Crypto Academy Week 4 // Cryptocurrency Mining // Submitted to @besticofinder.

Your mining lectures was very clear @besticofinder, thanks.

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Mining could be either an extraction or digging out valuable minerals or element from a particular source or location. Mining forms a very important aspect of cryptocurrency.

How Work Task

How crypto currency mining works?
Based on my understanding from your lectures, Cryptocurrency mining is a process whereby a computer or system is engaged in the activity of digging or extraction in other to gain same or other cryptocurrencies.

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During cryptocurrency mining a miner does two things:

1. Receives reward for mining
2. Confirms transactions and keeping the system secured.

Every miner represent a node in the network which collects and organizes transactions. When cryptocurrency transactions are made, they are stored in a pool, transactions are usually numerous, the miner collects this transactions from the mining pool and begin assembly into the block. Before starting the mining process, each transaction taken from the memory is hashed.

The mining node adds transaction where incentives are sent to themselves which is referred to as Coinbase, during which coins may be created. This transaction s are then recorded. Once they have succeeded in hashing all transactions, the output gotten are then once again organised into pairs and hashed again.

They hashed until the top of the merkle tree in which they are hased is reached. The top of this tree can be referred to as the root hash.
The root hash along with the hash of the previous block and a random number, called the nonce is the place in the hash header, which is then hashed to produce an output that can serve as the new identifier of the fresh block. In order to e valid the block must start with certain number of zeros.

The target value - also known as the hashing difficulty - is regularly adjusted by the protocol, ensuring that the rate at which new blocks are created remains constant and proportional to the amount of hashing power devoted to the network.

Cryptocurrency mining is a continuous process, and it get more difficult each a new user Joins, but on the contrary if the miner decides to leave the block the mining difficulties will reduce keeping the block time constant.

What is Mining Difficulty?

Cryptocurrency mining gets difficult when new miners are introduced into a block. Mining difficulties implies the times and resources needed for its operation. As a cryptocurrency, (e.g. Bitcoin) becomes known and popular, there arise too many computers participating in the process. This will inturn force the increase of the hash power of the entire network.

What are the challenges for crypto currency miners?

Miners Income
Mining is quite a difficult task, it even gets more difficult as particopation increases, reducing the mining incentives shared among miners. Mining involves various expenditures which must be cartered for. Now the problem is that if income made from mining cannot be calculated or made to Carter for this expenditures then it poses a serious loss problem to the miner.

Cryptocurrency needs to maintain a higher price so as to get better profit from mining.

Security of cryptocurrency miner
Mining operations are computer and internet based even though they operate on the PKI encryption which for now has proved safe, but hackers are constantly getting better at what they do. Encryption could be a problem. Hacking is feasible.

Energy Required
Solving mathematical problem which are required to confirm transactions and creating newer blocks requires a vast amount of energy. Energy consumption resulting to the ability to affect the ozone layer.

Conclusion
Mining like of gold is digging for natural resources, so is cryptocurrency mining. It is very crucial for the growth and adoption of cryptocurrency.

Thank you.