What Is Bitcoin And Bitcoin Mining?

What and how creates Bitcoins

Mine-workers’ job is to protect Bitcoin and deal with all payments done by customers. Without mine-workers, the system would be too weak to protect itself and probably would always be under the risk of attack. Also, the coins would lose their value. Mine-workers get new coins from payments commissions. This is their reward for providing an excellent safeness and processing all services.

Blocks

Every single time when a mine-worker solves a special algorithm of Bitcoin’s work, it immediately gets a block. Mine-worker or a pool has to dig for a block. For every mined block a mine-worker also gets a reward – a certain number of coins regarding the network’s rules. All bitcoins that are paid as a reward are called new coins. This is how new coins come to the system and become used.

How many new coins will the system create

The rule for giving a reward when digging a block reached 50 bitcoins. This is what a mine-worker gets for a 210,000 block. When a mine-worker finds 210,001 block, the reward becomes only 25 bitcoins. According to the statistic, mine-workers find blocks every 10 minutes, therefore, the process of halving blocks happen every 4 years. However, if every new block is found every 10 minutes, it means that the reward becomes too low and the network cannot produce new Bitcoins.

Every single customer has an access to information about new bitcoins creating. There is a block explorer that can be reviewed by anyone.

Is it possible to make fake Bitcoins?

No. Bitcoin has a unique cryptography for making all transactions verified. Therefore, if the pattern or a writing on a coin does not match this cryptography, the bitcoins will not be recognized. Only those coins that were given to mine-workers as a reward can be used for next payments. As a result, no one can bring coins and add the to the organization. This will not allow people to use coins that they do not own. To create and use digital currency that does not belong to the network is impossible.

There could be some companies that will claim that they produce bitcoins. Still their currency would would be useful for their system only but not a true Bitcoin network. The system will spot fake coins by a different pattern and define them as invalid.