Why Do People Mine Bitcoin?

                            Why Do People Mine Bitcoin?

There are several reasons why people mine Bitcoin. Mining is the only way

Bitcoin is produced. Also, unlike conventional currency which is based on

gold and silver, Bitcoin is based on mathematics.

People around the world use software programs that follow a

mathematical formula to produce Bitcoins. The beauty of this is that the

mathematical formula is freely available, so basically, anyone can check

it. Also, the mining software is open source, so anyone can look it up to

verify that the inputs correspond to the desired outputs.

People want the freedom that the mining of Bitcoins provides, and the

benefits that come with it. The reasons why they mine Bitcoins can be

summarized by the characteristics of Bitcoin itself. These characteristics

are practically absent or inconsistent in the conventional governmentbacked

currencies listed as follows:

1. It is decentralized

This is one of the major reasons why people mine Bitcoins, and that is

because the Bitcoin network is not controlled by one central authority.

Conventional currency’s central banks can just decide to take people’s

money away from them, like was experienced in Cyprus in early 2013 by

the Central European Bank. With Bitcoins, every machine involved in its

mining forms part of a large network, and they all work together,

although competitively. Also, even if some part of the network abruptly

goes offline for some reason, the money keeps on flowing nonetheless.

2. It is easily set up

Getting started with mining Bitcoins is a relatively faster and easier

process compared to conventional banks. With Bitcoin mining, you get

your Bitcoin address in seconds, with no hassle and no fees payable.

Unfortunately, the same cannot be said of conventional banks which make

you jump through hoops simply to open a bank account. Not to mentio

the herculean task and bureaucracy synonymous with setting up a

merchant bank account.

3. It is completely transparent

Another reason why people mine Bitcoins is because of its transparency.

You can access details of every single transaction that has ever been

made on the Bitcoin network via a large version of a general ledger

known as the Blockchain. You can also confirm the total amount of

Bitcoins stored in a publicly-used Bitcoin address, though the identity of

the owner of the address remains anonymous. For those who want to

make their activities even more opaque on the Bitcoin network, they can

do so by making use of different Bitcoin addresses and by not transferring

large amounts of Bitcoin to a single address.

4. Minimal transaction fees

Unlike conventional bank systems that charge high fees on international

money transfers, mining of Bitcoins eliminates going through the

middleman; you get to enjoy very minute transaction fees.

5. It is fast

Nothing beats the speed of a Bitcoin transaction. You can send money

from any part of the world to another, and it will arrive in the recipient’s

Blockchain wallet in minutes, as soon as the Bitcoin network processes

the payment.

6. It is non-retrievable

Once a transfer has been completed, and the Bitcoins are sent, there is

no possibility of retrieving them back. This is because it requires the

proofs for all of the transactions before the one you want to reverse. The

Bitcoins you send out are gone forever and can only be reversed if the

recipient agrees to send them back. It is therefore very important that

you are sure that you really want a transaction before going ahead with

it.

7. It is secure

The mining of Bitcoins allows individuals to become architects of their

own wealth but also prevents any one person from gaining enough power

to block transactions. This is seen as an advantage and another reason

why people mine Bitcoins because of the security of its transactions. It is

an ingenious means of payment that effectively ensures that the risk of

fraudulent activities being perpetrated is significantly curbed.