Bitcoin - Bitcoin mining



What is Bitcoin mining?

 Bitcoin is one big global ledger system that records transactions from one person to another. Someone has to make sure that all the transactions are recorded properly and that the ledgers on all the systems are synchronized all over the world. For bitcoin, this process is not done by the 'someone' or any people but by thousands of computers all over the world that are all connected to the internet. These computers are known as the 'miners' - the computer that process transactions.

To do this processing in a very secure way, these computers need to perform very complicated calculations that take a lot of computing power, and in turn, require a lot of energy and expensive and specialized processing equipment. Other than that, someone has to pay all this equipment and electricity for all the processing. Remember, people that are professional on this is very needed too.

Another way to look at it is to consider what would happen if a large bank built the world's biggest global transaction processing system: they would spend a few billion dollar on it and then charge everyone transaction fees to recoup this cost. With bitcoin mining, the cost this global system has just been spread over thousands of computer, and they recoup their cost through newly minted Bitcoin. In short, it's simply a democratisation of financial infrastructure.


More reference:
https://www.weusecoins.com/en/mining-guide/

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