Function and process involved in crypto-currency mining

Nowadays, digital or virtual currencies are used that are based on block-chain technology. Cryptography is used for its security which is difficult to counterfeit it. If you want to get information related to basics of block chain or why we use crypto currencies you can visit www.cryptolico.com.

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Crypto currency mining:  In mining various forms of crypto-currencies, it is first verified and then it is added to the block chain and the miners are responsible for doing this job using a computer and they also solve mathematical problems using hash function of cryptograph and those who crack the code first are given rewards for their performance.

Mining involves two functions:

  • To add transaction to the block chains by securing and verifying it.
  • To release new currencies.

Step by step process involves:

  • If few coins are transferred between two users, then the transaction is recorded and put on block chain.
  • As the transaction takes place over the block chains then it should be secure and encrypted and easily available for the miners who contributed on the network so that they can snatch it.
  • Miners will have to solve a puzzle based on cryptograph using a guess and check method. This gives them chance for being the first to verify and make block secure for themselves.
  • This secured block is added to the block chain and then it will be verified by other nodes through a process called Consensus.
  • If the verification is success then the miner may be rewarded by newly-created coin and that will the proof of their work.

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