and the 'Mur's Law' effect. In this way, participants can only accept tasks corresponding to a predetermined difficulty level. This is also very beneficial for ensuring competition and increasing the burden for manipulations. The principles of 'Proof of Work' and 'Storage of Payments' can also be applied together. For example, those who hold larger and as 'old' accounts as possible from 'Peercoin' can also benefit from lower difficulty levels.
In addition, it is necessary to download special programs known as 'Client' or 'Wallet' to connect your computer to the network. Through these programs, you can acquire and send cryptocurrencies.
