Cloud mining is all about purchasing hash power, much like pool mining, where you can either purchase additional resources for your CPU or share your own. You pay for the desired hash rate and provide the remaining work to the miners. You receive a piece of whatever they made based on the hashes you purchased after a predetermined amount of time.

The Blockchain network is a decentralized P2P network with a shared ledger. The network is run by miners, who also record, process, and validate transactions because there is no central authority. The information exchanged over the network is readily available, yet private information is always kept private. To obtain their blocked rewards in this case, miners must validate blocks of transactions. Every time a new transaction block is added to the system, a new coin is introduced to the network.