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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 permit 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 from the ground. But bitcoin isnt bodily, so why do we call it mining

Since its similar to gold mining in the bitcoins exist in the protocols design (like the gold is underground), but they havent been brought out into the mild yet (like the golden hasnt been dug up). 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 discuss nodes. A node is a powerful computer which runs the bitcoin applications and assists keep bitcoin running by participating in the relay of information. Anyone can run a node, you just download the bitcoin software (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 which it knows, that will relay the information to nodes that they know, etc.. This way it ends up getting around the entire network pretty fast. .

Some nodes are mining nodes (usually referred to as miners). These group outstanding transactions into blocks and add them into the blockchain. How can they do this By solving a complex mathematical mystery that is part of this bitcoin app, and including the answer in the cube. The puzzle that needs solving is to find a number that, when combined with the data in the cube and passed through a hash function, produces a result that's within a certain range.

(For fiction fans, this number is called 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.)

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How can 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 use the hash function to the combination of the guessed number and also the data in the block. The resulting hash must begin with a pre-established number of zeroes.

Whats more, there might be several nonces that make the intended result, or there may be none (in the event the miners keep trying, but with a different block configuration). .

The first miner to get a resulting hash within the desirable 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 the work, the victorious miner gets some new bitcoin. .

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

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

Additionally, the costs of being a mining node are considerable, not only due to the powerful 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 because of the large amounts of electricity that running these chips consumes. .

And, the number of all bitcoins awarded as a reward for solving the mystery will decrease. Its 12.5 now, but it pits each four years or so (the next one is expected in 2020-21). The value of bitcoin relative to price of electricity and hardware could go up over the next few decades to partially compensate this reduction, but its not certain. .

The difficulty of the calculation (the necessary number of zeroes at the beginning of the hash string) is corrected frequently, so that it requires on average approximately 10 minutes to process a block.

Why 10 i loved this minutes that's the amount of time the bitcoin programmers think is necessary for a continuous and diminishing flow of new coins until the maximum number of 21 million has been attained (expected some time in 2140).