Good question. There’s a long explanation and a short explanation. I’ve tried to explain this to my friends and people I meet who ask about it, but normally their eyes just gloss over after about 5 minutes.I’m going to refer to a website I found that explains it fairly well in an easy to understand manner. Check out www.bitcoinmining.com and watch the video. It gives you an idea but you really need to do more research as it has become much more advanced since I started mining.Thanks for the question. I think you may have given me an idea for a new post to write about.