Step 4Cryptocurrency mining
Mining is the process by which recent cryptocurrency transactions are checked and new blocks are added to the blockchain.
Checking transactions
Mining computers pick a set of pending transactions from a group of transactions and check each one carefully to ensure the transaction is verified. Two checks take place:
1st Check
Confirms that the sender has sufficient funds to complete the transaction. This involves checking the transaction details against the transaction history stored in the blockchain.
2nd Check
Confirms that the sender has authorised the transfer of funds. When sending funds, a user must sign the transaction using a private key, which is then combined in a cryptographicVarious mathematical techniques for encrypting and decrypting data, to keep it private when transmitted or stored electronically. Cryptography is also a skill used to communicate in or decipher secret writings or ciphers. manner. with the transaction data to form a unique digital signature. Because of the mathematics involved, miners can use this digital signature to verify that the sender had access to the wallet’s private key – and therefore the funds contained within it – without the sender having to reveal their private key.
