What Is Cryptocurrency Mining?
So, we are going to start this piece from the beginning, let us understand what authentic cryptocurrency mining is? This concept comes directly from the emergence of the first ‘virtual currency’ – Bitcoin. Bitcoin mining is a procedure that is used to derive new coins from the digital domain. This requires heavy and sophisticated computational power which is used to break down extremely complex mathematical and brain-teasing puzzle problems. Cryptocurrency mining, in general, might seem rewarding to investors, but it is extremely difficult and time-consuming with machines hard to deal with (if you ever get to witness the computational setup of crypto mining stations, you will notice it creates a lot of noise and is extremely heated as it consumes a lot of power – around 133.68 Terawatt)
This process is not a matter of a single-handed approach, hundreds of miners work together to solve one problem, competing a lot more simultaneously. However, lately many claims to mine cryptocurrency on their personal computers and laptops. How is this done?
Solo Mining vs. Pool Mining
Solo mining is the process where an individual does the operations and applications of mining cryptocurrency instead of joining any group or pooling the work. When a miner is part of a ‘pool mining’ operation they are all connected in the same blockchain and receive the same complex problem to solve. Every hardware gets engaged in solving this problem, if one of them can get to the solution, they inform others who in return check and verify the solution. The transactions henceforth are delivered to the blockchain.
Pool mining is always recommended by cryptocurrency critics and councils, as the result of several TH/s (Total Hash Rate) yields a greater advantage.
Even a personal mining station (at home or office) requires a lot of hardware and software. We will discuss that later.
Disclosing The Misinterpretations Of Crypto Mining
Recently, while interacting with a crypto enthusiastic pal I came across something interesting, (quoting their conversation) “Mining doesn’t require any computational language, it is just a way to own cryptos without putting money into it.” Later adds, “ I mine crypto, it doesn’t involve any complicated “coding” per se, just encapsulated apps which are already available. It is not a problematic process as it used to be.”
Here this particular type of mining is called “No cord mining” of cryptocurrency. This is an experience that anyone can get. There has to be a specific app, and not every app will have the permission of the established blockchains such as Binance and Ethereum to let you do that. Just for an example, one can mine the cryptocurrency called ‘Pi’ or ‘Mina’, these cryptocurrencies can be mined on a no-cord platform, there is no requirement to know any computational language to mine these. What these apps or software have done is, they have provided a very user-friendly experience in crypto mining.
However, crypto mining of any coin which is listed under notable blockchains (such as Ethereum, Binance margin) holds a real value in the market. Currently Pi or Mina doesn’t have any real or added value in the market (even a bottle cap is pricier than these coins in the market, how? They have a physical existence). To mine a coin that has a legitimate blockchain network- First, the miner needs a huge amount of computational power. Second, the miner needs to know a programming language called ‘Solidity’. Solidity enables the individual to have smart contracts, using this one can deploy cryptocurrency and mine them. Post mining, there comes the role of a crypto wallet, after mining these cryptocurrencies one needs to transfer them into their crypto wallet. The crypto wallet then checks and verifies if these coins contain a legitimate code (if these codes don’t exist, the wallet won’t let you enter it). In simple words, these coins won’t be exchanged for cash or any other cryptocurrency with the market value listed under established blockchains.
Mine In Exchange For Bitcoin Or Other Crypto As A Mode Of Payment
One may mine altcoins or other cryptocurrencies and get paid in Bitcoin. Among many software available, experts mention “Nice Hash”. It acts as a hash rate marketplace where you sell them your computational power. They rent out this power among other things and in return pay the miner.
Hardware Required To Mine In PC/Laptop
This depends from coin to coin, varying on the difficulty of the blockchain the coins belong to. If a miner is just beginning or has a less complicated blockchain then CPU or GPU is enough (in pool mining). If someone intends to go solo, good luck spending on the super expensive machinery ASIC [Application-Specific-Integrated-Circuit].
I hope this was helpful.