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Author Topic: Impact of Processing Power on Mining Ability  (Read 74 times)
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July 09, 2020, 06:44:17 AM

Impact of Processing Power on Mining Ability

With the spread of cryptocurrency and crypto trading lots of people are being interested in this field. With the passage of time investors of cryptocurrency become interested in mining of coins. This is boosted by the entry of a large number of altcoins as these are comparatively require less processing power for mining. Altcoins are built over the foundations set by Bitcoin as it was the first successful crypto coin which have opened new horizons for expeditors.
Before discussing the impact of processing power, it looks pretty good to have a look into the mining process. Let’s start!

What is Mining?

In a simple sense, mining is considered as the process of getting crypto coins using processing power of your computers. In fact, it is not as simple as it seems. It’s a complex procedure which earns crypto coins as reward for the miner.

For a deeper understanding, concept of blockchain should also be known as it is used as core technology for mining coins. Decentralization, high security and inalterability are the main pillars of cryptocurrency. In this scenario, every transaction which happens in the system is encrypted individually and then included into a structure called block. This process repeats until a fixed number of transactions is encrypted and added to the block.

All these transactions remain untraceable as privacy is priority in cryptocurrency. The no traceability protects their manipulation by any single person or entity.  Rigid encryption makes these blocks like complex mathematical puzzles.

Before adding these blocks into blockchain which is available publicly, miners verify the transactions for not being false and regulate the infrastructure. This requires solving these puzzles with massive computing power machines.

As result of this process, crypto coins are created and distributed among the miners as mining fees according the consumed computing power.

Role of Processing Power in Mining

CPU is the main gadget which solves the mathematical puzzles of the encrypted block to verify the transactions. These puzzles are hard to solve with low power CPU, only CPU with high processing power can solve these encrypted puzzles.
Commonly, CPUs having low processing ability are not fruitful for mining big coins. These can do good for mining tier 2 or 3 altcoins. For mining of a coin, specified software are used. Every digital coin has customized software for it mining. While mining, miner compete for completing the solution and the winners are those who did it first.

Keeping this in mind, one can easily understand the importance of processing power. It is understood that CPU with high processing power will win the competition and get the reward. So, participating in mining without having a powerful CPU cannot benefit as per expectations. 

For mining of high coins, very high processing power CPU or GPUs are used. As it is discussed earlier that blocks are the structures in form of complex mathematical puzzles, which are solved by miners in verification process while adding them into existing blockchain.

However, for 2nd and 3rd tier altcoins can be successfully mined with CPUs having less processing power. These may include Litecoin, Dogecoin, Ethereum, Nexalt and many other altcoins. Using CPUs with high processing power or GPUs can benefit more in mining of these coins. 

Why GPUs are preferred in Crypto Mining?

GPUs are processing units which deal with video or still graphics. These are capable of performing the same task again and again. Anther major quality of GPU is hundreds of cores which can handle thousands of threads simultaneously. This parallel processing is much beneficial in solving complex mathematical puzzles in short intervals of time. GPUs provide high thoughput because of parallel processing.

Role of Continuous Power Supply in Mining

Electricity is the main source which makes the CPU or GPU work. The consumption of power for mining depends upon the processing speed. Speedy hardware requires more electric power with a continuous supply. The power consumption is also associated with mining software such as ASIC consumes less energy to perform its calculations. According to an estimate one watt is consumed for execution of one gigahash per second. In the same manner, one Terahash per second uses one kilowatt, one Petahash per second uses one megawatt and so on.
Continuous power supply is compulsory for the continuous execution of hash functions for mining. If power supply cuts off, it can damage not only the calculations but also can affect the hardware or software which is being used for mining purpose. If one has suitable hardware and software but can not provide power supply as per needed, the mining activity will not be fruitful. It is mandatory to manage all required resources for mining if one is aimed to harvest the full benefits.

Benefits of high processing power with constant electric supply

In mining of cryptocurrency or solving cryptographic puzzles high processing power and constant electric supply are key elements. As both of these are the foundation on which different mining software can be executed and coins can be generated. There are many benefits of these elements but here are a few of them.

Let’s have a look:

(i) Active participation in Mining

High processing power enables active participation in mining process. As it is discussed earlier that peers connected to the network compete for the solution of block and the winner gets the reward. High processing power and continuous power supply helps to beat others and win the race.

(ii) Can get high throughput

Hardware with high processing power gives high throughput for all the executions. GPUs are good example of it. GPU performs parallel processing and provides with better throughput. Continuous power supply ensures the solid and beneficial results.

(iii) Can mine multiple coins

Hardware with high processing power are capable of mining different types of coins without any issue. If the user changes the plan for mining another crypto coin there is no need of changing the hardware.

(iv) Customized Mining Rigs

Continuous power supply source and high processing power hardware enables the use for designing a customized mining rigs for mining crypto coins. For customized mining rigs different mining software can be used.

Hopefully, this content will proof helpful for you in understanding of different concept of crypto mining and processing power of your devices.
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