What is Crypto Mining and How to make money with Mining.

What is Crypto Mining and how do you make money with Mining?

You can earn on cryptocurrencies in different ways: speculate on the stock exchange (buy cheaper – sell more expensive), invest, raise funds through ICO, etc. But one of the most popular ways to earn money in mining.

What is Crypto Mining

Mining is the production of cryptocurrencies. But you probably don’t understand anything from this definition. So let’s rephrase it a bit: mining is the confirmation of transactions in the Blockchain network.

Transactions are operations, that is, the transfer of funds. For example, you transfer a few bitcoins to your friend – this is a transaction. Such an operation in the field of cryptocurrencies cannot be performed just like that. For the transfer to take place, the transaction must be confirmed. That’s what miners do. The process of confirming transactions is called mining.

What is the essence of mining

Transaction confirmation is the entry of data about this operation into a new block. As soon as the data is entered, the transaction will be completed (that is, the transfer will be completed). Then the next blocks will be formed – but for the next transactions. The constructed blocks will not disappear anywhere, they cannot be changed, they will remain forever – this is how the chain (chain) of blocks (block), or Blockchain, is formed.

Each block is formed by calculating a special key (hash). This key is designed to protect the contents of the block (i.e. transaction data). Due to the fact that there is a key, no one can delete the block or change the information recorded in it.

The essence of mining is that finding this very key is not an easy task. Dozens of miners are fighting for its solution – whoever finds the key first gets a reward (in the form of a certain number of coins that the participants in the transaction “pledge” as a commission even during the operation). And the one who has more powerful mining equipment finds the key first.

You too can start decrypting blocks (i.e. mining) and get rewarded. To do this, you need to read more about this method and purchase the appropriate equipment

What is an ASIC miner

This is a mining device that performs computational operations in an attempt to find the very cherished key (hash). It consists of the following parts:

  • corps. Performs a protective function;
  • power supply. Rectifies voltage and reduces it;
  • fans. Responsible for cooling parts;
  • fees. All electronic components are located on it: chips, transistors, capacitors, etc.

Can I get rich by buying an ASIC miner

You can. You need to start the mining process according to the instructions from the manufacturer, after which the decryption of the blocks will begin. The process can go on without stopping, even around the clock. But there are a number of factors that affect the size of your profit. Here they are:

  • hashrate. This is the performance of your hardware, i.e. how fast it can “look up” keys (decrypt blocks);
  • block reward. The bigger it is, the better;
  • power consumption. Your ASIC device will consume electricity, so you need to pay for electricity;
  • tariff 1 kWh. The more expensive electricity in your area, the less you earn.

There is another important factor – the current rate of cryptocurrency. You will receive a reward for decrypting blocks in the corresponding digital currency. And the latter tends to sag in price. If this happens, you will lose funds – after all, sooner or later you will still need to exchange cryptocurrency for real money (in order to spend). But not everything is so terrible: the coin may rise in price – then you will get a big profit.




Disclaimer: (The information provided here is for informational purposes only. It is important to mention here that investing in cryptocurrencies is subject to risks. Always consult an expert before investing money as an investor. Anyone from TechPe.in Investing money is never advised here.)

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