How Does Crypto Mining Work?

(Part 3 of A Brief Overview of Cryptocurrency)

Cryptocurrency mining has been a recent source of controversy in the media at the moment. But what is mining, who does it, and what is its purpose? This chapter gives some of the main facts about what mining actually is, who does it, and what these controversial concerns may shape the way cryptocurrencies operate in the future.

Mining is basically the process of ‘minting’ new coins by putting them into circulation. Blocks of information are validated on the blockchain by miners who look after the DLT by sorting complex algorithms and assigning labels to that information. This process is called hashing. It assigns information to each of the transactions on the blockchain, records it, and files it away.

New coins are created by the miners solving these puzzles on the blockchain as they extract this information, much like traditional miners. Coins are awarded to the miners who solve each of the problems on the ledger when a block of data is added to the chain on the network. There are so many miners working on blockchain that one new block is added to the chain every ten minutes on average.

The miner’s job is to audit transaction information that is added to the network. They ensure no duplicates of the same coins, either through error or deliberately, in transactions and…