2.0 What is Mining? - Makh1/italcoin GitHub Wiki

Instead of having one central authority that secures and controls the money supply (like most governments do for their national currencies), ITAL coin spreads this work across a network of “miners”.

Miners assemble all new transactions appearing on the ITAL coin network into large bundles called blocks, which collectively constitute an authoritative record of all transactions ever made, the blockchain.

The way ITAL coin makes sure there is only one blockchain is by making blocks really hard to produce. So instead of just being able to make blocks at will, miners have to produce a cryptographic hash of the block that meets certain criteria, and the only way to find one is to try computing many of them until you get lucky and find one that works.

This process is referred to as hashing. The miner that successfully creates a block is rewarded with 40 freshly minted ITAL coins.

Every few days, the difficulty of the criteria for the hash is adjusted based on how frequently blocks are appearing, so more competition between miners equals more work needed to find a block.

This network difficulty, so called because it is the same for all miners, can be quantified by a number.