Miner is a term used to refer to a person or computer program that performs the computational process of mining. In cryptocurrency, miners are people or companies who use computer systems with specialized hardware to solve complex mathematical puzzles in order for transactions to be verified and added to the blockchain.
Mining is essential to the processes that make cryptocurrencies, like Bitcoin, secure and viable. By solving the mathematical puzzles, miners are rewarded with a small fraction of the cryptocurrency they are mining.
The miners are essentially competing to be the first to solve the puzzle. As newer puzzles become available, miners must update their systems to ensure they can process the changing puzzles. The more miners join the network, the more difficult the puzzles become and the greater the investment in both power and hardware is necessary.
Mining can be done in one of two ways; with an individual miner, or a pooled miner. With an individual miner, the user will mine alone with their own set of hardware. With a pooled miner, the user joins a mining pool which consists of a group of miners who work together to solve the same puzzles. The rewards are then split among the members of the pool.
Mining can be a lucrative process, but it is also a highly energy-intensive one because of the electricity needed to power the equipment. It can also be a risky business, as the cryptocurrency market is prone to sudden and drastic changes in value.
