Stephen Whitelaw answers your CryptoCurrency questions
By Stephen Whitelaw, in Business · 06 Apr 2022, 10:10 · 0 Comments
What is bitcoin mining?
Answer: Bitcoin mining is the process by which new bitcoin are introduced to the world. Bitcoin miners all try to solve an extremely difficult maths problem using their computers and the one who solves the problem is awarded the newly minted bitcoin.
Anyone can mine bitcoin, however the hardware required to be the winner has moved from home computers to gaming rigs and on to 10,000’s of dedicated machines called ASIC’s located in giant server farms. So bitcoin mining is no longer a profitable from your house or office. The bitcoin algorithm has a heartbeat that issues a set but decreasing number of bitcoin, roughly every 10 minutes. This started out in 2008 at 50 bitcoin and is halved every 4 years, it currently stands at 6.25 bitcoin per 10 minutes.
If more people decide to mine bitcoin then the maths problem becomes harder to solve and vice versa if the number of miners falls then the maths problem is easier to solve. This is known as the difficulty adjustment factor.
When a miner wins the latest block he/she is given the blockchain reward and is then able to add a new block to the bitcoin blockchain – this block can contain up to 4,000 transactions which will then form part of the public bitcoin blockchain. The miner is also rewarded with the transaction fees associated with all of the transactions in the recent block. Due to the reducing issuance schedule the last bitcoin will be mined sometime in 2140, which means that bitcoin miners will only be rewarded with transaction fees – I suspect another reward mechanism will have been devised by then.
It is possible to join a mining pool, where 1,000’s of other people get together to pool their processor resources to mine bitcoin and the rewards are shared our depending on your effort. It is worth noting that bitcoin mining is considered income in most countries and thus needs to be declared for income tax purposes. [In most countries buying and selling bitcoin is considered a taxable event and comes under capital gains tax – unless you live in Portugal where there is currently no capital gains tax on crypto currencies]
Whether you are an interested newcomer or are looking for specific technical help and assistance with anything to do with crypto currency, we are here to help.
Simply send your email to [email protected] and we will publish selected questions and answers in the upcoming editions and online.
It should be noted that neither The Portugal News nor Stephen Whitelaw will provide any financial advice in relation to crypto.
Support The Portugal News
The Portugal News provides, free, independent, honest and unbiased news in print, online, on social media and in emailed newsletters. We support local communities, foreign residents and visitors of all nationalities to Portugal with news and views on all things Portuguese. This takes a dedicated, motivated loyal team. To help us continually improve our services we ask you to consider making a contribution – no matter how small.
Be the first to comment on this article
More in Business
Auchan rejects accusation of “price fixing”
By TPN/Lusa, In Business – 27 Mar 2022, 13:05
New service combining food delivery with real estate appraisals
By TPN, In Business – 26 Mar 2022, 12:03
Portugal patent boom
Portugal is the fastest growing country in the registration of patents across the entire EU.
By TPN, In Business, Portugal, Europe 06 Apr 2022, 09:08
In 2021, Portuguese inventors submitted 286 patent applications to the European Patent Office (IEP). This is an increase of around 14% compared to the same period in the previous year, reports Jornal de Negócios. Data released reveals a high growth in patent applications in the area of computer technology, with the numbers almost tripling, as…
Right Money, Right Place, Right Time
The financial services industry is constantly changing and evolving. Laws and regulations change, new products enter the market, and technology presents new and innovative ways to help people achieve their goals.
By Advertiser, In Business 01 Apr 2022, 10:40
In finance, the right approach is the stepping stone to the path of success. You can’t change the past but choosing a secure financial future is in your hands. Holborn Assets offers our expat clients UK qualified financial advice on a range of areas that helps them protect, maintain and enhance their private wealth whilst securing the…
Airbus expanding in Portugal
Finance, HR, Purchasing, Information Management, Engineering, Communication, Customer Services, Legal and Compliance are the areas which Airbus is looking to hire in Portugal.
By TPN, In Business, Company News 30 Mar 2022, 18:07
Airbus will hire 300 employees in Portugal this year to expand its operations in Lisbon, where the European aircraft manufacturer last year hosted its Global Business Services Center. According to a press release from Airbus, this subsidiary “already employs more than 130 specialists in the areas of administrative, transactional, reporting and IT…
Metaverse: The New Level Of Crypto With Firepin ($FRPN), EverGrow ($EGC) and Decentraland
The Metaverse is the new internet buzzword as the virtual realm continues to gain more popularity.
In Business 30 Mar 2022, 15:47
This digital reality is the perfect combination of the crypto market and the gaming world as it allows gamers to effortlessly monetise their gaming experiences. But there are currently hundreds of Metaverse cryptocurrencies on the market, and figuring out which one is the most profitable and successful in the present and future can be overwhelming. So, here…
Will cryptocurrency expansion continue in 2022?
Emerging markets were at the forefront of last year’s massive growth in global cryptocurrency adoption.
In Business 30 Mar 2022, 11:00
With this growth widely tipped to continue into 2022, a range of countries will see their crypto markets mature or expand. As OBG detailed at the time, the onset of Covid-19 spurred a massive expansion in the use of cryptocurrency in a number of emerging economies. For example, Nigeria – Africa’s biggest cryptocurrency market –…
Wine prices set to soar
With costs rising across the sector, producers in the Douro, Alentejo, Verdes and Lisbon warn that wine will become even more expensive in supermarkets and in restaurants.
By TPN, In Business, News 28 Mar 2022, 12:03
The rising prices of glass, corks, labels, glues, pallets, cardboard boxes, pesticides, fertilisers, electricity, fuel, and shipping have all been identified as factors in wine prices skyrocketing in recent months. In a report by ECO producers admit that in the coming weeks wine will have to become more expensive on supermarket shelves or in restaurants…
Other Business Articles
CryptoCurrency glossary of terms – Letter ‘G’
Confused by all the cryptocurrency terms out there? Delve into our easy to understand…
By Stephen Whitelaw, In Business – 24 Mar 2022, 14:19
The dark side of working from home
Remote work is increasingly popular. However, there are experts who claim that it can be…
By Paula Martins, In Business, COVID-19 – 22 Mar 2022, 10:14
Xiaomi opens store in Albufeira
Xiaomi has opened a new store in the Algarve in AlgarveShopping, in Albufeira.
By TPN, In Business, Company News – 21 Mar 2022, 16:02
Cluttons opens Almancil office
Cluttons have launched a new office in the Algarve, Portugal, located 15 minutes from Faro…
By TPN, In Business, Property, Algarve – 21 Mar 2022, 15:30
Super Bock “adjusting” product prices
Increases in production and transport costs has led the Super Bock group to make…
By TPN, In Business, Company News – 20 Mar 2022, 11:02
Shining a light on Portugal’s artistic talent
The Sovereign Portuguese Art Prize was launched in 2021 to increase the international…
By Advertiser, In Business – 18 Mar 2022, 08:00