What is Bitcoin mining and how it’s done

By: | Updated: March 10, 2018 10:25 AM

Bitcoin mining is a process by which crypto-transactions are verified and also added to the public ledger called Blockchain

Bitcoin price today plunged to further low in IndiaBitcoin mining involves compiling latest held transactions into blocks and solving a computationally cumbersome puzzle.

In the world of today, almost all have a fair amount of understanding about what Bitcoin phenomenon is all about. However, ‘Bitcoin mining’ is still to be understoood fully. Bitcoin mining is not only a process that helps the crypto-assets function as required, but also a technique that helps in launching news Bitcoins to digital wallets all across the world. So, what’s Bitcoin mining all about? In simple terms, the process followed by which crypto-transactions are verified and also added to the public ledger called Blockchain, in turn helping release if Bitcoins is called Bitcoin mining. Bitcoin mining involves compiling latest held transactions into blocks and solving a computationally cumbersome puzzle. You don’t need anything but a good internet connection and a computer  to carry on with Bitcoin mining.

Bitcoin Mining process

The participants in Bitcoin mining are required to solve the puzzle in order to place the next block on the blockchain and thereafter claim rewards for the same. One can easily receive a newly released Bitcoin (block reward) or a transaction fees related with the compiled transactions. For every 4 years or 210,000 blocks this block reward is halved. In 2009, the block reward was at 50 which has now diminished to 12.5, according to Investopedia. The difficulty of mining or solving puzzles keeps adjusting with time and in general for every 2016 blocks or nearly two weeks. In case of increased computational power, mining becomes harder and vice versa.

Bitcoin was trading at $9,332.20 on the CoinDesk price index at the time of reporting. Cryptocurrencies mainly bitcoins are under pressure after the Securities and Exchange Commission (SEC) recently released a statement hinting about regulation. SEC has said that all the cryptocurrency exchanges which offer virtual assets for trading to register with SEC. Post this announcement, a fear has gripped markets that the SEC may tighten the regulations on cryptocurrencies in the coming day. The prices of virtual currencies are dipping since then.

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