Bitcoin Mining: What, How, And Why It Matters
By: Nikhil Pandey
Image: Unsplash
2 Jan 2026
Bitcoin is a decentralised digital currency system launched in 2009, operating without banks or governments
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Bitcoin mining validates transactions, creates new bitcoins, and maintains the blockchain's security and trust globally
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Miners use powerful machines to solve cryptographic puzzles and add verified blocks to blockchain records
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The Proof-of-Work system ensures fairness by rewarding the first miner solving computational challenges securely globally
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Mining difficulty adjusts automatically, while hash rate reflects overall network strength and competition levels worldwide
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Bitcoin halving reduces block rewards every four years, controlling supply until twenty-one million coins exist
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Miners earn bitcoins and fees, often working in pools using ASIC hardware for efficiency, profitability
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In India, mined crypto is taxed at thirty percent, with mandatory reporting requirements for investors
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