Mining cryptocurrency doesn’t involve dozens of people miles underground chipping away at rocks to reveal the oh-so-treasured Bitcoin. Although the traditional definition of mining doesn’t apply here; cryptocurrency mining is one of the aspects of crypto that doesn’t seem to gain as much traction as the rest of the craze. It’s also important to know that while not all cryptocurrencies require mining, many popular ones do (Bitcoin and Ethereum to name a few). It used to be true that in order to mine cryptocurrency, you would have to use a computer capable of some seriously high-tech work. While higher processing power is optimal to mine cryptocurrencies, the process has become available on smaller-capacity devices; leaving more and more people interested in the mining process.
So what does mining mean?
We already covered that it doesn’t mean underground digging. However, crypto mining isn’t that far off from the popular definition. First, you have to understand that coins like Bitcoin aren’t just created out of thin air. The encrypted codes already exist; it’s a miners job to dig them up. As each series of numbers representing a cryptocurrency token is found, it is added to a ‘block’. Once a block is complete, it’s added to a chain. Hence, the blockchain.
Miners are also responsible for encrypting transactions and determining the authenticity of cryptocurrencies. A successful miner will have to complete calculation after calculation until they are rewarded. This plays into the amount of computer power needed for mining; as the faster the processor, the more crypto coins can be mined and the more transactions can be verified quicker. Successful work by miners is rewarded in a payment of the crypto coin; while these amounts vary, it’s safe to assume miners are well-compensated for their work.
How to become a miner
While many people have been mining for years, it’s not a closed club. Before becoming a miner, you have to ask yourself if there’s enough supply to get involved. There’s never an endless supply of crypto coins, which means mining will eventually see an end. Becoming a miner takes dedication, time, and a good chunk of change up front for the proper hardware. Once you’re ready to get started you have to set up a digital wallet for your earned crypto to be sent to; followed by downloading the proper software. You’ll want to complete extensive research on the process, hardware, tips, and tricks. All that’s left is deciding which coin to target. Choosing a specific coin will determine the type of hardware and software you’ll want to hunt down.