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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 procedure to allow a performance of around two million transactions every day. At 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 physical, so why do we call it mining

Since 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 (like the golden hasnt yet been dug up). 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 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 just download the bitcoin software (free) and also leave a certain port open (the drawback is the fact 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 that it knows, who will relay the information to nodes that they know, etc.. This way it ends up getting around the entire network fairly fast. .

Some nodes are mining nodes (usually referred to as miners). These set outstanding transactions into cubes and add them into the blockchain. How do they do this By solving a intricate mathematical puzzle that's a portion of this 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 block and passed through a hash function, produces a result that's within a certain range.

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(For trivia lovers, this number is known as a nonce, which can be a concatenation of number employed 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 forecast exactly what the output will be. So, miners suppose the puzzle number and apply the hash function to the combination of that guessed number and also the information in the cube. The resulting hash must begin with a pre-established number of zeroes.

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

The first miner to acquire a resulting hash within the desired 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 find out the mystery number for the next one. As a reward for the own 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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Though its not nearly as cushy a deal as it sounds. There are a whole lot of mining nodes competing for that reward, and it's a question of fortune and computing power (the more guessing calculations you can perform, the luckier you are).

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

And, the number of bitcoins given as a reward for solving the mystery will decrease. Its 12.5 now, however, it halves every four decades or so why not look here (the next one is expected in 2020-21). The worth of bitcoin relative to price of power and hardware could extend up over the next few decades to partly 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 it takes on average about 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 maximum number of 21 million has been reached (expected some time in 2140).

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