Remember those days when Bitcoin just came in to exist and when nobody understands what it is?, what is cryptocurrency?, what is Bitcoin mining? when crypto trading does not exist, only some internet dark world communities are using Bitcoins, on an initial stage when Bitcoin comes into existence also mining is needed for generating new Bitcoins.
So… What is Mining..?
Just as gold miners produce the world’s supply of gold, so do bitcoin miners produce all the digital currency available to the market – but, naturally, it is a bit more complicated than that. But simply crypto mining is done by using computers with software help, so… where bitcoins exist? How Miners get Bitcoins…? simply Bitcoins exist in the Blocks, those blocks are connected with each other, so miners using software to open block and take bitcoins. and also miners are verify transactions are made and record of those transactions in blocks.
Then Why Bitcoins are Hard to Mine…?
Only 21 million bitcoins exist in the world, out of which more than 16% has already been mined. so here in the blockchain one block can take 10 minutes to open, open the block miners need a key. Just imagine block as a room that is locked, and you want to open the door and you have a bunch of keys to open the door you must select a right key.
Here in a Mining, those keys are called as Hash and mining software work is trying to open block with a different hash, so mining computers need energy to mine, and also here bitcoin supply is limited to 21 million and demand is increasing, and where demand is high and supply limited more miners are join to mine with more powerful computers.
The rate of block creation goes up as more and more miners join the network. At the same time, the difficulty level goes up to adjust itself, which in turn brings the rate of block creation down. also, bitcoin mining rewards are halved in every 4 years and currently the mining reward is 12.5 BTC for solving 1 block.
Bitcoin mining has literally grown from a group of enthusiasts into an industry-like venture. The money-making was initially easy but in the present day, only those with special and high-power machinery can extract Bitcoins profitably.