ADVFN Logo

We could not find any results for:
Make sure your spelling is correct or try broadening your search.

Trending Now

Toplists

It looks like you aren't logged in.
Click the button below to log in and view your recent history.

Hot Features

Registration Strip Icon for charts Register for streaming realtime charts, analysis tools, and prices.

How Do Bitcoin Mining Pools Operate?

Share On Facebook
share on Linkedin
Print

A Bitcoin mining pool is a network of miners who combine their resources (that is, hash rate) to channel them towards digitally unearthing new Bitcoins so that the reward will be shared in proportion to the amount of hash rate provided by each entity on the network. Miners are the backbone of the Bitcoin network. Mining requires a large amount of calculation when solving the difficult puzzles involved in creating new blocks. This puts a strain on an individual miner. The difficult puzzle and high competition in the race to be the first to discover the new block make it very difficult, or even almost impossible, to get the reward. The mining pool will lessen the strain, increase efficiency, and also increase the chance of the successful discovery of new blocks. The reward will be shared according to the hash rate contributed to the network.

©

The hash indicates the attempts made to solve the puzzle, while the rate stands for the speed at which the puzzle is being solved.

Necessities for Mining Bitcoin

  • Bitcoin Wallet
    There is a need for a place to store new Bitcoins after they are discovered. Cold storage wallets will be ideal for miners for this purpose. Mined coins should be stored separately from the wallet used for active transactions and investments.
  • Mining Hardware
    Mining a new block requires a powerful processing unit, specially designed for the mining task. And the device designed for the task is the ASIC (application-specific integrated circuit device). The regular CPU and GPU may not be that effective for the task.

Bitcoin ASIC miners in warehouse. ASIC mining equipment on stand racks for mining cryptocurrency in steel container. Blockchain techology application specific integrated circuit storage.

  • Bitcoin Mining Calculator
    This device is useful for tracking the account. It is good for calculating the profit and loss incurred in the process of mining. It helps you calculate hash rates and equipment, the cost of energy, and pool fees. Proper calculations assist you in determining the expected estimated profit.
  • Cheap and Reliable Power Supply
    The location of mining farms is expected to be in areas with stable supplies and affordable electricity. This is because mining farms consume electricity. On top of that, the farm needs fans because of the heat generated by the mining rigs.

Learn from the market wizards: Books that will take your trading to the next level

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com