Interestingly enough, though, not all cryptocurrencies are mined. Though, as of late 2021, this arms race is quieting down thanks to a number of factors (including a crackdown on miners by China), the GPU market has yet to recover. ![]() Plenty of people interested in making money from cryptocurrency-Bitcoin in particular-have started doing so, often by connecting several devices to each other to create powerful networks that can combine and amplify the processing power of each individual device.Īs a result, the market for GPUs was practically destroyed, with these groups buying all the units they could get their hands on-even stealing them in some cases-and making it so regular consumers had to pay massive prices even for badly outdated models. Of course, if you don’t have a supercomputer, you can always build one. The phone or laptop you’re most likely reading this article on would probably take millions of years to solve one. ![]() However, hashes are, by their very nature, incredibly complicated puzzles to solve. If you’re slower than the competition, you don’t get one. Do it fast enough, and the reward is a coin. In a way, crypto mining is really just solving these incredibly complicated mathematical puzzles. A hash is a random set of characters and numbers which, with the right key, reveals the original message it’s a basic part of cryptography and is where the “crypto” part of “cryptocurrency” comes from. ![]() To unlock a block in the chain, you need to validate it by solving a complicated equation, usually in the form of something called a hash. Interestingly enough, since the blockchain has to be finite, it also means that most cryptocurrencies have a hard limit to how many can exist: Bitcoin for example has a cap of 21 million. Mining is validating new blocks and gaining access to the coins within. To summarize, the ledger records the creation and movement of coins in the blockchain.
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