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Instead, they went with Solution 2. The resulting currency, known as bitcoin cash, increased the blocksize to 8 Mb in order to accelerate the verification process to allow 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 out of the ground. However, 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 brought out 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 this as a reward for creating blocks 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 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 takes up about 145GB).
One node will send information to a few nodes that it knows, who will relay the information to nodes that they know, etc.. That way it ends up getting around the whole network pretty quickly. .
Some nodes are mining nodes (usually known as miners). These group outstanding transactions into blocks and add them into the blockchain. How do they do this By solving a intricate mathematical puzzle that is 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 information in the block and passed through 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 makes it impossible to predict exactly what the outcome will be. So, miners suppose the puzzle number and use the hash function to the combination of the guessed number and the information in the block. The resulting hash must begin with a pre-established number of zeroes.
Whats more, there might be several nonces that produce the desired result, or there may 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 victory to the remainder of the network. All the other miners immediately stop work on that block and start trying to figure out the puzzle number for the next one. As a reward for the own work, the victorious miner has some new bitcoin. .
At the time of writing, the reward is 12.5 bitcoins, which at time of writing is worth almost $200,000.
Also, the expenses of being a mining node are considerable, not only because of the effective hardware needed (in case you've got a faster processor than your competitors, you have a better chance of finding the right number before they perform ), but also due to the large amounts of power that running these chips consumes. .
And, the number of bitcoins awarded as a reward for solving the mystery will decrease. Its 12.5 now, however, it pits each four years or so (the next one is anticipated in 2020-21). The worth of bitcoin relative to price of power and hardware could go up during the next few decades 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 adjusted frequently, so that it requires on average about 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 steady and diminishing flow of new coins until the highest number of 21 million is attained (anticipated some time in 2140).