What is a bitcoin mining and How it works?

 

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4. What is a bitcoin mining and How it works?

5. Transactions: When someone sends bitcoins to someone else, the transaction needs to be verified by the network. These transactions are collected into a group called a "block."

6. Hashing: Miners compete to solve a complex mathematical problem based on a cryptographic hash algorithm. This process is called "hashing." The first miner to solve the problem gets to add the next block of transactions to the blockchain and receives a reward in the form of newly minted bitcoins.

7. Proof of Work: The mathematical problem that miners solve is difficult to find but easy to verify. This concept, known as "proof of work," ensures that miners have to expend computational power to find the solution, making it costly to cheat the system.

8. Adding the Block: Once a miner finds the solution, they broadcast it to the network. Other nodes in the network then verify the solution, and if it's correct, the new block is added to the blockchain, and the miner is rewarded with bitcoins.

9. Reward: As of now, the reward for mining a block is 6.25 bitcoins, plus any transaction fees from the transactions included in the block.

10. Difficulty Adjustment: The difficulty of the mining problem is adjusted regularly to ensure that new blocks are added to the blockchain approximately every 10 minutes, regardless of the total computational power of the network.

1. Adding the Block

2. Block Verification: Miners receive a new block of transactions that need to be added to the blockchain. Before attempting to add it, miners verify that the block is valid, meaning it adheres to the consensus rules of the Bitcoin network.

3. Proof of Work: Miners then compete to solve a complex mathematical problem based on a cryptographic hash algorithm. This process is known as "proof of work." The first miner to solve the problem gets to add the new block to the blockchain.

4. Broadcasting the Solution: Once a miner finds a solution, they broadcast it to the rest of the network. This solution includes the new block and the proof of work.

5. Verification by Other Nodes: Other nodes in the network verify the solution provided by the winning miner. They check that the proof of work is valid and that the block adheres to the network's rules.

6. Adding to the Blockchain: If the majority of nodes agree that the new block is valid, it is added to the blockchain. The block is linked to the previous block, forming a chain of blocks that contains the entire history of transactions on the network.

7. Reward: The miner who successfully added the block to the blockchain is rewarded with newly minted bitcoins, as well as any transaction fees from the transactions included in the block.

Mining

1. Transaction Verification: Miners verify the validity of transactions by solving cryptographic puzzles. When a miner successfully solves a puzzle, it adds a new block of verified transactions to the blockchain.

2. New Bitcoin Creation: As a reward for their efforts, miners are rewarded with newly created bitcoins. This is how bitcoins are issued and put into circulation.