If you stumbled upon this post from our website torrent4you.org, it probably means that you either want to expand your knowledge or are thinking about starting cryptocurrency mining. In both cases, you have come to the right place.
In this post on the site, we will tell you how mining works.
To answer the question in the post, you must first understand the basics of blockchain.
What is blockchain and how does it work?
Bitcoin is powered by blockchain technology. The blockchain can be thought of as a chain of blocks. Every X amount of time, a new one is created block and is added to the previous block. This is an ongoing process. Time to find block of bitcoin is 10 minutes... Every 10 minutes, a new block is created that contains 1 MB of information about all transactions executed in the last 10 minutes. Each block also contains miner rewardwho found it first. Finding a block is looking for a special number called a nonce. If you want to understand why nonce is an integral part of mining, we suggest you watch this excellent visualization.
At the time of this writing, block reward is 6,25 BTC for each created block.
What does it mean to mine cryptocurrencies?
Cryptocurrency mining or crypto mining Is the process by which miners confirm transactions on the blockchain. It is also called Proof-of-Work or PoW... When miners confirm transactions, they prevent double spending online (spending bitcoin twice). When sending or receiving bitcoins (creating transactions), you will most likely have to wait 3 or 6 confirmations before the bitcoins are credited to your wallet. Behind the scenes, miners verify that the transaction is valid and is included in new blocks (3 confirmations take approximately 30 minutes).
Miner Is a device (a computer with processor / video card or ASIC), which solves mathematical problems. Bitcoin miners solve hash function based on algorithm SHA-256... The one who "finds»The first decision (correct nonce) gets the block reward. In other words, he finds a block.
Speed is measured by how many hash functions are solved per second (Hash / s). At the time of this writing, the total hash rate of the Bitcoin network (all miners currently mining Bitcoin) is around 152 TH / s.
Block time and difficulty
The time to find a block of bitcoin is on average every 10 minutes... This means that new bitcoins are created every 10 minutes. These bitcoins are a reward for the first miner who solved the math problem (found a nonce). The average time to solve a math problem is regulated by the complexity, which increases or decreases, depending on overall network speed (more speed = more difficulty). Difficulty is adjusted every 2016 blocks... This equals 20160 minutes or 14 days.
Since the current hashrate of the Bitcoin network is 120 TH / s, an individual person cannot be competitive and expect to be lucky to find a block. Currently, the average ASIC runs at a speed 50 TH / s, which gives a single miner 0,00004% chance to find a block every 10 minutes. This is why miners usually join a pool. A pool is a group of miners who act as one miner on the blockchain network... This gives them a higher chance of finding a block. Once they find a block, they distribute the reward among all participants based on the amount of power they have provided. Read this postif you want to know more about how pools distribute rewards.
Cryptocurrencies and algorithms
We can divide cryptocurrencies depending on whether they are mined on video cards, processors or ASIC... Below are the most common cryptocurrencies and algorithms that can be mined using video cards, processors or ASICs.
|Monero||RandomX||processor / graphics card|
Please note that these are not all cryptocurrencies and algorithms, these are just a few of the most common ones. Also remember that each of the cryptocurrencies offers something unique. For example, faster time to find a block, anonymity, ASIC resistance, etc.