Greater Fool glossary / Crypto & Digital Assets

crypto mining

Crypto mining is the process of using computer power to solve difficult mathematical puzzles in order to verify transactions and add new blocks to a blockchain. Miners are rewarded with newly created cryptocurrency and transaction fees for their work.

In practice

A miner runs special software on powerful computers that compete to solve a puzzle. The first computer to solve it gets to add the next batch of transactions to the blockchain and receives newly created Bitcoin as a reward. This process happens continuously as new transactions occur.

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