Bitcoin Mining the Backbone of Bitcoin
Bitcoin is a cryptocurrency digital cash. It is decentralized and have its own blockchain. This currency has no middle man, in other words, coins are sent without a bank with peer–to–peer technology (computers which are connected to each other) to another user.
What is a Bitcoin? it’s a computer file which is stored in a digital wallet application on a computer or a smartphone. With the wallet you have a private and a public key to receive and send bitcoins to each other. Every transaction is recorded on the blockchain which is a container of data. The blockchain can store millions of transactions and the data is secure, transparent, and tamper–free.
Now we move a step deeper into bitcoin to discuss mining. The miners use specialized computers to solve computational problems. The role of the miner is to secure the network and to process every Bitcoin transaction. The purpose of mining is to allow Bitcoin nodes (a node is a device on the blockchain network) to reach a secure, tamper–resistant consensus. A Bitcoin node runs a series of checks on a transaction. Nodes check to see if the data structure and syntax of the transaction are correct. These actions are not done by hand, but machines, also known as miners. Bitcoin miners are specialized computing hardware, as well as the people who own and run them.
Mining is used to issue new Bitcoins. Bitcoin is different from a central bank. A central bank can issue money at any time when they want to improve the economy. With Bitcoin, the miners are rewarded new bitcoins every 10 minutes when they mine by using their computing power to generate the new bitcoins. The miner has to include transactions sent to the Bitcoin network in their blocks. Once the transaction has been included in a block, it is officially embedded into Bitcoin’s blockchain.
Mining bitcoins is a highly specialized industry. Most Bitcoin mining is done in large warehouses where the electricity is cheap.
Take note: Do not make an investment decision on a Bitcoin or any other cryptocurrency or other investment based on the information on this website.