Steemit Crypto Academy [Beginners' Level] | Season 3 Week 8 | Blockchain Reward
Hello Crypto Academy Family,
I won't deny the fact that I have learnt alot from this course at hand, it's very interesting! So am here to share my own understanding on Blockchain Rewards. The questions of this assignment are listed below:
QUESTIONS:
- In your own words explain Mining and block reward?
- What do you understand by Bitcoin halving?
- What are the effects of Halving on miners?
- What is the current block height on the Bitcoin Blockchain? How many more blocks before the next halving?
- Do you think steem's inflation rate reward Can affect other coins? Why?
- what is the current block height of the Steem Blockchain? How many more blocks before the next reduction?
First let me define mining according to English dictionary:
"Creation of new units of cryptocurrency by validating transactions and demonstrating proof of work."
—English dictionary
Mining involves a lot of Processes to create new units of cryptocurrencies. According to my own definition:
Mining is the act or process of validating transactions up to the planned number of block Size to get a full ledger (block).
Miners are the people responsible for the addition of the valid transactions to the Blockchain database.
What do I mean by a valid transaction here?
I know you might be asking yourself what I meant by a valid transaction. A valid transaction is the transaction that has been authenticated and authorized by the nodes(computers) in the network!
And because a block needs a unique hash to be added to the Blockchain, this has become cumbersome among the verifiers of transactions!
To verify a transaction needs what is called "Proof-of-Work".
It is the use of computers by the Miners to add a block to the Blockchain and it requires a lot of complex calculation to do that. That is where Blockchain Reward comes into play!
The work associated with validating transactions and finding the rightful hash for the block is not in vain. Miners who successfully validate the transactions and find the rightful hash for a block are being rewarded.
The system used to find the rightful hash for a new block to fit into the Blockchain is called Application-Specific Integrated Circuit (ASIC).
The first Miner who successfully validate a transaction is being rewarded with a newly mined bitcoins and the transaction fees of all the transactions in that block.
Every Investors should know that Bitcoin halving occurs every four years. Miners earn 50BTC when a new Cryptocurrency is released. This is in compensation for their effort in finding the rightful hash for a block to fit into the Blockchain. On a Bitcoin Blockchain, a block is a file storing 1MB worth of Bitcoin record of transactions.
Bitcoin halving is the act of cutting the pace of mining new BTC into halve which occurs every 210,000 mined blocks, which is about every four years untill all the 21,000,000 btc are completely mined. By so doing, the reward for mining a block splits by half.
The concept of Bitcoin halving reduces the supply of the coin ( inflation rate).
Since the rewards for mining Bitcoin is reduced by half, Bitcoin miners are affected strongly!
And the reward for less efficient miners becomes unprofitable. For example; if the reward for mining a block is 50btc, when halving occurs, the miner will be rewarded with 25btc instead of 50btc and so on...
The screenshots above show the current height of Bitcoin as as the time of writing this post!
Since Bitcoin halves every 210,000 blocks and the next halve is expected to be the 4th. Considering this, the next halving will be calculated as thus;
Block height for the next halving = 4 x 210,000
=840,000
Current block height = 696,788 blocks
Therefore, the number of blocks before the next halving = 840,000 - 696,788
143,212 Blocks
No! This is because the steem Cryptocurrency does not have market dominance as the Bitcoin Cryptocurrency which has the largest portion of the total crypto Market capitalization. And the purchasing power of steem is not matched upto $1usd.
The screenshot above shows the current height of steem as of writing this post!
The inflation rate of steem reduces by 0.01% every 250,000 blocks.
Current block height = 56,550,549
The number of reduction so far is calculated as;
56,550,549/250,000 = 226.202196
Which means that there have been 226 reduction so far.
To calculate the block height for the next reduction by the whole number we have:
Block height for the next reduction = 226 x 250,000
= 56,500,000
Therefore, the number of blocks before the next reduction = 56,500,000 - 56,550,549
= -50,549 blocks
Answers to the previous assignment is given below:
- As the time of making this post, the current price of BTC is $48,865.39 on the coinmarketcap.
Given that 1satoshi=0.00000001BTC
Then 1BTC will be ;
(1/0.00000001)satoshi =100,000,000satoshi
So 1BTC =100,000,000satoshi = 48,865.39USD
If 2,500USD was purchased.
Number of satoshi will be;
100,000,000 x 2,500 ÷ 48,865.39
That gives me 5,116,095.461429859
So I will have 5,120,000satoshis to 3sig figure for a purchase of $2500.
- As at the Tim of making this post, the price of 1bnb is $456.32 on the coinmarketcap
Given that;
1Jager = 0.00000001BNB
Then 1BNB = 1/0.00000001Jager
=100,000,000Jager
So
100,000,000Jager = $456.32
If I made a purchase of $30,
I will have
100,000,000 x 30 ÷ 456.32
That gives me 6,574,333.800841515jager
So I will have 6,570,000 to 3sig figure for a purchase of $30.
Bitcoin Mining is a really great work to do. And it bring a fair incentives to the Miners. Bitcoin becomes so difficult since the expansion of Bitcoin Blockchain and it consumes a lot of electricity to mine.
The Bitcoin deflationary brought about by Nakamoto Satoshi helps to increase the value of the currency.
Cc: @awesononso
Nice one you did great
Thanks so much I will like to hear that again
Nicely done, I'm quite envious of your assignment
Thanks so much I appreciate