ELI5: What is an 'automatic cryptocoin miner', and what are the implications of having one included in the new uTorrent update?

Although a lot of big words were used in this post, you are far from correct in explaining what is going on with a cryptocoin.

First, the computer is not solving 'hard' math problems, they are actually solving an easy math problem, but they solve it over and over again to find an input that will produce a desired output. What they are performing is a hash, and they want the output to be less than a certain value.

The work/answer to the problem is actually worthless. But it has value because the people using/designing the coin have agreed that to add something to their block chain they need to provide the input they used to produce the desired output.

The block chain is important to the coin because it stores all the transactions and serves as proof of who has what. You benefit from adding to the block chain because you get two things:

  1. You may get new coins. When the coin was designed it was agreed that the first N people to add to the chain will get newly introduced coins. This provides incentive to do the work to add to the chain and to slowly introduce coins. The number of new coins you get typically decrease as time goes on until it is 0, and is all predefined.

  2. Transactions fee: people submit their transactions that they want to perform to the miners doing the work to add to the block chain. The more transactions the miner accepts the longer it takes for each calculation to see if they found a number that produces a hash that is of a certain value. To add incentive to the miner to take your transaction and add it to the block chain you offer them a fee. Your transaction can't happen until it is on the chain, so you need someone to add it for you.

As you can see the math problem that the miner solved has no value except to add on a block to the chain. Once a block is added to the chain all the miners need to start over with new info and try and solve a similar problem.

The difficult of finding primes does not come in to play at all with the mining/block chain. It is used to give people access to accounts that store bitcoins on the block chain.

/r/explainlikeimfive Thread