Crypto Mining

Introduction:

What Is Crypto Mining? Cryptocurrency Mining Explained

The term crypto mining means gaining cryptocurrencies by solving cryptographic equations through the use of computers. This process involves validating data blocks and adding transaction records to a public record (ledger) known as a blockchain.

In a more technical sense, cryptocurrency mining is a transactional process that involves the use of computers and cryptographic processes to solve complex functions and record data to a blockchain. In fact, there are entire networks of devices that are involved in crypto mining and that keep shared records via those blockchains.

It’s important to understand that The cryptocurrency market itself is an alternative to the traditional banking system that we use globally. So, to better understand how crypto mining works, you first need to understand the difference between centralized and decentralized systems.

Traditional Banks Are Centralized Systems

In traditional banking, there’s a central authority that controls, maintains, and updates a centralized record (ledger). That means that every single transaction has to go through the central banking system, where it’s recorded and verified. Plus, it’s a restricted system — only a small number of organizations (banks) are allowed to connect to the centralized banking system directly.



Cryptocurrencies Use Decentralized, Distributed Systems

With cryptocurrencies, there’s no central authority, nor is there a centralized ledger. That’s because cryptocurrencies operate in a decentralized system with a distributed ledger (more on this shortly) known as the blockchain. Unlike the traditional banking system, anybody can be directly connected to and participate in the cryptocurrency “system.” You can send and receive payments without going through a central bank. That’s why it’s called decentralized digital currency.

But in addition to being decentralized, cryptocurrency is also a distributed system. This means the record (ledger) of all transactions is publicly available and stored on lots of different computers. This differs from the traditional banks we mentioned earlier, which are centralized systems.

But without a central bank, how are transactions verified before being added to the ledger? Instead of using a central banking system to verify transactions (for example, making sure the sender has enough money to make the payment), cryptocurrency uses cryptographic algorithms to verify transactions.

And that’s where bitcoin miners come in. Performing the cryptographic calculations for each transaction adds up to a lot of computing work. Miners use their computers to perform the cryptographic work required to add new transactions to the ledger. As thanks, they get a small amount of cryptocurrency themselves.

Understanding the Terms: Centralized, Decentralized, and Distributed



The examples in the graphic above display the differences between a centralized system and a decentralized one.

In the left half of the graphic is an illustration of a centralized system. The traditional centralized currency system in the U.S. operates through the use of computers, networks, and technologies that are owned, operated and maintained by financial institutions. So, whenever you send money to a family member or a friend, that transaction goes through your bank.
Is Crypto Mining Legal?

In general, the answer is yes. Determining whether crypto mining is legal or illegal primarily depends on two key considerations:

1. Your geographic location, and

2. Whether you mine crypto through legal means.

However, where you start to tread into the territory of illegal activities is when you use illicit means to mine cryptocurrencies. For example, some cyber criminals use Javascript in browsers or install malware on unsuspecting users’ devices to “hijack” their devices’ processing power. This type of cyber attack is known as cryptojacking.

Types of mining:

1. Cloud mining

2. CPU mining

3. GPU mining

4. ASIC mining

GPU Mining:

GPU mining involves the use of a gaming computer’s graphics processing unit to solve complex math problems to verify electronic transactions on a blockchain.

Normally, to mine a cryptocurrency, digital coins must be built on a blockchain architecture that supports proof-of-work (PoW) mining. Cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Monero (XMR), Litecoin (LTC) and Dogecoin (DOGE) are examples of coins that can be mined.



Issue in GPU mining:

Graphics cards (GPUs) are a crucial component of a gaming PC.

A modern card can produce the high-resolution and high frame-rate graphics that gamers expect.

But several factors, including manufacturing delays during the coronavirus pandemic, have contributed to a shortage.

• The great graphics card shortage of 2020 (and 2021)

• How do crypto-currencies work?

• Bitcoin consumes 'more electricity than Argentina'

Graphics cards are also popular with crypto-currency investors, who can use them for processing transactions and generating bitcoins, in a process known as mining.

Many miners build rigs using several graphics cards at a time to produce a powerful machine dedicated to mining crypto-currency, rather than gaming.

For this to be economical, the rig must generate more in bitcoins than the cost of the hardware and the electricity it uses to run.



Objectives:

1. To set up a GPU Mining Rig.

2. To choose a profitable coin, mining pool, and its algorithm.

To get the better efficiency by Over Clock And Under Volt.

To automate and make it remotely controllable.