Mining (English: Mining) refers to obtaining cryptocurrency, such as Bitcoin, Ethereum, Litecoin, etc., by executing proof of work or other similar computer algorithms. Since the name comes from a metaphor for mining, people who do the work of mining are often called miners.

Miners manage the Bitcoin network by solving the problem of a proof-of-work mechanism with a certain amount of work - confirming transactions and preventing double spending.

Satoshi Nakamoto compared generating Bitcoin by consuming CPU power and time to a gold mine consuming resources to inject gold into the economy. Bitcoin's mining and node software mainly initiates zero-knowledge proof and verification transactions through peer-to-peer networks, digital signatures, and interactive proof systems.

Each network node broadcasts transactions to the network. After these broadcast transactions are verified by miners (computers on the network), miners can use their own proof of work results to express confirmation. After confirmation, Transactions will be packaged into data blocks, and the data blocks will be strung together to form a continuous chain of data blocks.

Satoshi Nakamoto himself designed the first version of the Bitcoin mining program, which was later developed into the widely used first-generation mining software Bitcoin. This generation of software ran from 2009 to 2010. It is more popular in the middle of the year.

Each Bitcoin node will collect all unconfirmed transactions and aggregate them into a data block. The miner node will append a random adjustment number and calculate the SHA-256 of the previous data block. Hash operation value. The mining node keeps trying again and again until it finds a random tweak that produces a hash value below a certain target.

Since the hash operation is irreversible, it is very difficult to find a random adjustment number that meets the requirements, and requires a continuous trial and error process that can predict the total number of times. At this time, the workload proof mechanism comes into play.

When a node finds a solution that meets the requirements, it can broadcast its results to the entire network. Other nodes can receive this newly solved data block and check whether it complies with the rules. If other nodes discover that it is true by calculating the hash value

Benefits

The issuance of Bitcoin and the completion of transactions are achieved through mining, which occurs at a deterministic but constantly slowing down rate. The rate at which it is minted. Each new block is accompanied by a certain number of brand new Bitcoins created from scratch, which are rewarded as coinbase transactions to the miners who found the block.

The reward for each block is not fixed. Every time 210,000 blocks are mined, it takes about 4 years and the currency issuance rate is reduced by 50%. During Bitcoin’s first four years, 50 new Bitcoins were created per block. 12.5 new Bitcoins are created every block. In addition to the block reward, miners also receive fees for all transactions within the block.