What is Bitcoin Mining?

Bitcoin mining is the computational process that underpins the bitcoin network, validates transactions and gives the system its security. It is also the process by which new coins are created. Consequently it is arguably the most important aspect of the bitcoin ecosystem. Without miners, bitcoin would not exist and could not continue to function.

Physical currencies are created by a process of mining a metal from the ground, refining it from its ore and creating coins from it. The value of the coins partly reflects the work that has to be done to make them (though fiat currencies are also attributed a degree of arbitrary value by the state that issues and guarantees them).

Bitcoins use an analogous process, but instead of physical work, their creation requires virtual work. Miners’ work entails carrying out mathematical functions called ‘hashes’.

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