Bitcoin mining algorithm refers to the algorithm used to solve the complex computational problems of transaction confirmation and new bitcoin issuance in the Bitcoin blockchain. The core role of this algorithm is to ensure the security, decentralization and reliability of the Bitcoin network. Before we delve into the Bitcoin mining algorithm, we need to understand the nature of Bitcoin and the significance of mining.

Bitcoin is an encrypted digital currency based on blockchain technology. Its decentralized characteristics make transaction records impossible to tamper with, ensuring the transparency and security of transactions. Bitcoin mining is the process of confirming transactions and creating new Bitcoins through computing power competition. This process is not only the cornerstone of maintaining the normal operation of the Bitcoin network, but also an important mechanism to ensure the stable growth of Bitcoin value.

The core of the Bitcoin mining algorithm is Proof of Work, that is, miners need to solve a complex mathematical problem to prove that they have completed a certain amount of work, so as to obtain the right to record and the newly issued Bitcoin reward. The original intention of the design of this algorithm is to prevent malicious nodes from attacking the network and ensure the security and stability of the entire network.

In the Bitcoin mining algorithm, miners need to constantly try different random numbers to find hash values that meet certain conditions. This process requires a lot of computing power and electricity support, so Bitcoin mining has become more and more specialized and centralized. The emergence of large-scale mining farms has made the cost and threshold of individual mining higher and higher, which has also raised concerns about the decline in the degree of decentralization of Bitcoin.

In addition to the proof-of-work algorithm, Bitcoin also uses an incentive mechanism to encourage miners to maintain the network. Whenever a block is successfully mined, miners will receive a certain amount of Bitcoin rewards, and they can also receive transaction fees. This incentive mechanism effectively encourages miners to participate in the maintenance of the Bitcoin network and ensures the security and stability of the entire network.

However, with the popularity and rising value of Bitcoin, the energy consumed by Bitcoin mining has become increasingly huge, sparking controversy over energy consumption. Some people worry that Bitcoin mining will exacerbate the global energy crisis, while others believe that the decentralization and value of Bitcoin far outweigh the negative impact of energy consumption.

In general, as the core mechanism of the Bitcoin network, the Bitcoin mining algorithm bears the important responsibilities of maintaining network security, promoting transaction confirmation and issuing new coins. With the continuous development and improvement of blockchain technology, it is believed that the Bitcoin mining algorithm will continue to evolve, bringing more innovation and opportunities to the entire cryptocurrency field. Let us look forward to the future development of Bitcoin together, and believe that the Bitcoin mining algorithm will play an increasingly important role in the future.

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The following parameters are required

1. Block version

2. Hash value of the previous block: prev_hash

3. The value of the hash tree of the transaction record to be written: merkle_root

4. Update time: ntime

5. Current difficulty: nbits

The mining process is to find x so that

SHA256(SHA256(version + prev_hash + merkle_root + ntime + nbits + x )) <
TARGET

The range of x in the above formula is 0~2^32,
TARGET can be calculated based on the current difficulty. In addition to x, you can also try to change merkle_root and ntime. Due to the characteristics of hash, finding such an x can only be done by brute force.

Once you find x, you can broadcast a new block, and other clients will verify whether your block is legal. If your block is accepted, since the first transaction in each block must be to send the newly generated 25 bitcoins to a certain address, of course you will set this address to the address you own to get these 25 bitcoins.

Every transaction record of Bitcoin from the beginning to now is stored on the network, and the entire Bitcoin network maintains a huge transaction record file (now about 12G).

The update cycle of this file is an average of 10 minutes. The newly added transaction record is called a block, and this huge file consists of a string of blocks, called a block chain.

Why 25 bitcoins?

This is the rule. Initially, there were 50 bitcoins. Every time half of the remaining bitcoins were generated, the income would be halved, so that the total amount of bitcoins that can be generated in the end is close to 21 million. If you still claim to have mined 50 bitcoins, this will not be accepted by other clients, and this block will be mined in vain.

How to ensure that the update cycle is 10 minutes on average?

The smaller the TARGET, the more difficult it is to solve x. Every 2016 blocks (about 14 days) are generated, the network will adjust the TARGET according to the average interval of new blocks generated during this period.

Does the person with the fastest calculation speed always solve it first?

No. You always want to take the mining proceeds for yourself, so when everyone calculates, the address to send the mining proceeds is different, so the merkle_root is different, that is, everyone starts to solve from a different initial state.

What if they solve at the same time?

The block
chain will have a fork, some clients accept A, and some accept B, until a branch becomes longer, and everyone will choose this longer branch. If you mine it, unfortunately, it is not selected, your mining proceeds will be invalid.

Since the longer branch is selected, what should I do if I use a very low difficulty to solve it?

The client finds the longest branch that meets the current difficulty among many branches.

Are these calculations wasted?

If you want to spend a sum of money twice, you need to do this. Mine a new block, but hide it and don't broadcast it, and continue mining. Find merchant A, pay Bitcoin, let others on the network mine the block and write the transaction record. Find merchant B, pay Bitcoin, and write the block you mined. If you can mine two blocks first and broadcast them, everyone will regard your longer branch as the current block
chain, and the Bitcoin received by merchant A will not be recognized. The probability of success of such an attack depends on how fast you calculate the hash. If the computing power of the entire network is high enough, such an attack will either have a very low success rate or be extremely costly.