Definition
Merged mining lets a miner work on two or more separate blockchains simultaneously using a single proof-of-work computation. The technique, also called Auxiliary Proof-of-Work (AuxPoW), allows a stronger parent chain (such as Bitcoin) to secure a weaker child chain without any additional hashing effort. The miner embeds a commitment to the child chain's block inside the parent chain's coinbase transaction, so one valid hash can satisfy the difficulty target of both chains at once.
How it works
The child chain accepts a parent-chain block header as proof that sufficient work was performed. When a miner finds a hash that meets the child's (usually lower) difficulty, that block is accepted on the child chain even though the same work was aimed at the parent. Miners can thus earn rewards on multiple chains for effectively the same energy expenditure, which is why merged mining is attractive to pools and large operators.
Where it is used
Namecoin was the first chain to merge-mine with Bitcoin. Today Rootstock (RSK) uses merged mining to inherit a large share of Bitcoin's hashrate for its smart-contract sidechain. The proposed Drivechain design relies on a refined variant called Blind Merged Mining.
For operators, merged mining is one of the few ways to monetize the same hashrate across chains. D-Central treats it as a legitimate technical option; consult each project's documentation for setup specifics and the additional node requirements involved.
In Simple Terms
Merged mining lets a miner work on two or more separate blockchains simultaneously using a single proof-of-work computation. The technique, also called Auxiliary Proof-of-Work (AuxPoW),…