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Instead, they went with Solution 2. The resulting currency, known as bitcoin cash, increased the blocksize to 8 Mb in order to accelerate the verification procedure to allow a performance of around two million transactions every day. In 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 physical, so why do we call it mining
Because its similar to 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 (just as the gold hasnt yet been awakened ). The bitcoin protocol stipulates that 21 million bitcoins will exist at some point.
They get to do so as a reward for creating cubes of validated transactions and including them in the blockchain.
Backtracking a little, lets talk about nodes. A node is a powerful computer that runs the bitcoin software and assists to 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 drawback 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, that will relay the information to nodes that they know, etc.. This way it ends up getting around the whole network fairly quickly. .
Some nodes are mining nodes (usually referred to as miners). These set outstanding transactions into blocks and add them into the blockchain. How do they do so by solving a intricate mathematical puzzle that's part of this bitcoin program, and including the answer in the block. The mystery that needs solving is to find a number that, when combined with all the data in the block and passed via a hash function, produces a result that is within a certain range.
(For trivia lovers, this number is called a nonce, which is a concatenation of number used once. In the instance of bitcoin, the nonce is an integer between 0 and 4,294,967,296.)
How can they find this number By guessing at random. The hash function which makes it impossible to forecast exactly what the outcome will be. So, miners guess the mystery number and Free Bitcoin Mining Game use the hash function to the combination of the guessed number and also the data in the block. The resulting hash has to start with a pre-established number of zeroes.
Whats more, there may 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 cease work on that block and start trying to find out the mystery number for your next one. As a reward for the own work, the victorious miner has some new bitcoin. .
At the time of writing, the payoff is 12.5 bitcoins, which in time of writing will be worth nearly $200,000.
Although its not nearly as cushy a deal as it sounds. There are a whole lot of mining nodes competing for that reward, and it is a question of luck and computing power (the more guessing calculations you can execute, the luckier you're ).
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 correct number before they perform ), but also due to the large amounts of electricity that running these chips consumes. .
And, the number of all bitcoins given as a reward for solving the puzzle will decrease. Its 12.5 now, but it pits each four decades or so (the next one is anticipated in 2020-21). The value of bitcoin relative to cost of power and hardware could extend up over the next few years to partly compensate this reduction, but its not certain. .
The difficulty of this calculation (the necessary number of zeroes at the beginning of the hash string) is corrected frequently, so that it takes on average approximately 10 minutes to process a block.
Why 10 minutes that's the amount of time that the bitcoin developers think is necessary for a continuous and diminishing flow of new coins until the highest number of 21 million has been attained (anticipated some time in 2140).