Cryptocurrency and Its Essentials
When you hear the words, cryptocurrency mining, you envision coins being extracted from the ground. But knowing that cryptocurrency is nothing physical, why do we say mining?
Because it’s the same as gold mining in the sense that bitcoin is inherent in the protocol’s design (as gold is found underground), but they have yet to be brought out into the light (as gold that has not been dug out). According to the cryptocurrency protocol, there will be 21 million bitcoin at each specific time. Miners get them out gradually and in sets.They will be given the chance to do this as a reward for building blocks of validated transactions and inserting them in the blockchain.
Cryptocurrency software runs on a unique and dedicated computer known as a node.Because this computer plays a part in the information transfer process, it thus helps keep cryptocurrency running.Some of these nodes are mining nodes, and they are often called miners. They are responsible for collecting blocks of outstanding transactions and depositing them in the blockchain.
The process requires solving a difficult math problem that comes as part of the cryptocurrency program, after which the answer will be added to the block. The objective is to look a number which, when mixed with the data in the block and passed through a hash function, creates a result that is within a specific range.
Getting the Problem Solved
What should be done to find this number? Through random guessing. Predicting the output is impossible because of the hash function. Therefore, miners just take a wild guess at this all-important number and run the hash function on that number and the data in the block.
The resulting hash should start with a certain number of zeroes that has been previously defined. Knowing the exact number that will work is just plain impossible, as you can never tell which number will work, considering that two consecutive integers can produce wildly varying results.Furthermore, there could be a good number of nonces creating the desired result, or absolutely none.
The first miner that gets a resulting hash in the predefined range tells the entire network of its conquest. Others miners will then halt work immediately on that specific block and get started on another.
As a reward, the triumphant miner will gets some new cryptocurrency. Since calculation difficulty (on the number of zeroes that are required at the start of the hash string) changes often, it can take some ten 10 minutes to finish with one block. Ten minutes is the length of time cryptocurrency developers believe is important for a stable and diminishing flow of new coins before the 21 million max (expected to happen in 2140).