The Bitcoin protocol stipulates that 21 million Bitcoin will exist at some point. What Bitcoin miners do is bring them out into the light, a few at a time.
Bitcoin mining is performed by high powered computers that solve complex mathematical computations, these computations are impossible to solve by hand. When computers solve these computations, they add transactions to the blockchain and as a reward, they get a new Bitcoin.
How does it work?
What these computers are actually doing is trying to come up with a 64 digit hexadecimal number called a “hash”, basically a miner’s computer spits out hashes at different rates, the computers try to guess all 64 digit numbers. The chances of this is usually one in 7 trillion.
Arriving at the right answer before another miner depends a little bit on how fast your computer can produce hashes. The more the number of miners increase, the more difficult getting this hash is, the reverse is also the case.
What type of computers can be used for mining?
Miners realized that graphics card commonly used for video games were more effective at mining than desktops. Computers specifically for mining cryptocurrencies are called ASIC (Application specific integrated circuits). Faster bitcoin mining hardware is able to attempt more tries per second.
What is a mining pool?
A mining pool is a group of miners who combine their computing power & split the mined Bitcoin between participants, the profit from each block any pool member generates is divided up among the members of the pool according to the amount of hashes they contributed.
What is bitcoin cloud mining?
By purchasing bitcoin cloud mining contracts, investors can earn Bitcoin without dealing with the hassles of mining hardware, software, electricity bandwidth or other offline issues.
I hope I have helped you understand what Bitcoin mining is. You can leave your comments belowFollow us on social media