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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 process to permit a performance of around 2 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 out of the ground. However, bitcoin isnt bodily, so why do we call it mining
Because its similar to gold mining in that the bitcoins exist in the protocols design (just as the gold is underground), but they havent been brought out into the light 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 perform so as a reward for creating cubes of validated transactions and including them in the blockchain.
Backtracking a little, lets talk about nodes. A node is a powerful computer which runs the bitcoin applications 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 also leave a certain port open (the downside is the fact that it consumes energy and storage space the network at time of writing takes up about 145GB).
One node will send information to some nodes which it knows, who will relay the information to nodes they know, etc.. This way it ends up getting around the whole network pretty fast. .
Some nodes are mining nodes (usually known as miners). These set outstanding transactions into cubes and add them to the blockchain. How do they do so by solving a complex mathematical puzzle that's part of the bitcoin app, and including the answer in the block. The puzzle that needs solving is to find a number that, when combined with all the data in the block and passed via a hash function, produces a result that's within a certain range.
How can they find this number By guessing at random. The hash function which makes it impossible to predict what the outcome will be. So, miners guess 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 has to start 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 using a different block configuration). .
The first miner to acquire a resulting hash within the desirable range announces its victory to the remainder of the network. The rest of the miners immediately stop work on that block and start trying to find out the puzzle number for the next one. As a reward for the 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 nearly $200,000.
Additionally, the costs of being a mining node are considerable, not only due to the powerful hardware needed (in case you have a faster processor than your opponents, 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 processors consumes. .
And, the number of all bitcoins awarded 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 difficulty of this calculation (the necessary number of zeroes at the beginning of the hash string) is adjusted frequently, so it requires on average approximately 10 minutes to process a block.
Why 10 minutes That is the amount of time that the bitcoin programmers think is necessary for a continuous and diminishing flow of new coins until the highest number of 21 million is reached (anticipated some time in 2140).