No. Bitcoin and Cryptocurrency Mining Matters
Blockchain technology is simply incredible. Indeed, most technological advances make the world a better place. However, few have the disruptive power blockchain technology has shown. In 11 short years, its impact has brought efficiency in the financial sector, supply chain, healthcare, and many other sectors that generate data in their operations and deemed “too centralized.”
Cryptocurrencies are proving to be a gem for the under-banked, unbanked, and those who distrust centralized financial institutions. Bitcoin ensured that transactions are borderless and inexpensive. Anyone with an internet connection and a digital wallet can send and receive funds at anywhere, anytime.
The Double Spend Problem
But here is the thing, Bitcoin is nothing without participation. And by participation, we mean the involvement of miners. Bitcoin miners distributed across the world investing in the best Bitcoin mining equipment and paying for electricity, at different rates depending on the location, are vital for the network.
Crypto mining undergirds the Bitcoin network, and without it, the network will simply collapse because it can’t prevent the double-spend problem by itself. Realizing that participants have different objectives, the designer of Bitcoin, Satoshi Nakamoto, introduced an incentive system where keepers (miners) who confirm the validity of transactions and secure the network earn rewards.
Why Bitcoin Crypto Mining Matters
Disparate in their operation, miners coordinate, governing the system’s operations automatically without intermediaries. Bitcoin is such an elegant system, and it doesn’t matter how critics complain, pointing at the weakness of Proof of Work powered networks. The consensus algorithm and the concept of “work” that power the Bitcoin network is the best there is in the blockchain space.
A Proof of Work system can’t function without miners. Cryptocurrency mining matters because:
1. It is a Gel that Holds the Bitcoin Network Together
The challenge, years before Satoshi actualized Bitcoin, was the double-spending problem. Double spending arises when an individual spends his/her BTCs more than once without the system detecting. This phenomenon creates a disparity between what’s held in the account, those spent, and total coins in circulation. Physical fiat transactions don’t face this problem. Unchecked, the digital nature of BTC transactions can make it possible for one to create duplicates of the currency and simultaneously spend them, settling different transactions. For years, cryptographers and computer scientists had nothing but hypotheses before it emerged that “work” in Proof of Work consensus algorithm could solve this nagging concern.
This work is channeled by decentralized miners who confirm whether transactions are valid in the past and present blocks, and that blocks are linked only to the longest valid chain. Once a transaction is confirmed, it becomes immutable and maintained in the ledger in perpetuity.
By investing in computing powers and competing to solve complex math, mining acts like a bridge, a piece of connective infrastructure that ensures the fidelity of transaction enabling the trustless transfer of value. Without crypto mining, there won’t be any checks and balances, and that means no Bitcoin. Extended, the true potential of Bitcoin and what it represents is the reason Bitcoin mining truly matters.
2. It Paves the Way for Innovation
Cryptocurrency and blockchain historians argue that the failure of banks actually sparked the development of Bitcoin. Investigations into what might have triggered the Great Financial Crisis (GFC) of 2008-09 found that centralized, too-big-to-fail megabanks were to blame for marketing and selling mortgage products without due diligence. The result was a domino effect whose repercussions are still evident today. Incensed, Satoshi-mined Genesis block had a quote mentioning the UK’s Chancellor plan of bailing out banks. Bitcoin seems to have resolved this.
Owners of these coins have full control. Furthermore, other innovations can be built on Proof of work systems where mining is an integral part of the process. The best part is that the government has no kill switch, resulting in grumpy banks who face fierce competition from cryptocurrencies like Bitcoin.
Its decentralized nature gives it an edge, gifting owners’ autonomy and is a store of value during times of uncertainty. What’s more interesting is that Bitcoin opened up the playfield allowing innovators to pour in and create/launch services that further ease processes. While governments have taken different approaches, some are hostile, banning Bitcoin trading or mining citing consumption an unacceptable amount of electricity. Others are more open, read Japan, the US, and Malta, drafting regulations that allow citizens to trade and invest in the technology.
3. The World Needs More Computational Power
The hash power of any ASIC miner is its computing power. The more hash power it packs, the more powerful it is, and the more calculations it can perform per second. In essence, an ASIC miner is but a mini-computer designed to excel in one purpose only: cryptocurrency mining. However, as explained in previous articles, an ASIC can be tuned to perform better in other tasks other than mining all that depends on what the user needs. It can be to perform better simulations, to render and create better image processors, and so forth.
That is why if push comes to shove-and say Bitcoin mining is no longer attainable or there is a radical shift from the current consensus algorithm, computing power from data centers can be used to fulfill other purposes. The world needs more computing power than before. The rise of artificial intelligence, in particular, demands more, not less of this.
For this precise reason, Bitcoin data centers can easily be turned into sources of computing power needed by scientists and other innovators gearing to make the world more autonomous. When unlimited computational power comes from Bitcoin data centers, researchers will be unlocked.
For example, a programmer would solve the optimization problem through brute forces, building unbeatable opponents say in Chess or draughts. Then again, they can solve the computing halting problem, overcoming the Kolmogorov complexity paving the way ideal learning systems, which at present are only possible in theory.
Building Bitcoin’s Infrastructure
Crypto mining underpins blockchain. As it is, the Bitcoin network is heavily reliant on miners. It’s its pulse. And that is why in May 2018, VBit Technologies went against the grain, setting up a modern, regulatory compliant hardware mining facility in the United States.
In operation, it is a platform where anyone in the world, regardless of stature, can legally buy hash power and mine Bitcoin. There are different packages available, and the best part is that getting started is absolutely free and fast.
Don’t get left behind! Sign up for free and start mining Bitcoin today!