adminBITCOIN MINING
Bit coin mining is the process of verifying transactions on the bit coin network and adding them to the public ledger known as the block chain. Bit coins are created using specialized and well configured computer hardware and software.
However there are various bit coin hardware configurations and they are; CPU mining, GPU mining, ASIC mining and FPGA mining.
CPU (central processing unit) mining involves the use of the computer CPU for bit coin mining. CPUs are inherently designed such that they are suitable for rapidly switching between different task and also follow logic based instructions for algorithms execution via arithmetic logic units (ALUs). However, the hashing required for mining in a proof of work system requires a large amount of repetitive mathematical calculations that the CPU cannot cope with, given that they are more dedicated to rapid task switching and have fewer ALUs to carry out these repetitive tasks or calculations relative to other techniques based on other hardware implementations. Thus CPU mining tends to be more slower bit coin mining technique than the other methods.
GPU (graphic processing unit) mining uses the graphic processing unit of computer hardware for bit coin mining. GPUs are capable of carrying out repetitive tasks or calculations associated with bit coin mining. GPUs have more ALUs than CPUs do. As a result of this, GPUs can perform a higher number of repetitive tasks or calculations than CPUs with a higher efficiency and quantity.
ASIC (application specific integrated circuits) are micro-chips designed specifically for bit coin minning. They perform the hashing algorithm for proof of work mining as quickly as possible. To give an idea of the relative performance of ASIC in relation to CPUs is that ASICs are 100,000X faster than the best CPUs.
FPGA (field programmable array) mining uses integrated circuits that can be programmed to perform specific task. FPGAs offer the best of both worlds in terms of combining the power of ASICs with the flexibility of GPUs. They are sometimes used for mining but are less common than ASICs.
Bit coin mining software connects miners to the bit coin network and in addition manages the mining process. The bit coin mining software commonly used are; CG miner, Easy miner, multi miner and slush pool miner to name a few.
The advantages of bit coin mining cannot be over emphasized and includes; it secures the bit coin network, validates transactions, creates new bit coins, support decentralized finance, enables cross border payments and transactions and so on.
Their disadvantages are; high energy consumption, expensive hardware, high maintenance costs, volatility in rewards and centralization concerns.
Bit coin mining find applications in the following; cryptocurrency since bit coin mining provides the way to obtain the bit coin used for trading and investments. Bit coin mining can facilitate fast and secure remittances especially for cross border transactions. Bit coin mining can provide access to financial services for underserved communities and individuals.
The future of bit coin mining is based on the advances and development of the following technologies; increased adoption of the use of bit coin will enhance the demand of bit coin mining and the need for a more efficient and sustainable mining solutions. Renewable energy sources such as solar and wind power will gain traction as a viable energy solution for bit coin mining. Advances in mining technology such as more efficient ASICs and new mining algorithms will continue to shape the future of bit coin mining. Also the integration, decentralization and democratization, regulatory clarity by governments and institutional investors of bit coin will enhance bit coin mining operation at scale in the near future.
SOURCES:
- Bit coin : A peer to peer electronic cash system by Satoshi Nakamoto.
- The bit coin standard: The decentralized alternative to central banking by Saifedean Amnous.
- Inventing Bit coin : The technology behind the first decentralized crypto currency by Yan Pritzker.
- Bit coin mining: A comprehensive guide by Andreas Antonopoulos.
- Mining Bit coin : The ultimate guide by Bit coin miner.
