As the value of Bitcoin and crypto market grows as a whole, many new terms about Bitcoin and crypto make the newcomers feel curious. These terms may have one meaning, or they can be ambiguous because having two or more different understandings depends on the point of view of each user. Well, one of the terms that is still confusing to date is "Bitcoin Generator", because there are two different perceptions of the term.
Bitcoin Generator = Scam Site
Scam is a fraud scheme that is done by individuals, groups, or companies that are dishonest in an effort to get money. One of the meanings of Bitcoin Generator is a scam site that usually offers free Bitcoin. Pages like this have various types and have various ways to deceive clients. There are those who promise to multiply Bitcoin in a short time (www [dot] 0on [dot] info), there are also sites that provide Bitcoin creation like (www [dot] genbtc [dot] com).
The main equation of this kind of scam sites is the lure of very large returns in a fast time, profits that can be obtained routinely without doing anything, which can later increase if the amount of deposit is increased. They are good at utilizing ignorance and a sense of interest in people who want to get big money easily and briefly. So always remember, if it seems that the given offer is too good to be true (not realistic), we can be sure sit ...
To convince clients, the Bitcoin scam site will pay back the initial investment of the client. After the client gets proof of return, he will be increasingly interested in increasing profits by depositing more money. This is where the fraudsters start acting. There have been many examples of new fraud cases after the victim made a second, third, fourth deposit, etc.
- Bitcoin Generator = Bitcoin Creator Tool
The second perception that might emerge from the term Bitcoin Generator is a tool for creating new Bitcoin. We are familiar with Bitcoin Mining Rig or Cloud. People who control Bitcoin miners can also be called Bitcoin Generators. Simply put, Bitcoin is generated from the Bitcoin Blockchain, through special mechanisms and algorithms for Bitcoin mining.
There are many aspects and functions of Bitcoin mining that we will discuss here:
New Bitcoin issuance
Transaction confirmation
Security
A. Publishes New Bitcoin
Traditional currencies such as dollars or euros are issued by the central bank. The central bank can issue new money units at any time based on their consideration of its effects on economic conditions. With Bitcoin, every miner can produce Bitcoin by himself. The publishing rate is set in code, so miners cannot cheat the system or make Bitcoin illegal. They must use computational power to produce new Bitcoin.
B. Confirm Transaction
Miners confirm, enter, or write transactions sent on the Bitcoin network on their blocks. Transactions can only be considered safe and complete after they are included in the block, because they can only be embedded on the Bitcoin Blockchain officially when they are included in the block.
More confirmation means also better for larger payments. The visualizations are as follows:
Payment with 0 confirmation can still be reversed.
One confirmation is enough for a small Bitcoin payment of less than $ 1,000.
Three sufficient confirmations for payments of $ 1,000 - $ 10,000. Most exchanges require 3 confirmations for deposits.
Six confirmations are sufficient for large payments between $ 10,000 - $ 1,000,000.
C. Securing the Network
Miners secure the Bitcoin network by making it difficult to attack, change or stop. That is, the more miners that mine, the safer the Bitcoin network will be. The only way to reverse Bitcoin transactions is to have more than 51% of the power of the hash network. But because the hash power was distributed among many different miners, 51% attacks were almost impossible.
Hardware Bitcoin Mining
When Satoshi released Bitcoin, he wanted it to be mined on the CPU ...
Difficulty "in Bitcoin Mining
If only 21 million Bitcoin will be made, why is Bitcoin issuance not accelerated by increasing the strength of mining hardware? Surely this is what everyone has in mind today. Keep in mind, publishing is governed by the "Difficulty" system, an algorithm that adjusts the Proof-of-Work problem difficulty according to how fast the block is completed within a certain period (approximately every two weeks or 2016 blocks). Difficulty up and down as the hashing power is deployed to maintain the average time between blocks.
Halving Block Reward System
Satoshi designed Bitcoin in such a way that the rewards the miner automatically receives to break the block can be divided into two every 210,000 blocks (or about 4 years). Because Bitcoin prices have increased substantially (and are expected to continue to increase over time), mining remains a profitable effort even though there is a system ...
Keep in mind, the consensus used by the Bitcoin network is Proof-Of-Work. That is, anyone who has the biggest hashing power will have the greatest chance of getting a "quota" of block creation. So, the concept of Mining Pool which provides a platform for individual miners to participate in the hashing ecosystem of Bitcoin mining, can help them to compete with the "big" miners.