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Produced by Wayne | Vernacular Blockchain (ID: hellobtc)
When you hear the word "mining", you may think of scenes in Western movies: picks, dirt, and gold after digging into a rich overnight. Bitcoin mining is very similar to the process of mining gold by miners. It also requires luck and effort.
First, when computers solve these complex mathematical problems on the Bitcoin network, they will generate new Bitcoins, which is the same process as mining operations extract gold from the ground.
Secondly, solve computational mathematics problems, launch competitions and verify transaction information to make the Bitcoin network trustworthy and safe.
01
how mining is done?
When transacting through the Bitcoin network, the transaction information must be recorded and placed on a block. Because this block requires security and encryption, miners compete for it.
Miners must use a method of guessing and then verifying to solve a cryptographic puzzle in order to find the appropriate random number for the block. Miners usually need a lot of reliable, application-specific hardware to mine.
Once miners have dug up a block, the block is then added to the Bitcoin network and must be verified by other nodes (computers) on the network. This process is called consensus.
If the miner successfully verifies and ensures the security of the block, the miner can obtain a reward for the newly created currency. The process of rewarding work is called proof of work.
As compensation for the miners’ efforts, every time a miner adds a new transaction block to the Bitcoin network, he will receive Bitcoin, which is called a “block reward”.
02
How profitable mining?
Mining is called mining because it is a process in which miners make great efforts to obtain Bitcoin. For miners, the biggest concern has always been the increasing difficulty of computing problems involved in ensuring block security, and this is indeed the case.
In order to make mining profitable, miners have invested a lot of money in research and development, more advanced solution algorithms and more efficient hardware. Some organizations even relocated mining machines to rural dams and countries with cheaper electricity supplies.
In the early days of Bitcoin mining, miners could profit by using only the CPU of their home computer. The problem with CPUs is that they are designed to handle multiple computing tasks at the same time, such as running multiple programs on a computer screen at once.
It is worth noting that it is only profitable to mine most bitcoins that use a proof-of-work scheme if individuals are willing to invest heavily in hardware equipment, power supply or a combination of the two.
Large companies have realized this fact and have entered the mining field with all their strength to obtain most of the mining profits. Similarly, smaller organizations and individuals are currently struggling to compete in this field.
03
summary
In order to deal with these problems of mining centralization, more complex mining algorithms and proof schemes have emerged.
The fee-driven Bitcoin system requires developers to add a fee to the transaction, and the fee will provide the computing power of the transaction until the transaction is fully verified or the fee is exhausted.
This provides a safer way for miners to contribute to solving new blocks.
Have you participated in mining? How was the experience? Welcome to share your views in the message area.
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"Sound Description: This series is only for entry-block chain science learning, does not constitute any investment advice or recommendations. If there are any errors or omissions, please leave a message to point out. 』
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