MINING
Proof-of-work is called “mining” for a very good reason. Like with
physical mining, there is something that miners are searching for.
A typical gold mining operation processes 45 tons of dirt and rock
before accumulating 1 oz of gold. This is because gold is very rare.
However, once gold is found, it’s very easy to verify that the gold
is real. There are chemical tests, touchstones, and many other
ways to tell relatively cheaply whether the thing found is gold.
Similarly, proof-of-work is a number that provides a very rare
result. To find a proof-of-work, the miners on the Bitcoin network
have to churn through the numerical equivalent of dirt and rock.
Like with gold, verifying proof-of-work is much cheaper than
actually finding it.
SOURCE: Vijay Mukhi The Undocumented Internals of the Bitcoin, Ethereum and Blockchains
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What is Bitcoin Mining?
• Primary Method of Securing the Bitcoin
Network.
• Use of specialized computers(ASICs) to solve
a puzzle built into the protocol.
• Miners get rewarded for each block mined.
• Rewards consist of transaction fees generated
within the network.
• Involves costly “Work” that uses Electricity!
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WHERE MOST GET IT WRONG!
The purpose of mining is not the creation of new
bitcoin. That’s the incentive system!
Mining is the mechanism by which bitcoin’s
security is decentralized over a large network!
https://www.youtube.com/watch?v=kZXXDp0_R-w
Source: Mastering Bitcoin (Page 276)
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BITCOIN MINING ISSUANCE SCHEDULE
The maximum amount of newly
created bitcoin a miner can add to a
block decreases approximately every
four years (or precisely every 210,000
blocks). Based on this formula, bitcoin
mining rewards decrease
exponentially until approximately the
year 2140, when all bitcoin (21
million) will have been issued. After
2140, no new bitcoin will be issued.
Source Mastering Bitcoin (Page 277)
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CONSENSUS ALGORITHIMS
A consensus mechanism is a fancy way of describing
rules that everyone agrees on, in regards to who gets
to update the ledger. There are many types of
consensus mechanisms. For example:
Proof-of-Work(PoW) [Egalitarian]
Proof-of-Stake (POS) [Rich get Richer]
Hybrid PoW/PoS Consensus [Best of Both Worlds]
Byzantine Fault Tolerance (BFT) [Speed L1 BSC]
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PROOF OF STAKE (PoS)
Proof of stake uses a set of validators to reach consensus on
the main chain. These validators deposit an amount of the
blockchain’s cryptocurrency and cast votes weighted by their
stake. Not much electricity is consumed.
Hybrid PoW/PoS Consensus
The objective of hybrid Proof of Work and Proof of Stake
systems is to capture the benefits of the respective
approaches and use them to balance each other’s
weaknesses. Decred is among the few cryptocurrencies to
utilize both PoW and PoS in recognizable forms and merge
them together to produce a multi-factor or hybrid consensus
mechanism.
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Mining: CPU, GPU & ASIC
Blockchains fall into two categories, PoW and
PoS. Bitcoin, the first ever cryptocurrency, runs
on a PoW consensus mechanism.
This is a form of mathematics known as
cryptography.
Cryptography uses very difficult mathematical
equations that can only be solved by computers.
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CENTRAL PROCESSING UNIT (CPU)
It is considered the brain of a computer because
it controls the operations of all parts. CPUs
perform all types of data processing operations;
without one, a computer cannot work properly.
In the early days of Bitcoin, you could mine it on
your CPU. As mining became more competitive,
this was no longer feasible.
However, there are still other blockchains that
can be mined using a CPU today, such as the
Whive protocol.
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GPU(GRAPHIC PROCESSING UNIT)
GPUs are more powerful than CPUs in executing some
very specific functions. GPUs are meant to be effective at
doing massive amounts of calculations. This feature
makes them well suited for mining certain blockchains,
such as Ethereum.
Although it’s technically possible to mine Ethereum using
a CPU, it is discouraged. GPUs are far more effective for
mining Ethereum and other cryptocurrencies such as
Ravencoin and Beam.
There are different models of GPUs. Websites such as
WhatToMine allow you to input different GPU models and
estimate which will be the most profitable
cryptocurrencies for you to mine.
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GPU MINING RACK
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APPLICATION-SPECIFIC INTEGRATED CIRCUIT ASIC
An ASIC is a chip that can be used for one
purpose only. It used to be possible to mine
bitcoin using a CPU/GPU. But this changed
as it got more competitive.
Today, Bitcoin is mined using ASIC chips.
Litecoin is another popular cryptocurrency
that is mined using ASIC chips.
The majority of large-scale blockchain
mines are running ASIC machines. Because
these machines are purpose built, they
prove to be more effective and reliable at
mining.
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ASIC MINER
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POW - MINING
Solo Mining: Mining directly on the
network with your hashpower.
Pool mining: Coming together with
other miners to combine hashpower
and increase your chances to mine
block; rewards are shared.
MINING POOL
A mining pool is a joint group of
cryptocurrency miners who combine
their computational resources over a
network to strengthen the probability of
finding a block or otherwise
successfully mining for cryptocurrency.
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HOW A MINING POOL WORKS
Individually, participants in a mining pool contribute their
processing power toward the effort of finding a block. If
the pool is successful in these efforts, they receive a
reward, typically in the form of the associated
cryptocurrency.
Rewards are usually divided between the individuals
who contributed, according to the proportion of each
individual's processing power or work relative to the
whole group. In some cases, individual miners must
show proof of work in order to receive their rewards.
whivepool.cointest.com
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BITCOIN ENERGY CONSUMPTION
Bitcoin may be a useful way to send and receive money, but
cryptocurrency isn't created for free. The computer-based miners
who create bitcoins use vast amounts of electrical power in the
process. The energy-heavy process leads some experts to suggest
that bitcoin harms the environment.
The creation process, known as "mining" requires computers around
the world to complete rapid calculations to try to solve the same
mathematical puzzle. It always takes 10 minutes, and the winner is
rewarded with some digital bitcoin. Then a new puzzle is generated,
and the whole process repeats for another 10 minutes.
According to the University of Cambridge’s bitcoin electricity
consumption index, bitcoin miners are expected to consume roughly
130 Terawatt-hours of energy (TWh), which is roughly 0.6% of global
electricity consumption.
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BITCOIN NODE
Some estimate that there are over 10,000
operational full nodes on the Bitcoin network.
These nodes then propagate the blockchain to all
other nodes on the network to ensure the most
trusted blockchain is maintained.
The more nodes, the more decentralized the
network, and the harder it is to hack.
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DRIVING FINANCIAL & ENERGY ACCESS!
.
Peer-to-peer model Bitcoin brings allows people who are
financially excluded to enter the Global Digital Economy,
Nigerians in 2020 moved $500 Million Dollars…
Bitcoin as a settlement monetary network is very
efficient recently $2.4 Billion Dollars was moved on the
network for $26 in transaction fees. Lightning Network
scales this to allow for Automated M2M transactions
Bitcoin Mining is currently using 74% renewables in its
energy mix. This is making redundant energy projects
more viable and also innovations in computer
processing.
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WHIVE PROTOCOL
Whive, is an open source & peer-to-peer
blockchain protocol that is incentivizing
the building of sustainable distributed
solar energy solutions through Trustless
Rewards.
The Whive protocol’s mining is biased
towards smaller mobile computing CPU
devices built on the ARM architecture to
encourage fast & sustainable growth of
the solar energy sector
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YESPOWER PoW SCHEME
Yespower is a proof-of-work (PoW) focused fork of yescrypt, which
in turn builds upon scrypt. While yescrypt is a password-based key
derivation function (KDF) and password hashing scheme, and thus is
meant for processing passwords, yespower is meant for processing
trial inputs such as block headers (including nonces) in PoW-based
blockchains.
Why Yespower?
Different proof-of-work schemes in existence vary in many aspects,
including in friendliness to different types of hardware. There's
demand for all sorts of hardware (un)friendliness in those - for
different use cases and by different communities.
yespower in particular is designed to be CPU-friendly and GPU-
unfriendly. In other words, it's meant to be relatively efficient to
compute on current CPUs and relatively inefficient on current GPUs.
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WHIVE PROTOCOL FEATURES
Efficient ARM Focused CPU Mining
The Whive protocol’s mining is biased towards smaller
mobile computing devices built on the ARM architecture to
encourage fast & sustainable growth of the solar energy
sector
20 Year PoW Mining Schedule
Mining of 100M Whive Rewards ends in the year 2040
ensuring maximum distribution of solar micro-grid
ecosystems across the World
Bitcoin Fork & Auxiliary Chain
18,500,000+ Whive Rewards can be claimed by Bitcoiners
hodling 0.2 or more bitcoins starting April 2021, learn more
at https://whive.io/claim