$46k Spent on Bitcoin Mining Hardware: The Final Reckoning

Best Bitcoin Miner for the money

Bitcoin Mining / October 12, 2020

Bitcoin is all the rage right now. It seems you can’t go a day without seeing a Bitcoin article splashed all over the tech press—and, increasingly, the national papers. And that’s not a surprise as Bitcoin seems to be the first digital currency that may stick around, and perhaps even have the power to usurp traditional paper money. But just what is Bitcoin, how do you get some, and can you manage it on your Android? Read on.

What is Bitcoin?

Every Bitcoin created has a cryptographically generated 64-digit address. Each Bitcoin also has a public key and a private key that unlocks its cryptographically generated addresses. Bitcoin addresses are collectively known as a “wallet” and hold all your Bitcoins. In order to spend your Bitcoins their address must be verified using the public and private keys by a series of decentralized servers (laptops, desktops, dedicated servers, and, increasingly, smartphones) all over the planet.

Because of the advanced cryptography, the verification of these Bitcoin wallets by decentralized servers (known as mining) is a very processor-intensive and time-consuming task. But it also adds a layer of security and confidence in this digital currency. Bitcoin servers are connected via peer-to-peer networks, much like torrent networks, so no centralized server exists.

What is a Bitcoin worth and where can I spend them?

Right now, Bitcoin will make you rich—if you got in early. Back in 2009 a man bought 5, 000 Bitcoins for £15 and forgot he had them until news of the currency started exploding earlier this year. He ended up selling those 5000 Bitcoins a few months ago for £430, 000.

Yeah, I want a time machine too.

Bitcoin has been on a wild ride this year. The price exploded to £124 a Bitcoin on some markets in October. At the time everyone thought that was huge. But by November Bitcoin soared to £559.

But Bitcoin prices fluctuate wildly, and if you buy them on an exchange and get in at the wrong time, you can lose a ton of money. However, many now believe the value of Bitcoins can soar ten to a hundred times their current price.

At first you could only spend Bitcoins on random websites—or on the “dark web” where you can buy all kinds of illegal things. But as Bitcoin has risen in prominence, now major websites like Reddit, WordPress, Baidu and several retailers are taking the currency.

How do people get Bitcoins?

You can buy them, or you can mine them. Mining will get your free Bitcoins as rewards for using your hardware to calculate the complex mathematical problem resulting in a 64-digit answer that is required to verify a Bitcoin is legitimate. For every algorithm you solve you are awarded a block of 50 Bitcoins.

But there’s a catch, the difficulty of mining (ie: the algorithms that need solving) are automatically adjusted to make them more or less difficult so that only 50 new Bitcoins are created every ten minutes. This means that the more people that try to mine, the harder it is to get Bitcoins (in other words, more processing power is needed to crack advanced math problems). This helps keep the currency valuable.

Generating Bitcoins is called “mining” because, like mining precious metals in the earth, there is only a set number of Bitcoins that can ever be created—21 million. Right now about 11 million Bitcoins exist, which means only another 10 million can be mined. But if you get even a handful of those ten million, with prices as they are now, you can make enough of it to live on for years…or even the rest of your life.

If you do want to skip mining and just buy Bitcoins, you can do so on one of the many Bitcoin exchanges where you can use physical currency to purchase someone else’s Bitcoins. The biggest Bitcoin currency exchange is Mt. Gox.

Source: www.knowyourmobile.com