What is bitcoin mining?

Bitcoin mining is the process of verifying and adding transactions to the blockchain, a decentralized and distributed ledger that records all Bitcoin transactions. It involves using specialized computer hardware to solve complex mathematical problems that validate and secure transactions on the network.

Bitcoin miners compete with each other to solve these mathematical problems, which involves trying to find a specific number that, when combined with the transaction data, produces a hash (a unique digital signature) that meets certain criteria. The first miner to solve the problem and add the block of validated transactions to the blockchain is rewarded with newly minted bitcoins as well as transaction fees.

Mining serves two main purposes: validating transactions on the network and creating new bitcoins. The process is energy-intensive and requires significant computing power, leading some to criticize it for its environmental impact.