If you are interested in Blockchain and crypto-money, you have certainly heard about the famous mining of crypto money. This subject is fascinating and is often accompanied by many questions. Therefore, we are going to carry out a series of several articles in order to explain to you the basis of the mining of crypto money.
The origins of mining
Let’s start with a short history paragraph. The term “cryptomoney mining” appeared in 2009, when the first Bitcoin blockchain was created, it has a direct connection with gold miners. These miners, in search of wealth, would leave, pickaxe in hand, not knowing if they would return with pockets full of precious metals. In the same way, the Bitcoin miner, equipped with his computer, would go off to do mathematical calculations, and when he found the right result, our miner would be rewarded with Bitcoin.
Today, mining has evolved so much that mining with his personal computer, even if technically possible, is no longer economically interesting. There are now specialised machines for this task: Asics or RIGs (you can buy this type of machine from the company Just Mining, the French leader on the subject). Other cryptomoney companies have taken up this mining concept such as Ethereum (ETH), Litecoin (LTC), Monero (XRM), etc…
The concept of crypt mining is not very complicated to understand. Undermining is an operation consisting of validating a transaction on a blockchain network by means of a mathematical calculation. Technically known as “Proof of work”, mining makes it possible to secure the blockchain.
The role of the miner
The miner is the person who carries out the mining activity. He provides a mining pool with his computing power. The pool acts as a conductor in solving mathematical problems. We will devote an article to the mining pool in the next few days. At the end of the operation, for his contribution, the miner is rewarded, he receives payments in cryptomoney.
When you carry out a transaction in the classical banking system, your bank takes the money from your account, it sends it to another bank which deposits it in the beneficiary’s account. The bank acts as a trusted third party. In the block and mining economy, it is the miners who replace the trusted third party, there is no central body, in the sense that the block is said to be decentralised.
Who are the miners
Companies, individuals, you, me,… everyone can technically be a cryptomoney miner. Of course, the current market context means that it is not necessarily interesting for everyone to be one. You have to understand that the system has been designed in such a way that anyone on the planet can become a miner and contribute on his or her own scale to the security and development of the blockchain.
How does the mining of crypto-currencies work?
The proof of work
There are different ways to secure a blockchain. The best known, used from the beginning by the Bitcoin blockchain is the proof of work (PoW). This mechanism consists of solving a mathematical problem requiring computing power provided by computer hardware.
A history of mathematics
Mining is above all a story of mathematics. Transaction validation is carried out by solving a complex mathematical problem. To find the solution to the problem, the miner will try a multitude of possibilities until he finds the right result. This is why, the more computing power the miner has, the more chance he has of finding the right result before the other miners. This system naturally leads to competition and an increase in computing power over time. Thus, to adapt to the increase in this power, the protocol provides that the difficulty is adjusted to maintain a constant average time per block (10 min for Bitcoin and 15 seconds for Ethereum for example).
An illustration for a better understanding
To illustrate how bitcoin mining works, we will use the example of Andreas M. Antonopoulos, the famous Bitcoin ambassador on sudoku. He compared mining to a huge Sudoku competition in which each participant would start a new grid as soon as one of them had found the solution to the previous one. The difficulty of the grid would be adjusted so that the average resolution time would be 10 minutes (validation time of a block on the Bitcoin blockchain). Based on this principle, the difficulty of the grid can therefore be adjusted so that the calculation can be very difficult to solve, but it will be very easy to check.