Crypto Currency Overview
Crypto currency is a digital form of cash that is quickly gaining in popularity. It is not regulated by governments like traditional currency, and instead relies on a decentralized network of computers to verify transactions. This makes it a popular choice for those who want to avoid government control and censorship.
Bitcoin, the first and most well-known crypto currency, was created in 2009 and has since seen a surge in value. Bitcoin is unique in that there are a finite number of them- only 21 million will ever be created. This makes it attractive to investors as it is likely to increase in value over time. Other crypto currencies include Litecoin, Ethereum, and Bitcoin Cash.
The Blockchain
Mining Cryptocurrency
Blockchain technology is the backbone of cryptocurrency systems like Bitcoin.
In simple terms a block chain is a digital ledger, like a check book, of all cryptocurrency transactions. It is constantly growing as “completed” blocks are added to it with a new set of recordings.
Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Blockchains are secure by design and are an example of a distributed computing system with high Byzantine fault tolerance.
Transactions are verified by network nodes through cryptography and recorded in a public dispersed ledger called a blockchain. This allows cryptocurrencies to be immune to fraudulent activity such as double spending, and also allows people to audit cryptocurrency balances.
Cryptocurrency mining is the process of verifying and adding transactions to the blockchain. This is done by solving complex mathematical problems, and miners are rewarded with cryptocurrency for their efforts.
The cryptocurrency that is mined is then used to verify transactions on the blockchain. This helps to ensure that the blockchain remains secure and reliable. Miners are essential to the functioning of cryptocurrency systems, and without them, Bitcoin and other cryptocurrencies would not be possible.
It was once possible for the average person to mine cryptocurrency using a personal computer. However, as the blockchain has grown in size and complexity, it has become increasingly difficult to do so. This is because miners now require specialized ASIC chips in order to be successful.
Miners are rewarded with cryptocurrency for their efforts. In order to mine Bitcoin successfully, one would need access to powerful ASIC chips and a lot of computing power. As Bitcoin mining has become more competitive, it has become increasingly difficult for the average person to mine cryptocurrency.
For early Bitcoin adopters the process of mining crypto currency was extremely profitable especially if those early adopters did not spend, sell, or loose their bitcoin. Since crypto currency mining is no longer practical for the average person those that wish to own Bitcoin would need to purchase it on a cryptocurrency exchange. This process is much like the process of purchasing a stock.
