How cryptocurrency mining works: Bitcoin vs. Monero

Cryptocurrencies (Bitcoin and all other coins based on its source code) are based on strict mathematical principles. The usual money we use in everyday life, such as rubles, dollars and euros, are called fiat currencies and their issue, circulation and withdrawal from circulation is fully controlled by the respective state.

Bitcoin, unlike fiat money, does not have a single emission center – anyone can start issuing new coins.

How cryptocurrencies are issued

Emission of cryptocurrencies Bitcoin is based on a chain of blocks, starting from the very first (the so-called genesis block, once and for all set at the start of the system). All transactions are recorded in them, i.e. transfers of funds between different wallets. Moreover, each subsequent batch of records refers to the previous one.

Thus, an unbroken chain of blocks emerges. This chain cannot be changed, since any modification of any element will require recalculation of all subsequent ones, and this requires huge computing power comparable to the computing power of all computers in the world participating in the maintenance of the Bitcoin network.

Actually, the bitcoin network consists of two types of devices:

  • interconnected nodes (nodes), containing the entire chain of blocks from the very beginning;
  • checking new data packets before adding them to the current chain.

And miners, whose main task is to generate new records based on the existing chain.

Monero mining

Monero (XMR) is a cryptocurrency that is included in the TOP-10 coins in terms of capitalization. BTC to XMR is one of the most popular exchange pairs. It is open source and, unlike Bitcoin, is based on the CryptoNote protocol, which allows you to “confuse” transactions in such a way that the sender and recipient of money cannot be reliably identified. The Polkadot team have made progress and they have something to show for it: a new, scalable, efficient, and interoperable blockchain ecosystem that is self-governed. they also tell you How Do I Buy And Sell Polkadot (DOT)?

The peculiarity of Monero mining (if we compare everything with the same Bitcoin) is that the emission is not limited here: after 18 million coins have been mined, 0.6 coins will continue to be produced per two-minute block in the future. This was done so that the “miners” would not go to other cryptocurrencies, but would help maintain the network even after the end of the main distribution of coins.

Mining XMR is also unusual in that it requires a lot of memory and processor power, so it is much less efficient on a video card than on bitcoin.

The development of Monero is beneficial for many reasons at once:

  1. Smoothly decreasing emissions;
  2. Short gaps between blocks;
  3. The inability to mine Monero on ASIC, which means that very large conglomerates cannot crush all the mining;
  4. Ability to use both GPU and CPU for greater efficiency;
  5. New CryptoNight algorithm;
  6. No strong heating of the equipment.

Experts agree that the production of Monero is quite promising, and the sooner you start it, the more you can earn. But what if you have a weak computer, and buying a new processor or video card for mining is expensive? There is a way out – equipment rental at a distance.

What you should pay attention to?

Monero Before entering into and paying a contract with a company, read reviews about it. We do not recommend contacting very young resources about which nothing is known yet. Don’t forget that cryptocurrencies, including Monero, are non-refundable.

In addition, to receive payments, you need to create a wallet in XMR – this can be done on the official website of the cryptocurrency. Further, based on your financial capabilities, choose the tariff that suits you, pay in a convenient way, get access to your personal account and indicate your wallet there along with other settings.

Related Articles

Leave a Reply

Check Also