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Insteadthey went with Solution 2. The resulting currency, called bitcoin cash, increased the blocksize to 8 Mb in order to accelerate the verification procedure to allow a performance of around 2 million transactions every 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. But bitcoin isnt bodily, so why do we call it mining

Because its like gold mining in the bitcoins exist in the protocols design (like the gold exists underground), but they havent been brought out into the mild yet (just as the golden hasnt been dug up). 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 discuss 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 also 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 some nodes which it knows, who will relay the information to nodes that they know, etc.. That way it ends up getting around the whole network fairly quickly. .

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

(For fiction fans, 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.)

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How can they find this number By guessing at random. The hash function which makes it impossible to predict exactly what the output will be. So, miners suppose the puzzle number and use the hash function to the combination of the guessed number and 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 produce the desired result, or there might be none (in the event the miners keep trying, but with 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. The rest of the miners immediately cease work on that block and start trying to figure out the puzzle number for your next one. As a reward for the work, the victorious miner has some new bitcoin. .

At 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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Though its not nearly as cushy a bargain as it view sounds. There are a lot of mining nodes competing for this reward, and it's 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 due to 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 do), but also due to the large amounts of power that running these chips consumes. .

And, the number of bitcoins awarded as a reward for solving the mystery will decrease. Its 12.5 now, however, it halves every four years or so (the next one is anticipated in 2020-21). The worth of bitcoin relative to price of power and hardware could go up over the next few decades to partly compensate this reduction, but its not certain. .

The problem of this calculation (the necessary number of zeroes at the beginning of the hash string) is adjusted frequently, so that it takes on average about 10 minutes to process a block.

Why 10 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 reached (anticipated some time in 2140).