It is important to understand what is Bitcoin mining all about before starting to do any actual mining itself. Even if you are not going to mine any coins yourself it is wise to have a general understanding what it’s all about as Bitcoin is becoming a big phenomenon in the world. So how does Bitcoin mining work? Watch the video to find out.
What is Bitcoin Mining; The Bitcoin works like a P2P network.
That everyone using Bitcoin operate as if they are very small fractions of “bitcoin bank” But that bitcoins come? The money printed by the government decides when to print and to distribute to the people.
The Bitcoin does not belong to any government.
With Bitcoin, the miners use special software to solve mathematical problems.
And take a certain number of bitcoins in exchange.
This is a smart way to create currency.
Also, motivates more people to mine (mining).
If the miners are required to authorize transactions Bitcoin Most miners are translating into greater network security.
The Bitcoin network automatically changes the difficulty of mathematical problems depending on how quickly solved.
At first, Bitcoin miners solve these problems with the processors in their computers.
Soon they discovered that the graphics cards used for games were much better for this job.
The graphics cards are faster, but consume more energy and produce excessive heat.
The first commercial machine for Bitcoin mining contained chips programmed exclusively for this work.
These chips can be quickly but remain intensive.
ASIC (application specific integrated circuit), are chips designed for Bitcoin mining.
The ASIC Technology made the Bitcoin mining even faster while reducing power consumption.
As the popularity of Bitcoin increase, miners new added network making it even more difficult for those trying individually to solve these math problems.
To overcome this, the miners found a way to work together in “pools.”
Tanks of miners find the solution faster than individual users each member of the “tank” is rewarded with a rate proportional to processing power provided.
The Mining is an important and integral part of Bitcoin that ensures fairness while maintaining the Bitcoin network secure and safe!
Hey hey hey. It’s Ville and welcome to my blog. I am a tech enthusiast and always looking for ways to generate new income streams. At the moment Bitcoin cloud mining is one of the most promising ones and that’s why I created this website. Hope you like your stay. If you want a quick start guide about making passive income with cloud mining check out this guide.
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