Book Image

Bitcoin Essentials

By : Szmigielski
Book Image

Bitcoin Essentials

By: Szmigielski

Overview of this book

Blockchain is being billed as the technology of the future. Bitcoin is the first application of that technology. Mining is what makes it all possible. Exploring mining from a practical perspective will help you make informed decisions about your mining setup. Understanding what the future may hold for blockchains, and therefore for mining, will help you position yourself to take advantage of the impending changes. This practical guide starts with an introduction to Bitcoin wallets, as well as mining hardware and software. You will move on to learn about different mining techniques using the CPU, GPU, FPGA, and ultimately the ASIC as an example. After this, you will gain an insight into solo mining and pool mining, and see the differences between the two. The book will then walk you through large-scale mining and the challenges faced during such operations. Finally, you will take a look into the future to see a world where blockchain-based applications are commonplace and mining is ubiquitous.
Table of Contents (10 chapters)
9
Index

Can we do without mining?


Mining is the way by which we currently secure the Bitcoin blockchain and in conjunction with PoW it is used to distribute the newly minted bitcoins. But is mining, as we know it today, necessary? Can we do away with it and replace it with something better, something perhaps more efficient?

Replacing or eliminating mining

Theoretically, we can eliminate or replace mining with some other form of securing the blockchain. As discussed earlier, by replacing PoW with Proof of Stake we could eliminate mining, as we know it today. Of course, a secure blockchain is the number one concern, so we must be sure that switching to another algorithm will not compromise security. Therefore, mining as we know it today is technically not necessary, but it is the only secure way we know of today. There has not been enough research done regarding other algorithms to switch Bitcoin over to something else. Unless some amazing new way of securing the blockchain gets discovered soon, we...