Bitcoin

5 Things You Should Know About Bitcoin Mining

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Bitcoin mining has proven to be one of the most profitable ventures of the 21st century. Regular people all around the world are earning Bitcoin after devoting their computers to Bitcoin mining. But what is Bitcoin mining, and can you mine Bitcoin?

1. Bitcoin Mining Consumes Lots of Electricity

Bitcoin mining requires powerful computers, and these computers use lots of electricity. If you become a Bitcoin miner, you can expect your power bill to double, at least.

2. Bitcoin Mining Requires Specialised Equipment

Bitcoin mining hardware devices are called “ASICs” (Application Specific Integrated Circuits). These specialised computers have one purpose: searching for the secret codes that secure the Bitcoin network. It takes significant investment to acquire enough ASIC hardware to be competitive in the Bitcoin mining world.

3. Bitcoin Mining Introduces New Bitcoins to the World

21 million Bitcoin exist, but some of these Bitcoin are “buried” in software code. Bitcoin miners’ computers expend energy searching for the codes that will add new “blocks” to the Bitcoin blockchain. For their trouble, the miner that finds the code is rewarded with newly mined Bitcoin. The current reward is 12.5 Bitcoin, today worth about 75,000 Euros!

4. China Has More Bitcoin Mining Power Than Any Other Country

China is home to major ASIC manufacturers. These companies often use their own hardware products to mine Bitcoin. There are entire warehouses full of nothing but Bitcoin mining hardware, working 24 hours per day. China keeps electricity prices low, which also favors Bitcoin miners.

Bitcoin mining USB devices in a row with small fans.
Bitcoin mining USB devices in a row with small fans.

5. Bitcoin Isn’t the Only Cryptocurrency That Uses Mining

Bitcoin’s mining system has proven to be highly secure and effective. This has led some other cryptocurrencies, like Ethereum and Elastos, to use similar mining systems. Most other mined cryptocurrencies require ASIC hardware different than the devices used for Bitcoin mining (Elastos being one notable exception). Other cryptocurrencies have other security systems, which don’t require the high electricity consumption of Bitcoin mining.

As you can see, Bitcoin mining is a powerful system used all around the world. Bitcoin miners can receive big paydays, but the startup and maintenance costs of this industry are expensive for the average person. This doesn’t mean you can’t be a Bitcoin miner; but you certainly must do your homework to succeed!

Featured image source: Flickr

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