Bitcoin is one of the hot topics nowadays in the aspect of the global crypto coins market. It is being talked about almost everywhere, whether in the newspaper or on the internet. Though, questions about the various concepts are continuously arriving among interested people as it is quite a complex topic to understand. Bitcoin mining, a fascinating and one of the vital technologies that bitcoin adopted, is a topic that people are keen to learn about.
Not only is the topic interesting, but it is also a method to earn profit out of bitcoin. Although earning money through bitcoin mining is not as easy as it sounds but to take a start, you must know its basics as well. Here are some mostly asked questions about this technology to boost your knowledge about it.
- What exactly does bitcoin mining mean?
Bitcoin mining is the creation of bitcoins in its Blockchain network by a complex mathematical and computational process. The word mining came from gold mining, as gold is extracted from the earth; similarly, new bitcoin is being created in its Blockchain nodes.
The process of bitcoin mining has a different and vital significance too. In mining, the transactional data saved in the blocks of the bitcoin Blockchain are verified, and only after a successful verification do they get recorded permanently and the transaction completes. Therefore, mining bitcoin also assures complete safety and transparency of the network.
- What tools are required for bitcoin mining?
To start bitcoin mining, you have to invest in various strong tools. These are typical strong computers and hardware devices. In the early days, when mining, people used to do mining on regular CPUs, that is not sufficient for cryptocurrency mining and, therefore, was time-consuming. But, now accurate devices have been created, so mining becomes much easier. The tools you need are-
- Mining rigs or Competitive mining computers
- Mining software that you can get online
- Constant electricity with high power
- Uninterrupted internet service
- Mining pool membership in case you are willing to do pool mining
- How much time does it take?
Previously when miners used to mine in regular computers or CPUs that were not powerful enough for this type of high-energy driven tasks, mining one block needed much more time. With the help of high-end technology-driven powerful mining rigs, a block hardly needs 10 minutes to get verified. Therefore, it is the slandered time of mining bitcoin. However, as the network is being upgraded, it will hopefully be reduced more.
- What is the reward amount?
Bitcoin mining reward is constantly degrading in numbers as the total number of bitcoin that can exist is fixed per its protocol. The total number is 21 million, and only less than 2 million are left to be mined. When Nakamoto mined the first block (Genesis block, Block No. – 0) in 2009, the amount reward was 50 bitcoins. In 2012 the reward was 25 bitcoins. In 2016, it was 12.5. And in 2020, it was 6.25. So, it is getting halved after every 4 years.
- What is pool mining?
Pool mining is a convenient, less expensive, and more rewarding way of mining bitcoin. It is like a group of miners who invest in setting up the mining machinery. You can take part in a group by joining their membership. You have to make an initial investment. After mining, the reward amount will be distributed among the successful miners as per the ratio of how much computational power the individual miners put in.
- Is bitcoin mining better than bitcoin trading?
This is a thing that depends upon individuals. None of these two things are theoretical; they are totally practical. If you are willing to begin bitcoin mining, you must have the correct knowledge and setup and, off-course, need to practice. Similarly, or bitcoin trading having yourself registered with a genuine platform like bitcoinsup.org and continuous practice with adequate knowledge about the market is important.
Conclusion:
These are the frequently asked question on bitcoin mining. If you want to start mining, don’t miss the step to gather more knowledge about it first. Once you have understood the complete process of mining bitcoin, you are good to go to arrange a setup or take a pool membership.
