Mining of bitcoins is a type of process that is performed by high powered computers that are able to solve some of the complicated mathematical problems, these kinds of problems are so much complicated that they can’t be solved by one’s hands and are complex enough to tax even incredibly powerful computers as well.
Key points
- Bitcoin mining is a kind of process by which new bitcoins are created by solving a computational puzzle.
- This process is essential in order to maintain the ledger of all the transactions upon which bitcoins are based.
- Miners have now become very complicated over the last several years by utilizing complex machinery in order to speed up the mining operations.
Mining of bitcoin results in a two-fold. First is whenever the computers solve these complicated mathematical problems on the bitcoin network, then they are able to produce the new bitcoins. Second is by solving the computational mathematical problems, bitcoin miners are able to make the bitcoin payment network trustworthy as well as secure by verifying all of its transaction information.
When someone is willing to send their bitcoins anywhere then it is known as a transaction. transactions that are made either in-store or online are documented by the banks, point of sale systems as well as physical receipts. Bitcoin miners are able to achieve a similar thing by clumping transactions all together in the ‘blocks’ and then adding them to public records which are known as the ‘blockchain’. Nodes then maintain all the records of those blocks in order to verify them in the future. At the time, when the bitcoin miners add a new block of transactions to the blockchain then a part of their job is to make sure that all of those transactions are accurate and up to the mark.
