What is CryptoCurrency?
A cryptocurrency is a medium of exchange like normal currencies such as USD, euros, CNY Chinese Yuan, but designed for the purpose of exchanging digital information through a process made possible by certain principles of cryptography. Cryptography is used to secure the transactions and to control the creation of new coins. Cryptocurrencies use decentralized control as opposed to centralized electronic money/centralized banking systems. The decentralized control is related to the use of blockchain transaction database in the role of a distributed ledger.
What is Bitcoin (BTC)?
Bitcoin is a digital currency created in 2009 by an unknown person using the alias Satoshi Nakamoto. Simply put, bitcoin is a digital currency. No bills to print or coins to mint. It’s decentralized — there’s no government, institution (like a bank) or other authority that controls it. Owners are anonymous; instead of using names, tax IDs, or social security numbers, bitcoin connects buyers and sellers through encryption keys. It allows anyone to send money anywhere without the need of an intermediary.
What is Crypto Mining?
We will use Bitcoin mining to illustrate. Bitcoin mining is the process by which transactions are verified and added to the public ledger, known as the blockchain. The mining process involves compiling recent transactions into blocks and trying to solve a computationally difficult puzzle. Mining is also the means through which new bitcoin are released… Miners are rewarded with bitcoin when their computers solve the complex computations. Sometimes, two competing blocks are formed by different miners. The block with the largest total proof of work embedded within it is chosen for the blockchain.