Since its inception in 2008, Bitcoins have gained massive popularity owing to increasing value and limited availability. Over the years, the price of bitcoins has increased significantly, so understandably, people have become interested in other digital currencies. The term bitcoin mining has been quite popular in recent times. But, not many have a clear idea about it.
Below, we will help you get all your doubts cleared related to Bitcoin mining. Read on to know more in detail to have an overall better understanding!
Overview of Bitcoin Mining- A Brief Overview
Bitcoin mining is a process through which one can earn Bitcoins. In bitcoin mining, new transaction records are added to blockchain with utmost safety and security. Mining can be referred to as the record-keeping process that is executed using powerful computers. The Bitcoin miners need to solve complex mathematical puzzles in order to add new transactions to blockchain.
Who Are Bitcoin Miners?
All bitcoins miners are the users of bitcoins who successfully solve a mathematical puzzle. When they solve the puzzle, they are awarded bitcoins. When miners solve complex mathematical puzzles, they add new blocks to the public ledger of bitcoins, the blockchain. Thus, the payment network remains secure.
What has Blockchain to do with Bitcoin mining?
Cryptocurrencies are decentralized digital assets. To make them secure, cryptocurrencies are made using cryptography. The encryption for transmitting data between digital wallets and public ledgers ensures the security and safety of cryptocurrency transactions. Blockchains are public ledger that records all cryptocurrency transactions. Any transaction that gets added to the blockchain cannot be changed.
Why is Bitcoin Mining getting popular?
There are three ways to earn Bitcoins. You can purchase bitcoins on a cryptocurrency exchange, receive bitcoins in exchange for goods and services you offer, and mine bitcoins. When miners solve mathematical problems, they receive a certain amount of bitcoins in return. The current bitcoin reward is 6.25 coins for solving a puzzle or adding a block. The profit of bitcoin miners depends on the value of bitcoins. Many consider bitcoin as a good investment potential. So, bitcoin mining is getting popular.
What are the requirements for Bitcoin Mining?
Bitcoin miners need proper tools for bitcoin mining. The minimum requirements for bitcoin mining are-
A desktop or laptop with 7 GB disk space and 256 MB RAM. The operating system can be Windows 7/8x/10, Mac OSX, or Linux. The system should have data strength to download 150 M/day or 5 GB/month and upload 10 MB/day or 300 MB/month. The other requirements are mining software, a wallet, and a preferred mining pool(if the miner has chosen pool mining instead of solo mining).
How much time does Bitcoin mining take?
The anonymous creator of bitcoin, Satoshi Nakamoto, designed the bitcoin network in such a manner that the mining time for every block is 10 minutes. The difficulty level of the mathematical puzzle changes automatically to maintain this 10-minute time limit. The level of difficulty increases if more miners are trying to mine bitcoins.
What skills should the bitcoin miners possess?
For bitcoin mining, no specific educational qualification is needed. Thebitcoin miners should be skilled in computer hardware and software. Miners must apply their technical knowledge to improve the mining capacity of the system.
Are there other ways of getting bitcoins than bitcoin mining?
Yes, there are ways of getting bitcoins other than mining. You can earn bitcoins by purchasing them on bitcoin exchanges. You can also earn bitcoins if you accept them as a payment option for the goods and services you sell.
Can bitcoins be mined at home?
Bitcoin mining needs high-level hardware requirements, which consume a lot of electricity. If miners get a low-cost electricity supply, bitcoin mining may be possible at home. Bitcoin mining needs an uninterrupted data supply. Miners must have access to uninterrupted data supply to mine bitcoins. Hardware needed for bitcoin mining has high specifications, so they are expensive. People who can afford these expensive machines at home can mine bitcoins.
Conclusion
Bitcoin has become popular and widely accepted across the globe. Though many businesses have already accepted bitcoins as payment options, there are many countries where bitcoin trading is restricted or banned. Bitcoin mining can be profitable, provided people know how to do it. To know more about bitcoin mining, you can click here.
