What is Bitcoin Mining?
Bitcoin operates as a peer to peer network which means everyone who uses Bitcoin is a part of Bitcoin Bank.
With Fiat money, central banks are deciding when to print and distribute the money.Bitcoin does not have a central authority to print and distribute Bitcoin. There are miners that use computing power to solve a mathematical problem. When a problem solved, a new block created in the blockchain. The miner that founds the block gets a certain number of BTC as a reward in exchange. This is called MINING.
Can miners create limitless of Bitcoin as they want?
Unlike the fiat currencies, BTC has 21 million supply. As a result, creating limitless of Bitcoin is impossible.
How Miners are deciding when to create Bitcoin?
The Bitcoin network automatically changes the difficulty of the math problems depending on how fast they are being solved.
In the early days, Bitcoin miners solved these math problems with their home computers (CPU).
Then miners discovered graphics cards (GPU) are better for mining as it has more computing power.
GPU’ s were faster but they use more electricity.
Finally, ASIC (application specific integrated circuit) technology developed.
An ASIC is a microchip designed for a special application. It is a special kind of transmission protocol or a hand-held computer.
ASIC technology has made Bitcoin mining even faster while using less power.
On the other hand, ASICs made CPU and GPU useless to mine Bitcoin.
As the popularity of Bitcoin increases, more miners join the network and so the difficulty of mining increased.
It became almost impossible for a CPU miner to find a new block.
What is a Miner Actually Doing?
There are three aspects of mining.
- Creating new bitcoins (new blocks)
- Confirming transactions
- Securing the network
What is Mining Pool?
As the difficulty of mining raised, miners developed a way to work together in pools. Each miner gets reward proportionately to the amount of work he or she provides.
So with low computing power, mining BTC still possible with mining pools.
You can check the Bitcoin mining pools from the link above.
How many blocks have been mined so far?
You can check Blockchain.info, will give you that information in real time.