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INTRODUCTION

Hello s teemians. It's a good experience to join this community to enhance my knowledge in the Crypto world. Pofessor @besticofinder is an awesome and well educative teacher. Here's my answer to the task 4 homework given.

HOW DOES CRYPTOCURRENCY MINING WORK?

• Cryptocurrency Mining ?
  Cryptocurrency is a virtual currency which is always secured by cryptography and this makes it very impossible to counterfeit the currency. You should have heard the term mining relative to cryptocurrency especially Bitcoin in general. Crypto Mining in the crypto world is the state of securing blockchain data in checks which involves hard work that are been done by super computers and the results in a slow accumulation of resources just like mining for minerals and resources. The truth is that anyone can become a miner but mining is not for everyone cause it requires a lot of diligences and extra measures. Do you know that over 70% of Bitcoin mining happens in China, where very damn cheap electricity makes running mining computers extremely profitable and easy. Bitcoin is the most popular and minable cryptocurrency. Cryptocurrency is all about solving puzzles ,providing security and confirming transactions.

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WHAT IS MINING DIFFICULTY ?

Mining difficulty of a cryptocurrency indicates how difficult and time consuming it is to find the right hash for each block. It's as well a measurement unit used in the process of Bitcoin mining and indicates how difficult it is to solve a complex cryptographic puzzle. In mining difficulty new units either increases or decreases per time tho it's dependent on the number of miners in the network at the moment. Miners compete amongst themselves just for limited block rewards, so with more miners results to more computing power and the hashpower of the entire network increases at same measure.

WHAT ARE THE CHALLENGES FOR CRYPTO CURRENCY MINERS ?

• Electricity Bills :
  Apart from initial cost in hardware, there are other high expenses a miner has to pay which on of them is consumption of energy. Mining digital currency costs more in electricity bills compared to the rewards granted by solving a block puzzle. The cost of mining is highly different from the hardware results. It's known that a generation of electricity from mining ranging from 10MW which is equivalent to a small power plant to 3-6 GW which is the approximated energy consumes by small to medium size country like Denmark. stressed on the sustainability aspect of cryptocurrencies. The result of work in mining digital currencies is saps high energy and requires intensive computer capabilities. It is predicted that mining activities will slowed down in the next decade and only those with a substantial updated hardware will survive in the mining business and have the ability to reduce cost of electricity consumption.

• Law
  It is safer to believe and use since fiat currencies because it's been regulated by the central bank of a country. The policy of the country's monetary stand is within the full authority of the central bank. Talking about cryptocurrency, anyone can have multiple account, with no cost to create it. Being anonymous on Internet is the perfect ground for cyber criminals and fraudsters to execute their actions. Cybercriminals find this platform to perform to execute illegitimate actions like scamming and cheating. There are believes that cryptocurrency is being used by criminals for frauds like money laundering and drug trafficking etc even despite the knowing that the blockchain technology was created to help users financial transactions made easy yet cyber criminals will always find ways to make profit.

• Attack on network
  Do you know that the technology of the blockchain having decentralized feature has low susceptibility and security ? this gives way to manipulation and forgery. The blockchain technology does have challenges to its identity and access management system related to Internet of Things . The mining activities using pool creation are exposed to two (2) kinds of attack and they're : either malicious pool members or pool operators. An attack on the network can be done by the malicious pool operators by combining the resources in their pool then the malicious pool members can equally increase the computational power in a particular mining pools then destabilize it later. These users hop from one pool to another in order to sabotage the pools mining returns and withholding the effectiveness of the minners. Another deficiency in cryptocurrency mining is the attack on the code-based but you could make researches about it.

• Conclusion
  Best regards to Professor @besticonfider for the lectures. Cryptocurrency mining can be said to be the generator for most Cryptocurrencies. Big Thanks to my mentor @kadosh2340 & @focusnow.