Imagine you could take a shovel, and start digging in your local park and have a chance of finding $200,000 every 10 minutes. If it sounds unrealistic, this is the value of the 6.25 Bitcoins that are mined every 10 minutes at the time of writing.
Now imagine that every time someone else brings a shovel and starts digging in your local park, the chances of finding the $200,000 are even between the two of you. The reward stays the same but as more people join the local park to dig for the reward, the chances of you finding the reward decrease. In a nutshell this is how crypto mining works.
To “mine” cryptocurrency you need a shovel which in cryptocurrency mining means a computer that can “dig” or mine crypto for you. The $200,000 you can “find” is the value of the 6.25 BTC, and your local park symbolizes the online pool of other crypto miners that are competing with you for the reward.
In this article we have summarized how cryptocurrency mining works, why people mine crypto, and other means to get cryptocurrency. If you are new to Crypto, you are bound to hear the term cryptocurrency mining. For detailed information about mining crypto you can visit FYD for the full article about crypto mining.
You can also view this video about Cryptocurrency mining for beginners.
What is “mining crypto”?
Mining is the process of adding and verifying cryptocurrency transactions on a blockchain such as Bitcoin. Cryptocurrency miners are individuals competing online to solve a digital puzzle; where the winner is rewarded with cryptocoins. Cryptocurencies are unique piece of code that can be sent and received by anyone in the world. By selling the cryptocurrencies miners are “creating” they are able to sell these mined cryptocurrencies for Bitcoin/Euro/Dollar/Yuan, pay for expenses, and hopefully generate a profit in the process.
Other means to get Cryptocurrency
Mining cryptocurrency is not the only way to get your hands on crypto. Many simply buy their first cryptocurrencies through exchange platforms such as Coinbase or Binance. However there are more ways to obtain cryptocurrency such as: Masternodes and staking cryptocurrency. If you are interested in other means to get cryptocurrency find more information on fydcoin.com/masternodes or fydcoin.com/staking.
Why do people mine?
The reason for mining cryptocurrencies can differ from person to person. Some mine cryptocurrencies to learn more about blockchain and the technology behind Bitcoin. Others see Bitcoin mining much more as an industry and focus on profit. The main reason why there is interest in mining cryptocurrencies, is that there is a demand for them. The same reasons why there are companies mining gold are applicable for mining cryptocurrency.
Mining cryptocurrency is solving computational puzzles; it is an arduous task, to begin with, but it does not hinder mining enthusiasts. Miners get paid for their work. What they do ends up verifying the legitimacy of Bitcoin and its transactions. By this verification, the “double spending problem” is prevented by cryptocurrency miners.
Miners: What do they do?
Cryptocurrency miners confirm and verify transactions on a blockchain. Every time the computational puzzle is solved, a block is stored on a decentralized ledger (spreadsheet) or blockchain. The blocks that are found are verified by other miners while searching for the next block. Crypto miners secure decentralized networks such as Bitcoin and Ethereum.
An alternative to mining cryptocurrency is mining or minting FYD coin. Mining FYDcoin is similar to mining crypto, you need mining software (which is a piece of software called a cryptocurrency wallet) and a stable internet connection. The difference between mining cryptocurrency and mining FYD coin is that you need a positive balance of FYD in your wallet to mine FYD coin. By competing in the amount held in the cryptocurrency wallet instead of the strength of the crypto node, mining FYD coin doesn’t require you to invest in mining equipment or buy an expensive mining rig.
FYD is a crypto project for and by crypto enthusiasts, if you are new to cryptocurrencies or mining crypto, FYD is a great start to mine cryptocurrency for beginners. You can always visit FYD for more information about FYD coin Mining.