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Insteadthey 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 about bitcoin mining, you envisage coins being dug out of the ground. However, bitcoin isnt physical, so why do we call it mining
Since its like gold mining in that the bitcoins exist in the protocols design (just as the gold is underground), but they havent been introduced into the mild yet (like the golden hasnt yet been awakened ). The bitcoin protocol stipulates that 21 million bitcoins will exist at some point.
They get to perform so as a reward for creating cubes of confirmed transactions and including them in the blockchain.
Backtracking a little, lets discuss nodes. A node is a powerful computer that runs the bitcoin software and assists keep bitcoin running by participating in the relay of information. Anyone can run a node, you simply download the bitcoin applications (totally free ) and also 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, who will relay the information to nodes that they know, etc.. That way it ends up getting around the whole network fairly fast. .
Some nodes are mining nodes (usually known as miners). These set outstanding transactions into blocks and add them to the blockchain. How do they do this By solving a complex mathematical puzzle that's part of this bitcoin app, and including the answer in the block. The puzzle that needs solving is to find a number that, when combined with all the data in the cube and passed via a hash function, produces a result that's within a certain range.
How can they find this number By guessing at random. The hash function makes it impossible to forecast exactly what the output will be. So, miners guess the mystery number and use the hash function to the combination of the guessed number and the data in the cube. The resulting hash must 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 which case the miners keep trying, but using a different block configuration). .
The first miner to acquire a resulting hash within the desirable range announces its success to the remainder of the network. All the other miners immediately stop work on that block and start trying to figure out the mystery number for the next one. As a reward for the own work, the victorious miner has some new bitcoin. .
At the time of writing, the reward is 12.5 bitcoins, which at time of writing is worth almost $200,000.
Additionally, the costs of being a mining node are considerable, not only because of the effective hardware needed (if you have 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 processors consumes. .
And, the number of bitcoins given as a reward for solving the puzzle will decrease. Its 12.5 now, but it pits each four years or so (the next one is anticipated in 2020-21). The worth of bitcoin relative to cost of power and hardware could go up during the next few years to partly compensate this reduction, but its not certain. .
The problem of the calculation (the required number of zeroes at the beginning of the hash string) is adjusted frequently, so that 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 for a steady and diminishing flow of new coins until the highest number navigate to this site of 21 million is attained (expected some time in 2140).