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Why Bitcoin relies on digging (why Bitcoin is digging)

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Why Bitcoin relies on digging (why Bitcoin is digging)

Why Bitcoin Relys on Digging Editor’s Note: This article is from the vernacular blockchain (ID: hellobtc), authored by JackyLHH and reprinted by the Daily Planet with authorization Why does Bitcoin rely on digging? It has two basic concepts:

The first point is mining machinery manufacturers – Bitmain and Canaan Creative; The second reason is that the price of Cryptocurrency fluctuates violently. Without the participation of these companies or institutions, the price of Bitcoin would not exceed $10000 or even $20000; The third factor is whether the quantity of coins excavated is large. In the field we are going to discuss today, the most important thing is whether the coins dug up have value or not? This starts with digging out coins Firstly, let’s take a look at what mining is? How much computing power can be obtained by digging what? The Bitcoin network is composed of hardware maintained and operated by numerous miners, and the most important aspect is the cost of electricity, which is cheap and extremely low in energy consumption. Due to the high electricity prices and high equipment usage, most people are unable to purchase goods or services through electricity resources So for Bitcoin, there must be an issue of ‘inflation’. Because only when energy consumption is low will a new digital currency be generated, which is the so-called deflation problem. But currently, it seems that although many countries have adopted this technology, some governments have begun to implement regulatory measures on the industry, including countries such as the UK and Singapore, which are also continuously promoting the development of relevant laws and regulations Of course, this does not mean that all ordinary people know that the coins dug up are the same, that is, they believe that all the coins they hold will be mined and sold to others. For example, in the United States, it was announced in January that the University of California, Berkeley, would be established to provide new courses, while also planning to conduct research work with other places Another noteworthy point is that the mining giants in the United States are all vying to obtain more funds, especially those companies with a large number of machines. So mining is not only a process of making money, but also a way of asset allocation. Nowadays, many people view Bitcoin as a speculative tool or investment strategy. In fact, mining is also a form of trading for things like gold The reason why Bitcoin has such great appeal lies in its decentralized nature, and its consensus mechanism is also based on distributed ledgers generated by computer algorithms. Bitcoin has a history of over 1000 years since its birth, and behind it lies a large number of miners

Why is Bitcoin mining

According to LongHash, why is Bitcoin mining

Blockchain technology can help people better understand how to trade, store and manage Cryptocurrency. The value of Bitcoin mainly comes from its decentralized accounting method through hash algorithms, which is one of the most important functions in the “network” In computer systems, “network” refers to a network of running nodes, in which participants have a certain amount of computing power to complete a specific operation (i.e. block). Without the support of such computing resources, it would be impossible to create an effective digital asset. Due to the high technical complexity of blockchain, a large number of hardware devices are required to operate, and some people specifically designed for mining Bitcoin are also needed to handle this issue. So, what we are talking about today as’ network ‘(also known as protocol) is to address this need

First of all, we should understand what is “proof of work”, because it uses a Proof of work (PoW) called Proof Of Work, rather than a public chain similar to the POA consensus mechanism Bitcoin consists of two parts, the first part is called proof of equity (POS), and the second part is equity pledge (Stacking). In theory, anyone can become a validator or node operator to generate new blocks and receive rewards; The other part is composed of new tokens produced from mined blocks and new blocks When a new blockchain appears, its publisher can generate additional benefits from the old blockchain – such as native tokens that are moved down to make the blockchain safer and easier to use; At the same time, they can also be transferred to other blockchains.

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