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What is "mining"?

C

Caveman

Platinum Member
Can someone distill this down to a short paragraph about what mining is with respect to video cards?
 
Do "work" (see "proof of work"), such as hashing, to generate a new block, a collection of transactions, (see "block chain") to collect transaction fees paid by other users to transfer currency to different addresses, or mint, creation of new currency (not sure about mint).

Work is done on GPUs because latest work algorithms are designed to avoid the centralization of mining by large pools of ASICs: like Bitcoin and SHA-256.
 
ok... Looks like a long read to capture the gist of what's going on... Just looking for a very high level of understanding... Sounds like: use collective power of masses to process bits of electronic data to some end goal... And the vested interest in the electronic data processing end goal (a company) pays people to use their GPUs for whatever processing time they (the company) uses? Getting warm or missed the boat?
 
Caveman said:
ok... Looks like a long read to capture the gist of what's going on... Just looking for a very high level of understanding... Sounds like: use collective power of masses to process bits of electronic data to some end goal... And the vested interest in the electronic data processing end goal (a company) pays people to use their GPUs for whatever processing time they (the company) uses? Getting warm or missed the boat?
Click to expand...

That's typically the way I explain it to people who have never heard of the process before.
 
Bouowmx said:
Work is done on GPUs because latest work algorithms are designed to avoid the centralization of mining by large pools of ASICs: like Bitcoin and SHA-256.
Click to expand...

Why is this? If ASICs can get the work done quicker than GPUs, why are they trying to avoid them?
 
96Firebird said:
Why is this? If ASICs can get the work done quicker than GPUs, why are they trying to avoid them?
Click to expand...
To add to other's replies, the intent of proof-of-work system is not make work as fast as possible. The "work" should be difficult to compute, but easy to verify.
 
Caveman said:
ok... Looks like a long read to capture the gist of what's going on... Just looking for a very high level of understanding... Sounds like: use collective power of masses to process bits of electronic data to some end goal... And the vested interest in the electronic data processing end goal (a company) pays people to use their GPUs for whatever processing time they (the company) uses? Getting warm or missed the boat?
Click to expand...
I feel that you are getting there, but also missed it. In a Bitcoin (not for GPUs) perspective:

The bits of electronic data are transactions, transfers of currency.

Power of masses is collective, but also competitive: a user wants to hash (the "work" in Bitcoin proof of work) as much as possible to have a chance to make the next block and collect the transaction fees of the transactions processed into the block, and mint.

There is no "vested interest" or "company" of Bitcoin that pays others to process transactions: it's decentralized, part of the programming, or code, of Bitcoin.
 
tamz_msc said:
This is the best explanation I've seen, if you can spare 25 minutes.

Click to expand...
That was fascinating. I've neglected researching how crypto currencies work for far too long. This was very helpful. But what about privacy? Correct me if I'm wrong but doesn't a decentralized system like this mean that every transaction is public for everyone to see and as such, every shady govermental agency's wet dream?
 
Rayniac said:
That was fascinating. I've neglected researching how crypto currencies work for far too long. This was very helpful. But what about privacy? Correct me if I'm wrong but doesn't a decentralized system like this mean that every transaction is public for everyone to see and as such, every shady govermental agency's wet dream?
Click to expand...
It's not like you put your name behind the transactions. Only thing known about you is your history of transactions. The person who owns it is a mystery.
 
CatMerc said:
It's not like you put your name behind the transactions. Only thing known about you is your history of transactions. The person who owns it is a mystery.
Click to expand...
Up until the point when you try to convert it into actual currency such as US/EU. Or you can be tied tangentially if you buy something with crypto and have it shipped to your address.
 
Guys, please keep the thread craps and troll posts out of this thread. Only warning. Thanks
 
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