In today's money system, paper money can be printed and produced by governments as needed, but production at Bitcoin does not happen that way. Bitcoin is produced under the concept of "mining" by computing power and hardware.

How is Bitcoin Mining done?

Bitcoins are sent by people to a permanent person with money transfers or payments. But if all these payments and transfers were not recorded in a certain way, no transaction could be followed about who paid what. The Bitcoin network takes a list of all the operations that have occurred within a certain time period, and gives a list of "blocks" to this list. The job of the Bitcoin miners is to approve these operations with the power they have created and keep them in registry with "block" names.

What does "hash" mean?

The list of blocks created by the Bitcoin miners and made up of all the records is called the "block chain". It can be seen from the Bitchino address on the block chain how much processing has been done. When a new block created at a periodic time (about 10 minutes time slot) is added to the blockchain, A very long list of operations that take place on the Bitcoin network is created. A copy of this list added to the block chain is distributed to everyone on the Bitcoin network, ensuring that everyone is notified of the transaction.

But this accounting book, called the block chain, must be reliable and should not be falsified by any power. At this point, miners enter the block to ensure the reliability of the chain.

When a new block of transactions is created, the miners will process the information in this block. A summary of the mathematical formulas applied on this information is generated by the digits of the long list of transactions in the block. This is called "hash". These abstracts, called hashes, are added to the end of the block chain with the newly added block. The summaries ensure that the transactions in progress are minimized without loss of information in the long list.

One interesting feature of these summaries, called hashs, is that although it is simple to summarize a pool of data, such as Bitcoin blocks, it is practically impossible to look at the actual data from this summary. Although hashing from the data in the bitcoin blocks is a simple process, each "hash" produced is unique. If you change any character from this Bitcoin block, the whole summary will change.

Miners do not take advantage of processes that only take the blinking to create "hash". The other data miners use in addition to the operations on the block are the "hashes" added to the end of the blocks.

Because each block hash is generated using the summary of the previous block. Each block in this list contains information from the previous block, which means that the newly added block is associated with the previous block. If someone wants to change the operations in these blocks, everyone will know about it through the system.

If someone wants to perform a fake operation by changing a block in the block chain, this causes the summary of that block to change as well. Since each block contains information from the previous block, this change affects the entire chain. One who takes a look at the chain of blocks, anda, the fake block is identified when he notices this change.

Competition for Coin

Until now, we have learned how miners build blocks. The miners compete with each other to create these blocks, using software developed for this job. When someone finishes the process of extracting a block, it is rewarded with a 25 Bitcoin prize. The block chain is updated and all network users are notified.

It is a system for rewarding, promoting miners and for the realization of transactions.

We mentioned earlier that it is a simple process to summarize the operations on the block. Computers are doing really well in this regard. But if the digestion process was consistently the same, all Bitcoins were produced in a short time. So Bitcoin network has to make it difficult. Bitcoin protocol implements this enforcement process with a system called "proof of work".

The Bitcoin protocol requires a precise view of the generated abstracts, so there must be a certain number of zeros at the beginning of the abstracts. There is no way to predict how these summaries will look. How these summaries look is only understood when they are produced, and the whole summary changes with new data.

The miners constantly produce new summaries to produce the summary in the appropriate form and use a number called "nonce". For each inappropriate summary, the nonce value also changes. Here the miners compete with each other by performing these operations to have the Bitcoin award.