Bitcoin is the most popular cryptographic currency. Unlike traditional currencies, bitcoin is not centrally controlled. It’s a truly distributed online currency. It’s backbone is cryptography. Bitcoin exchange rate, as of now, is $234 for 1 BTC (Bitcoin). Bitcoin is accepted in only a few online spaces.
On traditional money, government prints the money whenever there is need. But in bitcoin, it’s discovered. A cryptographic problem is stored and that solution is broadcasted over the Internet to claim the bitcoin. There are fixed number of bitcoins, computationally possible.
It takes enormous computational power to solve the problem. The computational power required to mine bitcoin increases overtime. New kinds of techniques are used to mine
Given below are some of the techniques used for bitcoin mining.
The CPU of a normal computer is used to solve the cryptographic problem. It’s the slowest method. It was used in initial days when mining was easy and not much competition was around. Since CPU does single task at a time in enormous speed (depending on the number of cores), hashing is slowest. I tried it in my old computer and could reach a few megahashes per second only.
The GPU (Graphical Processing Unit) aka graphics card is used in generating the hashes. GPU is designed to do specific computations in a massively parallel way. It can provide the hash rate in terms of 100s of megahashes per second. For instance, ATI 5970 graphics card can give 800 megahashes per second. GPU mining is faster as GPU have thousands
of pixel and vertex shaders, which can be modified easily by software to do non-graphical things.
Field Programmable Gate Array (FPGA) is an integrated circuit that can be configured after manufacturing. It’s bought in large numbers and manufacturers’ program them to make them mine bitcoins. Since it’s a dedicated hardware, it can be used only for bitcoin mining and nothing else, once programmed. It can provide mining speeds ranging in Gigahashes per second. Multiple chips are combined together to make hardware and mining is done using this.
Application Specific Integrated Circuits (ASIC) are specially designed and manufactured for bitcoin mining. Since these chips are exclusively designed and fabricated for one thing, it’s very expensive and time-consuming. But the hashing speeds are mind-blowing and consumes relatively less power. It can do hashing in the range of 4.5 Terahash per second. There are also cloud providers, and they buy ASIC hardware and put them in data centers which are then rented out for mining.
Bitcoin mining is a fascinating area for enthusiasts. You can also try this and even convert your bitcoins to Rupees. 1 BTC is 15134 Rs. For more information, you can just google it or know more about it at bitcoin.org.