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What Is Bitcoin – Part 4

· Bitcoin,Crypto Currency,BitClub Network

Now let us explain what Bitcoin Mining is all about. Everyone who uses Bitcoin becomes part of the bank of Bitcoin. Miners use special software to solve mathematical problems that verify all transactions and they, the Bitcoin Miners, are in turn rewarded with newly issued or generated Bitcoin, as remuneration for their computing power. As more miners come online the Bitcoin Network becomes more secure and the mathematical calculations become even more difficult. Bitcoin would not work without the Miners. What are the Bitcoin Mining Pools? It is nearly impossible for individuals to mine because the mathematical calculations involved are so difficult to solve that it takes massive computing power to make the associated calculations. The solution to this is to create mining pools. People can share in the profits by pooling their resources together and then splitting the Bitcoin that is mined for each respective pool. There are no limits or restrictions on how large a pool can grow or how a pool is created and set up.

So to summarise, Bitcoin Mining is as follows. Bitcoin operates as a peer to peer network. This means that every person or business that uses Bitcoin is a tiny fraction or part of the bank of Bitcoin. Nevertheless, where do Bitcoins come from? With paper money a country's government decides when and when not to print and distribute money. Bitcoin does not have a central government. With Bitcoin, miners use special software to solve mathematical problems and are then issued a certain number of Bitcoins in exchange for their clever work in making these mathematical calculations. This provides a smart way to issue the currency and it also creates an incentive for more people to mine Bitcoin. Since miners are required to approve Bitcoin transactions, more miners mean that it becomes a more secure network. The Bitcoin Network automatically changes the difficulty of the mathematical problems depending on how fast they are being solved. In the early days Bitcoin miners solved these mathematical problems using the processors in their own individual computers. Soon all the miners discovered that the graphics cards in their own private computers used for gaming were way more suited to this type of mathematical problem solving.

Graphics cards are faster. They need more electricity and generate a lot of heat. The first commercial Bitcoin mining products included chips that were reprogrammed for mining Bitcoin. These chips were faster but still power hungry. Application Specific Integrated Circuit chips (ASIC) are designed specifically for Bitcoin mining. ASIC technology has made Bitcoin mining even faster while using less power. As the popularity of Bitcoin increases more miners will join the network on a continuous basis. This will obviously make it more difficult for individual miners to solve the complicated mathematical problems. To overcome this, miners have created and built a way for all miners to come together and work together in pools, known as Mining Pools. Pools of miners find solutions to the mathematical problems faster than do individual members of the network. Each miner is rewarded in proportion to the amount of work he or she provides as a miner. Mining is an important and integral part of Bitcoin that ensures fairness while keeping the Bitcoin Network stable, safe and secure.

If you want to use Bitcoin and the BitClub Network as an investment please contact Clyde Thorburn on his website.

Read more about Bitcoin and The BitClub Network.

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