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Insteadthey went with Solution 2. The resulting currency, called bitcoin cash, increased the blocksize to 8 Mb in order to accelerate the verification process to allow a performance of around 2 million transactions per day. At the time of writing, Bitcoin Cash is valued at $545.00 to Bitcoins $6,328.11.
When you hear bitcoin mining, you envisage coins being dug from the ground. But bitcoin isnt bodily, so why do we call it mining
Because its like gold mining in the bitcoins exist in the protocols design (just as the gold is underground), but they havent been brought out into the light yet (just as the gold hasnt been dug up). The bitcoin protocol stipulates that 21 million bitcoins will exist at some point.
They get to do this as a reward for creating cubes of validated transactions and including them in the blockchain.
Backtracking a bit, lets discuss nodes. A node is a powerful computer that runs the bitcoin software and assists to keep bitcoin running by participating in the relay of information. Anyone can run a node, you just download the bitcoin applications (free) and also leave a certain port open (the drawback is that it consumes energy and storage space the network at time of writing carries up about 145GB).
One node will send information to some nodes that it knows, who will relay the information to nodes that they know, etc.. This way it ends up getting around the entire network fairly quickly. .
Some nodes are mining nodes (usually known as miners). These set outstanding transactions into blocks and add them into the blockchain. How do they do this By solving a complex mathematical puzzle that is part of the bitcoin program, and including the answer in the cube. The mystery that needs solving is to find a number that, when combined with the information in the block and passed via a hash function, creates a result that's within a certain view website range.
(For trivia lovers, this number is known as a nonce, which can be a concatenation of number used once. In the instance of bitcoin, the nonce is an integer between 0 and 4,294,967,296.)
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How do they find this number By guessing at random. The hash function which makes it impossible to forecast exactly what the outcome will be. So, miners suppose the puzzle number and apply the hash function to the combination of that guessed number and the data in the cube. The resulting hash has to begin with a pre-established number of zeroes.
Whats more, there may be several nonces that make the desired result, or there might be none (in which case the miners keep trying, but using a different block configuration). . the original source
The first miner to acquire a resulting hash within the desired range announces its victory to the remainder of the network. All the other miners immediately stop work on that block and start trying to find out the puzzle number for the next one. As a reward for the own work, the victorious miner has some new bitcoin. .
At the time of writing, the payoff is 12.5 bitcoins, which in time of writing will be worth almost $200,000.
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Although its not nearly as cushy a bargain as it sounds. There are a whole lot of mining nodes competing for that reward, and it is a question of luck and computing power (the further guessing calculations you can perform, the luckier you're ).
And, the number of all bitcoins awarded as a reward for solving the mystery will decrease. Its 12.5 now, however, it pits each four years or so (the next one is anticipated in 2020-21). The worth of bitcoin relative to cost of power and hardware could extend up over the next few years to partially compensate this reduction, but its not certain. .
The problem of this calculation (the required number of zeroes at the beginning of the hash string) is adjusted frequently, so that it takes on average about 10 minutes to process a block.
Why 10 minutes that's the amount of time that the bitcoin developers think is necessary to get a steady and diminishing flow of new coins until the highest number of 21 million has been reached (expected some time in 2140).