Meet the ‘miners’: The shadowy group making a killing from the Bitcoin bonanza

Discussion in 'Cryptocurrencies' started by themickey, Dec 16, 2017.

  1. themickey


    Bitcoin’s incredible surge in recent weeks has stoked speculative mania among investors and doomsday predictions from mainstream financial experts.

    But while this frenzy has been playing out, one group has stayed under the radar: Bitcoin miners.

    Unless you’re a cryptocurrency afficionado, the chances are you know very little about this shadowy group of international tech boffins.

    But these mysterious miners are integral to the functioning of Bitcoin, and are without question the ones who understand it best.

    This week, as the value of one Bitcoin was surging beyond $20,000, The New Daily decided to track down some miners to find out who they are and what on earth it is they are doing. The results were extraordinary.

    Our search uncovered a futuristic world made up of a diverse group of tech entrepreneurs and cryptoanarchists, making a killing from the unprecedented surge in interest in Bitcoin.

    One of the ‘miners’ we spoke to was a 20-something IT developer based in the Philippines. Another was a Melbourne-based former accountant currently building one of the biggest Bitcoin mines in the world, in Mongolia.

    And most unexpectedly, the third was a middle-aged tradie-turned-solar farm owner in outback New South Wales who is using the electricity generated by his solar farm to mine the increasingly valuable cryptocurrency.
    But first, what is a bitcoin miner?

    When Bitcoin’s elusive founder Satoshi Nakomoto built the Bitcoin software in 2009, he (or she, or they) designed it so it would rely on a network of miners.

    To truly understand what these miners do requires a level of cryptoliteracy far beyond the average Joe (this journalist included). But in short, they use mining machines – little computer-like boxes – to solve complex mathematical problems posed by Nakomoto’s system.

    Solving these problems reveals a ‘block’ of Bitcoin, independently validating and recording its existence. It is essential that independent Bitcoin miners do this because it securely and immutably records the existence of the Bitcoin, making it as solid a piece of property as anything in the tangible world.

    For their efforts (and considerable expense, above all on energy bills) Bitcoin miners are rewarded with new Bitcoins.

    The video below explains how mining works.......

    Read the rest of it here....
  2. d08


    Using valuable energy for absolutely nothing. Well done, what we need is more pollution for zero benefit.
    dealmaker, Pekelo and themickey like this.
  3. just21


    There are benefits to Bitcoin. How would you survive if you lived in Venezuela, Argentina, or Zimbabwe where the government print unlimited quantities of money? What would you do if you were one of the 4 billion people not offered a bank account? The US Federal Reserve have overseen a 95% decline in the value of the dollar since it's creation in 1913. Because it happens slowly most people accept it.

    Arnie likes this.
  4. Surprise


    Thats not a benefit , people in these countries may as well use $ , many countries in the world use dollars beside their own local currency .
    Slartibartfast likes this.
  5. Bitcoin mining is like playing the lottery, Pick the right number and you win. The key is to pick as many numbers as possible in the least amount of time, and maybe you'll find the right one, before someone else does ... of course, if you don't, there is always another block ...
    Last edited: Dec 16, 2017
  6. Visaria


    Disagree...the absolute nothing is currently valued at $18k.
  7. themickey


    Possibly what may occur, the coins become nearly worthless but the technology of blockchain becomes a multibillion dollar industry.
  8. alexpun


    $18k with shallow market depth = penny stock
    ET180 and Surprise like this.
  9. just21


    How do you transfer dollars over the internet?
  10. just21


    The Federal Reserve have a 2% inflation target. They are telling you that they are devaluing the dollar every year. Since 1913 when the Fed was created the dollar has lost 95% of its value. Paper money is not a store of value.
    #10     Dec 16, 2017