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Cryptocurrency Mining

How bitcoins are brought into existence is through a process that we call mining. Mining a bitcoin is done through using software that connects you to the blockchain and allows you to verify transactions across the blockchain.

Verifying these transactions is done through solving a series of mathematical puzzles that yield a reward in bitcoin if the block gets completely mined. This is what would drive someone to want to mine bitcoin from the blockchain. As more and more bitcoin is extracted, the puzzles will increase in difficulty. This is done using a formula that calculates the time in between each block being completed. The time that it attempts to make between each block is 10 minutes, and if this is not achieved, it will adjust its difficulty to increase or decrease time. This portion of the bitcoin mining process is called the proof of work.

Another process in mining cryptocurrency is called proof of stake. This is similar to the proof of work in that it uses an algorithm to check to see if you own at least 1% of all of the currency. If this is proven to be true, you then have a chance to mine a block no matter your size because this provides you with an opportunity to mine. This way is much safer than others because the consumer has a real stake in the currency and does not want it to depreciate as it would bring the value of their coins down.

Mining pools are groups of people that team up their resources to mine blocks of cryptocurrency quicker than doing it by themselves. The rewards from each block are then shared amongst everyone involved. Most pools are free to use and much more cost effective than the price of mining by yourself.
Cryptocurrency mining is an effective way to make some cash if you have the spare room and parts laying around to make yourself a computer built specifically for mining. Unfortunately, most of us do not have all these extra things to be able to make this a justifiable route of making money.

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