See This Report about Free Bitcoin Mining Game
Instead, they went with Solution 2. The resulting currency, called bitcoin money, increased the blocksize to 8 Mb in order to accelerate the verification procedure to allow a performance of around two million transactions per day. At the time of writing, Bitcoin Cash is valued at $545.00 to Bitcoins $6,328.11.
When you hear about bitcoin mining, you envisage coins being dug out of the ground. But bitcoin isnt bodily, so why do we call it mining
Since its similar to gold mining in that the bitcoins exist in the protocols design (like the gold is underground), but they havent been introduced into the light yet (just as the golden hasnt been awakened ). The bitcoin protocol stipulates that 21 million bitcoins will exist at some point.
They get to do this as a reward for creating blocks of confirmed transactions and including them in the blockchain.
Backtracking a little, lets talk about nodes. A node is a powerful computer which runs the bitcoin applications and assists to keep bitcoin running by participating in the relay of information. Anyone can run a node, you simply download the bitcoin applications (free) and leave a certain port open (the downside is that it consumes energy and storage space the network at time of writing takes up about 145GB).
One node will send information to some nodes that it knows, who will relay the information to nodes they know, etc.. This way it ends up getting around the entire network pretty quickly. .
Some nodes are mining nodes (usually known as miners). These set outstanding transactions into blocks and add them into the blockchain. How do they do so by solving a complex mathematical mystery that is a portion of the bitcoin app, and including the answer in the cube. The puzzle that needs solving is to find a number which, when combined with all the data in the cube and passed through a hash function, creates a result that's within a certain range.
How do they find this number By guessing at random. The hash function makes it impossible to predict what the output will be. So, miners guess the mystery number and apply the hash function to the combination of the guessed number and the data in the block. The resulting hash has to start with a pre-established number of zeroes.
Whats more, there might be several nonces that make the desired result, or there may be none (in the event the miners keep trying, but using a different block configuration). .
The first miner to get a resulting hash within the desirable range announces its success to the rest of the network. All the other miners immediately stop work on that block and begin trying to find out the mystery number for the next one. As a reward for its work, the victorious miner gets some new bitcoin. .
In the time of writing, the payoff is 12.5 bitcoins, which at time of writing will be worth nearly $200,000.
Additionally, the costs of being a mining node are considerable, not only due to the effective hardware needed (if you've got a faster processor than your competitors, you've got a better chance of finding the correct number before they perform ), but also because of the large amounts of power that running these processors consumes. .
And, the number of bitcoins given as a reward for solving the puzzle will decrease. Its 12.5 now, however, it halves every four decades or so (the next one is expected in 2020-21). The worth of bitcoin relative to cost of electricity and hardware could extend up over the next few decades to partially compensate this reduction, but its not certain. .
The difficulty of this calculation (the required number of zeroes at the beginning of the hash string) is recommended you read adjusted frequently, so it requires on average about 10 minutes to process a block.
Why 10 minutes That is the amount of time the bitcoin programmers think is necessary for a steady and diminishing flow of new coins until the highest number of 21 million has been reached (anticipated some time in 2140).