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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 2 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. 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 mild yet (like the golden hasnt 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 blocks 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 helps to keep bitcoin running by participating in the relay of information. Anyone can run a node, you just download the bitcoin applications (totally free ) and also leave a certain port open (the downside 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 they know, etc.. That way it ends up getting around the entire network pretty quickly. .

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 intricate mathematical mystery that is part 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 all the information in the cube and passed via a hash function, produces a result that's within a certain range.

(For trivia lovers, 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 predict what the output will be. So, miners guess the mystery number and apply the hash function to the combination of that 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 might be none (in which case 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 rest of the network. All the other miners immediately stop work on that block and begin trying to find out the mystery number for the 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 at time of writing will be worth nearly $200,000.

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

Also, the costs of being a mining node are considerable, not only due to the powerful hardware needed (in case you've got a faster processor than your competitors, you've got a better chance of finding the right 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 anticipated in 2020-21). The worth of bitcoin relative to price of power and hardware could extend up during the next few decades 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 takes on average approximately 10 minutes to process a block.

Why 10 check my source minutes that's the amount of time the bitcoin developers think is necessary for a steady and diminishing flow of new coins until the highest number of 21 million has been attained (expected some time in 2140).