Before we begin talking about what cryptocurrency mining is all about, especially for people who are new in the cryptocurrency world and who don’t know what it is, it is important to first understand what cryptocurrency is… cryptocurrency is basically a digital currency that is similar to the physical currency we use. As opposed to the physical currency, cryptocurrency like bitcoin, ethereum do not have a bank or a central entity that controls it and decides what happens… its strength is that is decentralized and on the blockchain, meaning that there is no central authority or central entity that controls or alter it. In order words, users have full control of their cryptocurrency assets by keeping them in a cryptocurrency wallet and having full control of their keys.
Mining in the cryptocurrency world or cryptocurrency mining is a term that isn’t new to the cryptocurrency world, in fact cryptocurrency mining is as old as cryptocurrency itself and is as old as bitcoin which is the first cryptocurrency to be created. Whenever the term cryptocurrency mining is talked about, bitcoin is the first name that comes to mind because it was the first cryptocurrency to utilize mining. Cryptocurrency mining is basically the process of minting new cryptocurrencies and validating transactions from the blockchain.
Why can't everyone be a miner?
In the cryptocurrency world, whenever the term mining is mentioned it mostly refers to proof of work mining blockchains like Bitcoin, Ethereum etc. Mining is basically the process of minting new coins and validating transactions on the blockchain network using high computational hardware and mining rigs required to solve complex mathematical puzzles and problems and also creating new block and validating the transactions for the blockchain network. Because of the problems associated with proof of work mining, it is difficult for everyone to become a miner;
High cost of acquiring mining hardware and rigs
Mining hardware and rigs have become very scarce and as such become very expensive to purchase because of the high demand and low supply of the mining rigs. There are not that many manufacturers of the mining rigs which has caused the rigs available to be very expensive for the ordinary user to afford.
High level of technical knowledge required
Becoming a miner isn’t easy as it requires a high level of technical knowledge to be able to set up a mining rig successfully. Most users who go into mining have very good technical knowledge when it comes to software, blockchain and other technical jargons that are required to be able to set up a mining rig successfully to mine cryptocurrencies like Bitcoin or Ethereum.
High power and energy usage
This is also a huge factor that limits everyone from becoming a miner. In some countries, most especially in developing countries and underdeveloped countries, electricity bills are very expensive. Mining rigs are power and energy-hungry which means that they consume a lot of power and energy which drastically increases the electricity bills. Because of the high power consumption of the mining rigs, electricity fees can go very high that it becomes unprofitable for miners in that country. High power consumption and high payment of electricity bills limit everyone from becoming a miner.
I have a friend who was once scammed from someone who claimed he could teach him how to mine with very simple laptop and hardware. Turned out it was impossible, and required a more sophisticated setting.
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