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Instead, they went with Solution 2. The resulting currency, called bitcoin cash, increased the blocksize to 8 Mb in order to accelerate the verification process to allow a performance of around 2 million transactions per day. At the time of writing, Bitcoin Cash is valued at $545.00 to Bitcoins $6,328.11.

When you hear bitcoin mining, you envisage coins being dug from the ground. However, bitcoin isnt bodily, so why do we call it mining

Since its like gold mining in that the bitcoins exist in the protocols design (like the gold exists underground), but they havent been introduced into the light yet (like the gold hasnt been dug up). The bitcoin protocol stipulates that 21 million bitcoins will exist at some point.

They get to perform this as a reward for creating cubes of validated transactions and including them in the blockchain.

Backtracking a bit, lets talk about nodes. A node is a powerful computer which runs the bitcoin applications and helps keep bitcoin running by participating in the relay of information. Anyone can run a node, you simply download the bitcoin software (totally free ) and leave a certain port open (the downside is that it consumes energy and storage space the network at time of writing carries up about 145GB).

One node will send information to a few nodes which it knows, that will relay the information to nodes that they know, etc.. That way it ends up getting around the whole network pretty quickly. .

Some nodes are mining nodes (usually referred to as miners). These set outstanding transactions into blocks and add them to the blockchain. How do they do so by solving a intricate mathematical mystery that's a portion of the bitcoin app, and including the answer in the block. The mystery that needs solving is to find a number which, when combined with the information in the block and passed through a hash function, produces a result that is within a certain range.

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(For trivia lovers, this number is known as a nonce, which is a concatenation of number used once. In the case of bitcoin, the nonce is an integer between 0 and 4,294,967,296.)

How do they find this number By guessing at random. The hash function which makes it impossible to predict exactly what the outcome will be. So, miners suppose the puzzle number and use the hash function to the combination of that guessed number and the information in the block. The resulting hash has to begin with a pre-established number of zeroes.

Whats more, there may be several nonces that produce the intended result, or there might 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 desired range announces its victory to the remainder of the network. The rest of the miners immediately stop work on that block and begin trying to find out the puzzle number for your next one. As a reward for its own work, the victorious miner has some new bitcoin. .

In the time of writing, the reward is 12.5 bitcoins, which at time of writing will be worth almost $200,000.

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Although its not nearly as cushy a i was reading this bargain as it sounds. There are a whole lot of mining nodes competing for that benefit, and it's a question of luck and computing power (the further guessing calculations you can execute, the luckier you are).

Additionally, the costs of being a mining node are considerable, not only because of the effective hardware needed (if you've got a faster processor than your opponents, you have a better chance of finding the right number before they perform ), but also due to the large amounts of power that running these chips consumes. .

And, the number of all bitcoins awarded 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 anticipated in 2020-21). The value of bitcoin relative to cost of power and hardware could go up over the next few decades to partly 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 adjusted frequently, so it requires on average approximately 10 minutes to process a block.

Why 10 minutes That is the amount of time that the bitcoin programmers think is necessary to get a continuous and diminishing flow of new coins until redirected here the maximum number of 21 million has been reached (anticipated some time in 2140).

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