How does Ethereum Mining Work?

Ethereum is making Blockchain technology easy to implement without having to reinvent the wheel. So in order words, it presents a worldwide application of Blockchain technology. Miners and investors have made huge profit trading Ethers and the digital asset has taken the second spot as the most popular cryptocurrency presently existing.

What is Mining?
Mining is a rigorous computational process that requires a time and resources to solve the proof-of-work. The miner is rewarded in Ethers if they are the first in the network to solve the proof-of-work and add the transaction block to the blockchain ledger. In simple words, a miner can be defined as an investor who devotes time, energy and computer space in order to sort blocks.

How does Ethereum Mining Work?
Ethereum mining uses Proof of Work (PoW) consensus mechanism which is a protocol set by the network and followed by miners to solve the proof-of-work of a certain difficulty level. They are able to create a new block which is added to the Ethereum. Ether serves as the fuel to run the blockchain process smoothly.

The supply of Ether is not unlimited and follows a mathematical formula. Each year approximately eighteen million Ether gets mined. The algorithm that authenticates is known as Esthash. This algorithm validates by categorizing the nonce input to the end result in a particular way so that the worth will be lesser than the threshold value. If in case the outputs are uniformly distributed then the time needed in finding a nonce entirely depends on the difficulty level.

The difficulty, in Ethereum mining, is dynamically adjusted so that in every 12 seconds one block is produced on an average. Mining of Ether can also be done at home. It requires advanced knowledge of command prompt and script language.

The Basics
Ether mining consumes a lot of electricity. A personal computer can be used to mine Ether, provided that the system has a RAM of at least 2 GB and a Graphics Card (GPU). GPUs are better than CPUs as they are 200 times faster. Using AMD cards is more efficient than Nvidia cards. It will require around 30GB or more memory space for Blockchain and other software.

All in all, there are various ways to mine Ether. From hardware to cloud the best solution depends on the approach of the miner. The network of Ethereum is a long string of connections which are maintained by computers.

As with most blockchain networks, mining is a competitive process.