Mining from entry to proficiency (eight) mining industry ecology – peripheral services

Mining from entry to mastery (eight)

Getting Started – Basics of Mining

Miner mining is the process of producing and acquiring digital currency. Then it will face the problems of digital currency storage, exchange, payment, etc. Wallets, exchanges and other service providers provide a complete digital currency circulation chain.

The roles of providing peripheral services in the digital currency mining industry are:

  • wallet
  • Exchange

wallet

The wallet can be provided to the user, and the unique corresponding public key and private key are stored. The user can use the public key as the collection of the digital currency, the remittance address to conduct the transaction, and the private key to verify the transaction, thereby achieving the purpose of storing and using the currency. At present, mainstream wallets have two types: cold wallets and hot wallets.

Cold wallet

A cold wallet is a wallet that has no network connection. Using a cold wallet can reduce the risk of hackers stealing private keys, but it is more troublesome to save and need to avoid physical damage. Cold wallets mainly include paper wallets, brain wallets, and hardware wallets.

Paper wallet means printing or copying your private key on paper and keeping it in a safe place. There is no cyber risk in the paper wallet, but each time a transaction is made, the private key signature operation needs to be performed manually, which is complicated.

Using the brain wallet, users can use their own custom sentence to generate public and private key pairs. In the future, you only need to remember this sentence, you can regenerate the private key at any time in the brain wallet without physical loss or being The risk of theft. The brain wallet algorithm is an open source project, so even if the brain wallet service provider stops operating, the user can generate the private key by himself.

Currently mainstream brain wallet service providers are:

  • Bitaddress.org
  • idgui.com/N/

idgui.com/N/

The hardware wallet provides a special hardware device to store the private key. When the transaction signature is required, the hardware wallet is connected to the computer. After the signature is completed, the connection is disconnected. Generally, the network is isolated from the network, which reduces the network risk and is not easily damaged.

Currently mainstream hardware wallet service providers are:

  • Ledger
  • Trezer
  • KeepKey
  • Kushen wallet

Ledger Nano X

Hot wallet

A hot wallet refers to a wallet running on a networked device, usually with a web page, a mobile phone or a PC. Hot wallets can be divided into onchain wallets and offchain wallets according to whether the transaction is visible on the chain.

Onchain wallet transactions can be queried on the blockchain. Users participate in transactions that are not affected by the wallet. Users themselves keep private keys to support mnemonics and import private keys.

The current mainstream onchain wallet has

  • Imtoken
  • Cobo
  • Blockchain
  • BTC.com wallet

Cobo wallet

The offchain wallet is a centralized wallet and is generally provided by the exchange. The initiated transaction is essentially the adjustment of the amount of the internal account of the exchange. The transaction is not visible on the blockchain. The user does not need to keep the private key, just remember the account of the wallet. This mode is simple to operate, high in efficiency, and can be real-time, but it is greatly affected by the security of the exchange.

Exchange

The exchange is the main place for the circulation of digital currency. The emergence of the exchange makes the digital currency truly linked to the legal currency and enters the real world. In 2010, the first digital currency exchange was established. Up to now, the exchange has become a multi-faceted platform for supporting various financial operations such as legal currency transactions, currency transactions, futures, options trading, and pledge lending.

Legal currency transaction

Legal currency transactions refer to the trading of traditional legal currency and digital currency. Generally, due to the different currency-related policies of various countries, the exchange of legal currency supported by each exchange is also different.

Currently the mainstream support transactions for legal currency transactions are all

  • Fire coin network
  • Gate.io
  • OKEX

OKEX

Currency transaction

Currency trading refers to the conversion between digital currencies. Due to the differences in the currencies of the digital currencies supported by the exchanges, the currency trading pairs of the exchanges are also different. Basic currency exchanges are supported on all exchanges. Some exchanges only support currency transactions and do not support legal currency transactions, such as currency security.

Futures, options trading

An option is to treat the digital currency as an investment product. After the user pays the premium to the seller, the user has purchased or sold a certain amount to the seller at a predetermined price (exercise price) for a certain period of time or for a specific date in the future. The right to digital currency, but not the obligation to buy or sell.

Futures are promises to trade digital currencies in the future, also known as contract transactions, perpetual contracts, etc.

Some exchanges only support futures trading, such as BitMEX.

BitMEX

Pledged loan

Pledged borrowing refers to the use of digital currency as a collateral (pledge) in the code, and then a cash (legal or stable) with a certain rate of loss (pledge rate).

Check the pledge loan cold knowledge and lending arbitrage tutorial, click on " miners and lending "

The current mainstream digital currency lending platform is Matrixport.

Matrixport

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