Bitcoin coin mining is a process performed by highly sophisticated computers of earning new bitcoins. In recent years, the cryptocurrency market has experienced tremendous growth, and new currencies have been developed.
However, despite the increase in new cryptocurrencies, Bitcoin has maintained its position as the most valuable. Bitcoin mining is still profitable, and there are barriers to access it; thus, you need to work closely with trustworthy crypto mining companies.
Brief History of Bitcoin
This decentralized electronic currency was launched in 2009 by Satoshi Nakamoto, whose identity remains unknown up to date. According to its developer, this electronic peer-to-peer cash replaces centralized currencies like the US dollar and the British pound.
Since its development, bitcoin has maintained its position as the most valued and dominant domain in the crypto market. The years 2018-2019 are popularly referred to as the crypto winter, and during this period, the rate of crypto mining was slower than ever before.
However, the market got back to its feet in 2020 and 2021, and for the first time, the global cryptocurrency hit its all-time high, and it was worth one trillion dollars. At the beginning of 2021, the number almost doubled.
Bitcoin accounts for more than half the value of cryptocurrencies in circulation today. In March 2021, the total value of bitcoin in the global market was more than one trillion US dollars. A single unit of the currency is sold at more than $50,000.
Major Factors That Have Led to the High Value of Bitcoin
Cryptocurrencies have gained more popularity to the general public, and they are operating on a more firm foundation than ever before. People who invested in bitcoin immediately after its launch and held on to it have reaped a lot of profit.
Below are some of the significant factors that have led to the growth and increased value of cryptocurrency.
Public Knowledge and Acceptance
After the development of the cryptocurrency, it was not well embraced and accepted by the general public. Over the years, the general public has learned about the currency, which has pushed the growth and value of bitcoin. Investors and individual crypto miners accepted it. This acceptance led to the development of crypto mining companies.
Controlled Supply Of Bitcoin
Most of the cryptocurrencies in the market today, including bitcoin, are available in limited supply. Controlled supply is a step to minimize the number of miners, thus preventing inflation. This step ensures that bitcoin retains its value over time.
However, bitcoin undergoes a process referred to as the halving process. This process occurs every four years, and the value of the bitcoin is always expected to reduce with a significant margin.
Bitcoin Processing Power
The process of bitcoin mining consumes a lot of energy. The mining process itself is costly, and thus many people are unwilling to incur the cost. Thus there are limited miners; hence the increased value of bitcoin leads to high profits for those willing to incur mining costs.
Bitcoin Mining Process
Every bitcoin mining transaction is recorded in an enormous ledger referred to as the blockchain. Once this mining transaction is completed, the miner is sent a code. This code must be verified, and the process involves solving a complex mathematical problem that can only be decrypted using high-powered computers.
Once the mathematical problem is solved, the transaction is verified and added to the blockchain. The miner is rewarded with 6.25 bitcoins. However, this number drops after every four years due to the bitcoin halving process. This process of bitcoin mining may seem easy, but it requires experienced miners and sophisticated computers. These machines need a space to be housed appropriately and cooled because they run for long periods.
Reliable crypto mining companies can lower the mining cost and ensure you make profits from your transactions while using legit blockchain infrastructure to convert identifiable assets into interchangeable bitcoins.
Thus, Bitcoin remains the most valuable cryptocurrency in the world. It is a decentralized form of currency that aims to replace the conventional currencies we have known for a long. Acquiring this cryptocurrency involves a very tedious process that requires a high level of expertise and highly powered machines. With all the necessary appliances and expertise bitcoin mining process remains profitable.