Crypto Cloud Mining is somewhat similar to that of crypto mining with one basic difference. It is a relatively easier ask considering the example of Bitcoin’s mining process. It uses a data center, in a remote location and pooling in the electricity consumed by the processors at associated peripherals. In other words, instead of mining by a particular individual, the process is outsourced or contracted to a third-party, typically an organization who can bear the burden of the cost of electricity and central processing units (CPU), that does all the mining of Bitcoin on behalf of the users without using their own computers. However, if one really wants to protect his savings and investment in fiat currency, the person can opt for Bitcoin mining, instead of being bogged into the cumbersome management of the equipment and associated paraphernalia and in this regard crypto cloud mining is the next best substitute. As this concept provides earning and owning the coins or token you can use the cloud to earn your coins. In essence, the purpose of mining cryptocurrency will be better understood if one quickly breezes through some technological connotations associated with Bitcoin and another cryptocurrency in an oversimplified way, such as hash, the blockchain, Proof of Work (PoW), and Proof of Stake (PoS).
Importance of Hash Function
Primarily hash is a mathematical functional tool that assists the miners to translate alphanumeric codes into a heavily encoded random fixed-length number (for security reasons), usually in hexadecimal. For Bitcoin’s blockchain management, creating a hash with the help of an algorithm is vital. Whether it be a single word or a sentence, by using hash the output is in hexadecimal or fixed length, making it very difficult to decipher.
Designing a hash algorithmic function is much need of the day as it empowers the miners to provide secured encryption in crafting a new block. Subsequently, hashing demands exponential CPU output on a mass scale, thus leading to an increase in expenses. Therefore, to lure and encourage both individual miners and mining companies, to incur a substantial amount of capital expenditure with state of the art technology, the organization behind the development of crypto incentivize them. It is done by providing them with the option of (in the shape of coins) a transaction fee denominated in fiat currency. It is vital to mention here that miners are awarded only if the created hash is in congruence with the requirements and criteria, specified in terms and conditions.
Cryptocurrency is expected to take over future modes of payments more specifically because of the blockchain technology. If you are a miner or a buyer, who seeks to own any cryptocurrency for the purpose of doing transactions you need a wallet to use them. Bytus wallet allows you to do your transactions by converting your crypto into fiat currency without having to incur any type of transactional costs. Having a Bytus wallet is preparing for the future that is dominated by these cryptocurrencies.
Altug Tatlisu is the Founder & CEO at Bytus, Inc. and member of British Blockchain & Frontier Technologies Association. Accomplished software developer with 25 years of experience in development of applications. Excels in every stage of the life cycle of software development, including design creation, coding, debugging, testing, and maintenance. Expert in devising innovative and tailored solutions to assist businesses achieve their goals in a variety of industries. Advanced skills and knowledge of leading programming tools with a strong background in mathematics, algorithms, and data-processing logic.
Originally published at https://www.bitcoininsider.org on January 2, 2021.