What is Cryptocurrency Mining?

 

Cryptocurrency Mining pic
Cryptocurrency Mining
Image: investopedia.com

Certified Financial Planner (CFP) Robert M. Ryerson, a graduate of Rutgers University and experienced in his field, has embraced cryptocurrency. Enthusiasts like Robert M. Ryerson have invested in a system that stores information on a distributed ledger.

Cryptocurrency mining brings cryptocurrencies like Bitcoin out of the protocol’s base design and into the system. Cryptocurrency systems contain a specific number of units, like Bitcoin’s 21 million coins, but not all are brought out of the system immediately. Instead, the system “borrows” processing power from users who serve as “nodes” for the distributed cryptocurrency ledger, solving the mathematical puzzles that help the system work, and periodically rewards those nodes with coins.

Mining nodes discover the solutions to these problems by guessing at random, and the distribution of coins to the mining nodes is random as well. Receiving cryptocurrency as a direct result of mining becomes more likely with more computing power from additional CPUs or GPUs, but relies on being lucky enough to both successfully solve an equation and lucky enough to be chosen to receive the reward. Once received, the newly awarded coins can be used in the same way as any of the existing coins on the network. The downside of being a node, however, is that these “miners” need powerful hardware which uses a lot of electricity, an expensive proposition.

Published by Robert Ryerson

A financial professional with more than three decades of experience, Robert Ryerson works closely with clients in the Freehold, New Jersey, area to meet their financial planning needs. As a Certified Financial Planner (CFP) at New Century Planning, he focuses on retirement income planning, as well as estate administration, regularly assisting his clients with legacy and estate planning. He also advises them on health and disability insurance, including Medicare, Medicaid, and Medicare Supplement Plans. Mr. Ryerson’s many years helping his clients navigate the complexities of retirement planning gave him a deeper understanding of the healthcare costs that retirees face. In 2013, he drew upon this knowledge to co-author the book What You Don’t Know About Retirement Will Hurt You. Outside of his work at New Century Planning, Robert M. Ryerson is a regular fixture at workshops and seminars on retirement. He has delivered several keynote speeches on the often-confusing topic of required minimum distributions. Mr. Ryerson continues to share his financial expertise as a facilitator of online courses for Certified Public Accountants through The Society for Financial Awareness. In the early 2010s, Mr. Ryerson became concerned about the threat of identity theft after noting the many cybersecurity breaches suffered by major companies. He became a Certified Identity Theft Risk Management Specialist (CITRMS) in 2014. He has since taught identity theft recovery courses at local community colleges. Mr. Ryerson also wrote a book on the topic entitled What’s the Deal with Identity Theft: A Plain English Look at Our Fastest Growing Crime. A graduate of Rutgers University with a degree in economics, Mr. Ryerson began his career in the financial services industry as a stockbroker. He obtained his CFP designation in 1991 and began working as an independent financial planner a few years later. In addition, he is a notary public.

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