Bitcoin is a decentralized digital currency that relies on a distributed ledger technology called the blockchain to record and validate transactions. The blockchain is maintained by a network of users called miners, who use powerful computer hardware to perform a computational process called mining.
The mining process is designed to be difficult, so that it requires a significant amount of computational power to solve the mathematical problems that are used to validate transactions and add new blocks to the blockchain. Miners compete to be the first to solve the problem, and the miner who succeeds is rewarded with a certain number of newly minted Bitcoins, as well as any transaction fees that are associated with the transactions included in the block.
The process of mining involves the use of specialized software that connects the miner’s hardware to the Bitcoin network. The software receives a list of unverified transactions, which the miner then groups together into a block. The miner then uses their hardware to perform complex mathematical calculations in order to find a solution to a problem known as a “hash.”
A hash is a digital fingerprint of the block, and it is unique to the specific transactions and data included in the block. In order for a block to be added to the blockchain, the miner must find a solution to the hash that meets certain predetermined criteria. The criteria for a valid hash are based on the current difficulty level of the network, which is adjusted dynamically to ensure that the average time between new blocks is roughly 10 minutes.
Once a miner successfully solves the hash and adds a block to the blockchain, the block is broadcast to the rest of the network for verification. Other miners on the network then check the block to ensure that it is valid, and if it is, they add it to their copy of the blockchain. The miner who added the block is then rewarded with the block reward, which is currently 6.25 Bitcoins, and any transaction fees associated with the transactions included in the block.
In summary, Bitcoin proof of work miners are responsible for validating transactions on the Bitcoin network by using their computational power to solve complex mathematical problems. They compete to be the first to find a solution, and the miner who succeeds is rewarded with newly minted Bitcoins and transaction fees. The process also helps to secure the network by making it difficult for malicious actors to alter past transactions.