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Bitcoin is known as a decentralized currency created in 2009. It has always been abbreviated with the acronym BTC. Bitcoin is also the name of the P2P protocol that underpins the currency system. This protocol avoids excessive consumption and achieves the consensus of the nodes that make up an information network in a compromised system, which are constantly competing. It is this consensus that allows mining to be possible.
Mining is one of the most current activities, although it is not very profitable in most countries. The main problem is the excessive consumption of energy, which in many parts of the world is an expensive service and makes the energy expenditure of an RIG equipment excessive. However, there are countries where electricity is economic, such as China, Venezuela or Ecuador, where mining could be a very profitable extra income.
What is bitcoin mining?
Mining is the process by which cryptocurrencies are extracted from a chain of blocks. The definition of mining is like an analogy to gold mining, but there could not be a more wrong comparison. Mining is more of a competition than anything else.
For mining, an algorithm known as hash is used, which is responsible for breaking down a chain of blocks and determining it in a unit of fixed length, this value is known as nonce. The miner’s job is to analyze a chain of blocks to determine the nonce of the last block of the system in order to insert a new block referring to the new transaction.
The problem is that the algorithm does not know with certainty what the value of the chain of blocks is. To do this, you must throw values at random until you guess the correct one. The competition is that a blockchain network is made up of several miners or nodes that process the same chain of blocks at the same time, but only those who guess the nonce will get the reward. The miner who is able to analyze the largest amount of data in less time is the one who is more likely to decipher the correct value.
Where to buy a miner?
While you can buy a miner, the only way to get a new one is by putting it together part by part. A miner is nothing more than a computer capable of processing a lot of information in a short time. For this, the installation of several graphic processing units (GPU’s) is done on a motherboard attached to a processor.
The power of the miner will be determined by the power of the graphic processing units, that is why they are installed between two and six per miner to have a greater computational power. This makes the assembly of a miner an expensive investment.
Arming a miner is not very different from putting together a conventional computer. However, for those who have never done such work, there is the possibility of hiring a specialist to assemble all the components of the RIG.
Ways to mine
In addition to the solitary mining that we can carry out in our homes, there are some mining strategies or methods that are implemented with the intention of increasing the probability of success by deciphering the nonce. The most popular are:
Mining Farms : A farm is a cooperative system of several miners who join to increase their power. When the Chinese government began to invest in cryptocurrencies it did so by announcing the creation of miners’ farms with tremendous processing power. They were the first to make it public but there were already people who filled entire granaries of RIG’s.
Miner pools : a pool is a cooperative system of miners but unlike the farms, the equipment of the system is scattered and connected through the internet. The idea is to unite processing power to decipher the nonce of a chain of blocks. At the end of the operation, the reward for mining is distributed among the members of the pool according to the processing power provided to the group.