Definition ∞ Mining competition refers to the rivalry among cryptocurrency miners to solve cryptographic puzzles and add new blocks to a proof-of-work blockchain. Miners expend computational power to be the first to find a valid block, earning block rewards and transaction fees. The intensity of this competition is directly related to the network’s hash rate and the profitability of mining. It is a fundamental mechanism for securing and decentralizing proof-of-work networks.
Context ∞ News frequently reports on shifts in mining competition, often driven by changes in cryptocurrency prices, energy costs, or the introduction of more efficient mining hardware. Increased competition typically leads to higher network security but can also reduce individual miner profitability. Regulatory actions concerning energy consumption or environmental impact also significantly influence the dynamics of mining competition globally.
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