HOW BITCOIN IS CREATED ?

 Bitcoin serves as the backbone of the crypto economy, with 44% dominance of the total $2 trillion crypto market cap. But how are new Bitcoins actually created? Today, we’ll explore Bitcoin Mining.

Bitcoin is world's first crypto currency and it was launched as a decentralized digital currency, without a central authority or single administrator. It  was first unveiled in 2009 by an anonymous developer or group under the pseudonym Satoshi Nakamoto. The idea of a decentralized currency pop up during financial crisis of 2008–09, when the world was hit by a major recession and many countries plunged into major financial instability.

Due to a finite supply of 21 million BTC, it is becoming scare day by day, providing a predictable and fair monetary network for all participants

Today bitcoin is a well known crypto, and everyone wants to buy it. 

BUT HAVE YOU EVER WONDERED HOW NEW BITCOIN(BTC) IS CREATED? 

Well don't worry we are here to help you. This blog is going to explain how a bitcoin is created.So let's get started. 

New Bitcoins are created through a process called Bitcoin mining.

We aim to explain Bitcoin mining in today’s article in simple words.

Bitcoin Mining

New Bitcoins are created through a process called mining. Mining of BTC is done by advanced computers by solving encrypted mathematical equations at an incredibly rapid speed.

By solving these encrypted math puzzles, the miners on the Bitcoin network validate transactions on the open ledger, and new BTC is created in the process and paid out to the miners.

Today there are about 11,903 Bitcoin nodes, or computer points, operating the Bitcoin network worldwide, making it the world’s largest decentralized network and most powerful distributed supercomputer.

In contrast to traditional banking system where centralized ledgers were maintained by some people and they have the power to approve or disapprove any transaction, transactions on the Bitcoin network are approved by the entire network as a whole, in a process called Proof-Of-Work, also known as POW.

Today, specialized equipment such as Application-Specific Integrated Circuit (ASIC) machines are required to successfully mine BTC. Most miners today join a so-called mining pool, which is a group of BTC miners who combine their computing hash power and then split the mined Bitcoin rewarded to the pool.

Today mostly asic miners were used to mine btc. One of the best ASIC miner is the S9 having a massive 14 TH/s (TeraHash per second). Hashrates, explained later. 

# Quick Fact :- Excluding a 15 brief TH/s spike which occurred late 2011, a single S9 unit boasts a hashrate equivalent to the peak capacity of the entire Bitcoin network from its bootstrapping until mid-2012!

Mining rewards are paid at random to the miner who discovers a solution to a complex hash puzzle. The new rewards for Bitcoin mining are also reduced by half every four years, in a process called “halving”.

When Bitcoin was first mined in 2009, mining one block would have earned you 50 BTC. In 2012, this was cut down to 25 BTC. By 2016, this again came down to 12.5 BTC and currently, it is pegged at 6.25 BTC after the 2020 halving.

The halving process is also the basis of the popular Stock-to-Flow (S2F) model developed and coined by the anonymous Dutchman simply known as Plan B (@100trillionUSD), which emphasises the reduction in new Bitcoin being created through the halving process gives ground for BTC’s meteoric rise in value and price, both in the past as well as in the future.

 Now if you want to mine bitcoin, first check if mining is legal in your country or not. 

Bitcoin Hashrate

In simple terms, the hashrate is the measuring unit of the total processing and computer power of the Bitcoin network. That is, it is the speed at which any given mining machine, or a collection of miners, operates on the Bitcoin blockchain.

Higher the hashrate the more miners (or mining rigs) are active in the mining operations of Bitcoin, trying to solve the block and get the block rewards. Since a higher hashrate means that miners are increasing in numbers, the difficulty and competition to get the BTC block rewards grows as well.

Recently Bitcoin mining industry was being criticized to increase the consumption rate of fossil fuels,by increasing energy consumption to run miners, but reports indicate that more than 50% of all BTC miners actually use renewable energy sources to power their mining rigs.

This figure makes Bitcoin mining one of the most sustainable industries worldwide, and green energy is becoming a industry goal.

And today bitcoin mining became best stream of passive income. There are people out there who are full time miners, means they don't do any thing except mining cryptocurrency. 

From this statement power of crypto mining could be understood. 

That's all for now. Hope you guys can understand everything about cryptocurrency mining. 

Comment down if you are intrested in crypto mining or not. I will publish a full article of buying and seting up an ASIC miner.