Welcome to “Crypto Jargon” – the series where we break down the complex crypto terminology. Today’s article features the following acronyms related to crypto mining:

  • GPU and CPU
  • Mining RIG,
  • ASIC
  • ASIC Resistant

Let’s start with GPU which is not a strictly crypto term. It is in fact something that every computer has: Graphics Processor Unit. This is a computer hardware that is processing data. The higher a computer’s GPU is, the faster it operates. It can be very useful to have a high GPU processor for those who play video games or mine cryptocurrencies with a regular home PC and in regards to crypto mining, it was one of the most popular methods of mining in the early years of Bitcoin.

CPU stands for Central Processing Unit and is different than a GPU since it coordinates the different components of a computer when it’s in operation. The term Central Processing Unit (CPU) has been widely used in the computer industry since the early 1960s. CPU is often measured in terms of its speed, and the units for such measurement is gigahertz (GHz).
The stronger your computer’s CPU is, the more successful it will be for mining activities.

As I mentioned, early mining was done on home computers with high-end GPUs but as the mining industry grew, a lot of it moved on to Mining Rigs.

A mining rig is basically a machine (computer) that is specifically built for mining cryptocurrencies. It often consists of multiple high-end graphics processors (GPUs) in order to maximize its processing power.

Some mining rigs also use ASICs

ASIC stands for Application-Specific Integrated Circuit

Let’s break down this confusing term: “Integrated Circuit” is a computer chip. “Application-specific” means it was built for one specific purpose or computer application. An ASIC chip is used in cryptocurrencies to help record transactions on a blockchain, the process known as mining. Since mining of cryptocurrency data blocks can demand a lot of computer space and time, some miners set aside entire devices or partition off a section of their computers to do nothing else but mining. ASIC also uses far less power than a standard mining rig.

Most of the ASICs are produced in China. In fact, the biggest producer of ASIC chips is Bitmain, a Chinese company that for a long time was holding almost a complete monopoly on the market.

As the value of Bitcoin went up, ASICs began dominating the mining industry, creating mining pools to make it cost-efficient due to the high equipment expenses, making it impossible for people to mine Bitcoin using their home computers. These ASIC machines were not only dominating the network but also taking all the power from the small miners.

This poses a threat of centralized mining and in retaliation, “ASIC resistance” came into the picture.

ASIC Resistant is used to describe those cryptocurrencies that do not require expensive equipment for mining.

Those miners who prefer using their personal computers for GPU mining are in favour of ASIC-Resistant cryptocurrencies and they are considered to be fairer and more decentralized.


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🏆Exchanges I use for trading crypto:

Binance
Kucoin 
Bittrex
Bitfinex

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Where I buy crypto:

BitPanda (Europe)
Changelly (good for instant coins swaps)(Global)
Payeer (Europe, Asia, alternative to paypal)
Bitfinex 
Coinbase (USA, EU, Africa) Get $10 worth of Bitcoin on your first $100 crypto purchase with this link: http://bit.do/coinbase_join

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Where I store my crypto:

  • Ledger Nano – the best hardware wallet (offline storage)
  • Trezor – also one of the best wallets out there.
  • Exodus – desktop wallet
  • Coinomi – mobile phone wallet with instant coin swap feature
  • Crypto.com – mobile wallet and exchange

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