How does cryptocurrency mining actually work?

The answer

Cryptocurrency mining (in proof-of-work systems like Bitcoin) involves specialized computers racing to find a specific number (a 'nonce') that, when combined with transaction data and hashed, produces a result below a target threshold. The first miner to find a valid hash earns newly created Bitcoin plus transaction fees. This process secures the network by making it computationally expensive to alter transaction history. Bitcoin mining alone consumes roughly 150 terawatt-hours annually - comparable to the electricity usage of Poland - which has driven growing interest in less energy-intensive proof-of-stake alternatives.