- Mining is the process through which transactions are verified and added to the blockchain. For many cryptocurrencies (like Bitcoin), this is done through a consensus mechanism called Proof of Work (PoW), where miners compete to solve complex mathematical puzzles to add new blocks to the blockchain. In return, miners are rewarded with new coins.
- This process requires significant computational power and energy, especially for PoW-based cryptocurrencies like Bitcoin, which has led to concerns about its environmental impact.
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