Question
I have been mining bitcoin (via an offsite computer running 24/7 with an automated program) for some time now, but I was recently made aware that there may be an issue with leaving the system running on Shabbos.
I would appreciate it if the rav can enlighten me as to what exactly would be the halachic concern with mining bitcoin on Shabbos. Also, are there other cryptocurrency-related halachic issues that I should know about?
Answer
Since halachic inquiries related to cryptocurrencies have been coming in more and more frequently lately, I will attempt to address the most basic issues these new age digital currencies pose, including your specific question about mining.
The three most common ways people are profiting from the new phenomenon of digital currencies are mining, staking, and of course the most widespread method—trading. To understand the halachic concerns that may be relevant to these new practices, it behooves us to explain—on a basic level—what these methods of business are and how they create value.
1. Mining:
Bitcoin is a form of digital currency (otherwise known as cryptocurrency) in which transactions are recorded on a digital ledger called “blockchain.” Blockchain technology uses a network of millions of computers programmed to autonomously solve complex mathematical puzzles. By solving these complex math problems, one block at a time, these programs produce new bitcoin, which is awarded in fractions to the digital wallet of the computer (and its owner) that solved it. This is referred to as “mining” and is one of the most common ways people profit from the phenomenon of cryptocurrency.
2. Staking:
Put simply, “staking” is the process of locking up an amount of a particular cryptocurrency (usually Ethereum) for a specific period in order to contribute to the security and stability of the blockchain and to earn a reward [of a given amount of that currency] for doing so.
3. Trading:
To read more, subscribe to Ami
