You actually use hashes when you send emails and browse the internet – they are a key part of encrypting your online activity and keeping it safe. An example is the padlock next to the website address at the top of this page.
For Bitcoin, hashes are a complex mathematical equation that ASIC miners must solve in order to create a new block of transactions. The more hashes they solve before the next block, the more Bitcoin rewards they get.
This is a simplified description of events, but cryptography is a complex beast. You won’t need to know the ins and outs of crypto unless you’re a bitcoin developer.
Solving hashes is where most of the power consumption with Bitcoin comes from, as it is part of its protocol called “Proof-of-Work”. It takes work to secure the grid and it requires investment in setting up mining rigs, paying for electricity on the open market to power miners, and setting up green infrastructure to maintain operational and profitable miners.
Disclaimer: The information provided on this blog is for informational purposes only and should not be taken as any form of advice.
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