Most people initially consider Bitcoin to be just “silly magic internet money,” but if you take a more in-depth look into its underlying technology, it’s much more.

Bitcoin is a protocol: a set of rules that replaces the rulers. It’s a network.

A network is a group or system of interconnected people or things, therefore the strength of a network depends on the relationship between its participants. In the case of mineable cryptocurrencies, the community consists of many participants such as miners, consumers using the currency for transactions, and investors.

Securing the blockchain

Cryptocurrency mining was introduced to solve a challenging problem: double spending. How can the recipient of digital funds ensure that the payer has not already spent the money and maliciously not told them?

To add a new block to the chain, a miner has to solve a cryptographic proof-of-work (POW) problem. This is impossible to solve without applying large amounts of computational power. Mining is essential for the immutability of the blockchain. The more power used for proof-of-work, the more secure the digital ledger will be.

If we consider things from that perspective, Bitcoin and Ethereum are becoming increasingly more secure. According to Blockchain.info, the amount of hash rate, or how much computational power the entire network is consuming to solve a block for these two networks, has grown tremendously over the past 12 months.