One of the miners of bitcoin, Marco Streng is based in his home in the southwestern part of Iceland. He has thousands and thousands of computers that are in operation 24 hours every day in order to stay ahead of the mining competition considering there are millions of other miners scattered all over the globe.
When it comes to bitcoin currency, the central bank does not have the authority to add more money into the circulation but instead computers that are in operation inside the bitcoin network are being given incentives in the form of bitcoins whenever they have processed a certain block that contains bitcoin transactions.
Users with bitcoins can then send money anywhere in the globe with the use of individual bitcoin addresses. The process has no sending fee and there will be no third party required to check the transaction. With the popularity of bitcoin, it is now accepted by many huge online businesses.
In case of the computers used by Streng, they are installed to perform two different tasks – to make sure that the 225,000 bitcoin transactions everyday are legit and then record them in a ledger. Since they are doing this every day, they are earning as well which adds more bitcoins in circulation. There are now $10 billion worth of bitcoins all over the world.
The process has become popularly known as mining since it is not only very slow but intensive at the same time. With mining, the miners are getting incentives in the same way that actual miners find gems and gold.
Last Saturday, the usual incentive that the miners get is cut into half. This is because of the existing code in the bitcoin protocol created last 2008 that the prize should be cut into half once in every four years. This is done in order to make sure that the digital currency is not affected by inflation.
Since Saturday, the usual 25 bitcoins that are earned for every 10 minutes all over the world is now made to be 12.5. Mining guide to bitcoins are important for everyone because this change will ensure that only the mining pools that have the highest computing power will be able to profit for the meantime.