Join over 94,000 students, learn all you need to know about Bitcoin. One Email a Day, 7 Days in a Row. One of the most unique aspects of Bitcoin is that you can generate it through the process of mining, which is fastest bitcoin mining rig usb anyone with a computer can do. This is unlike fiat currency which can only be printed by the government.
This makes Bitcoin somewhat similar to gold and other precious metals, since they can only be mined, not printed on demand. Bitcoin mining is far different than extracting resources out of the Earth however. Mining is important because it confirms transactions and secures the blockchain. Without mining Bitcoin transactions would never be confirmed and Bitcoin would become unusable.
The blockchain is a list of all the transactions in Bitcoin’s history, and it is composed of blocks which are groups of transactions from around the same time. When mining your computer turns all of the data from the most recent block of transactions into a hash, which is far shorter than the original transaction data and is comprised of a complex series of letters and numbers. It would be relatively easy to solve Bitcoin hashes if turning a list of transactions into a hash was the only requirement, but Bitcoin protocol makes this more difficult through requiring a string of zeroes in the hash. Everytime the computer gets a wrongly formatted hash the nonce variable is changed and the computer tries again. In general it takes billions of iterations in order to find the correct Bitcoin block hash. Changing even 1 letter in the transaction data leads to a completely different hash, so as more transactions are added to a block the correct hash is constantly changing.