Wait, obviously that’s too hard to solve here. In addition, my entire aim is to keep things simple. Bitcoins are, anyway, made by solving complex math problems. This is achieved by a strong computer programmed to solve the math problems. That process is known as mining. People who own certain machines to make Bitcoins money mining are called miners. When solving a batch of problems it becomes known as a block. Many users validate blocks and they get added to what’s called the block chain until they’re checked. With a new block added to it approximately every 10 minutes this chain continues to expand. That chain is really just a master ledger that will keep growing and never ending. bitcoin mining store has some nice tips on this.
The very powerful machines which zap a lot of power and drive up the monthly utility bill for the miner. The explanation she takes so much strength is the talent involved in mathematics. To perform complex cryptographic algorithms, the mining machine needs that. Once the machine resolves a math problem a block of coins is born. Through time that 210,000 blocks were produced, the miner’s reward is halved. To do this takes 4 years. Yeah, it’s kind of like an Olympic Bitcoin. Currently the reward for the block is 12 Bitcoins (on June 23, 2020 the reward will be just 6 coins). Those coins go to the miner whose machine was then the lucky lottery winner. Each 10 minutes, there is a winner. There are also a lot of miners out there competing too. Said miner now has a value to it. My enough coins and you pay the bill for power, and then some.
Mine, too, has another path. It is called mining in the cloud. You are paying for using someone else’s network with this form of mining, and that dramatically cuts in your earnings. The positive thing about this method is that you don’t need to use your electricity, or even buy a machine.
Sounds really good for me. I would just like to start mining now. Is it a good idea, and can I regularly produce passive income? Possibly. For now hold on and you can call later.
Let’s try and break down this.
Returning to the original way of machine mining, you would have to start by buying a quality mining machine. It will bring you back about $2,000. Here’s a picture of a good machine (Bitmain’s Antminer S9) which can create a high hash rate of 14 TH / s. 1 TH / s represents 1,000,000,000,000 hashes per second. This machine does that 14 times. That is a lot of power to hash. A hash is just a really long number that the machine creates, trying to solve the algorithm every time. Again, all these machines are out there, to use my lottery analogy, hashing away hoping to be the next winner.
Then, with more competition, your chances of winning are becoming ever more difficult. Further complicating this matter is that the next problem gets incrementally harder to solve each time a math problem is solved. The difficulty of the Bitcoin network changes approximately every two weeks, or 2,016 blocks. The number of Bitcoins ever to be made is finite. It happens this number is 21,000,000. When we have passed the number another Bitcoin will never be mined again. The block chain itself will however continue to expand as it is used to verify every transaction or purchase.