How to Choose Miner | Blockchain and Cryptocurrency: What You Need to Know | 2019

TL;DR

Miners collect transactions from users, assemble them into blocks, and write these blocks onto the blockchain. They get paid for their work and the miner that creates a block is chosen randomly to ensure fairness.

Transcript

okay welcome back everyone in this segment we're going to talk about how mining works so let's see what the miners actually do so this one picture is going to explain exactly what miners do in these blockchains so i'll use again one of our examples i'll use the bitcoin blockchain to illustrate it but it's actually quite similar in many blockchains ... Read More

Key Insights

• 🚫 Miners in blockchains collect and assemble transactions into blocks before writing them onto the blockchain.
• 💦 They are paid through a special transaction called "coinbase" for their work in creating blocks.
• 👊 Random selection of miners ensures that anyone can participate in mining and prevents a Sybil attack.
• 👊 Sybil attacks, where a single entity controls a majority of miners, can disrupt the fairness and persistence of blockchains.
• 👻 Mining allows for liveness in the system as transactions can be posted even if some miners refuse to accept them.
• 🖐️ Miners play a crucial role in maintaining the integrity and security of blockchains.
• ❓ Different blockchains may have different mining mechanisms and reward structures.

Questions & Answers

Q: How do miners collect transactions in blockchains?

Miners collect transactions from users who issue them into the network, such as the Bitcoin network. They receive these transactions and assemble them into blocks.

Q: How do miners get paid for their work?

Miners receive payment for their work through the "coinbase" transaction. This transaction is included in each block they create and it pays them for their mining efforts.

Q: How is the miner chosen to create a new block?

The miner that creates a new block is chosen randomly from the set of all miners. This ensures that anyone in the world can participate in mining and have a chance to earn rewards.

Q: What is a Sybil attack and how does it affect mining?

A Sybil attack occurs when a single entity controls a majority of the miners. This entity can block transactions and even revert some transactions, which goes against the principles of fairness and persistence in blockchains.

Summary & Key Takeaways

• Miners in blockchains, like Bitcoin, collect transactions from users and write them onto the blockchain.

• They assemble transactions into blocks and include a special transaction called "coinbase" that pays them for their work.

• The miner that creates a block is chosen randomly to ensure that anyone can participate in mining.