What is Cryptcurrency mining? How many times have you heard the phrase of mining and wondered what exactly it is? Well, here is a quick Info Bite to help you out
The example below describes Bitcoin blockchain mining.
Mining is the process where transactions are added to the blockchain.
Miners (basically programs running on machined on the internet…called a node) are constantly listening for transactions. When these are created, they are broadcast to all the nodes working on that blockchain. Miners group these transactions to create a new block in the blockchain, and as part of the process they ensure that they are valid.
The challenge in the process is that different miners record transactions at different times meaning there is a danger that they could create blocks containing a different version of the ledger
This is resolved by the miners reaching a consensus as to whose whose block gets added to the chain. There are two main ways this consensus is reached, a method called Proof of Work (PoW) and Proof of Stake (PoS).
You can learn more about these methods in our article : What is PoW? explaining the different models.