Most people think of crypto mining simply as a way of creating new coins.
Crypto mining, however, is the process of validating crypto currency transactions on a block chain network and adding them to a distributed ledger. However, the challenge of a digital currency is that digital platforms are easily manipulated. Bitcoin’s distributed ledger, therefore, only allows verified miners to update transactions on the digital ledger.
Technically, mining refers to the computational process of creating more of the finite number of Bitcoins or other altcoins like Ethereum and Litecoin.
Different Methods of Mining Crypto-currencies:
Mining is divided into 3 types depending on its method:
- Individual mining or solo mining.
- Collective mining in pools.
- Cloud mining.
Cloud mining is the process of generating crypto currencies by using computing power from a third party – or a cloud mining operator. To do so, you would simply just need to place some funds into a cloud mining service provider, and in turn, the firm will invest those funds into a physical mining operation.
