Overview
Mining involves using specialized hardware to solve complex mathematical problems. The first miner to solve the problem earns the right to add the next block to the chain and receives a reward.
Functions
- Issuance: Creating new coins (e.g., Bitcoin).
- Security: Protecting the network from attacks by making it prohibitively expensive to alter the history.
- Verification: Validating and recording new transactions.
Hardware
Mining has evolved from using standard CPUs to powerful GPUs and eventually to Application-Specific Integrated Circuits (ASICs).