It is the process through which cryptocurrencies are made. It is called “mining” because it’s similar to “gold mining”. Some particular cryptocurrencies exist into the protocol (like the gold exists into the underground), and the “miners” bring it into the light. The miners create blocks of transactions, putting them in the blockchain network, and receive new cryptocurrency as a reward.
So, cryptocurrency mining has two functions:
- It adds transactions to the blockchain network.
- It releases new cryptocurrencies.