Bitcoin today is considered a great investment. In fact, it has reached a status of a good store of value, and its price has grown over $60,000. Consequently, online trading sites have seen a surge in the number of investors.
Also, on the other side of the spectrum, Bitcoin mining has faced another halving event which has cut in half the block reward of the miners. Bitcoin mining and investing are connected, and nothing will make Bitcoin mining obsolete process in the network. Let's take a look at the importance of Bitcoin mining for investors.
Outcomes Of Bitcoin Mining
The blockchain network cannot operate properly without Bitcoin mining and the miners. Basically, the miners work to verify the legitimacy of the blocks of transactions on the network. The main reason they do so is the prospect of obtaining Bitcoin.
However, there are some conditions that make mining increasingly time-consuming and difficult. It requires high-quality computer systems (developed specifically for mining), electricity, and time, as well as skills to solve a complex computational puzzle which is the last step in the process of getting a block reward.
Other costs of mining are associated with the halving event that we mentioned earlier, which is specifically programmed to cut in half the block reward. In 2009, the book reward was 50 BTC, and as time went on, after three halvings, the reward kept decreasing, and today is 6.25 BTC, which is a staggering difference for any miner.
In terms of the outcomes of the mining process, the main outcome is the release of new BTC into circulation when the miners are processing blocks of transactions. And, of course, the increased level of security and prevention of the double-spending problem via mining because the miners validate each BTC transaction of the network.
Importance Of Online Trading
That being said, the mining process is extremely important for everyone involved, including investors, because, without it, there won't be a stable flow of new BTC. Another crucial advantage is that online trading sites simplified the process of obtaining BTC and made it accessible to a global audience.
One example is Bitcoin System, which uses AI-powered- algorithms to provide profitable auto- trading for its users. If you want to become a member, just complete the Bitcoin trading app signup form and make a deposit of at least $250. You can potentially earn a daily ROI of up to 60% here.
Importance Of Mining
It is still important to understand Bitcoin mining as an investor because miners do have more power over future developments of the network. They have a voting power based on the computing power of their devices.
In other words, they have the option to vote on proposals regarding the blockchain network, and, based on the majority of votes, changes are made. Another factor that impacts BTC investments is transaction fees. It should be noted that on top of the block reward the miners get, they also are receiving compensation in the form of transaction fees.
Even though Bitcoin is known for its low processing fees, they tend to go up when the traffic of the network increases, and as we mentioned earlier, the competition in the blockchain network has risen as well as the number of BTC investors that trade BTC.
If you want to have your BTC transactions quickly processed, you will need to pay a higher fee, and that will give you give your transaction greater visibility and priority. It's also worth noting that because there is a limited supply of BTC of 21 million after this supply is completely mined, the fees will be the only source of compensation for the miners; therefore, they will probably be higher after this happens.
Summary
In conclusion, through crypto mining, the blockchain network remains secure as the miners are working on releasing new BTC into circulation, and also, they are the ones who get to vote on the changes in the network.
On the other hand, BTC investors are important because they drive the market demand for Bitcoin, which increases its values, and that is beneficial for both sides. So, as an investor in Bitcoin cryptocurrency, you still need to be aware of the latest news and developments in this field.
