Welcome to Crypto Jargon
the series where I break down the complex terms
that we use in reference to cryptocurrencies and blockchain tech.
In this episode,
I'll explain the following terms related to crypto mining:
GPU and CPU
Mining RIG,
ASIC and ASIC Resistant
Ok starting with GPU
which is a Graphics Processor Unit.
This is a computer hardware that is processing data.
And the higher a computer's GPU is,
the faster it operates.
It can be very useful to have a high GPU processor
for those who play video games
or mine cryptocurrencies with a regular home PC.
CPU on the other hand,
stands for Central Processing Unit
and is different than a GPU since it coordinates
the different components of a computer
when it's in operation.
The term Central Processing Unit (CPU)
has been widely used in the computer industry
since the early 60s.
CPU is often measured in terms of its speed,
and the units for such measurement is gigahertz (GHz).
The stronger your computer's CPU is,
the more successful it will be for mining.
Early mining was done on home computers
with CPU and GPU mining
but as the industry grew,
it moved on to Mining Rigs.
And a mining rig is basically a machine,
a computer that is specially built for mining cryptocurrencies.
It often consists of multiple high-end graphics processors (GPUs)
in order to maximize its processing power.
Some mining rigs also use ASICs
ASIC stands for Application Specific Integrated Circuit
Well, let's break down this confusing term:
"Integrated circuit" is a computer chip.
and "Application-specific" means that it was built for one specific purpose
or computer application.
An ASIC chip is used in cryptocurrencies
to help record transactions on a blockchain,
the process' known as mining.
Since mining of cryptocurrency data blocks
can demand a lot of computer space and time,
some miners set aside entire devices
or partition off a section of their computers
to do nothing else but mining.
An ASIC also uses far less power
than a standard mining rig.
And most ASICs are produced in China,
In fact,  the biggest producer of ASIC chips is Bitmain,
a Chinese company that for a long time
was holding almost a complete monopoly on the market.
As the value of Bitcoin went up,
ASICs began dominating the mining indusry,
creating mining pools
to make it cost-efficient due to the high equipment expenses,
making it impossible for people to mine Bitcoin using their home computers.
These ASIC machines were not only dominating the network
but also taking all the power from the small miners.
Which poses a threat of centralized mining and in retaliation,
"ASIC resistance" came into the picture.
ASIC Resistant basically, is used to describe those cryptocurrencies
that do not require expensive equipment for mining.
Those miners who prefer using their personal computers
for home GPU mining
are in favor of ASIC-Resistant cryptocurrencies
and they are considered to be fairer and more decentralized.
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