What is cryptomining? How do cryptominers work?

Since the concept of blockchain was born, miners are no longer the acronym for coal miners. It has been given a new meaning: people engaged in cryptocurrency mining are what we call “miners.”

 

1.Miners = nodes involved in accounting?

No matter in which system, only when the overall interests and personal interests are balanced, can the long-term operation be maintained. Just like if your company only requires you to work for it and not pay employees, then the company can’t operate normally.

 

Bitcoin uses a distributed system. All transaction information in a certain period of time will be recorded in a block, and this block is recorded in each device that participates in accounting. This ensures that even if a node in the entire network has a problem, it will not affect the normal operation of the blockchain. Therefore, the distributed accounting system is relatively safe.

 

While the distributed system obviously requires many nodes to participate in accounting, the founder of Bitcoin Nakamoto came up with a set of incentives to attract more people to participate.

 

Bitcoin uses cryptography to introduce a hash algorithm into the algorithm. This algorithm will give a very difficult calculation problem to all nodes in the system, and this algorithm can adjust the difficulty of the algorithm. It takes about ten minutes to control the correct hash value each time. The stronger the computing power of a node, the more likely it is the first calculation that gives the correct hash value, gaining bookkeeping rights, and be rewarded.

 

We liken the image of this method as mining, then the nodes involved in the bookkeeping are called miners. Bitcoin generates a block every 10 minutes, which is to pack the entire network into one block. Those who compete for the right to book in this process are called miners. People who gained bookkeeping rights can get Bitcoin incentives, which promotes miners’ participation and attract them to purchase mining machines to enhance their computing power to maintain Bitcoin and blockchain development.

 

2.Two types of mining

How does the miner work? Mining is divided into two types: individual mining and mining together in mine sites:

2.1 individual mining

After purchasing the equipment (mining machine), installing and adjusting the machine through video teaching and then you can mine at home, this method will consume higher electricity charges, thereby reducing the benefits. On the other hand, mining machines will generate a lot of noise during their operation, affecting the normal lives of themselves and others, so at present few people will choose to mine at home.

 

In addition, as people around the world continue to invest resources and build more mining equipment, the chances of mining successfully with personal power are now very small. So you can imagining what is a bitcoin worth now as it is so hard to mine.

 

Now let’s take cryptocurrency ethereum as an example, a medium-to-high-end graphics card can do 30 million Hash operations per second, but it takes an average of 1,200 trillion attempts to mine successfully. That is to say that it will take an average of 1.26 years to mine successfully. The original miners simply cannot afford such an unstable income.

 

2.2 Mining together in mine sites

At present, the trend of mining has slowly formed retailers to concentrate on large-scale mines for centralized mining. The mine site is generally located in a relatively remote area, avoiding noise problems, and the cost of electricity will be lower. At the same time, the mine will have professional maintenance personnel to manage the machines, and the machine problems can be solved at the first time.

 

In simple terms, the main job of the miners is to confirm the transaction and package the data. After owning the equipment and software, the miners do not need to be hands-on, as long as the power supply and network connection of the mining machine are guaranteed, the miners can start mining.