All you need to know about bitcoin mining
If you’re a seasoned crypto investor, chances are you know a thing or two about bitcoin and blockchain. You’re likely aware of how a bitcoin exchange platform works, how to buy and sell different currencies, and the importance of a good, secure bitcoin wallet. One thing you may be unaware of, however, is what, and who, makes that process possible.
Bitcoin miners play an incredibly important role in ensuring the security of bitcoin transactions around the world. Even a company with a platform as secure as BitLeague’s needs bitcoin miners to ensure blockchain transactions are verified and legitimate. While the casual bitcoin investor probably only needs a base-level knowledge of how mining works, we think it’s important to shed some light on the entire process for our clients. To us, it’s just good business practice.
What exactly is bitcoin mining?
At its core, bitcoin mining is the process of bringing new bitcoins into circulation by verifying blocks of transactions. After transactions have been successfully verified by a miner, they receive a portion of BTC as a reward. Because traditional transaction blocks could be verified fairly easily and quickly by a computer, there are more complex steps required to ensure the likelihood of verifying a transaction and the BTC payout received is equally distributed amongst verifying parties. Of course, it’s important to note that verifying one transaction block is equivalent to verifying 1 MB of data, and simply verifying that amount only makes you eligible to receive a BTC payout.
One of the biggest things bitcoin mining protects against is “double spending.” Unlike physical fiat, bitcoin is digital, and, as such, can be difficult to track at times. Double spending is the act of using the same unique bitcoin transaction code to make more than one purchase. It’s akin to paying for something with a $20 bill, then taking the bill back and buying something else. By uniquely identifying and verifying transactions, miners prevent this practice.
Who can mine bitcoin?
Technically, anyone with the right equipment. However, it’s important to note that it takes quite a bit of computer power to mine BTC, and even in mining, there’s no guarantee that you’ll be rewarded with a payout. In order to receive a portion of a payout, you have to be the first miner to get the right answer to a numerical problem. This “answer” is found by putting out a series of “hashes” that is less than or equal to whatever the “target hash” may be. You’re essentially guessing trillions of times, and in order to do this, you need enough computational power to put out lots of hashes at once. It’s slow work, but can be quite rewarding if you actually guess the right number before everyone else. The payout rate was 12.5 BTC in 2019. Multiply that by the amount BTC was trading, and that’s a six figure payout.
How does this affect bitcoin investors?
Bitcoin mining is the glue that holds the blockchain together. At BitLeague, we’ve formed a number of relationships with miners and are constantly tweaking our formula to ensure we remain in lockstep with the policies and practices they have in place to keep the blockchain system running smoothly.
We believe that every part of the blockchain is important for efficiency, and we pride ourselves on staying on top of bitcoin mining advancements in order to pass off what we learn to our clients.
If you’re looking for a free bitcoin platform that guarantees BTC returns and truly puts its clients first, look no further than BitLeague. Sign up for an account in seconds!