Bitcoinbasis.be

BB4 - What is bitcoin "mining"?

Bitcoin mining is the process of recording transactions on the Bitcoin network
in the blockchain. This process requires specialized computers, also known as
ASICs or "miners," to solve complex mathematical problems in order to verify
and secure transactions.

It is a decentralized system where these miners compete to be the first to find
a correct solution per block. The miner who first solves the problem is
rewarded with a number of bitcoins that are distributed with each block during
the rollout phase, along with the transaction fees of the confirmed
transactions.

Mining Bitcoin requires a lot of computing power and consumes electricity that
is largely generated from renewable energy sources. The use of specialized
equipment and pooling resources in so-called "mining pools" are common
strategies to increase the chances of earning the reward.

Bitcoin mining is essential for securing and maintaining the Bitcoin network and
contributes to the broader development of blockchain technology. It also
provides an opportunity to address imperfections in this market through
colluding miners who balance each other and together take on the role of an
unyielding, apolitical central bank in a decentralized way.


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