--- title: "Bitcoin Mining, Explained: How New Coins Are Made and the Network Secured" description: "Bitcoin mining both mints new coins and keeps the network honest. It runs on a handful of interlocking ideas — proof of work, the block reward, difficulty adjustment and the halving — and a lot of electricity." category: "Crypto" category_url: https://boursel.com/category/crypto author: "Hannah Blackwood" published: 2026-06-26T10:42:00.000Z updated: 2026-06-26T10:42:00.000Z canonical: https://boursel.com/article/bitcoin-mining-explained-how-new-coins-are-made-and-the-network-secured tags: ["bitcoin", "mining", "proof-of-work", "halving", "energy"] --- # Bitcoin Mining, Explained: How New Coins Are Made and the Network Secured Bitcoin mining both mints new coins and keeps the network honest. It runs on a handful of interlocking ideas — proof of work, the block reward, difficulty adjustment and the halving — and a lot of electricity. *This is general information, not investment advice.* "Mining" sounds like digging, but it's really a global computing race that happens every ten minutes. ## What miners do Roughly every **ten minutes**, thousands of specialized computers worldwide race to solve the same cryptographic puzzle. The winner gets to add the next **block** — a batch of recent transactions — to bitcoin's shared ledger, the blockchain, and earns a **block reward**: newly created bitcoin plus the transaction fees in that block. This is **proof of work**: the puzzle has no shortcut, only billions of guesses per second, and a miner who tried to slip in a fraudulent transaction would simply lose the race and earn nothing. Honesty is the profitable strategy. ## The block reward and the halving The reward is how new bitcoin enters circulation. It started at 50 BTC per block in 2009 and **halves every 210,000 blocks** (about four years). The [April 2024 halving](https://www.theblock.co/post/289875/bitcoin-ushers-in-fourth-halving-as-miners-block-subsidy-reward-drops-to-3-125-btc) cut it to **3.125 BTC**; the next, around 2028, drops it to ~1.56. The schedule is fixed in code and enforces a hard cap: **no more than 21 million bitcoin** will ever exist (over 19.7 million are already mined). Eventually miners will live on fees alone. ## Difficulty and hashrate Because more computing power would otherwise produce blocks faster, the network **automatically adjusts the puzzle's difficulty** every 2,016 blocks (~two weeks) to keep block time near ten minutes — a self-regulating thermostat. Total computing power is measured as **hashrate**; a higher hashrate generally means a more secure network. ## Hardware and economics Mining once ran on laptops, then graphics cards; today it needs **ASICs** — chips built for nothing but bitcoin hashing. **Electricity is the dominant cost**, which pushed mining toward cheap-power regions. China hosted most of the network until a 2021 ban sent miners fleeing; the U.S. absorbed much of that capacity and now hosts a large share. Because a single machine rarely wins, most miners join **pools** that combine power and share rewards in steady payouts. ## The energy debate Bitcoin's power use is large and contested. The [Cambridge index](https://ccaf.io/cbnsi/cbeci) has estimated its annualized electricity consumption on the order of a mid-sized country's — figures in the rough range of ~140 TWh a year (treat any single number as a moving estimate). Critics point to the carbon footprint and competition with other users. Defenders note a rising share of the energy comes from renewables and nuclear (Cambridge's 2025 industry report put it above half), and that some miners use otherwise-wasted "stranded" power or act as flexible loads that switch off at peak demand to help balance grids. The honest answer: bitcoin's carbon intensity depends heavily on which grid the miners plug into, and the debate isn't settled. ## The business of mining Mining is now an institutional industry with listed stocks — MARA, Riot, CleanSpark — that have raised billions. Their margins get squeezed when bitcoin's price falls near their all-in cost per coin (often tens of thousands of dollars), and the 2024 halving — which cut daily new issuance from ~900 to ~450 BTC — sharpened that pressure. The response has been telling: several miners are repurposing their power-and-cooling infrastructure to host **AI** workloads, which pay more per kilowatt — the same convergence we've covered between crypto mining and the AI data-center boom. ## The bottom line Mining is the enforcement layer of a money system with no central operator: proof of work makes cheating ruinously expensive, difficulty keeps the clock steady, and the halving imposes scarcity by algorithm. Whether its energy cost is a fair price for a decentralized network is a legitimate, open argument — but mining itself has gone from hobby to heavy industry, with its own stocks, power contracts and corporate strategy. ## Sources - [Bitcoin's fourth halving cuts the block reward to 3.125 BTC](https://www.theblock.co/post/289875/bitcoin-ushers-in-fourth-halving-as-miners-block-subsidy-reward-drops-to-3-125-btc) - [Cambridge Bitcoin Electricity Consumption Index](https://ccaf.io/cbnsi/cbeci)