Despite being labeled as a product with high risk and volatility, Bitcoin has proven its superiority in the market of decentralized digital currencies. Bitcoin blockchain platforms are the flag bearer of the crypto world and have the potential to rule the world of virtual currencies in the next couple of decades.
Bitcoin has helped millions of individuals and organizations to multiply their investments by many folds. A significant gain in its value over the last decade has made it one of the most popular assets to invest in.
Even though Bitcoin mining is a complex and expensive process it is an indispensable part of Bitcoin’s blockchain network. However, as an investor, you must be familiar with this complex and expensive process and you do not have to be an expert for this.
Let us make it simple for you. Here, we will talk about a few important things about Bitcoin mining including how it works and how many Bitcoins can be mined in a day. Read on to learn more in detail!
Importance of Bitcoin Mining That Everyone Should Be Aware of
The system of digital currency features some complex cryptographic technologies and problems in this system can emerge at any time. Bitcoin miners work hard to record and certify transactions. In the world of digital technology, it is quite easy to copy a computer file. The ease of copying can encourage scammers to flood the market with counterfeit digital currencies.
A network and a protocol are designed further to check recognized crypto transactions against the blockchain. If miners do not record and recognize Bitcoin transactions by solving complex cryptographic problems, scammers will be able to reuse the already used Bitcoins, which is known as double-spending. Through the process of mining, miners confirm transfers to the blockchain and prevent bad actors from double-spending.
How Does Mining Work? A Complete Beginner’s Guide
To record and authenticate transactions, miners work hard to fix complicated math problems using expensive computer hardware and a significant amount of energy. During the process of mining, miners around the world compete to be the first ones to solve a problem.
To solve complex problems, miners try to guess the correct number or hash. To deliver the correct hash, miners continue to guess the number randomly. During the process of answering, they need to guess the possible numbers as quickly as possible. The task requires continuous effort and powerful computer systems. As more and more miners join the process the level of difficulties raises.
A miner earns 6.25 Bitcoin if he/she successfully includes a block to the network. It is a reward and the amount received will be cut in half every few years. In other words, once 210,000 blocks are added to the blockchain by the miners, the reward amount will be cut in half. As of April 2022, the value of 6.25 Bitcoin is nearly USD 250,000.
However, the profitability of Bitcoin mining depends on many factors. The requirement of expensive equipment and high electricity cost often makes it difficult for the miners to make profits out of mining.
How Many Bitcoins Can You Mine In A Day? A Look at the Numbers
To earn 6.25 Bitcoins as a reward, a miner requires mining just one block.It takes 10 minutes for a miner to mine one Bitcoin block, which is equivalent to 6.25 Bitcoins. However, it is not so easy to mine a Bitcoin block, as millions of miners around the world are working hard to win rewards. Miners sometimes form a mining pool to mine together and share profit based on the level of contribution.
So, if it takes around 10 minutes for a miner to include a Bitcoin block to the network, nearly 144 blocks can be mined a day. If a miner or a pool of miners can mine 144 blocks a day, a reward of 900 Bitcoins will be achieved.
To conclude, the task of Bitcoin mining may sound attractive, but in reality, it is complex and expensive. Market fluctuations and uncertainty over Bitcoin’s value often make the task of mining more difficult. However, Bitcoin remains the most valuable cryptocurrency in the world and you can invest in Bitcoin at any time using applications like quantum ai.