Mining is the process where transactions are verified and added to the bitcoin blockchain, which is a public ledger of all bitcoin transactions. Bitcoin miners are individuals or companies that run the bitcoin mining software which verifies transactions made with bitcoin. Bitcoin started off being mined on home computers and even laptops in the first few years after Satoshi Nakamoto published the Bitcoin Whitepaper. Bitcoin mining is now done on an industrial scale, with vast warehouses of specialised mining hardware being used to try and win the block rewards.
Miners are economically incentivised to mine blocks and verify transactions truthfully because successful miners are rewarded with the block reward – an amount of bitcoin, and the transaction fees paid by network participants.
In order to form a new block, miners must solve a very complex mathematical problem. The bitcoin mining difficulty level automatically adjusts the difficulty of the mathematical problems to ensure blocks are created roughly every ten minutes. Every few years there is an event called the bitcoin halvening, where the block reward is halved.
Once they have solved the problem and won the block, the miner broadcasts the list of transactions made in that ten-minute period and links the block back to the previous block in order to ensure continuity. Each block is linked back to the previous block using the block “hash”, which is created by combining various bits of data that are contained within the previous block.
If a miner tries to publish a new block whilst editing a previous block (say, to give themselves more bitcoin), it will be invalid and rejected by the other network participants. This is what makes the bitcoin blockchain immutable.
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