The Basics of Bitcoin Mining – Bitcoin Binge
Bitcoin mining adds transactions to the blockchain.
Mining is essential for record keeping. It creates and sustains the public ledger that records every transaction made on the bitcoin network. On top of that, bitcoin mining rewards its participants.
Powerful computers and software are needed for mining. It’s a difficult process that entails solving highly complex mathematical problems. To miners though, the juice is worth the squeeze.
Bitcoin miners are rewarded for their efforts.
There are several ways to acquire BTCs. You can purchase them on an exchange, earn them by receiving bitcoin as payment, be gifted them from others, and so on. Or, you can be a bitcoin miner. When miners validate transactions and add them to the blockchain, they receive BTCs as a reward.
Bitcoin mining won’t last forever.
The creator of bitcoin, Satoshi Nakamoto, put a limit on the amount of the cryptocurrency that will exist. There can only ever be 21 million BTCs. Miners are key to bringing BTCs into existence but their purpose will eventually be rendered obsolete. In the meantime, they receive their bitcoin rewards roughly every 10 minutes. Every four years, the reward for their mining is also cut in half. That means there’s a lot of time before all possible BTCs are in circulation.
There is strength in numbers.
Bitcoin mining is a tough job. A single miner will take longer to confirm transactions than many working together. That is why mining pools are popular. Combining or “pooling” many computers is a way that miners can work together and be rewarded every time their server solves a bitcoin block.
So, is bitcoin mining for you? Maybe if you have access to cheap electricity, many powerful computers, and a lot of spare time and money to dedicate to the necessary upkeep for successful mining. In other words, it’s not for the faint of heart. There are massive pools working together and even professional companies working hard at it and the space is only getting more competitive.
Want to learn more about BTC? Find out what a satoshi is here.
Published at Sat, 01 Feb 2020 21:04:07 +0000
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