lightswarm124

fav bw moment?

Mining has 2 main components to it. 1: gather transactions done in the ~10 min block, and 2: provide proof that legitimate work has been done. Packaging the transactions cost very little computing power (you can do this part by hand even), but proving the work you did is legitimate requires a tremendous amount of hashing power from processors. For each transaction block, the Bitcoin protocol releases a certain amount of bitcoins (50btc at first, now at 25btc) as a reward to the miner(s) that proves the block's validity. In accounting perspective, all the rewarded and unrewarded btc will always total 21 million.

Here is the trick; the time interval between each block is averaged out to be ~10 minutes, meaning that if blocks are "mined" faster/slower, the protocol changes the difficulty of the proof-of-work to readjust the block times back to ~10 minutes. This means that if blocks are coming out at, let's say, 5 minutes consistently, the protocol requires the Bitcoin network's processors to be more computationally intensive so that it would take longer than 5 minutes for the network to discover a valid block.

You can install the mining client and be rewarded with bitcoins, but it will not be free. Since there is an open competition for the rewarded bitcoins, electricity costs as well as cost of the hardware make it very expensive to mine profitably. If you want to try mining for the sake of the experience I would suggest going after altcoins as those are not yet nearly as computationally intensive as Bitcoin.

Are there plans to issue a crypto-stock IPO on Gemini?