Bitcoin mining is the process by which new bitcoins are entered into circulation; it is also the way that new transactions are confirmed by the network and a critical component of the maintenance and development of the blockchain ledger. "Mining" is performed using sophisticated hardware that solves an extremely complex computational math problem. The first computer to find the solution to the problem is awarded the next block of bitcoins and the process begins again.
Blog: 2024 Beginners Guide | What Is Bitcoin Mining and How Does It Work
Mining is used as a metaphor for introducing new bitcoins into the system, since it requires (computational) work just as mining for gold or silver requires (physical) effort. Of course, the tokens that miners find are virtual and exist only within the digital ledger of the Bitcoin blockchain.
Since they are entirely digital records, there is a risk of copying, counterfeiting, or double-spending the same coin more than once. Mining solves these problems by making it extremely expensive and resource-intensive to try to do one of these things or otherwise "hack" the network. Indeed, it is far more cost-effective to join the network as a miner than to try to undermine it.
To find such a hash value, you have to get a fast mining rig, or more realistically, join a mining pool—a group of coin miners who combine their computing power and split the mined Bitcoin. Mining pools are comparable to those Powerball clubs whose members buy lottery tickets in masse and agree to share any winnings. A disproportionately large number of blocks are mined by pools rather than by individual miners.
In other words, it's literally just a numbers game. You cannot guess the pattern or make a prediction based on previous target hashes. At today's difficulty levels, the odds of finding the winning value for a single hash is one in the tens of trillions. Not great odds if you're working on your own, even with a tremendously powerful mining rig.
Miners have to factor in the costs associated with expensive equipment necessary to stand a chance of solving a hash problem. They must also consider the significant amount of electrical power mining rigs utilized in generating vast quantities of formulas in search of the solution. The site Cryptocompare offers a helpful calculator that allows you to plug in numbers such as your hash speed and electricity costs to estimate the costs and benefits.
The power efficiency will be lowered by simply running chips faster.
On the other hand, the mining efficiency will be worse off if the machine only operates in low-speed power-saving mode.
It is able to automatically conducts optimized actions at all times according to data such as global hash rate and power cost.
Though high-speed computing chips are important in mining cryptocurrency, mining efficiency could also be enhanced by adjusting the clock rate corresponding to the difficulty of computation from global hash rate.