You may have heard of cryptocurrency mining but you may not be sure what it is about. Digital currencies like Bitcoin and Ethereum don’t just appear out of the blue, but are mined by people.

Crypto mining means extracting cryptocurrencies by solving cryptographic equations with the help of computers. This process involves validating blocks of data and adding transaction records to a public record (ledger) known as a blockchain. After verification, new cryptocurrency coins will also be put into circulation.

Cryptocurrency operates in a decentralized ecosystem and as such, peer-to-peer transactions are possible. BTC is one of the most popular and largest cryptocurrencies that are mined. However, it is important to note that there are other crypto assets that can also be mined. Let’s look at crypto mining in detail.

How the mining process works

Miners are known as nodes on a blockchain network. Your main task is to collect various transactions and put them into blocks. Every time a cryptocurrency transaction takes place, the miners will review and verify it. Transactions are collected from storage pools and added to a candidate block. Every transaction is hashed and collected from the storage pool, which is the first step in crypto mining. The miner node then adds the transaction in which it sends the mining reward.

The initial transaction recorded in a block is called a Coinbase transaction. Once all transactions are hashed, the hash is grouped into a hash tree known as the Merkle tree. The tree is formed by pairing the hashes and then hashing them again. This process is repeated over and over until the hashes arrive at the top of the tree. As strange as it sounds, the top of the tree is known as the root hash. The root hash is placed in the block header and then hashed again, producing new output that serves as the identity of the candidate block.

In order for a transaction to be verified as valid, the block hash must be less than a certain value. This value is determined by the protocol and therefore each starts with a series of zeros.

Difficulty with crypto hashing

The scarcity of cryptocurrencies is one of the attributes that make them valuable. There are so many coins to trade in the Bitcoin Billionaire app and each one has its value. During the mining process, as we have already established, there is a target value also known as the hashing difficulty. This is a security measure provided by blockchains and the value is adjusted by the protocol. Therefore, the rate of creation of new blocks is kept constant and is proportional to the amount of hashing power used.

Every time new users join a network to mine cryptocurrencies, it increases competition. As competition increases, so does hashing difficulty. When such parameters are present, the block time is protected from being reduced. On the other hand, when miners leave a network, there is less competition and this also forces the hashing difficulty to decrease. Networks have several ways to ensure that miners are always rewarded for their efforts.


As you can see, cryptocurrency mining is a serious and engaging process that has so many elements to consider. If you are considering taking on the role of a cryptocurrency miner, it is wise to seek out as much information as possible in order to make the right decision. With the right resources, you can make a decent income from crypto mining.