Merged mining refers to a course of that allows a person to mine a couple of cryptocurrency concurrently with out compromising on computational efficiency.
Crypto mining is a extremely profitable exercise. With the suitable computing gear, you may start mining Bitcoin, Monero, Ravencoin, Dogecoin, Ethereum Traditional and a number of other different outstanding cryptocurrencies. Certain, the upfront value of shopping for the required graphic processing unit (GPU) or application-specific built-in chips (ASICs) can weigh in in your pockets. Nevertheless, you may rapidly recoup the funding after the mining rewards come into your pockets.
Nevertheless, what if there was a technique to mine a number of cryptocurrencies concurrently utilizing the identical mining gear? That may considerably improve the potential payout with out further funding in mining gear. It sounds almost not possible, however that’s precisely what merged mining refers to. However what precisely is merged mining, and the way does it work? Tag alongside to search out out.
What’s merged mining?
Merged mining refers to a course of that allows a person to mine a couple of cryptocurrency concurrently with out compromising on computational efficiency. That is doable by a consensus mechanism often called Auxiliary Proof of Work (AuxPoW).
AuxPoW works on the easy premise that the work finished on one blockchain will be accepted as legitimate work on one other chain. The idea turned widespread in 2010 when the founding father of Bitcoin, Satoshi Nakamoto, hinted at the opportunity of miners collaborating within the proof-of-work consensus mechanism of two blockchains concurrently.
How does Merged Mining work?
To efficiently implement the merged mining course of, each blockchains should use the identical hashing algorithm. For instance, the algorithm utilized by Bitcoin is called SHA-256, whereas Ethereum Traditional makes use of the KECCAK-256 algorithm.
If a miner needs to mine a coin alongside Bitcoin, they need to discover one other coin that makes use of the SHA-256 algorithm. The identical goes for Ethereum Traditional too. To mine a cryptocurrency alongside ETC, the opposite forex should use the KECCAK-256 algorithm.
Along with the hashing algorithm, many smaller technicalities should even be carried out correctly. Nevertheless, it should be famous that on this technique of merged mining, the mother or father blockchain doesn’t endure many technical modifications. It’s the auxiliary blockchain that should be successfully programmed to obtain and settle for the work finished by the mother or father chain.
Furthermore, it’s crucial to provoke a ‘exhausting fork’ if the blockchain is keen to offer or take away the assist essential to conduct merged mining. A tough fork refers to a serious replace to the protocol of a blockchain community. After the exhausting fork, the blockchain splits into two; the brand new model follows the protocol replace, and the older chain continues to perform because it did earlier than the replace.
The primary implementation of merged mining occurred in 2011 on the Namecoin blockchain, when assist for the SHA-256 algorithm was added to the community.
Advantages and dangers
One of many advantages of utilizing merged mining is that it could scale back the possibility of a 51 % assault on the auxiliary blockchain. The reason is straightforward, because of the elevated incomes potential, auxiliary chains that assist merged mining will entice extra miners. The extra miners there are on a community, the tougher it’s to orchestrate a 51 % assault.
A 51 % assault refers to an exploit the place one miner or a gaggle of miners comes to manage a majority (51 % or extra) of the nodes on the community. Nevertheless, many builders introduced a counterargument to this profit. They acknowledged that if a big mining firm participates within the mining exercise of a small auxiliary chain, it could simply orchestrate a 51 % assault.
One other apparent advantage of utilizing merged mining is the impact on carbon footprint. The power consumption of cryptocurrency mining has led to difficult and endless discussions, with highly effective opinions throughout each ends. Nevertheless, merged mining no less than doesn’t add to the ever-increasing carbon footprint on this planet.
Nevertheless, some miners argue in regards to the difficulty of upkeep in merged mining. Whereas it doesn’t require further processing assets, it does require further upkeep to mine two or extra property on a mining rig.
Merged mining is an attention-grabbing and thrilling idea. It permits younger blockchains to attain fast progress and safety whereas providing miners an added income stream. Nevertheless, not many blockchains have adopted this idea as a result of its perceived safety dangers. Maybe, with some enhancements, we might see merged mining being carried out extra typically sooner or later.