How Bitcoin Mining Works


When it comes to fiat currency, the government just prints their own money. Bitcoin however does not work the same way. Instead a group of people running machines called miners find blocks that reward them with bitcoins. Every miner in the world is competing against each other.

What Are Bitcoin Miners Exactly Doing?

Bitcoin transactions are being sent over the network every second, but unless there is a record of all these transactions, there would be no proof of them. The bitcoin network shows proof by collecting all of the transactions made during a set period into a list, called a block. It’s the bitcoin miners’ job to confirm those transactions, and write them into a general ledger.

Hashing out the blockchain

The general ledger of bitcoin is a huge list of blocks, known as the ‘blockchain’. It can be used to view any transaction on the bitcoin network between two wallet addresses. Every transaction gets put into a block that gets put into the blockchain and everyone participating in the bitcoin network gets a copy to prevent double spending.

How can we trust this general ledger and its held digitally? How do we know that the blockchain will not get destroyed or maliciously changed? Miners are the solution to these questions.

About author

No comments