Last October, Motherboard gained access to a massive, hidden Bitcoin “mine” housed in an abandoned factory in Liaoning Province in northeastern China.
The "mine" is a piece of infrastructure that keeps the decentralized digital currency network organized and functional, while the entities that exploit it benefit handsomely.
The term "mining" describes the process that takes place in automated computer systems, which decrypt and cross-check all transactions on the Bitcoin network.
Specifically, when a Bitcoin transaction is made, its details (account numbers and amounts) are recorded by both sides of the transaction in the ledger known as the "blockchain" which is then encrypted.
To prevent fraud, the records of both sides are cross-checked on a third computer randomly selected from the network. This process of decryption and cross-checking requires computing power, which anyone who offers to the network is rewarded with an amount in Bitcoin.
The complexity of decryption varies depending on the volume of traffic on the network which depends on the frequency of transactions taking place.
Because the total number of Bitcoins that will be created by the year 2110 is limited by the very algorithm that governs the system, the reward amount for the same "mining" complexity falls in half approximately every 4 years.
The "mine" they visited is just one of six locations owned by a secretive group of four people, part of a colossal mining operation that cumulatively generates 4050 Bitcoins per month, equivalent to a gross revenue of $1,500,000.
In other words, if you have made any Bitcoin transactions recently, they have probably been created there.
The group's six "mines", despite their dystopian appearance, include a computing power of eight petahash per second, which in effect represents 3% of the entire Bitcoin network.
Curiously, the workers of the "mine" actually live within the same facility and return home only four or five days a month.
During the summer months, temperatures inside reach 40 degrees and a deafening hum causes dizziness, due to the dozens of industrial fans that maintain a constant temperature in the 3000 computers specially built for mining Bitcoins.
Access to the mine was granted under the strict condition that details of the computer hardware, nor where it was sourced, would not be revealed.
It should also be noted that a few months is almost a lifetime in the Bitcoin world and consequently, the price and mining difficulty, as expected, fluctuated greatly in the months following the visit.
For the Bitcoin world, 2014 was a wild year: it saw a sharp rise in general Bitcoin adoption from the Microsoft and Dell groups, while just a few months ago the first Bitcoin exchange license was issued in the US, a huge milestone for the six-year-old cryptocurrency.
However, despite the supposed revelation of Bitcoin's creator, its real creators are the people who operate the mines.
Watch the video below:
Source: elogiki.gr
