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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 process to permit a performance of around two million transactions per 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 bodily, 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 exists underground), but they havent been introduced into the light yet (like the golden hasnt 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 blocks of validated transactions and including them in the blockchain.

Backtracking a bit, lets discuss nodes. A node is a powerful computer that runs the bitcoin software and helps keep bitcoin running by participating in the relay of information. Anyone can run a node, you simply download the bitcoin applications (totally free ) and leave a certain port open (the downside is that it consumes energy and storage space the network at time of writing takes up about 145GB).

One node will send information to a few nodes that it knows, who will relay the information to nodes 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 set outstanding transactions into cubes and add them into the blockchain. How do they do this By solving a complex mathematical mystery that is a portion 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 block and look here passed via a hash function, creates a result that is within a certain range.

(For fiction fans, this number is called a nonce, which is a concatenation of number employed 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 which makes it impossible to forecast what the output will be. So, miners suppose the mystery number and use the hash function to the combination of the guessed number and also the information in the block. The resulting hash must begin with a pre-established number of zeroes.

Whats more, there may be several nonces that make the intended 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 desired range announces its success to the rest of the network. The rest of the miners immediately stop work on that block and begin trying to figure out the puzzle number for your next one. As a reward for its own work, the victorious miner gets some new bitcoin. .

In the time of writing, the payoff is 12.5 bitcoins, which in time of writing will be worth almost $200,000.

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Although its not nearly as cushy a bargain as it sounds. There are a 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're ).

Additionally, the expenses of being a mining node are considerable, not only because of the powerful hardware needed (if you have a faster processor than your competitors, you've got a better chance of finding the correct number before they do), but also because of the large amounts of power that running these chips consumes. .

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

The problem of this calculation (the required 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 to get a continuous and diminishing flow of new coins until the maximum number of 21 million has been reached (expected some time in 2140).