{"headers":{"Content-Type":"application\/x-www-form-urlencoded"},"body":"source_lang=EN&target_lang=PL&tag_handling=xml&split_sentences=1&preserve_formatting=1&text=What+is+Bitcoin+mining%3F&text=Part+three+of+Bitcoin+Basics%3A+The+phenomenon+explained+in+plain+english%0A&text=In+part+two+of+our+bitcoin+basics+series%2C+we+outlined+%3Ca+href%3D%22https%3A%2F%2Fwww.coininsider.com%2Fhow-does-bitcoin-work%2F%22%3Ehow+bitcoin+works%3C%2Fa%3E%2C+be+sure+to+read+that+article+as+well+if+you+have+not+done+so+already.%0A%0A%3Chr+%2F%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EThere+are+two+immediate+ways+to+obtain+Bitcoins%3B+the+first+is+to+purchase+Bitcoins+%28or+a+fraction+of+a+Bitcoin%29+on+an+exchange%2C+while+the+second+is+to+accept+the+currency+as+tender+for+goods+or+services.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EThe+third+method%2C+called+%E2%80%9Cmining%E2%80%9D%2C+is+a+process+wherein+Bitcoins+are+created+and+enter+the+system.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EWhereas+excavators+drill+into+the+earth+and+retrieve+precious+metals+such+as+gold+and+silver%2C+Bitcoin+mining+sees+people+around+the+world+securing+the+Bitcoin+network+and+earning+bitcoin+as+a+reward+for+the+work+expended.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EAs+we%E2%80%99ve+covered+previously%2C+the+Blockchain+is+essentially+a+distributed%2C+open+ledger+present+on+Bitcoin+nodes+around+the+globe.+The+Blockchain+is+constituted+by+%E2%80%9Cblocks%E2%80%9D%2C+which+are+strings+of+numerous+transactions+linked+together+in+a+literal+%E2%80%98chain%E2%80%99.+%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EMiners+bear+the+responsibility+of+verifying+transactions+in+the+Blockchain.+This+is+done+by+applying+a+complex+mathematical+formula+to+information+present+in+each+block+that+generates+a+shorter+sequence+of+letters+that+is+referred+to+as+a+%E2%80%98hash%E2%80%99.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EA+hash+is%2C+in+essence%2C+a+seal+of+verification+that+is+applied+to+blocks+of+transactions+at+a+specific+time.+Represented+as+a+random+string+of+letters+and+numbers%2C+a+hash+is+composed+of+information+contained+within+the+block+as+well+as+the+hash+of+the+previous+block+in+the+chain.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EShould+one+element+of+the+block+be+tampered+with%2C+an+altogether+different+hash+would+be+produced+-+altering+not+only+the+block+itself%2C+but+any+subsequent+blocks+in+the+chain.+This+means+that+any+attempt+to+alter+the+blockchain+is+rendered+easily+visible+and+extremely+expensive+to+fake.+Like+a+fly+slowly+being+trapped+in+layers+of+amber%2C+each+new+block+that+gets+added+to+the+blockchain+makes+every+previous+block+harder+to+change.+%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EMiners+leverage+complex+computer+systems+with+special+software+to+verify+blocks+of+transactions.+By+creating+a+%E2%80%98correct%E2%80%99+hash+sequence%2C+each+block+becomes+sealed+off+and+the+miner+responsible+for+verifying+transactions+is+rewarded+with+an+allocation+of+Bitcoins.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EAt+the+time+of+writing%2C+miners+receive+12.5+Bitcoins+per+each+verified+block+as+a+bounty.+This+amount+diminishes+by+half+every+210%2C000+blocks.+The+fact+that+there+will+only+ever+be+21+million+Bitcoins+in+existence+ensures+their+value+over+time.+As+the+amount+of+bitcoin+created+in+each+block+decreases+over+time+the+dollar+value+of+each+bitcoin+goes+up.+%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EFurther%2C+the+difficulty+to+produce+a+correct+hash+is+also+increased+over+time%3B+specifically%2C+Bitcoin%E2%80%99s+difficulty+adjusts+every+2016+blocks%2C+and+is+designed+so+that+mining+one+block+should+take+around+ten+minutes.+This+ensures+that+users+cannot+hash+thousands+of+transaction+blocks+each+second+and+ensures+the+distribution+of+Bitcoins+into+the+world+over+a+longer+period+of+time.%3C%2Fspan%3E%0A%3Ch3%3E%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EIs+Bitcoin+mining+profitable%3F%3C%2Fspan%3E%3C%2Fh3%3E%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EIn+2017%2C+Bitcoin%E2%80%99s+price+surged+from+just+%24750+dollars+to+an+all-time+high+of+%2420%2C000+USD+-+meaning+that+investors+and+traders+have+had+great+opportunities+to+make+profits+by+holding+and+trading+the+cryptocurrency.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EWhile+most+people+might+%3Ca+href%3D%22https%3A%2F%2Fwww.coininsider.com%2Fbitcoin-trader-review%2F%22%3Epurchase+Bitcoins%3C%2Fa%3E+at+an+exchange+and+even+accept+them+as+tender+for+services+offered%2C+there+a+few+entrepreneurial+bitcoin+%E2%80%9Cprospectors%E2%80%9C%C2%9D+looking+to+mine+their+own+share.+However%2C+many+miners+will+find+that+they+spend+more+time+and+resources+attempting+to+stay+abreast+of+the+difficulty+to+mine+Bitcoin+rather+than+mining+Bitcoin+themselves.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EThe+essential+rule+of+Bitcoin+mining+dictates+that+the+more+one+mines%2C+the+more+complex+the+mining+process+becomes.+At+the+time+of+writing%2C+Bitcoin+has+proven+too+difficult+for+most+conventional+computer+systems+to+mine+and+thus+has+resulted+in+the+rise+of+dedicated+%E2%80%98Bitcoin+mining+rigs%E2%80%99.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3ESpecifically%2C+this+has+seen+miners+construct+or+purchase+computing+workstations+with+custom+computer+chips+specifically+designed+to+solve+the+Bitcoin+hashing+function.+These+custom+chips%2C+known+as+ASICs%2C+allow+miners+to+hash+more+efficiently+-+giving+them+a+competitive+advantage.+However%2C+the+process+of+procuring+these+systems+often+has+an+unintended+side-effect%2C+as+the+expense+of+powering+such+rigs+often+can+be+more+expensive+than+obtaining+such+equipment+in+the+first+place.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EStatistics+provided+by+%3C%2Fspan%3E%3Ca+href%3D%22http%3A%2F%2Fblockchain.info%2F%22%3E%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EBlockchain.info%3C%2Fspan%3E%3C%2Fa%3E%3Cspan+style%3D%22font-weight%3A+400%3B%22%3E+shows+that+bitcoin+miners+around+the+world+use+up+1+005.59+megawatt+hours+of+electricity+each+day+in+their+bid+to+produce+more+and+more+bitcoins.+This+means+that+the+industry+racks+up+over+%24150+000+in+electricity+costs+each+day.%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EHowever%2C+Bitcoin+mining+can+be+immensely+profitable+thanks+to+the+fact+that+bitcoins+themselves+are+provided+as+a+reward+for+successfully+participating+in+the+process%2C+and+as+the+value+of+bitcoin+increases+over+time%2C+one%E2%80%99s+profits+can+defray+one%E2%80%99s+expenses.+%3C%2Fspan%3E%0A%0A%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EAt+the+time+of+writing%2C+12.5+Bitcoins+are+provided+as+a+reward+for+verifying+blocks+of+transactions+on+the+Blockchain.+This+remains+an+alluring+prospect+for+miners%2C+and+has+even+resulted+in+the+emergence+of+large-scale+Bitcoin+mining+firms+which+procure+high-end+computer+systems+to+mine+Bitcoin+en+masse.%3C%2Fspan%3E%0A%0A%3Ci%3E%3Cspan+style%3D%22font-weight%3A+400%3B%22%3EIn+part+four+of+our+Bitcoin+Basics+series%2C+we%E2%80%99ll+be+exploring+the+likelihood+of+whether+%3Ca+href%3D%22https%3A%2F%2Fwww.coininsider.com%2Fwill-bitcoin-fail%2F%22%3EBitcoin+will+fail+in+the+future%3C%2Fa%3E.%3C%2Fspan%3E%3C%2Fi%3E","timeout":15}